Prof. Yale-Loehr is one of the nation's preeminent authorities on U.S. immigration and asylum law. Aside from teaching immigration and asylum law at Cornell Law School, he is also of counsel at Miller Mayer, LLP in Ithaca, New York. He has presented on these subjects at national conferences as well as authoring and co-authoring four standard reference works on the subject. Since 1996 he has served as chair, co-chair and member for the EB-5 Investor Committee of the American Immigration Lawyer Association (AILA). He is the 2001 recipient of the American Immigration Lawyers Association (AILA)'s Elmer Fried Award for Excellence in Teaching and the 2004 recipient of AILA's Edith Lowenstein Award for excellence in advancing the practice of immigration law. read Stephen’s full bio
In my interview with Stephen, we discuss the virtues of the EB-5 program, how new jobs are counted and his upcoming panel seat at the 2014 EB-5 Investor and Regional Center Conference in Chicago.
EB-5 is a four-way win. But it is a very complicated program because it combines immigration law, securities law, economic methodologies, and investment decisions. It is like a Rubik’s cube: Everything has to line up just right - Stephen Yale-Loehr
Guanxi Consultants: Introduce yourself. Who are you and what is your history with immigrant visa programs?
Stephen Yale-Loehr: I am co-author of Immigration Law and Procedure, the leading immigration law treatise, published by LexisNexis Matthew Bender. I also teach immigration law at Cornell University Law School, and am of counsel at Miller Mayer in Ithaca, NY. I am a member of the American Immigration Lawyers Association (AILA)’s Business Immigration Committee. I graduated from Cornell Law School in 1981 cum laude, where I was Editor-in-Chief of the Cornell International Law Journal. I received AILA’s Elmer Fried award for excellence in teaching in 2001, and AILA’s Edith Lowenstein award for excellence in the practice of immigration law in 2004. Specifically, with respect to the EB-5 immigrant investor program, I was chair, co-chair, or a member of the EB-5 Investors Committee of the American Immigration Lawyers Association (AILA) for over 10 years. I set up an EB-5 listserv through AILA. I regularly speak on EB-5 issues at various immigration conferences around the country. I also founded the Invest In the USA (IIUSA) trade association to promote the EB-5 program and to liaise with the immigration agency. I also testified at a July 2009 U.S. Senate hearing about the EB-5 program (read about his testimony here).
GXC: You’ve written on different issues arising in immigration law in a post 911 America. Do you think that investor visa programs fall more into the category of “problems” or “solutions”? Please explain.
SYL: Done correctly, the U.S. EB-5 program is a four-way win: (1) a win for a project developer because he or she gets capital to start or finish a project; (2) a win for US workers because jobs are created; (3) a win for US taxpayers, because the EB-5 program doesn’t cost anything to them; and (4) a win for EB-5 investors, who hopefully will get a green card at the end of the process if all works out well. However, like all immigration programs, the EB-5 program is very complex.
GXC: What do you think is the biggest asset of the EB-5 program?
SYL: The EB-5 program has several assets. It draws foreign investors to the U.S. In addition to the money they invest in EB-5 projects, they also buy homes and send their children to U.S. schools. A comprehensive peer-reviewed economic study found that during fiscal year 2012, investments made through the EB-5 program contributed $3.39 billion to the U.S. economy and supported over 42,000 U.S. jobs.
GXC: What do you think is the biggest drawback? Are there unknown costs that people aren’t considering when they chose to channel EB-5 investment into their projects?
SYL: One drawback to the EB-5 program is its complexity. Another drawback is long immigration processing times. It can take two years from the time an investor first decides to invest in an EB-5 project until they actually get their temporary Green Card to come to America.
In addition to the $500,000 an EB-5 investor must invest, there are other additional costs. For example, EB-5 investors pay an administrative fee to the regional center that is sponsoring the project. That fee is frequently about $50,000. They must also pay an immigration attorney’s legal fees. And they may have to pay an agent in their home country that helps them through the process.
GXC: Would you mind briefly explaining the issues that arose in 2012 regarding “tenant-occupancy”? SYL: In 2012 the U.S. immigration agency changed its thinking about whether tenants moving into office buildings can count as new jobs for EB-5 purposes. The USCIS stated that many times, tenants are not really new; they are just moving from one building to another.
GXC: Is tenant occupancy still acceptable at all for Regional Center jobs?
SYL: The USCIS now accepts jobs created by tenants in certain circumstances. The USCIS makes this determination on a case-by-case basis. In general, the USCIS will allow tenant jobs if the project will fill an existing investment void in that area to generate new demand for the tenant business.
GXC: When using a Regional Center to structure investment, USCIS counts “indirect” jobs as well as “direct” ones. Are there any statistics that show that indirect jobs counted by Regional Centers are having the desired effect on the economy?
SYL: No definitive study has measured the economic impact of indirect jobs created through the EB-5 program. However, indirect job counting is standard economic methodology used in many government programs. And as stated above, a comprehensive peer-reviewed economic study found that during fiscal year 2012, investments made through the EB-5 program contributed $3.39 billion to the U.S. economy and supported over 42,000 U.S. jobs that year alone. Many of those jobs were indirect jobs.
GXC: What types of firms have been responsible for “counting” indirect jobs?
SYL: Many economic methodologies exist to measure indirect jobs. They go by acronyms such as RIMS II, IMPLAN, and REDYNE. Such methodologies exist for many government programs, not just EB-5. Most good economists can use these methodologies to estimate the number of indirect jobs an EB-5 project will create.
GXC: What topics are you hoping to address at this year’s AILA EB-5 Investors & Regional Centers Conference? What presentations are you looking forward to hearing?
SYL: I will moderate the first panel, which is called EB-5 101. We will educate attendees about the fundamentals of the EB-5 program. Later panels will address more detailed topics such as securities law compliance and ethics.
GXC: Thank you for your time. Are there any final remarks about EB-5 and its future that you’d like to add?
SYL: As stated above, done correctly, EB-5 is a four-way win. But it is a very complicated program because it combines immigration law, securities law, economic methodologies, and investment decisions. It is like a Rubik’s cube: Everything has to line up just right, and in the right order and at the right time, for an EB-5 investment to work. EB-5 investors need experienced immigration lawyers and financial advisers to properly advise them.
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David Guastella is an EB-5 consultant for Guanxi Consultants based out of Chicago, IL. More information on David and Guanxi Consultants can be found here.