Congress Abolishes the INS and Creates the DHS: A Summary of Key Immmigration Legislation in 2002

Like the demolition of dilapidated buildings in a run-down neighborhood to make room for a new skyscraper, Congress legislatively razed numerous federal government agencies in 2002, and replaced them with a yet to be completed Department of Homeland Security (DHS). Through the Homeland Security Act of 2002 (HSA), Congress established the DHS as a cabinet-level department designed to help prevent, protect against, and establish procedures to respond to acts of terrorism on American soil. An estimated 22 federal agencies or agency components will be transferred to the DHS during a transition period that will likely extend into 2004. A dramatic casualty of this restructuring is the Immigration and Naturalization Service (INS).

Although it created far fewer after-shocks in the media than the HSA, Congress also passed the 21st Century Department of Justice Appropriations Authorization Act (DOJ Authorization Act). This act contains several immigration-related provisions, including changes to the American Competitiveness in the 21st Century Act (AC21) regarding the extension of status for H-1B workers past the six-year limit, changes to the Conrad 20 program, less restrictive procedures for the Fifth Preference (EB-5) immigrant visa category for foreign investors, and changes in eligibility for naturalization.

Both of these legislative measures have a broad impact. However, this article will only summarize the parts of these laws that directly affect business immigration. The full text of these bills can be accessed through the Library of Congress THOMAS World Wide Web system. The authors would also like to acknowledge the American Immigration Lawyers Association as the source for much of the information used in this article, particularly for updates, as immigration-related legislation continues to be implemented. A complete list of source material used in this article is attached at the end.

Department of Homeland Security

On November 11, 2002, President Bush enacted the Homeland Security Act of 2002 (H.R. 5005, Public Law No: 107-296), creating the DHS, a cabinet-level department that will absorb the operations of many federal agencies, including the INS. Following nomination by President Bush, the Senate voted 94-0 to confirm Tom Ridge, the current Homeland Security Office Director, as the first Secretary of Homeland Security.

The Department of Homeland Security has been organized into four divisions: Emergency Response and Preparedness is responsible to ensure the preparedness of the United States' emergency response professionals, provide the federal government's response and aid the country's recovery from terrorist attacks and natural disasters. It will oversee domestic disaster preparedness training and coordinate government disaster response. Chemical, Biological, Radiological and Nuclear Countermeasures will lead the federal government's efforts to prepare for and respond to terrorist threats involving weapons of mass destruction, including agroterrorism. Information Analysis and Infrastructure Protection is responsible to identify and assess current and future threats to the United States, map those threats against our current vulnerabilities, inform the President, issue timely warnings, and immediately take or affect appropriate preventive and protective action. This division will analyze domestic intelligence from other agencies, including those currently operating under the Department of Commerce, the General Services Administration, the Department of Defense, the FBI, and the Department of Energy. Finally, Border and Transportation Security is responsible to secure the United States' borders and transportation systems, manage who and what enters the country, and work to prevent the entry of terrorists and the instruments of terrorism while ensuring the speedy flow of legitimate traffic. The Secret Service will report directly to the Secretary of Homeland Security, but will remain intact under the Department of the Treasury, and will continue its mission to protect the President and other government leaders.

Border and Transportation Security

Border and Transportation Security will absorb the functions currently performed by the Customs Service, Coast Guard, Animal and Plant Health Inspection Service, Federal Protective Service, the Transportation Security Administration and other various offices. This division will also encompass all immigration services provided by the INS, which is currently part of the Department of Justice. Structurally, the DHS will separate out the functions of immigration services and benefits (e.g., family and employment related immigration, employment authorization, citizenship, asylum, lawful permanent residency, refugee status, inter-country adoptions, replacement immigration documents and foreign student authorization) from immigration-related law enforcement and border management. The DHS will have the legal authority to issue visas to foreign nationals and admit them into the country. The State Department, working through the United States embassies and consulates abroad, will continue to administer the visa application and issuance process.

Leadership and Structure

Heading the Directorate of Border and Transportation Security will be the Under Secretary of Border and Transportation Security. President Bush has nominated former Congressman Asa Hutchinson (R-Arkansas) for this position. The Under Secretary will be directly responsible for all immigration-related matters, including immigration services and benefits, law enforcement and border management, and establishing immigration policies and priorities. Reporting to the Under Secretary will be the Commissioner of Customs and the Deputy Secretary for Border Security.

In addition to internal streamlining, the HSA significantly impacts the structure of congressional oversight committees with jurisdiction over the DHS. Restructuring will likely consist of two committees, one for authorizations and one for appropriations, rather than the multiple committees currently charged with overseeing various components of the INS.

Immigration functions will be transferred to two bureaus within the Directorate of Border and Transportation Security: the Bureau of Citizenship and Immigration Services (BCIS), responsible for immigration services and benefits; and the Bureau of Border Security (BBS), responsible for law enforcement and border management. In an unusual organizational structure, the BBS will report directly to the Under Secretary of Homeland Security who heads the Directorate of Border and Transportation Security, while the BCIS will report to the subordinate position of Deputy Secretary of Homeland Security. The Deputy Secretary has broad responsibility for the day-to-day operations of the entire Directorate of Border and Transportation Security. Immigration practitioners have expressed concern that the responsibilities and resources for these top immigration-related positions will be spread too thin, and that the BCIS has not been granted structural equity with the BBS, which will have a direct impact on funding for the BCIS.

Critics of the DHS organization plan have charged that the HSA fails to provide for one high-level official who is focused on immigration policy, relegates immigration services to a bureau that lacks distinct leadership, and provides for little coordination between the now separate functions of services and enforcement. Immigration practitioners have also expressed concern that case processing will be de-prioritized and that adjudications at Service Centers and District Offices will not receive adequate funding, staffing and policy attention to address current backlogs and prevent further delays.

Bureau of Citizenship and Immigration Services (BCIS)

As noted above, the BCIS will be responsible for immigration services and benefits, such as employment-based immigrant and nonimmigrant visa categories. The BCIS will include the Service Centers and the sections of District Offices related to services. The HSA included several provisions designed to protect citizenship and immigration services:

• Requires that the Director of BCIS have identical qualifications and compensation levels as the Assistant Secretary of BBS.
• Provides for a Citizenship and Services Ombudsman, who will be charged to identify issues and propose changes.
• Establishes the position of Special Assistant, who will serve as a private sector liaison.
• Establishes a Chief of Policy and Strategy, who will be responsible for making policy recommendations on service issues and coordinating immigration policy with its counterpart in the BBS.
• Establishes the position of Legal Advisor to the Director, who will provide legal advice and represents the BCIS before the Executive Office for Immigration Review.
• Directs the Secretary of Homeland Security to establish a Technology Advisory committee; mandates the implementation of an Internet-based system that will allow online access to information; and provides for a study on the feasibility of online filing for benefits by November 2003.

Bureau of Border Security (BBS)

The BBS will include the sections of the INS involved with enforcement, such as Border Patrol, detention and removal, intelligence, investigations and inspections. Immigration Business News & Comment points out that the separation of inspections from adjudications will have an impact on border crossing by offering this hypothetical: for example, Canadian TNs are likely to have their applications for admission in TN status adjudicated by inspections officers of the BBS, while Mexican TNs who must file petitions [at a Service Center] will have their TN status established by adjudicators in the BCIS. (Immigration Business News & Comment, January 14, 2003). Any disconnect between the BCIS and BBS will result in a difference in adjudication standards for any visa category under this structure.

The BBS will also administer the SEVIS system for F and J students. The SEVIS system controls the issuance of student and exchange visitor certificates of eligibility, monitors changes in the student's approved programs, and the actual admission of students into the United States at the border. Thus, the BBS will handle virtually all aspects of F, M and J visa categories.

The Homeland Security Act further outlines the responsibilities of the BBS:

• Quality control and investigations of misconduct, corruption and fraud within the Bureau. The BBS has the authority to discipline and terminate employees under certain conditions.
• Establishes a Chief of Policy and Strategy responsible for consulting with BBS officers in local offices; analyzing and researching policy issues and making recommendations on immigration enforcement; and coordinating immigration policy with the position's counterpart in the BCIS.
• Establishes the position of Legal Advisor to the Assistant Secretary of the BBS, who will provide legal advice and represents the BCIS before the Executive Office for Immigration Review. Current INS trial attorneys will be located in this office.

Transition

The Homeland Security Act abolishes the INS effective 60 days from signing (January 2003). The INS is the only federal agency completely abolished by the HSA. Implementation of the DHS has already commenced, although the Bush administration has admitted that it will take over a year to fully realize the DHS. As the department continues to evolve, updates will be posted on the department's website (www.dhs.gov). The transition from INS to DHS is expected to be highly disruptive. The HSA includes provisions for severance packages as a housekeeping incentive for INS employees to resign or take early retirement. The likelihood of a significant changeover in staff would have an immediate impact on adjudications in terms of personnel available to process applications. Additionally, inexperienced adjudicators are likely to mis- or re-interpret immigration policy.

Visa Issuance

Under the Homeland Security Act, the Secretary of DHS, acting through the Secretary of State, is vested with the authority to administer and enforce all visa-related laws and issue regulations regarding consular offices. The Department of State will continue to issue visas or refuse visas. However, they will do so under the policies, procedures and standards set forth by the DHS. The DHS will also assign an employee to each consular post. The DHS will also provide visa training to Department of State staff. Thus, the DHS will exercise full and final authority regarding visa issuance. These provisions will take effect either on the date published in the Federal Register or on November 25, 2003, whichever date is earlier.

Denied visas will be entered into a DHS database, pursuant to §202 of the Enhanced Border Security and Visa Entry Reform Act of 2002 (Pub. L. No. 107-173). Individuals who have been denied a visa will not be able to obtain a new visa unless data has been placed into this database and thoroughly reviewed by a consulate officer. This decision is subject to final review by DHS.

Executive Office for Immigration Review (EOIR)

The EOIR, the administrative appellate immigration court, will remain under the jurisdiction of the Department of Justice. However, the EOIR will be under the direct supervision of the Attorney General (currently John Ashcroft). Critics of the section of the DHS organization plan have charged that the HSA fails to adequately protect the role of immigration courts.

Freedom of Information Act (FOIA)

The HSA provides broad FOIA exemptions for information that is related to the security of critical infrastructure or protected systems, including computer systems and information. Improper disclosure of this information by a federal employee would become a criminal offense. If this provision is interpreted broadly, the FOIA exemption could have a dramatic chilling affect on both the ability to request information contained in INS/DHS databases as well as the dissemination of policy memos and other official information from any immigration-related bureau.

Office of Civil Rights

The Act provides for an Officer for Civil Rights and Civil Liberties, who will be responsible for reviewing and assessing abuses, including racial and ethnic profiling, by employees and officials of the department. Congress will receive an annual report outlining the alleged abuses reported to the office and any actions taken in response.

As noted, the Homeland Security Act impacts many aspects of American life, and many aspects of immigration law not mentioned in this article, which has focused on business immigration issues. For more extensive analysis, the authors recommend the following publication: Immigration and Naturalization Under the Homeland Security Act: An analysis of what will replace the INS, in Immigration Business News & Comment (Vol. 5, No. 1, January 14, 2003).

21st Century Department of Justice Appropriations Authorization Act

On November 2, 2002, President Bush signed into law the 21st Century Department of Justice Appropriations Authorization Act. This act authorizes the appropriation of funds to the Department of Justice, of which the INS is currently a part. In addition, the DOJ Authorization Bill amends several other acts, including the Immigration and Nationality Act (INA), the Commerce-Justice-State Appropriations Act of 1993 (C-J-S) and the American Competitiveness in the 21st Century Act of 2000 (AC21).

The DOJ Authorization Act incorporates several pro-immigration measures, including extension of status for certain H-1B workers past the six-year limit, positive changes to the Conrad 20 program for international medical graduates, less restrictive procedures for Fifth Preference (EB-5) immigrant visa category for foreign investors, and changes in eligibility for naturalization.

Extension of H-1B status beyond 6 years

Section 11030A of the DOJ Authorization Act allows H-1B nonimmigrants reaching the end of their maximum permitted 6-year stay to extend the period of stay beyond the 6-year limit if a labor certification application has been pending for at least 365 days, without the need for the foreign national to be at the stage where an I-140 immigrant visa petition has been filed.

The old rule (under AC21 §106) permitted H-1B workers to extend their status beyond the six-year limitation, in increments of one-year increments, provided the foreign national had filed an Immigration Petition for Alien Worker (Form I-140) and whose labor certification application or I-140 was filed at least 365 days before the requested extension. Extensions are permitted, in one-year increments, until a decision is made to deny an ETA-750 or I-140, or to grant or deny the individual's application for permanent residence (I-485).

The new rule addresses the reality that labor certification processing delays extend well beyond a year in many Department of Labor regions. Because of these delays, many foreign nationals in the permanent residence (or green card) process have not been able to file an I-140, as their labor certification applications have not been certified. Thus, these foreign nationals have not benefited from the provisions of AC21.

Conrad State 20

Section 11018 of the DOJ Authorization Act makes changes to the Conrad State 20 program by extending the program until 2004 and by expanding the number of J-1 waivers available to foreign physicians per state from 20 to 30. A recent division policy statement by the Department of State clarifies that this expansion permits states that have reached the numerical limitation of 20 requests for 2002 to submit up to 10 additional visa waiver requests for fiscal year 2002. This is an amendment to INA §214(1)(1)(B).

Foreign Investors

The DOJ Authorization Act provides for the removal of the conditional basis of permanent resident status for certain foreign national entrepreneurs, spouses and children:

Section 11031 applies to investors who filed and had their Immigrant Petition by an Alien Entrepreneur (Form I-526) approved between January 1, 1995 and August 31, 1998, and obtained conditional resident status and filed a Petition by Entrepreneur to Remove Conditions (Form I-829). The section sets forth numerous new procedures for determining whether an eligible investor can have the conditions removed from his permanent resident status. It also states that an investor whose conditional status is terminated by the INS may have that decision reviewed by an immigration judge. The provision also provides that any foreign national who was admitted on a conditional basis as a child of an investor shall remain a child for purposes of this title.

Section 11032 applies to individuals who filed an Immigrant Petition by an Alien Entrepreneur (Form I-526) that was approved by the INS between January 1, 1995 and August 31, 1998, and who timely filed an adjustment of status application or applied for an immigrant visa overseas, but who never became conditional residents because they remained overseas or because the INS never acted on their adjustment application. The provision provides that if the INS revoked the Petition by an Alien Entrepreneur (Form I-526) on the ground that the investor failed to meet the capital investment requirement, that revocation is to be disregarded for purposes of this bill, and the adjustment or immigrant visa application overseas is to be treated as reopened. Once the investor becomes a conditional resident, they must file a Petition by Entrepreneur to Remove Conditions (Form I-829) within two years.

Section 11035 defines full-time employment for purposes of section 203(b)(5) of the Immigration and Nationality Act (INA) as a position that requires at least 35 hours of work a week.

Section 11036 eliminates the establishment requirement from section 203(b)(6) of the INA. Investors must only provide evidence that they have invested in a commercial enterprise and do not have to prove that they established one. This section also eliminates the "establishment" requirement from section 216A of the INA for investors who have filed a Petition by Entrepreneur to Remove Conditions (Form I-829). Investors must also provide evidence that they have sustained their investment activities over the two-year period. The section also clarifies that the term commercial enterprise may include a limited partnership.

Section 11037 amends section 610(a) of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act of 1993 to refine the description of an EB-5 regional center and clarify that the regional centers can promote increased export sales, improve regional productivity, job creation or increase domestic capital investment. The section also indicates that the INS should approve applications for EB-5 regional center status where the application is based on a general prediction concerning the kinds of commercial enterprises that will receive capital from investors, the jobs that will be increased directly or indirectly as a result of the investment, and the positive economic impacts that will result from the investment.

Naturalization

Section 11030 and Section 11030B modify eligibility for naturalization by 1) extending the deadline for allowing family members to apply for honorary posthumous citizenship for non-citizen veterans who died while honorably serving the U.S. and 2) allowing grandparents and legal guardians of children whose parent, who otherwise would be authorized to submit the petition, died during the preceding five years become eligible for filing an application of naturalization on behalf of the child.

For more extensive analysis on the DOJ Authorization Act, the authors recommend the following article: 21st Century DOJ Authorization Appropriations Act Summarized, in Interpreter Releases (Vol. 79, No. 41, October 21, 2002).

Sources:

Articles

1. Single Roof for Homeland Security. Washington Post (June 7, 2002).
2. Congress Set to Create Department of Homeland Security. Posted on AILA InfoNet at Doc. No. 02071542 (July 15, 2002).
3. Enrolled Version of the New Homeland Security Act of 2002 and Expanded Section-by-Section Summary. Posted on AILA InfoNet at Doc. No. 02120240 (Dec. 2, 2002).
4. Groups Raise Immigration Issues with DHS Secretary-Designate Ridge. Posted on AILA InfoNet at Doc. No. 03011632 (Jan. 16, 2003).
5. Immigration and Naturalization Under the Homeland Security Act: An analysis of what will replace the INS. Immigration Business News & Comment. Vol. 5, No. 1, p. 1-7. January 14, 2003.
6. Legislative Update Connect, Vol. 4, No. 1. Posted on AILA InfoNet at Doc. No. 0311041 (Jan. 10, 2003).
7. The 107th Congress: A Legislative Overview Washington Update, Vol. 6, Number 18. Posted on AILA InfoNet at Doc. No. 02120946 (Dec. 9, 2002).
8. President Signs Homeland Security Measure. Interpreter Releases, Vol. 79, No. 46, p. 1733-1741. November 25, 2002.
9. President Signs into Law H-1B Extensions Beyond Six Years and Commuter Student Provisions. Immigration Business News & Comment, Vol. 4, No. 21, pp. 225-226. November 15, 2002.
10. 21st Century DOJ Authorization Appropriations Act Summarized. Interpreter Releases, Vol. 79, No. 41, p. 1573-1754. October 21, 2002.