79264 Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 

1 GAO, Commonwealth of the Northern Mariana 

Islands: Pending Legislation Would Apply U.S. 

Immigration Law to the CNMI with a Transition 

Period, GAO–08–466 (Washington, DC: Mar. 2008); 

GAO, U.S. Insular Areas: Economic, Fiscal, and 

Accountability Challenges, GAO–07–119 

(Washington, DC: Dec. 12, 2006); and GAO, 

Commonwealth of the Northern Mariana Islands: 

Serious Economic, Fiscal, and Accountability 

Challenges, GAO–07–746T (Washington, DC: Apr. 

19, 2007). 

notice of disqualification to his or her 

supervisor and the DAEO upon 

determining that he will not participate 

in the matter. 

(c) Disqualification from matters 

affecting prospective employers. An 

FLRA employee who is required, in 

accordance with 5 CFR 2635.604(a), to 

disqualify himself or herself from 

participation in a particular matter to 

which he has been assigned shall, 

notwithstanding the guidance in 5 CFR 

2635.604(b) and (c), provide written 

notice of disqualification to his or her 

supervisor and the DAEO upon 

determining that he will not participate 

in the matter. 

(d) Withdrawal of notification. An 

FLRA employee may withdraw written 

notice under paragraphs (a), (b), or (c) of 

this section upon deciding that 

disqualification from participation in 

the matter is no longer required. A 

withdrawal of notification shall be in 

writing and provided to the employee’s 

supervisor and the DAEO. 

Dated: December 10, 2010. 

Carol Waller Pope, 

Chairman, Federal Labor Relations Authority. 

Approved on this date: December 13, 2010. 

Robert I. Cusick, 

Director, Office of Government Ethics. 

[FR Doc. 2010–31874 Filed 12–17–10; 8:45 am] 

BILLING CODE 6727–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

8 CFR Parts 103, 214, and 274a 

[CIS No. 2758–08; DHS Docket No. USCIS– 

2008–0035] 

RIN 1615–AB75 

E–2 Nonimmigrant Status for Aliens in 

the Commonwealth of the Northern 

Mariana Islands With Long-Term 

Investor Status 

AGENCY: U.S. Citizenship and 

Immigration Services, DHS. 

ACTION: Final rule. 

SUMMARY: This final rule amends 

Department of Homeland Security 

(DHS) regulations governing E–2 

nonimmigrant treaty investors to 

establish procedures for classifying 

long-term investors in the 

Commonwealth of the Northern Mariana 

Islands (CNMI) as E–2 nonimmigrants. 

This final rule implements the CNMI 

nonimmigrant investor visa provisions 

of the Consolidated Natural Resources 

Act of 2008 extending the immigration 

laws of the United States to the CNMI. 

DATES: This rule is effective January 19, 

2011. 

FOR FURTHER INFORMATION CONTACT: 

Steven W. Viger, Office of Policy & 

Strategy, U.S. Citizenship and 

Immigration Services, Department of 

Homeland Security, 20 Massachusetts 

Avenue, NW., 2nd Floor, Washington, 

DC 20529–2140, telephone (202) 272– 

1470. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Commonwealth of the Northern 

Mariana Islands (CNMI) is a U.S. 

territory located in the western Pacific 

that has been subject to most U.S. laws 

for many years. However, the CNMI has 

administered its own immigration 

system under the terms of its 1976 

covenant with the United States. See A 

Joint Resolution to Approve the 

Covenant To Establish a Commonwealth 

of the Northern Mariana Islands in 

Political Union with the United States 

of America (the Covenant Act), Public 

Law 94–241, sec. 1, 90 Stat. 263, 48 

U.S.C. 1801 note (1976). On May 8, 

2008, President Bush signed into law 

the Consolidated Natural Resources Act 

of 2008 (CNRA). Public Law 110–229, 

122 Stat. 754 (2008). Title VII of the 

CNRA extends U.S. immigration laws to 

the CNMI with transition provisions 

unique to the CNMI. See 48 U.S.C. 1806; 

48 U.S.C.A. 1806 note. The stated 

purpose of the CNRA is to ensure 

effective border control procedures, to 

properly address national security and 

homeland security concerns by 

extending U.S. immigration law to the 

CNMI (phasing-out the CNMI’s 

nonresident contract worker program 

while minimizing to the greatest extent 

practicable the potential adverse 

economic and fiscal effects of that 

phase-out), to maximize the CNMI’s 

potential for future economic and 

business growth, and to assure workers 

are protected from the potential for 

abuse and exploitation. See sec. 701 of 

the CNRA, 48 U.S.C.A. 1806 note. 

Since 1978, the CNMI has admitted a 

substantial number of foreign workers 

from China, the Philippines, and other 

countries through an immigration 

system that provides a permit program 

for foreigners entering the CNMI, such 

as visitors, investors, and workers. In 

fact, foreign workers under this system 

represent a majority of the CNMI labor 

force. Such workers outnumber U.S. 

citizens and other local residents in 

private sector employment in the CNMI. 

Currently, the CNMI faces serious 

economic challenges, including the total 

collapse of the territory’s $1 billion a 

year garment industry and a substantial 

decline in its tourism industry.1 The 

result has been a decrease in the CNMI 

government budget from $217,964,866 

in 2005 to $132,565,000 in 2011. 

Title VII of the CNRA was to become 

effective approximately one year after 

the date of enactment, subject to certain 

transition provisions unique to the 

CNMI. On March 31, 2009, DHS 

announced that the Secretary of 

Homeland Security, in her discretion 

under the CNRA, had extended the 

effective date of the transition program 

from June 1, 2009 (the first day of the 

first full month commencing one year 

from the date of enactment of the 

CNRA) to November 28, 2009. DHS 

Press Release, ‘‘DHS Delays the 

Transition to Full Application of U.S. 

Immigration Laws in the 

Commonwealth of the Northern Mariana 

Islands’’ (Mar. 31, 2009), http:// 

www.dhs.gov/ynews/releases/ 

pr_1238533954343.shtm. The transition 

period concludes on December 31, 2014. 

The law also contains several CNMIspecific provisions affecting foreign 

workers and investors during the 

transition period. These temporary 

provisions are intended to provide for 

an orderly transition from the CNMI 

permit system to the Immigration and 

Nationality Act (INA) and to mitigate 

potential harm to the CNMI economy 

before these foreign workers and 

investors are required to obtain U.S. 

immigrant or nonimmigrant status. See 

sec. 701 of the CNRA, 48 U.S.C.A. 1806 

note; 48 U.S.C. 1806(c), (d). 

Among the CNMI-specific provisions 

applicable during the transition period 

is a provision authorizing the Secretary 

of Homeland Security to classify an 

alien foreign investor in the CNMI as a 

CNMI-only ‘‘E–2’’ nonimmigrant 

investor under section 101(a)(15)(E)(ii) 

of the INA, 8 U.S.C. 1101(a)(15)(E)(ii). 

48 U.S.C. 1806(c). This status is 

provided upon application of the alien, 

notwithstanding the treaty requirements 

otherwise applicable. Id. Eligible 

investors are those who: 

• Were admitted to the CNMI in longterm investor status under CNMI 

immigration law before the transition 

program effective date; 

• Have continuously maintained 

residence in the CNMI under long-term 

investor status; 


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• Are otherwise admissible to the 

United States under the INA; and 

• Maintain the investment(s) that 

formed the basis for the CNMI long-term 

investor status. Id. 

II. Proposed Rule 

In accordance with the CNRA, on 

September 14, 2009, DHS proposed the 

requirements and procedures for foreign 

investors in the CNMI to obtain 

nonimmigrant status within the E–2 

treaty investor classification (‘‘E–2 CNMI 

Investors’’). See 74 FR 46938. DHS 

provided a 30-day comment period in 

the proposed rule, which ended on 

October 14, 2009. The comments 

received during the comment period are 

discussed below. 

The proposed rule preamble 

described the CNMI’s immigration 

programs for investors that existed 

before November 28, 2009. Id. at 46939. 

The proposed rule also described the 

current United States E–2 treaty investor 

nonimmigrant status. Id. at 46940; see 

INA sec. 101(a)(15)(E)(ii), 8 U.S.C. 

1101(a)(15)(E)(ii); 8 CFR 214.2(e). DHS 

proposed the procedures for foreign 

investors in the CNMI to obtain 

nonimmigrant status within the E–2 

treaty investor classification, including 

the criteria that must be met and the 

evidence that must be submitted in 

order to be eligible for E–2 CNMI 

Investor nonimmigrant status. See 74 FR 

46938, 46949 (Sept. 14, 2009). 

As stated in the proposed rule, the 

E–2 CNMI Investor program is intended 

to provide a smooth transition for 

existing CNMI investors and to mitigate 

potential adverse consequences to the 

CNMI economy if the current 

investments could not otherwise be 

maintained as a basis for immigration 

status during the transition period. At 

the end of the transition period, the 

E–2 CNMI Investor classification will 

cease to exist. E–2 CNMI Investors and 

qualifying spouses and children must 

qualify for and obtain a new immigrant 

or nonimmigrant status under the INA 

in order to remain in the CNMI or to 

enter the CNMI after a departure. 

III. Final Rule 

This rule provides the procedures to 

obtain status as an E–2 CNMI Investor. 

The final rule adopts most of the 

regulations set forth in the proposed 

rule. The rationale for the proposed rule 

and the reasoning provided in its 

preamble remain valid with respect to 

these regulatory amendments, and DHS 

adopts such reasoning in support of the 

promulgation of this final rule. DHS has 

modified some of the proposed 

provisions for the final rule in response 

to the public comments received on the 

proposed rule. These changes are 

explained in detail in the summary of 

comments and DHS responses below 

and are briefly summarized as follows: 

1. The proposed rule provided that a 

CNMI Long-Term Business Entry Permit 

holder with a CNMI Long-Term 

Business Certificate would be eligible 

for a period of two years on the basis of 

the alien’s minimum $150,000 

investment. The final rule reduces the 

minimum investment to $50,000. New 8 

CFR 214.2(e)(23)(iii)(A)(2). 

2. The final rule provides a two-year 

application period after the effective 

date of the final rule. See new 8 CFR 

214.2(e)(23)(v). The proposed rule had 

proposed that applicants be required to 

apply for E–2 CNMI Investor status 

within two years of the beginning of the 

transition period. This change is one of 

a number of updating changes to reflect 

the fact that the transition program 

effective date is now in the past. Other 

such changes include: Changing 

references to the transition program 

effective date and to CNMI-issued 

immigration statuses to the past tense, 

as those statuses no longer are in effect 

after that date; changing the reference 

date to CNMI laws in effect from May 

8, 2008 (CNRA date of enactment) to 

November 27, 2009 (day before 

transition program effective date); and 

removing the definition of ‘‘transition 

program effective date’’ from new 8 CFR 

214.2(e)(23)(ii) as that definition is now 

in the general definitions section of the 

immigration regulations at 8 CFR 

1.1(bb). See new 8 CFR 214.2(e)(23)(v). 

3. The final rule adds the phrase ‘‘or 

any successor body’’ to the provision 

describing where a denial may be 

appealed. The proposed rule had 

proposed that denied petitions may be 

appealed to the USCIS Administrative 

Appeals Office. See new 8 CFR 

214.2(e)(23)(ix). 

4. The final rule clarifies the authority 

and process by which applicants in the 

CNMI can be granted E–2 CNMI Investor 

status in the CNMI without having to 

travel abroad to obtain a nonimmigrant 

visa. See new 8 CFR 214.2(e)(23)(xvi). 

5. The final rule adds the term 

‘‘continuous’’ to clarify the period of 

absence that would break continuity of 

residence under the definition of 

‘‘continuously maintained residence in 

the CNMI.’’ See new 8 CFR 

214.2(e)(23)(ii)(D). 

6. The final rule makes technical 

changes to the fee waiver provisions, in 

order to conform the rule to the 

reorganized format of 8 CFR 103.7 

provided in the DHS final rule, ‘‘U.S. 

Citizenship and Immigration Services 

Fee Schedule,’’ 75 FR 58962 (September 

24, 2010). See new 8 CFR 

103.7(c)(3)(xix). 

IV. Comments Received on the 

Proposed Rule 

During the 30-day comment period, 

DHS received 13 comments from a 

variety of individuals and organizations, 

including the CNMI Governor’s Office, 

the Saipan Chamber of Commerce, a 

former Senator of the CNMI, a Member 

of Congress, and other interested 

organizations and individuals. 

DHS considered the comments 

received and all other materials 

contained in the docket in preparing 

this final rule. The final rule does not 

address comments that were beyond the 

scope of the proposed rule, including 

those seeking changes to United States 

statutes, changes to regulations or 

petitions outside the scope of the 

proposed rule, or changes to the 

procedures of other DHS components or 

agencies. 

All comments and other docket 

material may be reviewed at the Federal 

Docket Management System (FDMS) at 

http://www.regulations.gov, docket 

number USCIS–2008–0035. 

A. Summary of Comments 

Of the 13 comments USCIS received, 

two comments supported the proposals 

in the rule as a whole and welcomed 

DHS’s efforts to minimize, to the 

greatest extent practicable, potential 

adverse economic and fiscal effects of 

federalization and to maximize the 

CNMI’s potential for future economic 

and business growth. 

Most commenters expressed concerns 

over specific provisions in the proposed 

rule, such as: The requirement to obtain 

a visa to re-enter the CNMI; the 

minimum investment of $150,000 for 

Long-Term Business Investors; and the 

continuous residence requirement. 

Several commenters wrote that certain 

investors would be ineligible for the 

E–2 CNMI Investor visa, that the rule 

will cause severe economic harm to the 

CNMI economy, and that DHS is 

incorrect in its interpretation of the 

effect of an extension of the transition 

period. 

B. Comments 

The specific comments are organized 

by subject matter and addressed below. 

1. Visa Requirement (Travel and 

Reentry) 

Two commenters disagreed with the 

proposed requirement that investors 

must obtain a visa to re-enter the CNMI. 

Commenters stated that obtaining a visa 

is an expensive and time-consuming 

process. DHS is aware of the public’s 


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concerns regarding the cost and time 

involved in obtaining a U.S. visa. 

However, visa fees and visa processing 

times are managed by the Department of 

State (DOS). After careful consideration, 

DHS is maintaining the visa 

requirement for investors who are 

abroad and seek to be admitted to the 

CNMI. A primary purpose of the CNRA 

is ‘‘to ensure that effective border 

control procedures are implemented 

and observed, and that national security 

and homeland security issues are 

properly addressed.’’ CNRA sec. 701(a), 

48 U.S.C.A. 1806 note. The visa process 

is an important aspect of effective 

border control. Therefore, DHS does not 

consider it appropriate as a matter of 

travel security and immigration policy 

to waive visa-based grounds of 

inadmissibility for those E–2 CNMI 

Investors who travel abroad and wish to 

return to the CNMI. 

However, DHS is able to address to a 

significant extent the general concern 

reflected in the comments about visas 

and travel costs by clarifying in the final 

rule the authority and process by which 

applicants who are already within the 

CNMI may be determined to be 

admissible to the United States and 

granted E–2 CNMI Investor status. For 

CNMI investors, DHS is providing 

beneficiaries of an E–2 CNMI petition in 

the CNMI with a grant of E–2 CNMI 

Investor status without requiring that 

they depart the CNMI in order to obtain 

a visa. In other words, an alien in the 

CNMI who is eligible for E–2 status will 

not have to make a trip abroad solely for 

the purpose of obtaining a visa, but if 

the alien is otherwise abroad, he or she 

will have to obtain a visa in order to 

travel to the CNMI. 

DHS notes that there is a distinct 

difference between a visa and a status. 

DOS issues a visa at a U.S. Embassy or 

consulate office abroad. A visa, placed 

in the alien’s passport, allows an alien 

to travel to a port of entry and apply for 

admission to the United States in a 

particular status. While having a visa 

does not guarantee admission to the 

United States, it does indicate that a 

consular officer has determined that the 

alien is eligible to apply for admission 

for a specific purpose. 

DHS is responsible for all admissions 

into the United States. If an alien 

seeking admission to the United States 

is admissible, DHS admits the alien and 

grants his or her status in the United 

States. The specified status controls the 

period of stay and conditions of such 

stay. In most cases, DHS grants status at 

the port of entry. As previously 

indicated, DHS is providing 

beneficiaries of an E–2 CNMI petition in 

the CNMI with a grant of E–2 CNMI 

Investor status without requiring that 

they depart the CNMI. The grant of such 

status is within DHS’ purview. Visa 

issuance is handled by DOS. 

2. Visa Issuance 

One commenter stated that the 

Department of State should issue visas 

in the CNMI and allow dependents to be 

exempt from applying in person for 

their E–2 CNMI Investor visas. Another 

commenter wrote that the E–2 CNMI 

Investor visa should allow for multiple 

entries. 

DHS cannot address these particular 

suggestions in this rule. Visa issuance is 

a function of the Department of State, 

and thus beyond the scope of this DHS 

rule. In any case, DHS believes that the 

concerns about visa issuance and the 

need for multiple-entry visas are 

adequately addressed by the waiver 

provision discussed below. 

The Supplementary Information to 

the proposed rule discussed the fact that 

E–2 CNMI Investor status could be 

granted directly to aliens present in the 

CNMI, unlike aliens abroad seeking that 

status who first must be issued an E–2 

CNMI Investor nonimmigrant visa by 

the Department of State at a consular 

post abroad and thereafter seek 

admission in E–2 CNMI Investor status. 

See 74 FR 46940; proposed 8 CFR 

214.2(e)(23)(vii). The proposed 

regulatory language, however, was not 

explicit about how that would be done 

consistent with the requirement that the 

alien be admissible to the United States. 

Thus, in order to give additional 

assurance and direction on this point to 

the affected public and to USCIS 

adjudicators, the final rule clarifies that 

a waiver of inadmissibility under 

section 212(d)(3)(A)(ii) of the INA may 

be granted to an eligible alien seeking an 

initial grant of E–2 CNMI Investor status 

from DHS while in the CNMI. See new 

8 CFR 214.2(e)(23)(xvi). Such aliens will 

necessarily lack an E–2 CNMI Investor 

nonimmigrant visa issued by the 

Department of State, and are thus 

inadmissible under section 

212(a)(7)(B)(i)(II) of the INA; they also 

by definition will (unless changing to 

E–2 CNMI Investor status from another 

nonimmigrant status under the INA) be 

aliens present in the United States 

without admission or parole, and thus 

inadmissible under section 212(a)(6)(A) 

of the INA. Therefore, the rule allows 

for a waiver of those two grounds of 

inadmissibility for aliens with 

appropriate documentation. 

This waiver provision is based upon 

the specific language in section 

212(d)(3)(A)(ii) that in the case of an 

alien ‘‘in possession of appropriate 

documents’’ who is seeking admission 

as a nonimmigrant, most grounds of 

inadmissibility may be discretionarily 

waived. INA sec. 212(d)(3)(A)(ii), 8 

U.S.C. 1182(d)(3)(A)(ii). In the unique 

situation of the CNMI, considering the 

express application of the nonimmigrant 

investor visa provision of the CNRA to 

aliens lawfully present in the CNMI in 

a non-INA status and without a previous 

reason to have needed to obtain a U.S. 

nonimmigrant visa from the Department 

of State, and mindful that the stated goal 

of the CNRA is to mitigate potential 

adverse consequences of transition to 

the extent possible, DHS concludes that 

the ‘‘appropriate documentation’’ 

requirement for the waiver may be met 

by aliens who meet the documentary 

requirements for petition approval 

described in new 8 CFR 214.2(e)(23)(vi). 

Those requirements include, but are not 

limited to, evidence of prior admission 

in CNMI investor status. As a 

conforming change, new 8 CFR 

214.2(e)(23)(vi) has been titled 

‘‘Appropriate documents’’ instead of the 

previous ‘‘Accompanying evidence,’’ 

and a valid unexpired passport is 

required as necessary evidence. Id. 

In the case of spouses and children 

present in the CNMI who are seeking a 

derivative grant of E–2 Investor 

nonimmigrant status based upon a 

principal investor’s approved petition, 

to satisfy the ‘‘appropriate documents’’ 

requirement for a section 

212(d)(3)(A)(ii) waiver of 

inadmissibility under INA sections 

212(a)(6)(A)(i) and 212(a)(7)(B)(i)(II), the 

applicant must present (1) a valid 

unexpired foreign passport and (2) 

evidence that the spouse or child is 

lawfully present in the CNMI under 

section 1806(e) of title 48, U.S. Code 

(the so-called ‘‘grandfather provision’’ 

applicable until not later than 

November 27, 2011 to aliens issued 

‘‘umbrella permits’’ or other 

authorization by the CNMI government 

prior to November 28, 2009). Such 

evidence may include evidence of a 

grant of parole by USCIS or a grant of 

parole by DHS pursuant to a grant of 

advance parole by USCIS under DHS 

policy in furtherance of the grandfather 

provision (in other words, parole 

granted to aliens residing in the CNMI 

as of November 28, 2009, rather than 

parole granted to arriving aliens for 

other reasons). See new 8 CFR 

214.2(e)(23)(xvi). The intended 

beneficiaries of this discretionary 

waiver are spouses and children 

lawfully residing in the CNMI under the 

grandfather provision. The reference to 

parole documents is included in the 

final rule because of uncertainty about 

what type of CNMI documentation may 


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be in the possession of these aliens, 

since they are not themselves investors 

and may not have ‘‘umbrella permits’’ or 

other CNMI-issued work authorization 

documents. Furthermore, USCIS has 

used parole and advance parole broadly 

with respect to lawfully present aliens 

in the CNMI since the transition date for 

humanitarian reasons, and thus DHS 

parole documents may be the best way 

to identify some members of the 

‘‘grandfather’’ provision group. 

3. Eligible Long-Term CNMI Investors 

Six comments opposed or offered 

suggestions on the proposed list of 

CNMI investor categories that would be 

eligible for the E–2 CNMI Investor visa. 

(a) High Level Managers 

One commenter stated that the 

proposed regulation omits high level 

managers from the eligible categories of 

CNMI long-term investors. The 

commenter also stated that these 

managers may not be eligible for L visas. 

If granted upon petition by an employer, 

the L–1A Intracompany Transferee 

Executive or Manager nonimmigrant 

classification enables a U.S. employer to 

transfer an eligible executive or manager 

from one of its affiliated foreign offices 

to one of its offices in the United States. 

INA sec. 101(a)(15)(L), 8 U.S.C. 

1101(a)(15)(L); 8 CFR 214.2(l). The 

commenter suggested that high level 

managers be eligible for E–2 CNMI 

Investor status. 

The final rule includes all CNMI 

investors who meet the long-term 

investor requirement under the CNRA. 

See new 8 CFR 214.2(e)(23)(iii). If a 

high-level manager is also an investor 

eligible for E–2 CNMI Investor status, 

the individual may obtain that status, 

but the final rule does not provide E– 

2 CNMI Investor status to employees 

who are not the actual investors in the 

approved investment. The final rule 

cannot go beyond the statute, which 

specifically provides that CNMI E–2 

Investor status is limited to those 

investors described in 48 U.S.C. 1806(c), 

and therefore the comment cannot be 

adopted. High level managers likely are 

ineligible for long-term investor status 

because they are not the actual 

investors. Although high level managers 

may be ineligible for the E–2 CNMI 

Investor visa, they may be eligible for 

either an H–1B or a transitional worker 

visa. Thus no change is made in the 

final rule in response to this comment. 

(b) Ineligible CNMI Investors 

One commenter wrote that hundreds 

of investors would be left out under the 

proposed regulation. The comment did 

not identify which types of investors 

would not be included in the proposed 

regulation. Certain categories used by 

the CNMI, including the short-term 

business entry permit, the long-term 

business entry permit, and the 2–Year 

Japanese Retiree classification, are not 

eligible for E–2 CNMI Investor status 

because these categories do not relate to 

long-term investors, as required by the 

CNRA. Based upon a review of CNMI 

investor classifications, DHS has 

included all long-term CNMI investors, 

including retiree investors, in the list of 

investors eligible for the E–2 CNMI 

Investor classification. See new 8 CFR 

214.2(e)(23)(iii). 

(c) Grandfathering Long-Term CNMI 

Investors 

One commenter suggested that DHS 

‘‘grandfather’’ long-term permit holders 

for a period of four years without adding 

new enforcement criteria in order to 

avoid economic disruption. While 

grandfathering long-term CNMI permit 

holders arguably could lessen economic 

disruption, grandfathering is not an 

option under the CNRA. Section 702(c) 

of the CNRA provides for a CNMI 

investor classification with specific 

eligibility requirements, to be provided 

only ‘‘upon the application of an alien.’’ 

48 U.S.C. 1806(c)(1). In accordance with 

the eligibility requirements under the 

CNRA, the E–2 CNMI Investor visa is 

available to all CNMI investors with 

valid long-term investor permits. The 

final rule has been drafted to minimize 

the potential adverse economic and 

fiscal effects by applying standards 

similar to those used by the CNMI 

government in approving long-term 

investors in the CNMI. Thus DHS is not 

adopting this comment. 

(d) Minimum Investment for Long-Term 

Business Investors 

Three commenters wrote that the 

$150,000 minimum investment 

requirement for Long-Term Business 

Investors will exclude investors who 

were granted Long-Term Business 

Certificates by the CNMI at a lower 

investment minimum of $50,000. In 

response to these comments, and in 

view of the fact that the CNMI 

government has previously granted 

Long-Term Business Certificates with a 

minimum investment of $50,000, the 

final rule has been amended to include 

those investors who were granted longterm business certificates with a 

minimum investment of $50,000, as 

long as they continued to hold that 

status on the transition program 

effective date. DHS decided to reduce 

the general minimum investment 

requirement rather than creating a 

separate eligible investor category in 

order to minimize any potential 

confusion in the adjudication process. 

See new 8 CFR 214.2(e)(23)(iii)(A). 

This modification of the proposed 

rule furthers the goal of DHS to 

minimize the potential adverse 

economic and fiscal effects of this 

rulemaking on the CNMI by including 

all CNMI long-term investor 

classifications. It is consistent with the 

CNRA’s references to aliens previously 

admitted to the CNMI in long-term 

investor status as eligible for the E–2 

CNMI Investor nonimmigrant program. 

4. Continuous Residence 

One commenter wrote that what the 

commenter described as the six-month 

residence requirement will be 

unnecessarily rigorous for those 

investors who do not reside in the 

CNMI, proposing instead to reduce the 

requirement to two months. Another 

commenter wrote that the residence 

requirement should apply at the start of 

the transition period. 

The rule does not in fact specifically 

require six months of residency; rather, 

the investor is required to have resided 

in the CNMI since he or she was 

lawfully admitted as a long-term 

investor (which, given the passage of 

time since the last date that such an 

admission could have taken place under 

the former CNMI immigration laws— 

November 27, 2009—is necessarily 

longer than six months), and to have 

been present in the CNMI for half the 

time that he or she has resided in the 

CNMI A continuous absence of six 

months or more may be considered to 

break the continuity of residence. New 

8 CFR 214.2(e)(23)(ii)(D). DHS therefore 

interprets the comment to raise in 

general a concern about required 

residence time, and to request a 

reduction in the residence time to two 

months. DHS understands the concern 

but is unable to agree with the 

suggestion to reduce the residency 

requirement to two months or otherwise 

to modify it substantively. The CNRA 

requires that the investor have 

‘‘continuously maintained residence in 

the Commonwealth under long-term 

investor status.’’ Therefore, by 

definition, the status is unavailable to 

those who do not reside in the CNMI. 

While reasonable absence is not 

incompatible with maintaining 

residence, DHS does not believe that the 

lengths of absence suggested by the 

commenter, amounting essentially to 

absentee investment, are consistent with 

the statute. DHS has made a technical 

amendment to further clarify that the 

reference to an absence of six months or 

more as breaking the continuity of 


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residence means a ‘‘continuous’’ absence 

of six months or more. 

In response to the commenter who 

wrote that the residence requirement 

should apply at the start of the 

transition period (i.e., that DHS should 

not consider whether the investor 

resided in the CNMI during the period 

of status under CNMI law prior to the 

transition program effective date), DHS 

does not believe that such a change is 

consistent with the CNRA’s requirement 

that the alien have ‘‘continuously 

maintained residence in the 

Commonwealth under long-term 

investor status.’’ 48 U.S.C. 1806(c)(1)(B). 

By definition, long-term investor status 

was a status provided prior to the 

transition program effective date under 

the laws of the CNMI formerly in effect. 

Id. In the proposed rule, DHS provided 

as liberal a construction of the CNRA’s 

residence requirements as it reasonably 

could do under the statute, including 

permitting substantial periods of 

absence from the CNMI not to terminate 

continuous residence. See new 8 CFR 

214.2(e)(23)(ii)(D). For these reasons, 

DHS made no changes in response to 

this comment, other than the technical 

clarification identified above. 

5. Economic Impact 

Some commenters stated that the rule 

would have a significant negative 

impact on the CNMI economy. More 

specifically, these commenters objected 

that the analysis ‘‘substantially 

understated’’ the adverse effects of the 

rule and imposed an ‘‘exit requirement’’ 

upon investors at the end of the 

transition period. 

DHS disagrees with the commenters’ 

assertion that this rule represents either 

an ‘‘adverse’’ economic impact or an 

‘‘exit requirement.’’ The commenters 

may be conflating the economic impact 

of the CNRA’s imposition of the 

immigration laws of the U.S. on the 

CNMI with the actual economic impact 

of this rule. When measuring the costs 

of a regulation, USCIS must measure 

these costs against a baseline. Per 

guidance from OMB Circular A–4, the 

baseline should be the best assessment 

of the way the world would look absent 

the proposed action. Without this rule 

in place, foreign investors who cannot 

qualify for status under the immigration 

laws of the U.S. would be required by 

the CNRA to leave the CNMI no later 

than Nov. 27, 2011. With this rule in 

place, foreign investors who cannot 

qualify for status under the immigration 

laws of the U.S. are allowed to stay until 

December 31, 2014. Consequently, this 

rule allows certain foreign investors to 

remain in the CNMI several years 

beyond when they would be able to stay 

without this rule in place. In this 

manner, this rule provides a significant 

economic benefit to the CNMI, and 

comments expressing concern over the 

economic impacts of this rule are 

misplaced. 

One commenter wrote that DHS 

incorrectly determined that the 

proposed regulation does not constitute 

a major rule under the Small Business 

Regulatory Enforcement Fairness Act of 

1996 (SBREFA). The commenter 

believes that this rule should be 

considered a major rule and therefore 

subject to disapproval by both Houses of 

the U.S. Congress and the President of 

the United States. 

DHS does not agree with the 

commenter. The commenter is 

apparently citing SBREFA’s 

Congressional Review Act, 5 U.S.C. 801 

(CRA). The CRA delays implementation, 

and provides a mechanism for 

congressional disapproval, of 

regulations designated as ‘‘major rules’’ 

by the Administrator of the Office of 

Management and Budget. Such a 

designation is made where OMB finds 

the rule has resulted in or is likely to 

result in (a) an annual effect on the 

economy of $100,000,000 or more; (b) a 

major increase in costs or prices for 

consumers, individual industries, 

Federal, State, or local government 

agencies, or geographic regions; or (c) 

significant adverse effects on 

competition, employment, investment, 

productivity, innovation, or on the 

ability of United States-based 

enterprises to compete with foreign 

based enterprises in domestic and 

export markets. See 5 U.S.C. 804(2). 

OMB has not determined that this rule 

is a major rule and, therefore, the CRA 

does not apply. 

One commenter argued that DHS 

utilized outdated data which led to an 

understated economic impact on 

foreign-owned businesses. 

As mentioned in the analysis, precise 

data for the CNMI are difficult to obtain. 

The 2005 CNMI Household, Income, 

and Expenditures Survey data, used in 

the initial analysis, have been updated 

with the most current publicly-available 

data from the 2007 Economic Census of 

Island Areas in the final analysis. The 

analysis required by the Regulatory 

Flexibility Act need not produce 

statistical certainty; the law requires 

that DHS ‘‘demonstrate a ‘reasonable, 

good-faith effort’ to fulfill [the RFA’s] 

requirements.’’ Ranchers Cattlemen 

Action Legal Fund v. U.S. Dep’t of 

Agric., 415 F.3d 1078, 1101 (9th Cir. 

2005); see also Associated Fisheries of 

Maine v. Daley, 127 F.3d 104, 114–15 

(1st Cir. 1997). Also, when conducting 

a Regulatory Flexibility Analysis, the 

RFA requires consideration only of the 

direct costs of a regulation on a small 

entity that is required to comply with 

the regulation. Mid-Tex Electric Coop. v. 

FERC, 773 F.2d 327, 340–43 (DC Cir. 

1985) (holding indirect impact of a 

regulation on small entities that do 

business with or are otherwise 

dependent on the regulated entities is 

not considered in RFA analyses); see 

also Cement Kiln Recycling Coal. v. 

EPA, 255 F.3d 855, 869 (DC Cir. 2001) 

(observing that, in passing the RFA, 

‘‘Congress did not intend to require that 

every agency consider every indirect 

effect that any regulation might have on 

small businesses in any stratum of the 

national economy’’). 

6. End of Transition Period 

Two comments opposed the 

termination of the E–2 CNMI Investor 

classification at the end of the transition 

period. 

(a) Extension of Transition Period 

One commenter objected to the DHS 

interpretation of the CNRA that any 

extension of the transition period by the 

Secretary of Labor will only extend the 

transitional worker visa and not the 

CNMI-only investor visa. DHS disagrees 

with the commenter. The CNRA 

specifically authorizes the Secretary of 

Labor only to extend ‘‘the provisions of 

this subsection’’ beyond December 31, 

2014. See 48 U.S.C. 1806(d)(5)(A). ‘‘This 

subsection’’ is subsection (d), which 

solely addresses the transitional worker 

program. Id. The CNRA does not 

provide authority to extend subsection 

1806(c), the nonimmigrant investor 

program, past the end of the transition 

period. Id. 

(b) Expiration of E–2 CNMI Investor 

Classification 

One commenter wrote that CNMI 

investors will be required to apply for 

a standard U.S. investor visa in order to 

remain in the CNMI after the transition 

period has ended. DHS appreciates the 

concern but is constrained by the 

CNRA. Although the Secretary of Labor 

has the authority to extend the initial 

5-year transition period with respect to 

the transitional worker program, the 

E–2 CNMI Investor provision cannot be 

extended, as discussed above. The 

transition period will end on December 

31, 2014. See new 8 CFR 

214.2(e)(23)(xiv). Investors who seek to 

remain in the CNMI must apply and be 

approved for another immigrant or 

nonimmigrant status on or before 

December 31, 2014. DHS is aware that 

some CNMI investors may not qualify 

for another immigration classification at 

the end of the transition period; 


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Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 79269 

however, DHS does not have authority 

to extend the E–2 CNMI Investor 

classification beyond its statutory limits. 

V. Other Changes 

Since DHS issued the proposed rule 

before the transition program effective 

date, DHS has made a number of other 

minor changes to the final rule as a 

result of the timing of the rule. These 

include: 

A. Changes of Tense and Other Timing 

Matters 

The proposed rule was written and 

issued before the transition program 

effective date. The fact that the final rule 

is issued after that date requires some 

wording changes. In particular, as 

immigration statuses are now a matter of 

Federal rather than CNMI law, 

including the Federal ‘‘grandfathered’’ 

status provided for up to two years past 

the transition program effective date to 

aliens based on their status under CNMI 

immigration law as of that date (see 48 

U.S.C. 1806(e)), references in the 

proposed rule that could have been read 

to imply that CNMI immigration law 

statuses would continue as such after 

the transition program effective date 

have been modified accordingly. See 

new 8 CFR 214.2(e)(23)(i)(A) (changing 

references to admission under CNMI 

law and status as of transition date to 

the past tense); new 8 CFR 

214.2(e)(23)(i)(B) (removing reference to 

continuous residence ‘‘under such longterm investor status’’). These changes are 

technical rather than substantive, as the 

applicant for CNMI E–2 Investor status 

must still show that he or she has 

continuously resided in the CNMI since 

admission by the CNMI as a long-term 

investor, that he or she had long-term 

investor status as of the transition 

program effective date, and that he or 

she has maintained the investment(s) 

that formed the basis for that status, as 

provided by the proposed and the final 

rule. See new 8 CFR 214.2(e)(23)(i)(A), 

(B), (D); 8 CFR 214.2(e)(23)(ii)(D). 

DHS has also modified the reference 

to investor classifications under CNMI 

law in new 8 CFR 214.2(e)(23)(iii). The 

proposed rule referred to CNMI law as 

in effect on May 8, 2008, the date of the 

CNRA’s enactment. As explained in the 

Supplementary Information to the 

proposed rule, the reason for that date 

was to provide a practicable baseline to 

the rulemaking. In other words, the 

proposed rule was drafted in such a way 

so as to take into account the possibility 

that the CNMI government could modify 

its long-term investor classifications 

under the authority to enact 

immigration law for the CNMI that it 

possessed prior to November 28, 2009. 

Such an action could have had 

substantial effects on the rulemaking 

and the public’s ability to provide 

useful comments on it. However, the 

CNMI government did not modify its 

long-term investor classifications. 

Therefore it is appropriate as a nonsubstantive technical change to conform 

date references in the final rule to the 

transition of immigration authority on 

November 27, 2009 (the last day of 

CNMI immigration authority) rather 

than May 8, 2008. 

DHS has also removed the definition 

of ‘‘transition program effective date’’ 

that the proposed rule had provided as 

proposed new 8 CFR 214.2(e)(23)(ii)(G). 

This definition would have been 

redundant with the definition of 

transition program effective date in 8 

CFR 1.1(bb) that was provided by the 

DHS Interim Final Rule, Application of 

Immigration Regulations to the 

Commonwealth of the Northern Mariana 

Islands, published on October 28, 2009, 

74 FR 55726. The transition program 

effective date in this definition is 

November 28, 2009, the same as had 

been stated in the proposed rule on the 

E–2 CNMI Investor program. That 

definition applies to all USCIS programs 

in the CNMI. 

B. Reference to Administrative Appeals 

Office 

The final rule modifies the proposed 

rule’s reference to appeals of denials of 

applications for E–2 CNMI Investor 

status. See new 8 CFR 214.2(e)(23)(ix). 

Rather than refer solely to the ‘‘USCIS 

Administrative Appeals Office’’ (AAO), 

the provision now refers to the AAO ‘‘or 

any successor body.’’ This change is not 

substantive, but provides flexibility in 

case of a future USCIS administrative 

reorganization or the renaming of an 

office with respect to administrative 

appeals. DHS has found that overly 

specific references to particular officials 

or offices in regulations can lead either 

to unnecessary future conforming 

rulemakings, or obsolete regulations, if 

and when names and responsibilities 

are reorganized or otherwise modified. 

C. Information Needed for Background 

Check 

The final rule includes the proposed 

rule’s specific authorization to collect 

biometric information from applicants 

for E–2 CNMI Investor status, with the 

applicant paying the biometric services 

fee. See new 8 CFR 214.2(e)(23)(viii). 

The final rule clarifies that biometric 

services include reuse of previously 

provided biometric information 

(typically in an extension of status 

scenario), consistent with USCIS’s 

current practice. Id. 

D. Fee Waiver Provisions 

The final rule makes technical 

revisions in order to conform the rule to 

the reorganized format of 8 CFR 103.7 

provided in the DHS final rule, ‘‘U.S. 

Citizenship and Immigration Services 

Fee Schedule,’’ 75 FR 58962 (Sept. 24, 

2010). See new 8 CFR 103.7(c)(3)(xix). 

The final rule also clarifies that the 

authority to waive fees applies to Forms 

I–539 filed by derivative spouses and 

children, as well as to Forms I–129 filed 

by principal applicants. The proposed 

and final fee rules provided generally 

for need-based application fee waivers 

for any applicant for E–2 CNMI Investor 

status in new 8 CFR 214.23(e)(xv), but 

the conforming reference in 8 CFR 

103.7(c) did not refer specifically to the 

I–539 as well as the Form I–129. 

VI. Regulatory Requirements 

A. Small Business Regulatory 

Enforcement Fairness Act of 1996 

This rule is not a major rule as 

defined by section 804 of the Small 

Business Regulatory Enforcement 

Fairness Act of 1996. This rule, with its 

impact limited to addressing eligible 

aliens currently in one of the CNMI 

long-term investor classifications, will 

not result in an annual effect on the 

economy of $100 million or more; a 

major increase in costs or prices; or 

significant adverse effects on 

competition, employment, investment, 

productivity, innovation, or on the 

ability of U.S.-based companies to 

compete with foreign-based companies 

in domestic and export markets. 

B. Executive Order 12866 

This rule is a significant regulatory 

action under Executive Order 12866, 

section 3(f)(1), Regulatory Planning and 

Review. Accordingly, the Office of 

Management and Budget has reviewed 

this rule. 

In accordance with Executive Order 

12866, USCIS is required to prepare an 

assessment of the benefits and costs 

anticipated to occur as a result of this 

regulatory action and to provide the 

assessment to the Executive Office of 

the President, Office of Management 

and Budget, Office of Information and 

Regulatory Affairs. The analysis below 

is the DHS Economic Analysis as 

required by the Executive Order. 

1. Public Comments on the Estimated 

Costs and Benefits of the Proposed Rule 

DHS invited the public to comment 

on the extent of any potential economic 

impact of this rule on small entities, the 

scope of these costs, or more accurate 

means for defining these costs. As a 

result, DHS received a number of 


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2Northern Marianas College, Business 

Development Center, An Economic Study of the 

Commonwealth of the Northern Mariana Islands 

(Saipan, MP: Northern Marianas College 1999). 

3 Id. 

4CNMI Comprehensive Economic Development 

Strategic Plan 2009–2014. CNMI CEDS Commission 

Updated 1/29/09. 

5 Id. 

6See Walt F. J. Goodridge, The Last Garment 

Factory is Closing, Saipan Tribune (Jan. 14, 2009) 

(available at http://www.saipantribune.com/

newsstory.aspx?cat=3&newsID=86872). 

7 GAO, Commonwealth of the Northern Mariana 

Islands: Managing Economic Impact of Applying 

U.S. Immigration Law Requires Coordinated 

Federal Decisions and Additional Data, No. GAO– 

08–791 (Aug. 4, 2008) (2008 GAO Rep.), available 

at http://www.gao.gov/new.items/d08791.pdf. 

comments related to the regulatory 

analysis performed for the proposed 

rule which is addressed above in the 

preamble of this rule. 

(1) Background. 

The CNMI lies north of Guam, 

between the Philippines and Japan. S. 

Rep. No. 110–324, at 2 (2008). The 

United States captured the islands of the 

CNMI in World War II and they became 

a district of the U.S.-administered 

United Nations Trust Territory of the 

Pacific Islands. Id. Under the Covenant 

through which the CNMI joined the 

United States in 1976, the CNMI was 

exempted from most provisions of U.S. 

immigration laws and allowed to 

control its own immigration; however, 

the Covenant gave the U.S. Congress the 

authority to modify that arrangement 

through Federal legislation. Id. 

The United States enacted the CNRA, 

amending the level of control the CNMI 

would have over its immigration system 

to more closely harmonize it with the 

laws and procedures applicable to other 

U.S. jurisdictions, particularly those 

designed to ensure that border control, 

worker protections, national security, 

and homeland security issues are 

properly addressed. See CNRA section 

701, 48 U.S.C. 1801 note. 

(2) Changes made by this rule. 

In order to reduce the opportunity for 

fraud and to improve homeland 

security, this rule requires foreign 

investors who wish to reside in the 

CNMI to reapply every two years using 

USCIS Form I–129, Petition for a 

Nonimmigrant Worker. Requiring 

renewal every two years will help 

USCIS make sure the investor has 

maintained eligibility and provided 

updated biometrics. The CNRA 

generally extends Federal control of 

immigration in the CNMI to address 

national security and homeland security 

issues, and the requirement for renewal 

within this period is consistent with 

current practice for non-CNMI E–2 

treaty investor nonimmigrants. See 

CNRA section 701 (48 U.S.C. 1801 note). 

However, USCIS is aware of and 

sensitive to the potential economic 

impact of new Federal immigration 

requirements on the CNMI economy, 

and this rule’s requirements have been 

developed with that in mind. According 

to an economic study performed by the 

Northern Marianas College, employment 

grew in the CNMI by 12.7 percent 

annually between 1980 and 1995, 

because of expansion of the garment and 

tourism sectors.2 During that time, the 

garment and tourism industries 

accounted for 85 percent of the CNMI 

economy.3 Recently, economic 

conditions have changed dramatically 

for these two CNMI industries. As a 

result of changes in World Trade 

Organization agreements, the apparel 

industry in the CNMI was faced with 

greater international competition. 

Ultimately, this led to a decline in the 

value of CNMI textile exports to the 

United States, from $1.1 billion in 1998 

to $317 million in 2007.4 The number 

of licensed apparel manufacturers 

dropped from 34 to six in 2008.5 The 

remaining three garment factories closed 

or suspended their operations in early 

2009.6

The CNMI tourism industry also has 

been in decline in recent years. The 

terrorist attacks on the United States on 

September 11, 2001; the Severe Acute 

Respiratory Syndrome (SARS) epidemic 

which began in Asia in 2003 and led to 

the death of 774 people worldwide; the 

downturn in many Asian economies; 

changes in airline service; and other 

concerns have reduced the number of 

tourists traveling to the CNMI from 

736,117 in 1996 to 389,345 in 2007.7

Because of the decline of the CNMI 

economy, USCIS has sought to 

minimize the potentially negative 

effects of implementing the CNRA, 

while recognizing that Federal oversight 

of CNMI immigration is necessary to 

reduce fraud, assure worker protections, 

and ensure U.S. homeland security. 

(3) Alternatives considered. 

USCIS considered a narrow 

construction for implementation of the 

CNMI-only nonimmigrant investor visa 

as required by section (6)(c) of the 

Covenant Act, as added by section 702 

of the CNRA. Possible constructions 

analyzed included limiting which 

investor-based categories under current 

CNMI law would be permitted to 

become CNMI E–2 Investors. 

Specifically, DHS discussed options 

wherein only CNMI perpetual foreign 

investors would be permitted, as well as 

options wherein only long-term 

business permit holders or a 

combination of only perpetual foreign 

investors and long-term business permit 

holders would be permitted. However, 

in light of the potential adverse 

economic impact of such limitations 

and the goal of limiting adverse 

economic impact on the CNMI, these 

narrower options were not chosen. 

USCIS chose the broadest interpretation 

possible, whereby long-term business 

permit holders, foreign investors and 

retiree investors (other than investors 

under a short term program not judged 

to qualify under the CNRA) would be 

eligible for CNMI E–2 Investor status, 

because such an interpretation is most 

in keeping with the mandate to limit 

adverse economic impact. 

(4) The total cost of this regulation to 

investors. 

(a) Fees. 

This regulation will require all foreign 

investors wishing to remain in the 

CNMI to reapply for investor 

registration every two years using 

USCIS Form I–129, Petition for a 

Nonimmigrant Worker. The current 

application fee for this form is $325. 

Additionally, this rule will require 

CNMI investors to provide their 

biometrics and imposes a biometrics fee, 

currently $85. Thus, the total current 

fees for each initial and biennial 

registration are $410 ($325 + $85). Fee 

waivers for inability to pay are 

available. 

(b) Paperwork burden. 

It takes approximately 2.75 hours to 

complete Form I–129, according to the 

instructions to the form. Since most of 

the respondents under this rule will be 

business investors, their average hourly 

costs will be much higher than the 

average hourly costs of the average 

salaried worker. Thus, for the purpose 

of this analysis, USCIS based hourly 

costs on the average hourly salary for 

‘‘chief executives’’ from the Department 

of Labor’s May 2008 National 

Occupational Employment and Wage 

Estimates to determine the cost 

associated with the hours necessary to 

complete the Form I–129. The hourly 

wage for chief executives is $77.13. If 

we multiply $77.13 by 1.4 to account for 

fringe benefits, the hourly cost is 

$107.98. Multiplying $107.98 by the 

2.75 hours required to fill out the I–129 

results in paperwork burden cost per 

form of $296.95 (rounded up to $297). 

However, because of generally lower 

wage levels in the CNMI and because 

some CNMI investors are retirees, this is 

a maximum cost estimate and the likely 

actual cost to investors is expected to be 

lower. 

Additionally, if a foreign investor 

wishes to bring along his or her family 

they will have to complete Form I–539, 

Application to Extend/Change Status. 


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8 2008 GAO Rep., supra note 7. 

9This estimate considers the added time burden 

costs of the new USCIS paperwork but includes no 

similar cost savings from eliminating the paperwork 

burden associated with the CNMI’s current 

program. Thus actual costs savings are likely to be 

greater than estimated here. 

10Minimum wage totals $7.25/hour × 1.4 

(burdened rate) = $10.15/hour. See http:// 

www.dol.gov/whd/Flsa/index.htm. $10.15/hour × 

3.42 hours = $34.71. 11 2008 GAO Rep., supra note 7. 

The current application fee for this form 

is $290 and this form takes 

approximately 45 minutes to complete 

according to the form instructions. If the 

foreign investor fills out this form 

himself, the paperwork cost to complete 

this form is $107.98 × .75, or $80.99 

(rounded up to $81) per investor. 

(c) Cost incurred per foreign investor. 

Adding the estimated paperwork 

burden cost for completing Form I–129 

of $297 to the $410 current application 

and biometrics fees, the total cost 

incurred for each CNMI foreign investor 

to submit the I–129 as required under 

this rule every two years is $707. Since 

re-registration is only required every 

other year, annualized costs to foreign 

investors are $354 ($707/2). 

In addition, the $81 paperwork cost of 

completing the I–539 plus the $290 

application fee equals a total of $371. In 

this case, Form I–539 is being used to 

grant initial status and to extend status 

every two years. This results in an 

annualized cost of $186 ($371/2) for 

foreign investors to complete and 

submit Form I–539 every two years for 

their family. 

In addition, spouses and children 

who wish to receive the same status as 

their foreign investor spouse or parent 

may be required to provide biometrics at 

a current fee of $85 per person. 

According to a recent GAO report, the 

average family in the Northern Mariana 

Islands includes two children.8

However, biometrics are only required 

for children between the ages of 14 and 

21. Therefore, for purposes of analysis, 

we assume that each foreign investor’s 

family will be required to provide 

biometric fees for one spouse and only 

one child for an additional cost of $170. 

This will be required only every other 

year for an average annualized fee of 

$85 ($170/2). Adding this fee to the 

above paperwork costs and fees will 

lead to an annualized cost per investor 

family of $625 ($354 + $186 + $85). 

The above annual estimates represent 

the costs incurred by those investors 

with a spouse and one child between 

the ages of 14 and 21. For those 

investors with a spouse and more than 

one child between the age of 14 and 21, 

these estimates may be too low. For 

those investors, particularly those who 

are retired, these estimates may be too 

high. Lack of data on foreign investors 

prevents us from further refining our 

estimates. 

Under the CNMI government’s former 

immigration authority, foreign investors 

were charged $1,000 every two years or 

$500 per year by the CNMI government. 

CNMI fee setting methodology is 

unknown to USCIS. For this analysis, it 

is assumed that the CNMI fees 

resembled U.S. Government agency 

service and user fees in that they were 

set at the amount necessary to recover 

costs in accordance with Office of 

Management and Budget guidance, and 

were not intended to generate a profit. 

Thus, while fees collected by the CNMI 

for the foreign investor program will no 

longer be collected by the CNMI 

Government, the cost of administering 

that program will not be incurred, 

resulting in a neutral financial effect. To 

the extent that the CNMI government 

used such fees to raise revenue, such 

excess will be lost as a result of this 

rule. 

This final rule replaces the $1,000 fee 

formerly charged every two years by the 

CNMI government under the legal 

authority it possessed prior to the 

transition program effective date. 

Therefore, this rule will raise the foreign 

investor’s annualized direct cost by 

$125 ($625–$500), through the end of 

the transition period in 2014.9 USCIS 

did not estimate the paperwork burden 

associated with completing the requisite 

CNMI application forms. Consequently, 

the $125 annualized direct cost for 

foreign investors is most likely 

overstated. 

Additionally, this rule provides that 

spouses of foreign investors are eligible 

to apply for employment authorization 

documents. This accommodation is a 

significant qualitative benefit for an 

investor’s spouse who needs or wants to 

work while living in the CNMI. If the 

spouse chooses to take advantage of this 

benefit, he or she must file a Form 

I–765, Application for Employment 

Authorization, which requires a current 

fee of $380 and 3.42 hours to complete. 

Since the occupation of these spouses is 

unknown, we use fully burdened 

minimum wage of $10.15 to estimate the 

opportunity cost of completing the form 

at $34.71.10 DHS is unable to accurately 

estimate the number of investors who 

have spouses that will request 

employment authorization, although 

some CNMI E–2 spouses are likely to 

take advantage of this opportunity. 

(5) Number of filings expected. 

USCIS projects that most foreign 

investors plan to re-register their status, 

although a small number of foreign 

investors may be found ineligible. For 

the purpose of this analysis, we assume 

that all current investors will choose to 

re-register. USCIS does not believe the 

relatively low additional annualized 

cost of $125 to foreign investors will 

cause foreign investors not to re-register. 

In 2006–2007, there were 448 longterm business entry permit holders and 

30 foreign investor entry permit holders 

and retiree investor permit holders, 

totaling 478, or approximately 500 

foreign registered investors.11 In its 

recent report, the GAO estimates that 

the number of active and valid longterm business and perpetual foreign 

investor entry permits totaled 506 in 

2008. In another measure, the GAO 

suggests that 448 businesses were 

associated with long-term business 

entry permits and additional 56 

perpetual foreign entry permits were 

associated with 30 businesses. This 

analysis assumes that 500 foreign 

investors would be affected because of 

the constantly changing economic 

environment in CNMI. The annualized 

costs and fees throughout the transition 

period, as discussed above, would be an 

additional $125 per investor for a total 

annualized direct cost of $62,500 ($125 

× 500) for all CNMI foreign investors. 

Foreign investors who travel to and 

from the CNMI will now be required to 

have visas. USCIS, however, is not 

requiring foreign investors who travel to 

the United States to have visas in this 

rule, as that requirement will exist 

irrespective of this rule. Thus the cost 

to obtain a visa is not a cost of this rule 

but rather the cost of the CNRA, and the 

application of Federal immigration laws 

in the CNMI. 

(6) The cost to the Federal 

Government. 

There are no additional costs to the 

Federal Government, because USCIS is 

generally a fee funded agency. USCIS 

will recoup its costs through the 

collection of Form I–129 and Form I– 

539 fees. 

(7) Effects after 2014. 

(a) The CNRA and this rule. 

The CNRA was intended to ensure 

effective border control procedures and 

to properly address national security 

and homeland security concerns by 

extending U.S. immigration law to the 

CNMI, and to maximize the CNMI’s 

potential for future economic and 

business growth under U.S. immigration 

law. This rule establishes temporary 

regulatory provisions to transition the 

CNMI to U.S. immigration law and to 

mitigate harm to the CNMI economy 

before investors in the CNMI are 

required to obtain U.S. immigrant or 


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79272 Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 

12 2008 GAO Rep., supra note 7. 

13See INA section 101(a)(15)(L), 8 U.S.C. 

1101(a)(15)(L); 8 CFR 214.2(l). 

nonimmigrant visa classifications. The 

CNMI investor program established by 

this rule will last until the end of the 

transition program, December 31, 2014, 

by which time the CNMI E–2 Investor 

must apply and be approved for another 

immigrant or nonimmigrant status 

under the INA. It is assumed that the 

data provided by the CNMI and other 

interested parties, gathered by Congress, 

and considered in development and 

passage of the CNRA showed significant 

differences in the nonimmigrant visa 

programs under the INA and the visa 

and certificate programs offered by the 

CNMI. Current foreign workers and 

investors in the CNMI would mostly not 

be eligible for a status under the INA, 

or else legislation of a transition period 

and temporary mitigating regulations as 

proposed under this rule would be 

unnecessary. Thus, while one stated 

goal of the CNRA is the economic and 

business growth of the CNMI, by 

providing a mitigating transition 

program, the legislation implies that 

goal will require at least through 2014 

to be achieved. This rule will operate 

during that time. 

(b) Effect on investors. 

This rule links investment levels to 

those required for CNMI status for a 

long-term business investor at $50,000; 

a perpetual foreign investor at $100,000, 

in an aggregate approved investment in 

excess of $2,000,000, or a minimum of 

$250,000 in a single investment; and, a 

retiree investor at $100,000 in Saipan, 

$75,000 in Tinian or Rota, or $150,000 

elsewhere in the CNMI. To qualify as a 

U.S. E–2 treaty investor with 

nonimmigrant status, the applicant must 

invest a substantial amount of capital in 

a bona fide enterprise in the United 

States, must be seeking entry solely to 

develop and direct the enterprise, and 

must intend to depart the United States 

when the treaty investor status ends. In 

addition, the treaty investor must be a 

national of a country with which the 

United States has a treaty of friendship, 

commerce, or navigation and must be 

entering the United States pursuant to 

treaty provisions. 

There is no accurate way for USCIS to 

estimate for what other visa or 

nonimmigrant status the 500 foreign 

registered investors may qualify. 

However, a review of the CNMI 

eligibility criteria and anecdotal 

evidence indicates that many of them 

would not meet the minimum financial 

investment necessary to be eligible for 

U.S. E–2 status currently. Further, the 

retiree investor permit holders do not 

qualify as U.S. E–2 Investors in their 

current status, notwithstanding that 

they may have access to or be able to 

acquire enough capital to invest and 

qualify. Finally, according to the GAO 

Report, about 18 percent of foreign 

investors in the CNMI are from 

countries with which the United States 

does not have a treaty of friendship, 

commerce, or navigation.12 Thus of the 

500 foreign registered investors in the 

CNMI, many of them will need to spend 

the transition period making themselves 

eligible for another status under the 

INA. Anecdotal evidence indicates that 

at least a few of the affected investors 

from countries without treaties of 

friendship, commerce or navigation 

with the United States may be eligible 

for L–1A executive or managerial visas; 

thus the possibility exists that some of 

these investors may be able to stay in 

the CNMI in another status after the end 

of the transition program on December 

31, 2014.13

(c) Effect on the CNMI economy of the 

CNRA. 

USCIS has not analyzed the precise 

effect of increased or decreased 

investments in the CNMI caused by the 

CNRA. Nevertheless, as indicated 

before, the differences between the 

CNMI foreign investor programs before 

the CNRA took effect and those 

available afterward under the INA are 

certain to change the mix of foreign 

investors eligible for a new status and 

maintaining a presence in the CNMI 

after the end of the transition program 

on December 31, 2014. An immigrant 

investor program, or immigration 

through investment, seeks to promote 

economic growth through increased 

export sales, improved regional 

productivity, creation of new jobs, and 

increased domestic capital investment. 

The presumption is that the investment 

opportunity coupled with the 

opportunity to live in the country 

offering the program offers advantages, 

or at least appears to offer advantages, 

to the investor over investments and 

residence in his or her country of origin. 

Assuming that these goals are generally 

achieved, withdrawal of the alien’s 

investment without substitution of a 

substantially similar investment would, 

at the least, end what positive results 

had been started, and, at the worst, have 

the reverse effect and retard growth, 

sales, productivity, jobs, and 

investment. Thus, if a substantial 

number of the 500 foreign investors in 

the CNMI are required by the CNRA to 

leave, and their investments are not 

maintained or replaced by another equal 

or greater investment, then it will likely 

have a negative impact on the CNMI 

economy. This rule is intended to 

mitigate that impact. 

(8) Benefits. 

CNMI administration of an 

immigration system outside U.S. 

immigration law led to visa system 

abuses in the CNMI. Sen. Rep. No. 110– 

324, at 3 (2008). Given this abuse, there 

are concerns not only for the well being 

of foreign employees working in the 

CNMI, but also for the potential abuse 

of the visa system by those seeking to 

illegally emigrate from the CNMI to 

Guam or elsewhere in the United States. 

Id. at 3–5. This reduces the integrity of 

the U.S. immigration system by 

increasing the ease by which aliens may 

unlawfully enter the United States 

through the CNMI. Federal oversight 

and regulation of CNMI foreign 

investors should help reduce abuse by 

foreign investors in the CNMI and the 

opportunity for aliens to exploit the 

CNMI as an entry point into the United 

States. Id. at 2, 4–5. The Federal 

Government’s assumption of 

responsibility for immigration 

enforcement in the CNMI reduces the 

opportunity for abuse of the CNMI 

immigration regime for illegal access to 

the United States. 

(9) Conclusion. 

This rule responds to a Congressional 

mandate that requires the Federal 

Government to assume responsibility for 

all immigration to the CNMI by foreign 

investors, whether temporary or 

permanent and to implement the special 

E–2 investor provisions of the CNRA in 

the CNMI. This rule will implement this 

mandate and thus contribute to U.S. 

homeland security. USCIS concludes 

that the alternative chosen for this rule 

represents the most cost-effective means 

of implementing its Congressional 

mandate while having the least possible 

negative impact on the CNMI economy. 

C. Regulatory Flexibility Act—Final 

Regulatory Flexibility Analysis 

The Regulatory Flexibility Act of 1980 

(RFA), 5 U.S.C. 601–612, as amended by 

the Small Business Regulatory 

Enforcement Fairness Act of 1996, 

Public Law 104–121, requires Federal 

agencies to consider the impact of their 

regulatory proposals on small entities 

whenever an agency must publish a 

notice of proposed rulemaking. 

Recently, new data concerning the 

CNMI were made available by the U.S. 

Census Bureau. DHS also examined a 

recent U.S. Department of the Interior 

(DOI) report; however the data in that 

report did not apply to this analysis. 

DHS did incorporate some of the overall 


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Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 79273 

14U.S. Department of the Interior, The Secretary 

of the Interior, A Report on the Alien Worker 

Population in the Commonwealth of the Northern 

Mariana Islands, Washington, DC, April 2010, 

available at http://www.doi.gov/oia/reports/ 

042810_FINAL_CNMI_Report.pdf. 

15The 2007 Economic Census of Island Areas was 

released by the Census Bureau on September 1, 

2009. The 2007 Economic Census results for the 

CNMI are available at http://factfinder.census.gov/ 

servlet/FindEconDatasetsServlet?_caller=

geoselect&_ts=291885681264. 

16The 2007 Economic Census data for the CNMI 

is available at http://factfinder.census.gov/servlet/

FindEconDatasetsServlet?_caller=geoselect

_ts=291885681264. 

17This number is smaller than the 500 long-term 

permit holders identified by the GAO report 

referenced earlier. This likely is due to data 

reporting restrictions of the Census Bureau. 

18 23 est. × 42% = 9.66 fewer establishments and 

3,121 employees × 42% = 1,311 fewer employees. 

DOI conclusions later in this analysis.14

Accordingly, DHS has updated this 

analysis to reflect the most recent 

information. In the Initial Regulatory 

Flexibility Analysis (IRFA), DHS 

primarily utilized data from the 2005 

CNMI Household, Income, and 

Expenditures Survey (HIES) to analyze 

the impacts on small entities. Since 

2005, the CNMI economy has 

experienced significant changes; new 

data from the 2007 Economic Census of 

Island Areas show important differences 

in the labor force and business 

establishments.15

1. Objectives of, and Legal Basis for, the 

Final Rule 

On May 8, 2008, President Bush 

signed into law the Consolidated 

Natural Resources Act of 2008 (CNRA), 

Public Law 110–229. Title VII of the 

CNRA extends U.S. immigration laws to 

the CNMI with transition provisions 

unique to the CNMI. The stated purpose 

of the CNRA is to ensure effective 

border control procedures, to properly 

address national security and homeland 

security concerns by extending U.S. 

immigration law to the CNMI, and to 

maximize the CNMI’s potential for 

future economic and business growth. 

48 U.S.C. 1801 note. 

The law also contains several CNMIspecific provisions affecting foreign 

workers and investors during the 

transition period. 48 U.S.C. 1806(b), (c). 

This rule establishes procedures for 

foreign investors in the CNMI to obtain 

nonimmigrant status within the E–2 

treaty investor classification, in 

accordance with the CNRA. 

Additionally, this rule is intended to 

provide a smooth transition for existing 

CNMI investors and to mitigate 

potential adverse consequences of the 

CNRA to the CNMI. 

2. Significant Issues Raised by Public 

Comments in Response to the IRFA 

DHS received a number of comments 

relating to the economic analysis. These 

comments have been addressed in 

section IV(B)(5) (Economic Impact), 

above. 

3. Description and Estimate of the 

Number of Small Entities to Which the 

Rule Will Apply 

a. Regulated entities. 

This rule will directly affect foreign 

investors in the CNMI. As previously 

stated, foreign investors in the past 

could apply for the following CNMI 

entry permits: Foreign investor permits, 

long-term business permits, and retiree 

investor permits. These investors are 

small business owners and this rule 

does not regulate small nonprofits or 

small governmental jurisdictions. 

b. Number of small entities to which 

the final rule will apply. 

This analysis is most concerned with 

the number of business establishments 

owned by foreign investors, the number 

of workers they employ, and the 

revenue levels of those entities. This 

analysis is based on data from the 2007 

Economic Census of Island Areas as we 

believe they are the best data publicly 

available.16

According to the 2007 Economic 

Census of Island Areas, there were 1,191 

business establishments in the CNMI, 

and 365 of these establishments were 

owned by foreign investors.17 Table 1 

outlines the pertinent statistics on these 

foreign-owned businesses. 

TABLE 1—FOREIGN-OWNED BUSINESSES IN THE CNMI 

Industry name 

(NAICS) # Est. # Emp. Avg emp. Avg sales/receipts SBA guideline 

Total CNMI (all sectors & est.) ............................................. 1191 22,622 19 $1,078,243 

Total Foreign-owned Est ...................................................... 365 9,663 26 1,149,214 

Foreign-owned by sector 

Construction (23) .................................................................. 17 165 10 379,941 $7 to $33 million. 

Manufacturing (31–33) ......................................................... 23 3,121 136 2,831,696 500–1,500 employees. 

Wholesale (42) ..................................................................... 18 168 9 1,104,444 100 employees. 

Retail (44–45) ....................................................................... 77 785 10 660,727 $7 to $29 million. 

Real Estate (53) ................................................................... 29 103 4 178,517 $7 to $25.5 million. 

Prof Services (54) ................................................................ 16 88 6 169,063 $4.5 to $27 million. 

Admin/Support Services (56) ............................................... 23 245 11 414,043 $4.5 to $35.5 million. 

Educational Services (61) .................................................... 28 83 3 76,500 $7 to $35.5 million. 

Arts & Entertain (71) ............................................................ 20 268 13 482,850 $7 million. 

Accomm. & Food Services (72) ........................................... 68 2,661 39 1,367,735 $7 to $20.5 million. 

Other Services (81) .............................................................. 25 256 10 259,280 $7 to $25 million. 

Table 1 illustrates the fact that all 

foreign-owned businesses in the CNMI 

are small entities by comparing the 

average number of employees per 

establishment or the average receipts/ 

sales/revenue per establishment to the 

size guidelines outlined by the Small 

Business Administration. 

It is important to note that the 

manufacturing numbers reported in 

Table 1 are certainly changed today. The 

2007 data indicated that the apparel 

sector of the manufacturing industry in 

the CNMI accounted for 42% of the 

entire manufacturing industry. Now that 

apparel manufacturing in the CNMI has 

ceased operations, we estimate that 10 

foreign-owned apparel manufacturing 

establishments have ceased operations 

and this results in a decrease of about 

1,311 employees.18 One promising 

development in the CNMI was 

highlighted by a recent Department of 

the Interior study that reported a 

number of the industries listed above 

are now forecasting employment growth 


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79274 Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 

19U.S. Department of the Interior, A Report on 

the Alien Worker Population in the Commonwealth 

of the Northern Mariana Islands, Wash., DC (Apr. 

2010), available at http://www.doi.gov/oia/reports/ 

042810_FINAL_CNMI_Report.pdf. 

20 $125/$1,149,214 (average annual receipts/ 

revenue of foreign-owned establishments) = 

0.01087%. 

by 2014.19 As of 2007, the foreignowned small businesses that will be 

impacted by this rule employed about 

43% of workers in the CNMI. This 

segment certainly represents a 

substantial number of employers and 

business establishments in the CNMI. 

4. Reporting, Recordkeeping and Other 

Compliance Requirements 

a. Significance of Impact. 

As discussed above, the average 

petitioner will be required to incur 

annualized fee and paperwork burden 

costs of $625 ($354 for investors + $186 

for family members’ I–539 + $85 for 

biometrics), and the CNMI government 

will not charge its $1,000 fee every two 

years. Therefore, at most this rule will 

raise the foreign investor’s annualized 

costs by $125 ($625¥$500) each year of 

the transition. The increased annualized 

cost for each investor due to this rule 

represents less than 0.01087% of 

average annual receipts in the CNMI for 

foreign owned establishments (see Table 

1 for average sales/receipt 

information).20 Therefore, USCIS 

believes that this additional fee and 

paperwork burden should have little to 

no impact on the decision of foreign 

investors to remain in the CNMI. 

b. Paperwork Reduction Act—new 

reporting requirement. 

Foreign investors who wish to reside 

in the CNMI will have to apply in the 

first year and reapply every two years 

using USCIS Form I–129, Petition for a 

Nonimmigrant Worker. This is a new 

requirement within the meaning of the 

Paperwork Reduction Act. As stated 

above, Form I–129 results in paperwork 

burden cost per form of $297. 

Additionally, a foreign investor who 

brings along his or her family will have 

to complete Form I–539, Application to 

Extend/Change Status. The paperwork 

cost to complete this form is $81. If the 

spouse of a foreign investor chooses to 

seek employment, he or she must file a 

Form I–765, Application for 

Employment Authorization, which has a 

paperwork burden estimated at $35.47 

for the spouses taking advantage of this 

option. This rule does not require 

professional skills for the preparation of 

reports or records. 

5. Steps Taken To Minimize Significant 

Adverse Economic Impacts on Small 

Entities 

Throughout the development of the 

rule, DHS attempted to gather 

information regarding the economic 

impact of the rule’s requirements on 

foreign investors. DHS considered 

limiting the categories of investors 

under previous CNMI law who would 

be permitted to become CNMI E–2 

Investors. However, in light of the goal 

of limiting adverse economic impact on 

the CNMI, USCIS chose the broadest 

interpretation possible, whereby longterm business permit holders, foreign 

investors and retiree investors (other 

than investors under a short term 

program not judged to qualify under the 

CNRA) would be eligible for CNMI 

E–2 Investor status, because such an 

interpretation is most in keeping with 

the mandate to limit adverse economic 

impact. 

Since all of the entities directly 

affected by this rule are small, this rule 

provides no different requirements or 

any exemption from coverage of the rule 

based on entity size. It should be noted, 

however, that small entities may request 

a waiver of their fees under this rule, if 

they do not have the ability to pay. 

Commenters recommended a few 

alternatives to the proposed rule. These 

include: Extension of transition period; 

elimination of the $150,000 minimum 

investment requirement; and change in 

the definition of continuous residence. 

(a) Extension of Transition Period: 

One commenter objected to the DHS 

interpretation of the CNRA that any 

extension of the transition period by the 

Secretary of Labor will only extend the 

transitional worker visa and not the 

CNMI-only investor visa. As previously 

discussed, the commenter’s 

interpretation of the CNRA is incorrect. 

Therefore, DHS is unable to adopt this 

alternative approach. 

(b) Minimum Investment for LongTerm Business Investors: 

Three commenters wrote that the 

$150,000 minimum investment 

requirement for Long-Term Business 

Investors will exclude investors who 

were granted Long-Term Business 

Certificates by the CNMI at a lower 

investment minimum of $50,000. As 

previously discussed, DHS found that 

these comments had merit. The final 

rule therefore has been amended to 

include those investors who were 

granted long-term business certificates 

with a minimum investment of $50,000, 

as long as they continued to hold that 

status on the transition program 

effective date and are otherwise eligible. 

This modification of the proposed 

rule furthers the goal of DHS and the 

intent of Congress to minimize potential 

adverse economic and fiscal effects of 

the CNRA on the CNMI and small 

entities by including all CNMI long-term 

investor classifications. 

(c) Continuous Residence: 

One commenter wrote that the 

proposed rule’s residence requirement 

will be unnecessarily rigorous for those 

investors who do not reside in the CNMI 

and proposed reducing the requirement 

to two months. Another commenter 

wrote that the residence requirement 

should apply at the start of the 

transition period. As previously 

discussed, DHS does not believe that 

adopting these suggestions would be 

consistent with the CNRA’s continuous 

residence requirement. 

D. Executive Order 13132 

Executive Order 13132 requires each 

Federal agency to develop a process to 

ensure ‘‘meaningful and timely input by 

State and local officials in the 

development of regulatory policies that 

have Federalism implications.’’ The 

phrase ‘‘policies that have Federalism 

implications’’ is defined in the 

Executive Order to include regulations 

that have ‘‘substantial direct effects on 

the States, on the relationship between 

the national government and the States, 

or on the distribution of power and 

responsibilities among the various 

levels of government.’’ USCIS has 

considered the Federalism implications 

of this rule under the Executive Order. 

Executive Order 13132 is based upon 

the role and authorities of ‘‘States’’ under 

the U.S. Constitution. The CNMI is not 

a ‘‘State’’ as defined by section 1(b) of 

Executive Order 13132 to include ‘‘the 

States of the United States of America, 

individually or collectively, and, where 

relevant, to State governments, 

including units of local government and 

other political subdivisions established 

by the States.’’ Therefore, USCIS has 

determined that no actions are required 

under Executive Order 13132. USCIS 

has, however, solicited the input of the 

CNMI government and other CNMI 

stakeholders on issues relating to 

treatment of investors under Public Law 

110–229. 

E. Paperwork Reduction Act 

Under the Paperwork Reduction Act, 

44 U.S.C. 3501 et seq., all Departments 

are required to submit to the Office of 

Management and Budget (OMB), for 

review and approval, any reporting or 

recordkeeping requirements inherent in 

a regulatory action. The information 

collection requirements contained in 

this rule, Form I–129, Form I–539, and 

Form I–765, have been previously 

approved for use by OMB. The OMB 


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control numbers for these collections 

are 1615–0009, 1615–0003, and 1615– 

0040 respectively. The evidentiary 

requirements contained in this rule at 8 

CFR 214.2(e)(23)(vi) are not new 

requirements and are currently 

contained on the instructions to Form 

I–129. Accordingly, these evidentiary 

requirements will not add to the burden 

for completing Form I–129 and 

Supplement E. 

This final rule requires minor changes 

to: 

• Form I–539, Application to Extend/ 

Change Nonimmigrant Status (OMB 

Control No. 1615–0003) and 

• Form I–129, Petition for 

Nonimmigrant Worker (OMB Control 

No. 1615–0009). 

Accordingly, USCIS has prepared 

OMB 83–Cs (correction worksheets) for 

both these forms to reflect nonsubstantive changes, and has submitted 

them to OMB with this final rule. 

It is estimated that there will be a 

slight increase in the number of filings 

of Form I–129 (due to the new 

requirement to have foreign investors 

who wish to reside in the CNMI submit 

Form I–129) and Form I–539. However, 

the current OMB-approved annual 

burden hours are sufficient to 

encompass the filings added as a result 

of this rule. 

List of Subjects 

8 CFR Part 103 

Administrative practice and 

procedure, Authority delegations 

(Government agencies), Freedom of 

information, Immigration, Privacy, 

Reporting and recordkeeping 

requirements, Surety bonds. 

8 CFR Part 214 

Administrative practice and 

procedure, Aliens, Employment, 

Foreign officials, Health professions, 

Reporting and recordkeeping 

requirements, Students. 

8 CFR Part 274a 

Administrative practice and 

procedure, Aliens, Employment, 

Penalties, Reporting and recordkeeping 

requirements. 

Accordingly, chapter I of title 8 of the 

Code of Federal Regulations is amended 

as follows: 

PART 103—POWERS AND DUTIES; 

AVAILABILITY OF RECORDS 

■ 1. The authority citation for part 103 

is revised to read as follows: 

Authority: 5 U.S.C. 301, 552, 552a; 8 

U.S.C. 1101, 1103, 1304, 1356; 31 U.S.C. 

9701; 48 U.S.C. 1806; Public Law 107–296, 

116 Stat. 2135 (6 U.S.C. 1 et seq.), E.O. 12356, 

47 FR 14874, 15557, 3 CFR, 1982 Comp., p. 

166; 8 CFR part 2. 

■ 2. Section 103.7 is amended by: 

■ a. Removing the word ‘‘and’’ at the end 

of paragraph (c)(3)(xvii); 

■ b. Removing the ‘‘.’’ at the end of 

paragraph (c)(3)(xviii) and adding a ‘‘, 

and’’ in its place; and by 

■ c. Adding a new paragraph (c)(3)(xix) 

to read as follows: 

§ 103.7 Fees. 

* * * * * 

(c) * * * 

(3) * * * 

(xix) Petition for Nonimmigrant 

Worker (Form I–129) or Application to 

Extend/Change Nonimmigrant Status 

(Form I–539), only in the case of an 

alien applying for E–2 CNMI Investor 

nonimmigrant status under 8 CFR 

214.2(e)(23). 

* * * * * 

PART 214—NONIMMIGRANT CLASSES 

■ 1. The authority citation for part 214 

is revised to read as follows: 

Authority: 8 U.S.C. 1101, 1102, 1103, 

1182, 1184, 1186a, 1187, 1221, 1281, 1282, 

1301–1305 and 1372; sec. 643, Pub. L. 104– 

208, 110 Stat. 3009–708; Public Law 106– 

386, 114 Stat. 1477–1480; section 141 of the 

Compacts of Free Association with the 

Federated States of Micronesia and the 

Republic of the Marshall Islands, and with 

the Government of Palau, 48 U.S.C. 1901 

note, and 1931 note, respectively; 48 U.S.C. 

1806; 8 CFR part 2. 

■ 2. Section 214.2 is amended by adding 

a new paragraph (e)(23) to read as 

follows: 

§ 214.2 Special requirements for 

admission, extension, and maintenance of 

status. 

* * * * * 

(e) * * * 

(23) Special procedures for classifying 

foreign investors in the Commonwealth 

of the Northern Mariana Islands (CNMI) 

as E–2 nonimmigrant treaty investors 

under title VII of the Consolidated 

Natural Resources Act of 2008 (Pub. L. 

110–229), 48 U.S.C. 1806. 

(i) E–2 CNMI Investor eligibility. 

During the period ending on January 18, 

2013, an alien may, upon application to 

the Secretary of Homeland Security, be 

classified as a CNMI-only nonimmigrant 

treaty investor (E–2 CNMI Investor) 

under section 101(a)(15)(E)(ii) of the Act 

if the alien: 

(A) Was lawfully admitted to the 

CNMI in long-term investor status under 

the immigration laws of the CNMI 

before the transition program effective 

date and had that status on the 

transition program effective date; 

(B) Has continuously maintained 

residence in the CNMI; 

(C) Is otherwise admissible to the 

United States; and 

(D) Maintains the investment or 

investments that formed the basis for 

such long-term investment status. 

(ii) Definitions. For purposes of 

paragraph (e)(23) of this section, the 

following definitions apply: 

(A) Approved investment or residence 

means an investment or residence 

approved by the CNMI government. 

(B) Approval letter means a letter 

issued by the CNMI government 

certifying the acceptance of an approved 

investment subject to the minimum 

investment criteria and standards 

provided in 4 N. Mar. I. Code section 

5941 et seq. (long-term business 

certificate), 4 N. Mar. I. Code section 

5951 et seq. (foreign investor certificate), 

and 4 N. Mar. I. Code section 50101 et 

seq. (foreign retiree investment 

certificate). 

(C) Certificate means a certificate or 

certification issued by the CNMI 

government to an applicant whose 

application has been approved by the 

CNMI government. 

(D) Continuously maintained 

residence in the CNMI means that the 

alien has maintained his or her 

residence within the CNMI since being 

lawfully admitted as a long-term 

investor and has been physically 

present therein for periods totaling at 

least half of that time. Absence from the 

CNMI for any continuous period of 

more than six months but less than one 

year after such lawful admission shall 

break the continuity of such residence, 

unless the subject alien establishes to 

the satisfaction of DHS that he or she 

did not in fact abandon residence in the 

CNMI during such period. Absence from 

the CNMI for any period of one year or 

more during the period for which 

continuous residence is required shall 

break the continuity of such residence. 

(E) Public organization means a CNMI 

public corporation or an agency of the 

CNMI government. 

(F) Transition period means the 

period beginning on the transition 

program effective date and ending on 

December 31, 2014. 

(iii) Long-term investor status. Longterm investor status under the 

immigration laws of the CNMI includes 

only the following investor 

classifications under CNMI immigration 

laws as in effect on or before November 

27, 2009: 

(A) Long-term business investor. An 

alien who has an approved investment 

of at least $50,000 in the CNMI, as 

evidenced by a Long-Term Business 

Certificate. 


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79276 Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 

(B) Foreign investor. An alien in the 

CNMI who has invested either a 

minimum of $100,000 in an aggregate 

approved investment in excess of 

$2,000,000, or a minimum of $250,000 

in a single approved investment, as 

evidenced by a Foreign Investment 

Certificate. 

(C) Retiree investor. An alien in the 

CNMI who: 

(1) Is over the age of 55 years and has 

invested a minimum of $100,000 in an 

approved residence on Saipan or 

$75,000 in an approved residence on 

Tinian or Rota, as evidenced by a 

Foreign Retiree Investment Certification; 

or 

(2) Is over the age of 55 years and has 

invested a minimum of $150,000 in an 

approved residence to live in the CNMI, 

as evidenced by a Foreign Retiree 

Investment Certificate. 

(iv) Maintaining investments. An 

alien in long-term investor status under 

the immigration laws of the CNMI is 

maintaining his or her investments if 

that alien investor is in compliance with 

the terms upon which the investor 

certificate was issued. 

(v) Filing procedures. An alien 

seeking classification under E–2 CNMI 

Investor nonimmigrant status must file 

an application for E–2 CNMI investor 

nonimmigrant status, along with 

accompanying evidence, with USCIS in 

accordance with the form instructions 

before January 18, 2013. An application 

filed after the filing date deadline will 

be rejected. 

(vi) Appropriate documents. 

Documentary evidence establishing 

eligibility for E–2 CNMI nonimmigrant 

investor status is required. 

(A) Required evidence of admission 

includes a valid unexpired foreign 

passport and a properly endorsed CNMI 

admission document (e.g., entry permit 

or certificate) reflecting lawful 

admission to the CNMI in long-term 

business investor, foreign investor, or 

retiree foreign investor status. 

(B) Required evidence of long-term 

investor status includes: 

(1) An unexpired Long-Term Business 

Certificate, in the case of an alien in 

long-term business investor status. 

(2) An unexpired Foreign Investment 

Certificate, in the case of an alien in 

foreign investor status. 

(3) A Foreign Retiree Investment 

Certification or a Foreign Retiree 

Investment Certificate, in the case of an 

alien in retiree investor status. 

(C) Required evidence that the longterm investor is maintaining his or her 

investment includes all of the following, 

as applicable: 

(1) An approval letter issued by the 

CNMI government. 

(2) Evidence that capital has been 

invested, including bank statements 

showing amounts deposited in CNMI 

business accounts, invoices, receipts or 

contracts for assets purchased, stock 

purchase transaction records, loan or 

other borrowing agreements, land 

leases, financial statements, business 

gross tax receipts, or any other 

agreements supporting the application. 

(3) Evidence that the applicant has 

invested at least the minimum amount 

required, including evidence of assets 

which have been purchased for use in 

the enterprise, evidence of property 

transferred from abroad for use in the 

enterprise, evidence of monies 

transferred or committed to be 

transferred to the new or existing 

enterprise in exchange for shares of 

stock, any loan or mortgage, promissory 

note, security agreement, or other 

evidence of borrowing which is secured 

by assets of the applicant. 

(4) A comprehensive business plan for 

new enterprises. 

(5) Articles of incorporation, by-laws, 

partnership agreements, joint venture 

agreements, corporate minutes and 

annual reports, affidavits, declarations, 

or certifications of paid-in capital. 

(6) Current business licenses. 

(7) Foreign business registration 

records, recent tax returns of any kind, 

evidence of other sources of capital. 

(8) A listing of all resident and 

nonresident employees. 

(9) A listing of all holders of business 

certificates for the business 

establishment. 

(10) A listing of all corporations in 

which the applicant has a controlling 

interest. 

(11) In the case of a holder of a 

certificate of foreign investment, copies 

of annual reports of investment 

activities in the CNMI containing 

sufficient information to determine 

whether the certificate holder is under 

continuing compliance with the 

standards of issuance, accompanied by 

annual financial audit reports 

performed by an independent certified 

public accountant. 

(12) In the case of an applicant who 

is a retiree investor, evidence that he or 

she has an interest in property in the 

CNMI (e.g., lease agreement), evidence 

of the value of the property interest (e.g., 

an appraisal regarding the value of the 

property), and, as applicable, evidence 

of the value of the improvements on the 

property (e.g., receipts or invoices of the 

costs of construction, the amount paid 

for a preexisting structure, or an 

appraisal of improvements). 

(vii) Physical presence in the CNMI. 

Physical presence in the CNMI at the 

time of filing or during the pendency of 

the application is not required, but an 

application may not be filed by, or E– 

2 CNMI Investor status granted to, any 

alien present in U.S. territory other than 

in the CNMI. If an alien with CNMI 

long-term investor status departs the 

CNMI on or after the transition program 

effective date but before being granted 

E–2 CNMI Investor status, he or she may 

not be re-admitted to the CNMI without 

a visa or appropriate inadmissibility 

waiver under the U.S. immigration laws. 

If USCIS grants E–2 CNMI Investor 

nonimmigrant classification to an alien 

who is not physically present in the 

CNMI at the time of the grant, such alien 

must obtain an E–2 CNMI Investor 

nonimmigrant visa at a consular office 

abroad in order to seek admission to the 

CNMI in E–2 CNMI Investor status. 

(viii) Information for background 

checks. USCIS may require an applicant 

for E–2 CNMI Investor status, including 

but not limited to any applicant for 

derivative status as a spouse or child, to 

submit biometric information. An 

applicant present in the CNMI must pay 

or obtain a waiver of the biometric 

services fee described in 8 CFR 103.7(b) 

for any biometric services provided, 

including but not limited to reuse of 

previously provided biometric 

information for background checks. 

(ix) Denial. A grant of E–2 CNMI 

Investor status is a discretionary 

determination, and the application may 

be denied for failure of the applicant to 

demonstrate eligibility or for other good 

cause. Denial of the application may be 

appealed to the USCIS Administrative 

Appeals Office or any successor body. 

(x) Spouse and children of an E–2 

CNMI Investor. 

(A) Classification. The spouse and 

children of an E–2 CNMI Investor 

accompanying or following-to-join the 

principal alien, if otherwise admissible, 

may receive the same classification as 

the principal alien. The nationality of a 

spouse or child of an E–2 CNMI investor 

is not material to the classification of 

the spouse or child. 

(B) Employment authorization. The 

spouse of an E–2 CNMI Investor 

lawfully admitted in the CNMI in E–2 

CNMI Investor nonimmigrant status, 

other than the spouse of an E–2 CNMI 

investor who obtained such status based 

upon a Foreign Retiree Investment 

Certificate, is eligible to apply for 

employment authorization under 8 CFR 

274a.12(c)(12) while in E–2 CNMI 

Investor nonimmigrant status. 

Employment authorization acquired 

under this paragraph is limited to 

employment in the CNMI only. 

(xi) Terms and conditions of E–2 

CNMI Investor nonimmigrant status. 


jlentini on DSKJ8SOYB1PROD with RULES
Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 79277 

(A) Nonimmigrant status. E–2 CNMI 

Investor nonimmigrant status and any 

derivative status are only applicable in 

the CNMI. Entry, employment, and 

residence in the rest of the United States 

(including Guam) require the 

appropriate visa or visa waiver 

eligibility. An E–2 CNMI Investor who 

enters, attempts to enter or attempts to 

travel to any other part of the United 

States without the appropriate visa or 

visa waiver eligibility, or who violates 

conditions of nonimmigrant stay 

applicable to any such authorized status 

in any other part of the United States, 

will be deemed to have violated the 

terms and conditions of his or her E–2 

CNMI Investor status. An E–2 CNMI 

Investor who departs the CNMI will 

require an E–2 CNMI investor visa for 

readmission to the CNMI as an E–2 

CNMI Investor. 

(B) Employment authorization. An 

alien with E–2 CNMI Investor 

nonimmigrant status is only 

employment authorized in the CNMI for 

the enterprise that is the basis for his or 

her CNMI Foreign Investment Certificate 

or Long-Term Business Certificate, to 

the extent that such Certificate 

authorized such activity. An alien with 

E–2 CNMI Investor nonimmigrant status 

based upon a Foreign Retiree Investor 

Certificate is not employment 

authorized. 

(C) Changes in E–2 CNMI investor 

nonimmigrant status. If there are any 

substantive changes to an alien’s 

compliance with the terms and 

conditions of qualification for E–2 

CNMI Investor nonimmigrant status, the 

alien must file a new application for E– 

2 CNMI Investor nonimmigrant status, 

in accordance with the appropriate form 

instructions to request an extension of 

stay in the United States. Prior approval 

is not required if corporate changes 

occur that do not affect a previously 

approved employment relationship, or 

are otherwise non-substantive. 

(D) Unauthorized change of 

employment. An unauthorized change 

of employment to a new employer will 

constitute a failure to maintain status 

within the meaning of section 

237(a)(1)(C)(i) of the Act. 

(E) Periods of admission. (1) An E–2 

CNMI Investor may be admitted for an 

initial period of not more than two 

years. 

(2) The spouse and children 

accompanying or following-to-join an 

E–2 CNMI Investor may be admitted for 

the period during which the principal 

alien is in valid E–2 CNMI Investor 

nonimmigrant status. The temporary 

departure from the United States of the 

principal E–2 CNMI Investor shall not 

affect the derivative status of the 

dependent spouse and children, 

provided the familial relationship 

continues to exist and the principal 

alien remains eligible for admission as 

an E–2 CNMI Investor. 

(xii) Extensions of stay. Requests for 

extensions of E–2 CNMI Investor 

nonimmigrant status may be granted in 

increments of not more than two years, 

until the end of the transition period. To 

request an extension of stay, an E–2 

CNMI Investor must file with USCIS an 

application for extension of stay, with 

required accompanying documents, in 

accordance with the appropriate form 

instructions. To qualify for an extension 

of E–2 CNMI Investor nonimmigrant 

status, each alien must demonstrate: 

(A) Continuous maintenance of the 

terms and conditions of E–2 CNMI 

Investor nonimmigrant status; 

(B) Physical presence in the CNMI at 

the time of filing the application for 

extension of stay; and 

(C) That he or she did not leave 

during the pendency of the application. 

(xiii) Change of status. An alien 

lawfully admitted to the United States 

in another valid nonimmigrant status 

who is continuing to maintain that 

status may apply to change 

nonimmigrant status to E–2 CNMI 

Investor in accordance with paragraph 

(e)(21) of this section, if otherwise 

eligible, including but not limited to 

having been in CNMI long-term investor 

status on the transition date and within 

the period provided by paragraph 

(e)(23)(v) of this section. 

(xiv) Expiration of initial transition 

period. Upon expiration of the initial 

transition period, the E–2 CNMI 

Investor nonimmigrant status will 

automatically terminate. 

(xv) Fee waiver. An alien applying for 

E–2 CNMI Investor nonimmigrant status 

is eligible for a waiver of the required 

fee for an application based upon 

inability to pay as provided by 8 CFR 

103.7(c)(1). 

(xvi) Waiver of inadmissibility for 

applicants present in the CNMI. An 

applicant for E–2 CNMI Investor 

nonimmigrant status, who is otherwise 

eligible for such status and otherwise 

admissible to the United States, and 

who has provided all appropriate 

documents as described in paragraph 

(e)(23)(vi) of this section, may be 

granted a waiver of inadmissibility 

under section 212(d)(3)(A)(ii) of the Act, 

including the grounds of inadmissibility 

described in sections 212(a)(6)(A)(i) (to 

the extent such grounds arise solely 

because of the alien’s presence in the 

CNMI on November 28, 2009) and 

212(a)(7)(B)(i)(II) of the Act, for the 

purpose of granting the E–2 CNMI 

Investor nonimmigrant status. Such 

waiver may be granted without 

additional form or fee required. In the 

case of an application by a spouse or 

child as described in paragraph 

(e)(23)(x) of this section who is present 

in the CNMI, the appropriate documents 

required for such waiver are a valid 

unexpired passport and evidence that 

the spouse or child is lawfully present 

in the CNMI under section 1806(e) of 

title 48, U.S. Code (which may include 

evidence of a grant of parole by USCIS 

or by the Department of Homeland 

Security pursuant to a grant of advance 

parole by USCIS in furtherance of 

section 1806(e) of title 48, U.S. Code). 

* * * * * 

PART 274a—CONTROL OF 

EMPLOYMENT OF ALIENS 

■ 3. The authority citation for part 274a 

is revised to read as follows: 

Authority: 8 U.S.C. 1101, 1103, 1324a; 48 

U.S.C. 1806; 8 CFR part 2. 

■ 4. Section 274a.12 is amended by: 

■ a. Adding a new paragraph (b)(22); 

and by 

■ b. Adding a new paragraph (c)(12) to 

read as follows: 

§ 274a.12 Classes of aliens authorized to 

accept employment. 

* * * * * 

(b) * * * 

(22) An alien in E–2 CNMI Investor 

nonimmigrant status pursuant to 8 CFR 

214.2(e)(23). An alien in this status may 

be employed only by the qualifying 

company through which the alien 

attained the status. An alien in E–2 

CNMI Investor nonimmigrant status 

may be employed only in the 

Commonwealth of the Northern Mariana 

Islands for a qualifying entity. An alien 

who attained E–2 CNMI Investor 

nonimmigrant status based upon a 

Foreign Retiree Investment Certificate or 

Certification is not employmentauthorized. Employment authorization 

does not extend to the dependents of the 

principal investor (also designated E–2 

CNMI Investor nonimmigrants) other 

than those specified in paragraph (c)(12) 

of this section; 

* * * * * 

(c) * * * 

(12) An alien spouse of a long-term 

investor in the Commonwealth of the 

Northern Mariana Islands (E–2 CNMI 

Investor) other than an 

E–2 CNMI investor who obtained such 

status based upon a Foreign Retiree 

Investment Certificate, pursuant to 8 

CFR 214.2(e)(23). An alien spouse of an 


jlentini on DSKJ8SOYB1PROD with RULES
79278 Federal Register / Vol. 75, No. 243 / Monday, December 20, 2010 / Rules and Regulations 

1 12 U.S.C. 2903. 

2See 12 CFR parts 25, 228, 345, and 563e. 

E–2 CNMI Investor is eligible for 

employment in the CNMI only; 

* * * * * 

Janet Napolitano, 

Secretary. 

[FR Doc. 2010–31652 Filed 12–17–10; 8:45 am] 

BILLING CODE 9111–97–P 

DEPARTMENT OF THE TREASURY 

Office of the Comptroller of the 

Currency 

12 CFR Part 25 

[Docket ID OCC–2010–0021] 

RIN 1557–AD34 

FEDERAL RESERVE SYSTEM 

12 CFR Part 228 

[Docket No. R–1387] 

RIN 7100–AD50 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Part 345 

RIN 3064–AD60 

DEPARTMENT OF THE TREASURY 

Office of Thrift Supervision 

12 CFR Part 563e 

[Docket ID OTS–2010–0031] 

RIN 1550–AC42 

Community Reinvestment Act 

Regulations 

AGENCIES: Office of the Comptroller of 

the Currency, Treasury (OCC); Board of 

Governors of the Federal Reserve 

System (Board); Federal Deposit 

Insurance Corporation (FDIC); Office of 

Thrift Supervision, Treasury (OTS). 

ACTION: Joint final rule. 

SUMMARY: The OCC, the Board, the 

FDIC, and the OTS (collectively, ‘‘the 

agencies’’) are adopting revisions to our 

rules implementing the Community 

Reinvestment Act (CRA). The agencies 

are revising the term ‘‘community 

development’’ to include loans, 

investments, and services by financial 

institutions that support, enable, or 

facilitate projects or activities that meet 

the ‘‘eligible uses’’ criteria described in 

Section 2301(c) of the Housing and 

Economic Recovery Act of 2008 (HERA), 

as amended, and are conducted in 

designated target areas identified in 

plans approved by the United States 

Department of Housing and Urban 

Development (HUD) under the 

Neighborhood Stabilization Program 

(NSP). The final rule provides favorable 

CRA consideration of such activities 

that, pursuant to the requirements of the 

program, benefit low-, moderate-, and 

middle-income individuals and 

geographies in NSP target areas 

designated as ‘‘areas of greatest need.’’ 

Covered activities are considered both 

within an institution’s assessment 

area(s) and outside of its assessment 

area(s), as long as the institution has 

adequately addressed the community 

development needs of its assessment 

area(s). Favorable consideration under 

the revised rule will be available until 

no later than two years after the last date 

appropriated funds for the program are 

required to be spent by the grantees. The 

agencies will provide reasonable 

advance notice to institutions in the 

Federal Register regarding termination 

of the rule once a date certain has been 

identified. 

DATES: Effective Date: This joint final 

rule is effective January 19, 2011. 

FOR FURTHER INFORMATION CONTACT: 

OCC: Michael S. Bylsma, Director, or 

Margaret Hesse, Special Counsel, 

Community and Consumer Law 

Division, (202) 874–5750; or Greg Nagel 

or Brian Borkowicz, National Bank 

Examiners, Compliance Policy, (202) 

874–4428; Office of the Comptroller of 

the Currency, 250 E Street, SW., 

Washington, DC 20219. 

Board: Paul J. Robin, Manager, 

Reserve Bank Oversight and Policy, 

(202) 452–3140; or Jamie Z. Goodson, 

Attorney, (202) 452–3667; Division of 

Consumer and Community Affairs, 

Board of Governors of the Federal 

Reserve System, 20th Street and 

Constitution Avenue, NW., Washington, 

DC 20551. 

FDIC: Janet Gordon, Senior Policy 

Analyst, Division of Supervision and 

Consumer Protection, (202) 898–3850 or 

Richard Schwartz, Counsel, Legal 

Division, (202) 898–7424; Federal 

Deposit Insurance Corporation, 550 17th 

Street, NW., Washington, DC 20429. 

OTS: Stephanie M. Caputo, Senior 

Compliance Program Analyst, 

Compliance and Consumer Protection, 

(202) 906–6549; or Richard Bennett, 

Senior Compliance Counsel, 

Regulations and Legislation Division, 

(202) 906–7409; Office of Thrift 

Supervision, 1700 G Street, NW., 

Washington, DC 20552. 

SUPPLEMENTARY INFORMATION: 

Background 

The Community Reinvestment Act 

(CRA) requires the Federal banking and 

thrift regulatory agencies to assess the 

record of each insured depository 

institution in helping to meet the credit 

needs of its entire community, 

including low- and moderate-income 

neighborhoods, consistent with the safe 

and sound operation of the institution, 

and to take that record into account 

when the agency evaluates an 

application by the institution for a 

deposit facility.1 The agencies have 

promulgated substantially similar 

regulations to implement the 

requirements of the CRA.2

There is a pressing need to provide 

housing-related assistance to stabilize 

communities affected by high levels of 

foreclosures. High levels of foreclosures 

have devastated communities and are 

projected to continue into 2012 and 

beyond with damaging spillover effects 

for low- and moderate-income census 

tracts, as well as middle-income census 

tracts, affected by high levels of loan 

delinquencies and foreclosures. Among 

the many consequences of high levels of 

foreclosures are growing inventories of 

vacant foreclosed properties and 

institution ‘‘other real estate owned’’ 

(OREO) properties, depreciating home 

values, declining property tax bases, 

and destabilization of communities 

directly affected by high levels of 

foreclosures and of adjacent and 

surrounding neighborhoods. 

Neighborhood Stabilization Program 

(NSP) 

Congress recognized the need to 

provide emergency assistance to address 

these problems with the establishment 

of the Neighborhood Stabilization 

Program (NSP) through Division B, Title 

III, of the Housing and Economic 

Recovery Act of 2008 (HERA), Public 

Law 110–289 (2008). Under HERA, 

emergency funds (‘‘NSP1’’) totaling 

nearly $4 billion for the redevelopment 

of abandoned and foreclosed properties 

were distributed to States and localities 

with the greatest need for such funds 

according to a formula based on the 

number and percentage of home 

foreclosures, the number and percentage 

of homes financed by a subprime 

mortgage-related loan, and the number 

and percentage of homes in default or 

delinquency in each State or unit of 

general local government. Under NSP1, 

each of the 50 States and Puerto Rico 

received a minimum award of $19.6 

million and 254 local areas received 


jlentini on DSKJ8SOYB1PROD with RULES