The EB-5 visa program allows noncitizens to obtain permanent residency by investing capital in job-creating enterprises. Since 1992, a 'regional center' component has allowed investors to pool funds and count indirect job creation toward the visa requirements. In 2022, Congress enacted the EB-5 Reform and Integrity Act (RIA) to overhaul the program and combat fraud. As part of this reform, Congress established an 'EB-5 Integrity Fund' and mandated that 'each regional center designated under' the new statutory provision pay an annual fee to support fraud monitoring. The fee amount varies based on the number of investors. Appellant EB5 Holdings Inc. owns regional centers that were designated by the government prior to the 2022 RIA. When the USCIS announced it would collect this fee from all active centers, including legacy centers, EB5 sued, arguing that the fee provision only applied to centers designated after the RIA's enactment. The district court granted summary judgment for the government, ruling that the fee applied to all currently designated centers, and EB5 appealed.
The court focused on the statutory text of 8 U.S.C. § 1153(b)(5)(J)(ii)(I), which requires the Secretary to collect fees from 'each regional center designated under subparagraph (E).' The appellants argued that 'designated' referred to the discrete act of designation that occurred before the RIA, meaning legacy centers were designated under the old 1992 rider, not the new subparagraph (E). The court rejected this, applying standard rules of grammar. The court explained that the past participle 'designated' is routinely used as an adjective to describe a present state of being, similar to how an 'escaped' prisoner is currently at large. Therefore, 'designated' in the fee provision refers to the entity's current status as a center authorized to operate, not the timing of the authorization event. The court noted that the phrase 'under subparagraph (E)' identifies the statutory source of the center's legal status, which is the RIA for all currently active centers. The court also addressed the argument that the phrase 'designated under subparagraph (E)' implies a narrower group than 'any regional center' used elsewhere in the statute. The court found this 'meaningful-variation' argument unpersuasive because the statute itself uses the phrases interchangeably within the same section (subparagraph J), indicating they refer to the same group. Finally, the court rejected the claim of impermissible retroactivity. The court reasoned that the fee is a condition for continued participation in the program, not a penalty for past conduct. Since the centers wish to remain designated, they must pay the fee to maintain that status, making the requirement purely forward-looking.
All regional centers currently participating in the EB-5 program, including those designated before 2022, must pay the annual Integrity Fund fee to maintain their designation. Centers that fail to pay within 30 days face penalties, and those more than 90 days late risk having their designation terminated. The decision clarifies that the fee is a prospective condition of participation rather than a retroactive tax on past investments.
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