Two U.S. House Democrats are proposing a new visa for immigrants who can obtain "significant" venture capital funding for a business, or can otherwise establish a business that creates some jobs.
The legislation is from U.S. Rep. Zoe Lofgren (D-Calif.), who represents Silicon Valley, and Luis Gutierrez (D-Ill.), who has been an immigration reform leader.
By themselves, immigration reform bills by Democrats in the Republican-controlled House are dead on arrival. But Republicans are planning significant reforms to a program that provides permanent residency to foreigners who meet certain investment and job-creation goals, and this is opening the door for Lofgren and Gutierrez to try to attach their reforms.
What's prompting this legislative activity on immigration is a Sept. 30 deadline to renew a key element of the EB-5 visa program for immigrant investors.
Investors today can gain permanent residency with an EB-5 visa if they make an investment of at least $500,000 in a job-creating project in an area with high unemployment. They can also "pool" these investments in "regional centers," which can then be used to fund multi-million-dollar projects, such as construction of a new hotel. At least 10 jobs must be created.
Last month, U.S. Senator Chuck Grassley (R-Iowa), the chair of the Senate Judiciary Committee, along with ranking member Patrick Leahy (D-VT), introduced legislation to reauthorize the regional center program for five years.
But this cash-for-visa program, available for up to 10,000 immigrants including family members, has drawn criticism over the years as well as charges that it is susceptible to favoritism by officials. It has raised national security concerns also, because of the connections of some of the people making the investments, including "Iranian operatives" with a goal "to infiltrate the United States," according to a letter two years ago by Grassley to federal officials.
The Grassley-Leahy bill would require background checks on investors, require disclosures of conflicts of interest, improve oversight and raise the investment threshold from a minimum of $500,000 to $800,000, among other things.
The Lofgren-Gutierrez bill, called the Entrepreneurial Business Creating Jobs Act, includes reforms to the EB-5 program as well, but goes a step further and creates a new visa, the EB-6.
One provision is for venture capital-backed start-up entrepreneurs who obtain backing from an "established" VC, super angel investor or qualified employer of at least $500,000 toward a new commercial enterprise, or by a qualified seed accelerator that has invested at least $100,000. There is also provision for self-funded investments that lead to jobs. The visa isn't automatic; the business venture must prove itself and meet certain thresholds around jobs or revenue.
It remains to be seen whether the House Republicans will allow the Lofgren-Gutierrez bill to join an expected EB-5 extension bill in that chamber. But such a move could renew a broader debate over whether green cards for STEM (science, technology, engineering and math) graduates of U.S. schools is another way to retain foreign graduates.