Nw. Immigrant Rights Project v. U.S. Citizenship & Immigration Servs.

Decision Date08 October 2020
Docket NumberCivil Action No. 19-3283 (RDM)
PartiesNORTHWEST IMMIGRANT RIGHTS PROJECT, et al., Plaintiffs, v. UNITED STATES CITIZENSHIP AND IMMIGRATION SERVICES, et al., Defendants.
CourtU.S. District Court — District of Columbia
MEMORANDUM OPINION

The United States Citizenship and Immigration Services ("USCIS"), a component of the Department of Homeland Security ("DHS"), Dkt. 1 at 3 (Compl. ¶ 12), receives millions of applications and petitions each year for immigration benefits. Dkt. 50 at 14-15. Many of these benefits are of no small consequence to applicants; they include "naturalization, lawful permanent residence, employment authorization, humanitarian benefits, and other forms of legal status." Id. at 15.

These benefits must be funded somehow, and DHS generally does so by charging fees for its services. In recent years, however, its costs have outstripped the fees it collects. See Dkt. 69-1 at 2; U.S. Citizenship and Immigration Services Fee Schedule and Changes to Certain Other Immigration Benefit Request Requirements, 84 Fed. Reg. 62,280, 62,288 (Nov. 14, 2019) ("Proposed Rule"). To address this shortfall and to make various policy changes, DHS proposed a rule in November 2019 altering the fees it charges, shifting from an "ability-to-pay" to a "beneficiary-pays" model, charging a fee to apply for asylum for the first time, and reducing the availability of fee waivers for those of limited means. Id. at 62,280, 62,298. On August 3, 2020, the Department finalized that rule. See U.S. Citizenship and Immigration Services Fee Schedule and Changes to Certain Other Immigration Benefit Request Requirements, 85 Fed. Reg. 46,788 (Aug. 3, 2020) ("Final Rule" or "Rule"). The rule was set to take effect on October 2, 2020, id., but was recently enjoined by the United States District Court for the Northern District of California, Immigrant Legal Res. Ctr. v. Wolf, No. 20-cv-05883-JSW, 2020 WL 5798269 (Sept. 29, 2020).

Plaintiffs Northwest Immigrant Rights Project ("NWIRP"), Ayuda, Inc. ("Ayuda"), and CASA de Maryland, Inc. ("CASA") seek a stay of implementation or enforcement of the Rule pursuant to the Administrative Procedure Act ("APA"), 5 U.S.C. § 705, or in the alternative, a preliminary injunction against implementation and enforcement of the Rule. Dkt. 50 at 1. Defendants USCIS, DHS, Chad F. Wolf in his official capacity as Acting Secretary of Homeland Security, and Kenneth T. Cuccinelli in his official capacity as Senior Official Performing the Duties of the USCIS Director and Deputy Secretary of Homeland Security oppose Plaintiffs' motion. Dkt. 69 at 12, 16. The Court heard oral argument on September 24, 2020, and received supplemental briefing on September 28, 29 and 30, 2020. Dkts. 78-82.

Upon consideration of the parties' arguments and submissions, and for the reasons explained below, the Court will GRANT Plaintiffs' motion for a preliminary injunction.

I. BACKGROUND
A. Statutory and Factual Background

DHS promulgated the Rule pursuant to the Immigration and Nationality Act ("INA"), which establishes the "Immigration Examinations Fee Account" ("IEFA") for the receipt of fees the Department charges. 8 U.S.C. § 1356(m). The INA allows DHS to set "fees for providing adjudication and naturalization services . . . at a level that will ensure recovery of the full costs ofproviding all such services, including the costs of similar services provided without charge to asylum applicants or other immigrants." Id. The INA further provides that "[s]uch fees may also be set at a level that will recover any additional costs associated with the administration of the fees collected." Id.

In 2010, DHS conducted a comprehensive review of and revision to its fee structure. See U.S. Citizenship and Immigration Services Fee Schedule, 75 Fed. Reg. 58,962 (Sept. 24, 2010) ("2010 Rule"); Dkt. 50 at 16. The revised fee-schedule exempted "a range of humanitarian and protective services, such as refugee and asylum processing," from fees, explaining that "a large percentage of applicants would clearly be unable to pay" any fees. 2010 Rule, 75 Fed. Reg. at 58,973; Dkt. 50 at 16. For other services to which fees did apply, DHS allowed waivers for individuals "unable to pay the prescribed fee" if such a waiver would be "consistent with the status or benefit sought." 8 C.F.R. § 103.7(c)(1); Dkt. 69 at 13-14.

To determine what constitutes an inability to pay, USCIS issued a memorandum in 2011 ("2011 Memorandum") that established a three-part test. AR 43-50. First, if the applicant received a "government 'means-tested' benefit, such as Medicaid or Supplemental Nutrition Assistance Program benefits," the applicant would be deemed ineligible to pay and the fee waived. AR 47; Dkt. 50 at 16-17. Second, if the applicant received no means-tested benefit, USCIS would consider whether the applicant's income was less than or equal to 150% of the Federal Poverty Guidelines ("FPG"). AR 48-49; Dkt. 50 at 17. If so, the applicant was deemed unable to pay and the fee was waived. Finally, if neither of the first two prongs applied, USCIS would consider whether the individual was otherwise "suffering financial hardship" and, if so, waive the fee. AR 49.

The 2011 Memorandum also addressed how applicants could show that they satisfied these tests. The approach was a flexible one. Although USCIS created an official form for applicants to request fee waivers, it explained that use of the form was not mandatory. AR 46-47. Although the form identified certain types of documentation accepted as proof of inability to pay, the Memorandum recognized that other forms of documentation could accompany the waiver request, including pay statements, statements from employers, and tax returns. AR 48.

In 2016, DHS issued another comprehensive revision to its fees, retaining the 2010 fee waivers and exemptions and capping increases to naturalization, employment authorization, and other fees, which the Department deemed "overly burdensome on applicants, petitioners, and requestors if set at the recommended [financial] model output levels." U.S. Citizenship and Immigration Services Fee Schedule, 81 Fed. Reg. 73,292, 73,297, 73,307-08 (Oct. 24, 2016) ("2016 Rule"). DHS also "created a reduced fee for low-income naturalization applicants" with family incomes greater than 150%, but less than 200%, of the FPG. Id. at 73,326; Dkt. 50 at 17. The Department created this reduced fee to "ensure that those who have worked hard to become eligible for naturalization are not limited by their economic means." 2016 Rule, 81 Fed. Reg. at 73,326.

In October 2019, USCIS revised the form and instructions governing fee waivers (as well as a related policy manual) in a manner that abandoned the 2011 Memorandum, narrowed eligibility for fee waivers, and imposed new hurdles to obtaining waivers. Dkt. 11-2; AR 484. The agency restricted fee waivers to those who can demonstrate that their "documented annual household income" was at or below 150% of the FPG or can establish "financial hardship including, but not limited to, medical expenses of family members, unemployment, eviction, victimization, and homelessness." Dkt. 11-2 at 14. The new standards also eliminated anapplicant's option of demonstrating inability to pay based on the receipt of means-tested benefits, mandated use of the USCIS form, and imposed new evidentiary requirements. AR 484. Before the new standards took effect, however, the United States District Court for the Northern District of California preliminarily enjoined the changes on the ground that the Department failed to conduct notice-and-comment rulemaking. City of Seattle v. DHS, No. 3:19-cv-7151-MMC (N.D. Cal. Dec. 11, 2019); Dkt. 69 at 14; Dkt. 50 at 19 n.5.

Meanwhile, DHS issued a Notice of Proposed Rulemaking in November 2019, proposing a new fee schedule and further limiting the availability of free waivers. See Proposed Rule, 84 Fed. Reg. 62,280. In response to the Proposed Rule, DHS received 43,108 comments, which the Department reviewed before issuing the Final Rule. Final Rule, 85 Fed. Reg. at 46,794. The "vast majority of commenters opposed all or part of" the Rule, raising concerns, among other things, about the effect the Rule would have on the availability of immigration benefits for low-income immigrants and the demand for those benefits. Id. at 46,795.

The Rule is designed to serve two purposes: (1) it makes "[f]ee schedule adjustments . . . necessary to recover the full operating costs associated with administering the nation's lawful immigration system," id. at 46,789; and (2) it shifts from an "ability-to-pay" model to a "beneficiary-pays" model, which "ensure[s] that those who benefit from immigration benefits pay their fair share of costs," id. at 46,795. To serve these purposes, the Rule curtails the availability of fee waivers. Id. at 46,806. The Rule does not permit fee waivers unless "[t]here is a statutory or regulatory provision allowing for fee waivers" or the applicant belongs to specific protected groups. Id. at 46,920 (to be codified at 8 C.F.R. § 106.3). Even with respect to this limited class, moreover, the Rule permits fee waivers only if (a) the applicant's annual gross household income is less than or equal to 125% of FPG (amounting to $15,950 annually for asingle person) and (b) the applicant submits the required USCIS form and accompanying documents. Id. at 46,920; Dkt. 50 at 19; Dkt. 69 at 14-15. Although the USCIS Director reserves discretion to waive fees "in whole or in part" in "an emergent circumstance, or if a major natural disaster has been declared," he may not waive the 125% requirement or the requirement that the applicant satisfactorily complete the USCIS fee-waiver-application form. Final Rule, 85 Fed. Reg. at 46,920; Dkt. 69 at 15. These regulations displace the 2011 Memorandum's test for ability to pay, including the "means-tested" approach to fee-waivers, which Plaintiffs characterize as "the easiest, most...

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