[Congressional Record Volume 161, Number 88 (Wednesday, June 3, 2015)]
[Senate]
[Pages S3681-S3682]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. LEAHY (for himself and Mr. Grassley):
  S. 1501. A bill to promote and reform foreign capital investment and 
job creation in American communities; to the Committee on the 
Judiciary.

[[Page S3682]]

  Mr. LEAHY. Mr. President, today I am proud to introduce the 
bipartisan American Job Creation and Investment Promotion Reform Act of 
2015, which will extend and significantly improve the EB-5 Regional 
Center program. Since its inception in 1993, the EB-5 Regional Center 
program has generated billions of dollars in capital investment and 
created tens of thousands of jobs across the country, much of which has 
occurred in areas that traditionally struggle to attract investment and 
jobs. The program's authorization is set to expire at the end of 
September. My legislation would reauthorize it for 5 years while 
enacting broad reforms to enhance the program's integrity. I am proud 
to be joined by Senator Grassley in this effort.
  The EB-5 Regional Center program faces significant challenges. I have 
always been supportive of its ability to create American jobs but the 
program has experienced some problems in recent years. There have been 
troubling reports of fraud and abuse, concerns regarding onerous 
processing delays for developers and investors, and questions over 
whether the program is truly benefiting those that Congress intended. 
These concerns can overshadow the many success stories, and have led 
some to understandably lose faith in the program.
  I have not seen any flaw inherent to the EB-5 Regional Center program 
that could not be remedied, and I strongly believe that this is a 
program worth fixing. Over the last two decades this program has proven 
it can result in significant investment and jobs in communities that 
desperately need both, all at no cost to American taxpayers. While our 
immigration system as a whole is broken, and only comprehensive reform 
will remedy its many injustices, reforming and reauthorizing the EB-5 
Regional Center program warrants our immediate attention because the 
program is set to expire in a matter of months.
  In Vermont, this program revitalized rural communities during the 
worst of economic times. At the height of the recession, Country Home 
Products was able to speed up its engineering initiative to develop a 
new line of equipment in the power tool market. Sugarbush ski resort 
invested in new facilities and resources to increase visitors and keep 
its doors open. Without EB-5 capital, these manufacturing, 
construction, and hospitality jobs would likely not exist in Vermont. 
The state-run Vermont Regional Center continues to attract substantial 
capital investment and--with the Department of Financial Regulation now 
joining the Agency of Commerce and Community Development in overseeing 
the program--also provides unparalleled oversight of EB-5 projects.
  I have long sought substantial reforms to the EB-5 Regional Center 
program at the Federal level. Last Congress, my EB-5 amendment to 
Comprehensive Immigration Reform provided the Department of Homeland 
Security the authority to revoke suspect regional center designations 
or immigrant petitions. This amendment, which was unanimously approved 
by Senate Judiciary Committee, also provided for increased regional 
center reporting, background checks, and oversight related to the offer 
and sale of securities. Sadly these improvements have all had to wait, 
as the House of Representatives failed to allow a vote on the 
bipartisan immigration reform bill that passed the Senate last 
Congress.
  Fortunately, however, the agency that administers EB-5 has not stood 
idly by waiting for Congress to strengthen the program. I credit 
Alejandro Mayorkas, the former Director of United States Citizenship 
and Services, with bringing many concerns to light. The agency has 
since transformed its review of EB-5 applications. Staff levels have 
increased nearly ten-fold, in-house economists now analyze proposed 
business plans, and fraud detection and national security staff now sit 
side-by-side with adjudicators. These actions have all helped the 
agency to guard against abuses.
  However, as Congress now faces reauthorizing this job-creating 
program, I have listened to concerns raised about how the program 
functions. I believe we must do more, which is why I have been working 
for over a year to further reform and modernize the Regional Center 
program. The bill I introduced today builds upon what the Senate passed 
last Congress as part of Comprehensive Immigration Reform.
  This legislation, if enacted, would provide the Department of 
Homeland Security additional, much-needed authorities, including 
further expanding background checks, conducting a more thorough vetting 
of proposed investments earlier in the process, and providing for the 
ability to proactively investigate fraud, both in the United States and 
abroad, using a dedicated fund paid for by certain program 
participants. The bill would also provide investors with greater 
protections and more information about their investments. It would 
provide project developers clarity and shorter processing times in 
order to make the program more predictable and functional. It would 
raise minimum investment thresholds so more money goes to the 
communities that need it. It would help to restore the program to its 
original intent, by ensuring that much of the capital generated and 
jobs created occur in rural areas and areas with high unemployment.
  Taken together, the oversight tools, security enhancements, and anti-
fraud provisions included in this legislation provide the framework for 
a complete overhaul of the EB-5 Regional Center program. These reforms 
will instill both confidence and transparency in the program.
  I look forward to continuing to work with all Senators and 
stakeholders to improve and reauthorize this important program. I am 
confident our work will result in a secure EB-5 program that will 
create American jobs and promote economic growth throughout our 
country, particularly in the rural and distressed communities that need 
it most.

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