WASHINGTON, D.C. – Both of Ohio’s U.S. Senators, and a number of leaders from a variety of state sectors, praised the Senate’s passage of the CHIPS Act of 2022 on Wednesday afternoon.
Published reports state the U.S. House of Representatives is expected to clear the legislation before leaving town Friday for the August recess, sending it to President Joe Biden for his signature.
The bipartisan legislation, which passed in the Senate by a 64-33 vote, is being promoted as an incentive to semiconductor manufacturing in the United States, making supply chains more resilient, enhancing national security, and strengthening the U.S. economy.
Locally, this legislation has been closely monitored with the announcement of Intel’s investment in a semiconductor plant in New Albany. The goal is that chips will become a major American export out of Ohio.
U.S. Senator Sherrod Brown (D-Ohio) hailed the passage as an act that supports and grows domestic supply chains, invest in Ohio manufacturing jobs, and reduce costs for Americans by reversing decades of offshoring American manufacturing. Currently, 90 percent of chip manufacturing capacity is overseas, Brown noted.
“By investing in Ohio’s manufacturing, research and higher education, the CHIPS Act will restore critical supply chains, help lower costs for Ohioans, and create thousands of good-paying jobs,” Brown said. “This is a first step toward ending decades of corporate offshoring of our supply chains that cost Ohio jobs and now is costing everyone by causing inflation. We are putting another nail in the coffin for the term ‘Rust Belt’ – and we’re just getting started.”
In January, Intel announced a $20 billion investment to build a semiconductor plant in New Albany, which is expected to create 10,000 jobs. The CHIPS Act will boost Intel’s initial investment to create thousands of additional jobs in Ohio.
“Today’s passage of the CHIPS Act is critical in the effort to bring semiconductor manufacturing back to the United States, protect our national security and create thousands of high-paying jobs in Ohio,” U.S. Sen. Rob Portman (R-Ohio) said. “I was proud to help lead efforts in the Senate to pass this legislation and ensure that Intel’s planned semiconductor plant in central Ohio remains on track and reaches its full potential.
“Intel’s announced investment is already the largest in Ohio’s history and the company has indicated that with this CHIPS legislation its record investment will grow even larger over time. It is also expected that other major Ohio investments from suppliers will follow. I urge the House to act quickly on this bipartisan legislation so the president can sign it into law, and I look forward to attending the groundbreaking for this transformational project in the coming months.”
Intel’s announcement is in partnership with the U.S. National Science Foundation, which will provide an additional $50 million for research grants nationally that will be available to Ohio institutions.
“We congratulate the Senate’s bipartisan vote today to fund the CHIPS Act and urge the House to follow suit,” said Pat Gelsinger, Intel CEO. “We will move forward together to advance American leadership in semiconductor manufacturing and R&D, and strengthen American national and economic security.
“We thank Senators Brown and Portman for their leadership on this important issue and are excited to be one step closer to start building in Ohio.”
Steve Stivers, President and CEO of the Ohio Chamber of Commerce, also applauded the passage.
“Ohio’s economy stands to benefit even more from the transformational nature of Intel’s investment in semiconductor manufacturing in our state thanks to the CHIPS Act, which will bolster American manufacturing and national security,” Stivers said. “We want to thank the members of Ohio’s Congressional delegation who have been working hard to see this through, especially Senators Brown and Portman, for their leadership on this important issue.
The automotive industry hailed the news, too.
“As America’s No. 1 vehicle manufacturer, assembling more vehicles and employing more hourly workers in the U.S. than any other automaker, Ford applauds the Senate for its bipartisan passage of the CHIPS Act,” said Steven Croley, Chief Policy Officer and General Counsel, Ford Motor Company. “This legislation will empower the United States to lead in the global transition to electric and connected vehicles and alleviate supply constraints caused by the global shortage of legacy semiconductor chips our industry needs.
“Ford has announced nearly $14 billion in U.S. EV and battery investments in the last year alone, and CHIPS will help make those manufacturing lines hum with exciting vehicles our customers love.”
The education sector chimed in as well.
“Investment in the domestic semiconductor industry is critical to keeping our nation strong and competitive,” said Ohio State President Kristina M. Johnson. “This bill recognizes the importance of realizing that goal by making strategic investments in research and development, overcoming supply chain challenges, and cultivating the workforce of the future. Ohio State is deeply committed to playing a key role in economic growth both locally – particularly related to the Silicon Heartland initiative – and across the U.S.”
According to a press release from Brown’s office, the CHIPS Act will:
Provide $52.7 billion for the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America fund:
The CHIPS Act will provide $52.7 billion to expand domestic semiconductor manufacturing, research and development, and workforce development. This will invest in companies like Intel that build chips fabs in the United States, allowing them to break ground and expand production of their investment in Licking County.
The CHIPS for America fund will provide $200 million over five years for the National Science Foundation (NSF) to promote growth of the semiconductor workforce, which faces the need to add 90,000 workers by 2025. Some of this funding will help grow the semiconductor workforce in Ohio.
The CHIPS for America Fund will also provide more than $11 billion to Department of Commerce research and development initiatives in the semiconductor industry, including funding for Manufacturing USA Semiconductor Institutes. This funding will support partnerships between government, industry, and academia to conduct advanced semiconductor manufacturing research and development, invest in new technologies, and expand workforce training and development opportunities.
Provide $2 billion to focus solely on legacy chip production to advance economic and national security interests:
These chips are essential to the auto industry, the military, and other critical industries. It will translate into more legacy chips for Ford, Jeep, Honda, GM, and other companies in Ohio.
Provide more than $11 billion to Department of Commerce research and development initiatives in the semiconductor industry, including funding for Manufacturing USA Semiconductor Institutes:
A partnership between government, industry, and academia to research virtualization of semiconductor machinery, development of Assembly, Testing, and Packaging (ATP) capabilities, and the development and deployment of training.
Provide $200 million for a Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Workforce and Education Fund:
$200 million is over five years for the National Science Foundation to promote growth of the semiconductor workforce, which faces the need to add 90,000 workers by 2025. Some of this funding will help grow the semiconductor workforce in Ohio.
Clarify that upstream suppliers are eligible to receive CHIPS funding:
Suppliers are essential to building strong domestic semiconductor manufacturing ecosystems.
Require that all construction projects funded under the CHIPS Act are subject to prevailing wage requirements, which will ensure that the Ohio Building Trades will build the fabs in central Ohio.
Require the Department of Commerce to establish activities and assign personnel to ensure that the recipients of CHIPS manufacturing incentives meet their commitments to increase the participation of economically disadvantaged individuals in the semiconductor workforce:
Such personnel would also serve as a resource to support the participation of minority-owned businesses, veteran-owned businesses, and women-owned businesses, in CHIPS-funded projects. This will ensure that CHIPS funded projects in Ohio serve a diverse constituency across the state and lead to broad based prosperity of Ohioans from underrepresented backgrounds.