Sunset of the USCIS EB-5 Immigrant Investor Pilot Program is set for September 30, 2012. The EB-5 Pilot Program is one of the longest running ‘pilot program’ in United States government history. It is the Pilot Program—a program which has been routinely renewed since its inception in 1992—that designates regional centers to operate within the realm of EB-5 investments. If the EB-5 Pilot Program sunsets at the end of September, what concerns would that raise for the various members of the EB-5 community?

For starters, let us clarify that the perception of the EB-5 program coming to an end is untrue. The EB-5 Immigrant Investor program is a law enacted by congress for operation through the USCIS. The Pilot Program, however, the program that designates regional centers to operate as matchmakers between projects and investors, is just that: a pilot. If the pilot program reaches sunset and is not extended, it bears no effect on the EB-5 Program itself.

Due to the misconceptions of the September 30^th deadline, investors may be concerned about their ability to complete the program. If operating through a regional center, then the investors’ I-526 application must be received by the sunset date—September 30, 2012. If the USCIS acknowledges receipt of the application, then the investor may complete the program through the regional center project. It is important to note that the USCIS, like any government entity, has a very structured process that takes time to complete and it can take anywhere from 6-8 months to receive I-526 approval.

Projects may also be concerned about the sunset of the Pilot Program. If enough investors do not get their I-526 applications into the USCIS by the sunset date, then project funding through a regional center will not be possible and they will have to begin looking for alternate sources of funding. Without regional centers, projects still interested in funding through EB-5 are going to have to search even harder to find EB-5 money and adjust their business plans to support the Original EB-5 program which allows for only a single investor—drastically reducing the capital investment amount.

Because the requirements of the Original EB-5 program are slightly different than those of the Pilot Program, a few things would suffer without the extension of the latter. First, the job creation aspect would no longer provide such significant benefits to the community in which a project is located. Second, investors would have to take an active role in the management and operations of the business, taking away responsibility and ownership from the project. Lastly, because investors are not investing into a fund, the total investment capital for a business or project would be that of a single investor; an amount that is typically the minimum required and significantly less than what regional center projects have been seeking.

At the end of the day, the possible sunset of the EB-5 Pilot Program negatively affects US economic growth. The economic impact of a regional center—Pilot Program—project is greater than that of a business created through the Original EB-5 program as it has the ability to create more jobs, fund a larger project within a more impactful industry, and help to stimulate growth within local communities. At a time when banks are tightening their grips on lending to new business ventures, extending the EB-5 Pilot Program would bring new jobs, businesses, and growth to the United States.