On October 9th, 2015, Daniel Miles gave a presentation on the EB-5 program, an employment-based visa, at The Delaware Valley Regional Planning Commission. Daniel explained that the EB-5 program was created by the Immigration Act of 1990, and is one of 5 employment-based visas. In exchange for investing money and creating jobs in the United States foreign nationals have the possibility to obtain a greencard.
The presentation highlighted many advantages of the EB-5 program such as providing an alternate source of capital, low cost source of funding, and increasing the overall liquidity of a business or project, which helps to reduce the cost of acquiring capital from other sources.
Originally EB-5 investments were in an existing business either for expansion or saving a troubled business. Today most EB-5 projects involve real estate development projects such as offices, hotels, retail establishments and more.
Over the 2010-2013 period, Pennsylvania has been the 3rd largest user of EB-5 funding. In this time over $684.2 million has been invested generating $1.1 billion in economic activity, supporting 13,800 jobs, paying $142.8 million in federal taxes and $65.2 million in state and local taxes.
The EB-5 program was originally set to expire on September 30, 2015, but the current program has been extended until December 2015, and there have been a number of competing bills introduced in Congress. Daniel suggested some of the changes that could be made to the TEA process, such as increased investment amounts, limits on the proportion of EB-5 funding in the capital stack, as well as elimination of country quotas, and finally, making the program permanent.