On August 11, 2016, USCIS published new processing times for I-829 petitions. The news is not good for EB-5 investors. USCIS is now taking in excess of 21 months to adjudicate I-829 petitions. This means that EB-5 investors may wait more than one or even two years for final approval of an I-829 from USCIS. The delays are unconscionable.

For those less familiar with EB-5 terminology, the term I-829 refers to the form number of the petition that an EB-5 investor files within 90 days of the expiration of his or her conditional green card status. An investor’s I-829 is supported by proof that, among other things, there has been sufficient job creation to support his or her green card case. At the I-829 stage of the process, an investor must also evidence that his or her investment has been sustained. For thousands of investors, what should be a relatively ministerial process of verifying facts has turned into a bottleneck.

I-829 delays are a blemish on the EB-5 Program, undermining the credibility of USCIS, which should facilitate eligible investors’ transition from conditional to permanent green card status. Right now thousands of investors are in limbo awaiting USCIS action on their I-829s. Clearing this backlog needs to be a USCIS priority.

Why are there such record-setting delays with I-829 cases?

USCIS is simply not equipped to administer the EB-5 Program effectively. This is the main issue at the heart of any discussion about delays at the agency including long-pending I-829s.

There are a very high number of I-829 petitions in the system at USCIS, which contributes to delays. But high volume is only one part of the story.

Structurally, USCIS does not have the tools, expertise and resources that are needed to deal with the complex corporate, securities and business documents that are generally submitted with EB-5 petitions. USCIS nonetheless takes on the review of offerings, which stalls its overall ability to do the work the agency knows how to do. It is noteworthy that USCIS scrutiny of offerings has done very little to combat fraud or abuse by unscrupulous parties who seek to use the EB-5 Program. Nor has USCIS involvement to date translated into investors having more protection in deals. The agency needs a new role in EB-5.

USCIS should get out of the business of monitoring a complex investment program. Congress needs to step in and bring other agencies onto the scene. Lawmakers need to re-define, delineate and limit the responsibilities of USCIS with respect to EB-5. Until Congress makes such systemic changes to the Program, we will continue to see outrageous delays with the processing of EB-5 related benefits, I-829s included. The losers are the investors and the legitimate job creating projects. In its current state, EB-5 is just becoming unworkable for all.

What’s the outlook?

The outlook for real change to EB-5 is uncertain. Congress needs to re-think the division of labor among agencies that could be more engaged with the EB-5 Program. But we are six weeks away from the expiration of the Program’s temporary extension, so the Program itself is also in limbo. Because we are in a presidential election year, no one can predict what action Congress will take, if any, to extend EB-5 prior to the end of September 2016.

Systemic overhaul of EB-5 is needed

USCIS has a mandate that is overly broad with respect to administration of the EB-5 Program. Systemic overhaul is in order. Other federal agencies should be involved more directly to manage aspects of the EB-5 Program that USCIS should not be expected to oversee. For example, Congress should consider delegating fraud detection in source of funds documentation in EB-5 cases to the U.S. Department of Treasury. This agency has the expertise to analyze and detect issues relating to money laundering and violations of sanctions implicated in an EB-5 transaction.

The SEC should also have an expanded role in administration of the EB-5 Program. The Commission is equipped to manage EB-5 on both the transactional and anti-fraud fronts, and spearhead enforcement. Any EB-5 reform should take into account the need for the Program to be overseen by multiple agencies. USCIS should play a purely adjudicatory role with respect to substantive immigration benefits. This would allow USCIS to focus on clearing its backlogs.

Meanwhile, we have thousands of EB-5 investors who have been given a conditional welcome to the United States, while they spend years in limbo awaiting USCIS action on their I-829 petitions. While we cannot predict how lawmakers will reform the Program, we anticipate continued delays and incremental increases in processing times for I-829s into 2017. For impacted investors, this translates into even lengthier waiting times than the current 21 month projection by USCIS.