The dome of the U.S. Capitol building is illuminated before sunrise in Washington, D.C., on Dec. 11, 2015.
Photograph by Bloomberg
By Steven T. Dennis
December 16, 2015

Congressional leaders nixed a bipartisan effort to overhaul investor visas in a win for developers of projects in Manhattan and other cities around the country.

The EB-5 visa allows foreigners to get a green card in return for a $500,000 investment toward the creation of American jobs. The program has become very popular in recent years, as developers tapped it for billions of dollars in cheap financing for their projects. It has also resulted in high-profile cases of fraud. (Read last year’s Fortune feature on the issue.)

Congressional aides said Democratic Sen. Charles Schumer of New York and Republican John Cornyn of Texas were among the lawmakers who put the brakes on the plan to overhaul the program, which will now continue unchanged through September 2016.

The EB-5 program was created to boost investment and jobs in impoverished areas, but it has come under criticism for its use in mega-projects in Manhattan and elsewhere.

“I care about creating jobs and attracting investment in rural communities like Vermont and distressed areas,” said Sen. Patrick Leahy, a Vermont Democrat, in a statement to Fortune. He co-authored an overhaul bill with Senate Judiciary Chairman Charles Grassley, R-Iowa, House Judiciary Chairman Robert Goodlatte, R-Va., and Rep. John Conyers, D-Mich.

“We pushed aggressively for its inclusion in the omnibus appropriations bill but congressional leadership inexcusably rejected this much-needed reform,” he said. Leahy said he hopes the spending bill will get a markup in January.

The overhaul would have increased the minimum investment to $800,000 per person in priority areas to qualify for a green card. It also would have reserved 4,000 of the 10,000 visa slots for rural and impoverished urban areas, and it would have required more oversight of projects to protect against fraud.

Invest in the USA, an industry group, and the Leadership Conference on Civil and Human Rights had separately endorsed the reform legislation.

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