“All Regional Centers Must Pay” – The Sunshine State Precedent on the EB-5 Integrity Fund Fee

Introduction

In Sunshine State Regional Center, Inc. v. Director, USCIS, the United States Court of Appeals for the Eleventh Circuit confronted a novel question spawned by the EB-5 Reform and Integrity Act of 2022 (“the Act”): Must regional centers that were already authorised before the Act bear the annual cost of the new EB-5 Integrity Fund Fee? The appellant, Sunshine State Regional Center (“Sunshine State”), argued that it should be exempt because its designation pre-dated the statutory subparagraph (E) that now governs the regional-center programme. The District Court rejected that contention, and the Eleventh Circuit has now affirmed, establishing a sweeping rule that every currently-designated regional center—whether formed before or after 2022—owes the Integrity Fund Fee.

This decision comes at the confluence of immigration law, administrative law, and statutory interpretation. It addresses not only the fee provision itself but also broader interpretive principles following the Supreme Court’s recent decision in Loper Bright Enterprises v. Raimondo, which curtailed deference to agency interpretations. The Eleventh Circuit’s reading is therefore precedential on two fronts: (1) the substantive reach of the Integrity Fund Fee, and (2) the post-Loper Bright methodology for judicial review of agency action.

Summary of the Judgment

Holding: 8 U.S.C. §1153(b)(5)(J)(ii)(I) applies to “each regional center designated under subparagraph (E),” and that phrase encompasses all currently designated centers, including those originally authorised under the pre-Act statutes. Consequently, Sunshine State must pay the annual Integrity Fund Fee.
Reasoning Highlights: The court reasoned that designation is an ongoing “status,” not a one-time historical event, and that the only operative programme for investors is now housed in subparagraph (E); therefore, any center still holding that status is, by definition, “designated under” the new subparagraph. Textual, structural, and contextual canons all pointed the same way.
Retroactivity Rejected: Imposing a future-looking fee is not unlawfully retroactive; it creates no new liability for completed transactions, but merely conditions continued participation in the programme.
Result: District Court affirmed; Sunshine State’s complaint dismissed in relevant part.

Analysis

1. Precedents Cited

Behring Regional Center LLC v. Mayorkas (N.D. Cal. 2022) – Provided backdrop: court enjoined USCIS from automatically “de-authorising” pre-Act centers. Sunshine State tried to leverage Behring; the Eleventh Circuit distinguished it and—even assuming Behring’s correctness—showed that Behring actually supports the broad reading.
Loper Bright Enterprises v. Raimondo (2024) – Supreme Court rejected Chevron deference. The Eleventh Circuit explicitly applied Loper Bright, conducting an independent de-novo review of statutory meaning without automatic agency deference.
Landgraf v. USI Film Products (1994) – Canon on statutory retroactivity, applied at Step Two to reject Sunshine State’s retroactivity argument.
Textual cases on grammar/usage: Henson v. Santander; Piccadilly Cafeterias; Hewitt v. United States – cited for how past-participles and present-perfect tenses operate.

2. The Court’s Legal Reasoning

a. Textual Ambiguity → Structural Clarity
The phrase “regional center designated under subparagraph (E)” is superficially ambiguous: “designated” (past participle) could signal a one-off event; “under” can bear several meanings. Turning to structure, the court noted:

The only valid EB-5 programme after 2022 resides in subparagraph (E). A center’s continued participation necessarily flows through that provision.
Designation is not static; the statute repeatedly discusses “suspending” or “terminating” a designation—confirming that designation is a current status that can be lost.
Congress used “establish” (one-time event) in clause (E)(iii) to govern new applications, but it used “designated” in (E)(i) and (J)(ii)(I) to encompass that continuing status.

b. Contextual & Policy Alignment
The Integrity Fund finances anti-fraud enforcement—precisely because historic abuse largely involved pre-Act centers. It would be illogical for Congress to exempt the very entities that gave rise to reform. Moreover, other provisions (e.g., subparagraphs (F) & (M)) preserve benefits for investors in pre-Act centers, which only cohere if those centers remain part of the programme and subject to new obligations.

c. Surplusage & Meaningful-Variation Canons
Sunshine State argued that if “under subparagraph (E)” covered everyone, those words would be surplus. The court responded that:

Other provisions invoke the same phrase when enumerating duties (e.g., annual reports). Uniform usage therefore promotes symmetrical meaning.
Reading an implicit limitation would create far greater surplusage across subparagraphs (e.g., enforcement powers, investor protection clauses) and lead to implausible carve-outs.

d. Retroactivity Analysis
At Landgraf step two, the fee is prospective: collected annually, tied to ongoing status, and triggers only future compliance costs. No vested rights are impaired; no “new duties” attach to completed transactions. Comparable to imposing a new property tax that merely affects future ownership.

3. Impact of the Judgment

Uniform Obligations Nationwide: All regional centers, regardless of vintage, now unquestionably face the Integrity Fund Fee and other obligations (annual statements, promoter restrictions, securities-law compliance).
Signpost for Other Circuits: No other court of appeals has decided this precise question; the Eleventh Circuit’s comprehensive textual analysis will likely be persuasive authority elsewhere, especially post-Loper Bright.
Administrative Practice Settled: USCIS can rely on this precedent to continue collection without fear of contrary regional litigation within the Eleventh Circuit.
Investor Stability: By confirming the fee applies but preserving designation, the decision avoids investor chaos that would follow widespread de-designation.
Chevron Aftermath Example: Provides an early roadmap for how lower courts will parse statutes after Loper Bright: careful grammar, statutory context, lesser weight on agency gloss.

Complex Concepts Simplified

EB-5 Regional Center: A private or public economic entity approved by DHS to pool foreign investors’ funds and create U.S. jobs. Investors obtain green cards if job-creation metrics are met.
Integrity Fund Fee: Annual payment ($10k or $20k) by each regional center into a fund used by DHS for audits, site visits, investigations, and compliance activities.
Designation vs. Establishment: “Establishment” refers to the initial creation of a center; “designation” is the government’s stamp of approval that until suspended or terminated.
Retroactivity Doctrine: Courts presume Congress does not apply laws to past actions unless expressly stated. A law is retroactive if it changes the legal consequences of events that have already finished.
Loper Bright’s Effect: Courts now decide statutory meaning independently instead of deferring to an agency whenever a statute seems ambiguous.

Conclusion

Sunshine State Regional Center, Inc. v. Director, USCIS cements the principle that participation in the modern EB-5 programme comes with modern responsibilities. The Eleventh Circuit’s methodical reading of statutory text, bolstered by structural coherence and policy logic, leaves little doubt that Congress intended a single, unified set of obligations—chief among them funding the very Integrity Fund designed to police the system. In the broader legal landscape, the case is a model for post-Chevron statutory interpretation: close reading, grammar scrutiny, and holistic statutory context now carry the day. Future litigants challenging EB-5 fees or similar programme reforms will have to grapple with this precedent, and agencies can take measured comfort that reasonable, text-anchored interpretations may withstand Loper Bright-style scrutiny.