07.22.09

Leahy-Chaired Panel Hears Testimony From Jay Peak President About Foreign Investor Program

WASHINGTON – A panel chaired by Senator Patrick Leahy (D-Vt.) heard testimony Wednesday morning from the president of Jay Peak Resort, Bill Stenger, about a key foreign investor program administered by U.S. Customs and Immigration Services (USCIS).  The EB-5 Immigrant Investor Regional Center Program has generated hundreds of millions of dollars in states and communities across the country since it was established in 1993.  The program is also responsible for the creation of tens of thousands of jobs.

Jay Peak is an active participant in Vermont’s Regional Center program which was established in 1997.  Vermont’s Regional Center projects have drawn business and tourism to the state.

“In a small State like Vermont, a development project like Jay Peak has an exponentially positive impact on the surrounding community.  Sugarbush also took advantage of the Regional Center program to generate much-needed capital,” said Leahy. “And along with the positive message a healthy and productive program like this sends to investors around the world, the core purposes of the EB-5 Regional Center Program are to generate capital investment and create jobs in communities around the United States.”

Leahy has played a key role in extending the Regional Center pilot program throughout the past several years, and has introduced legislation in previous Congresses to make the program permanent.  Earlier this month, Leahy secured an amendment to the Department of Homeland Security Appropriations Act to make the program permanent.  Currently, the Regional Center program is set to expire in September.

Since 1993, the Regional Center program has created thousands of jobs and generated millions of dollars in capital investments across the United States.  Under the program, foreign investors are required to pledge a minimum of $500,000 to a project within a Regional Center and can apply for an EB-5 visa.  If approved by U.S. Citizenship and Immigration Services (USCIS), foreign investors are granted a conditional two-year green card.  After two years, the investor must provide proof that they have created at least ten jobs as a result of the investment and have met additional investment requirements set by USCIS. 

The hearing is webcast live online, and an archived webcast will be available online later today.

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Statement Of Senator Patrick Leahy (D-Vt.),
Chairman, Senate Judiciary Committee,
Hearing On “Promoting Job Creation And Foreign Investment In The United States:
An Assessment Of The EB-5 Regional Center Program”
July 22, 2009

The purpose of today’s hearing is to examine the EB-5 Immigrant Investor Regional Center Program.  This program has been responsible for the investment of hundreds of millions of dollars, and the creation of tens of thousands of jobs in American communities since 1993.  The program has paved the way for ski resort expansion in Vermont, dairy operations in Iowa, energy development in Oklahoma and Texas, and the manufacture of hurricane-resistant housing in Alabama.  These are just a few examples of projects financed by foreign investment through the Regional Center program, and all indications are that interest in the program is growing. 

For years this program has been reauthorized on a temporary basis.   Currently, it is set to expire at the end of September.  Making this program permanent is a critical first step to its continuing success.  That is why earlier this month, I offered, with Senator Sessions’ support, an amendment to the Department of Homeland Security Appropriations Act, H.R.2892, to do just that.  The amendment was adopted on July 8, and I trust it will become law as part of that bill. 

I also remain committed to considering changes to improve the overall program.  I have not yet introduced a broader EB-5 bill this Congress, and so I invite the witnesses to suggest improvements to make the program more workable for the agency, for communities and other stakeholders, and for investors who use the program.  I hope that this hearing will initiate a dialogue about how Congress, the agency and stakeholders can work together to ensure that the goals of job creation and security can be met, and at the same time make the program as effective and efficient as we can for those who are developing projects in communities around the country.  I strongly believe this program has the potential to grow as a meaningful source of positive economic development around the United States.   

I thank the U.S. Citizenship and Immigration Services for testifying today, as we all agree that the agency has a crucial role to play in the program’s implementation.  I also welcome Bill Stenger from Vermont.  Bill Stenger recognized years ago the opportunities that the Regional Center program could bring to Vermont.  He is expanding Jay Peak, a wonderful ski resort, into a year-round resort, in part by attracting foreign investment dollars.  In a small State like Vermont, a development project like Jay Peak has an exponentially positive impact on the surrounding community.  Sugarbush, another Vermont ski resort -- which I can see from the steps of my farmhouse in Vermont -- also took advantage of the Regional Center program to generate much-needed capital.  Just last week, my staff visited with a company in Windsor, Vermont, called Seldon Technologies, the inventors of carbon nanotube water purification systems.  Seldon Technologies is considering the EB-5 program as a way to fund domestic manufacturing jobs here in the United States.  I also welcome Ron Drinkard of the Alabama Center for Foreign Investment, Stephen Yale-Loehr, who is actively involved in the EB-5 Regional Center program, and Michael Dougherty, a former Ombudsman for USCIS. 

Immigration through investment is not unique to the United States.  Canada, England, and the rest of the United Kingdom all offer similar programs.  In fact, in the current difficult economy, Canada has actively promoted its immigrant investment program around the world.  And but for the difficulties Congress has had reauthorizing this program, entrepreneurs in the United States could be doing the same thing with greater certainty.  The program must be made permanent in order to give confidence to investors that it is a viable, long-term economic opportunity. 

It should surprise no one that citizens of other countries are eager to invest in the U.S. economy.  And along with the positive message a healthy and productive program like this sends to investors around the world, the core purposes of the EB-5 Regional Center Program are to generate capital investment and create jobs in communities around the United States.  I want to underscore that both of these benefits are accomplished at no cost to taxpayers, and are not reliant on what is currently a very restrictive credit market.   Under the program, in order to become a non-conditional lawful permanent resident, a foreign investor must prove the creation of 10 new jobs.  The job creation requirement is central to the program, and ensures that foreign investments translate into tangible benefits for Americans. 

We can all acknowledge that the issue of immigration is a difficult one.   But I view the Regional Center program as less about immigration than about job creation and capital investment in American communities.   I know this program is important in Senator Sessions’ State, just as it is in Vermont.  I hope the Ranking Member and I can work together constructively to make this program a productive and positive part of our broader immigration system. 

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