/>iUnder the EB-5 Reform and Integrity Act of 2022 (RIA), designated EB-5 regional centers must make an annual payment into the EB-5 Integrity Fund. The annual fee is $20,000 for each regional center, except for those with 20 or fewer total investors in the preceding fiscal year (Oct. 1–Sept. 30) in its new commercial enterprises, in which case the annual fee is $10,000. The Department of Homeland Security then uses the fees in the Integrity Fund to conduct audits on regional centers, site visits on EB-5 projects, and overseas investigations relating to EB-5 stakeholders and applicants abroad.
U.S. Citizenship and Immigration Services (USCIS) published the first “Notice of EB-5 Regional Center Integrity Fund Fee” in the Federal Register March 2, 2023, for the FY 2023 Integrity Fund fee. USCIS later extended the payment window for payment of both the FY 2023 and 2024 Integrity Fund fees to Oct. 1–Oct. 31, 2023. USCIS also stated on its Integrity Fund website that the final deadline for paying both the FY 2023 and FY 2024 Integrity Fees was Dec. 30, 2023, or 90 days after the due date. USCIS warned that it would reject Integrity Fund fee payments for FY 2023 and FY 2024 received after that date, including those made in response to a Notice of Intent to Terminate.
In June and July 2024, USCIS commenced sending Notices of Intent to Terminate to designated regional centers that failed to pay the FY 2023 and FY 2024 Integrity Fund fees by Dec. 30, 2023. Litigation ensued against Department of Homeland Security because many regional centers either did not understand or did not know that both FY 2023 and FY 2024 fees were due by Dec. 30, 2023, or were misadvised that both fees were due. As of the date of this blog, it is not clear if USCIS will change its position on whether it was required to terminate regional centers that failed to pay the Integrity Fund fees for FY 2023 and FY 2024 by Dec. 30, 2023, or whether USCIS should have first imposed a reasonable penalty and notified regional centers that failed to pay, and/or whether USCIS should have used its discretion to extend due dates again following the imposition of reasonable penalties allowed by the RIA.
Importantly, each year the Integrity Fund fees are due for the upcoming fiscal year, not the past fiscal year. Starting Oct. 1, 2024, and continuing through the month of October, USCIS will collect the FY 2025 Integrity Fund fee. As outlined in the RIA, USCIS will terminate the designation of any regional center that does not pay the required fee within 90 days after the annual fee’s due date. The annual fee is payable online. Regional centers should prepare to pay the FY 2025 Integrity Fund fee once the Pay.gov portal becomes available on Oct. 1, 2024. Multiple reports leading up to the Dec. 30, 2023, deadline indicated that USCIS incorrectly processed some regional center payments. To avoid any technical issues with payment, penalties, and/or termination, regional centers should pay early and keep a clear record of the payment in case USCIS requests evidence of the payment later. Moreover, regional centers should make sure the payment is processed with their credit card company or through their bank account to avoid any issues after the payment portal closes.
Penalties for failure to pay the Integrity Fund fee include late fees and/or termination. Termination of the regional center could be damaging if the regional center has post-RIA investors. Under the RIA, investors filing Form I-526E based on investment in a new commercial enterprise must continue to be sponsored by an approved regional center. If the regional center is terminated, the new commercial enterprise must associate with a new regional center in good standing, although the RIA clarifies that the regional center need not be in the same geographic location as the original regional center. Based on the Instructions to Form I-526E, it is likely USCIS will require EB-5 investors to file an amendment to their pending or approved I-526E petition to notify USCIS of the new regional center sponsorship. This may delay the issuance of conditional green cards and result in additional fees for investors. Thus, regional centers should consider paying early and taking adequate steps to make sure their payments are timely processed by the government.
