Biden unveils multi-billion dollar funding initiative for intel’s expansion across four states

President Joe Biden has unveiled a significant plan on Wednesday, dedicating billions of federal dollars from the CHIPS and Science Act to amplify semiconductor production within the United States.

Set to be announced at Intel’s Ocotillo campus in Chandler, Arizona, the preliminary agreement entails $8.5 billion in federal funds designated for Intel, a leading global producer of semiconductor chips, to construct and enhance facilities across four states. Additionally, the CHIPS program office under the Biden administration will allocate $11 billion in loans as part of this agreement.

During a briefing with journalists on Tuesday, Commerce Secretary Gina Raimondo emphasized the historic nature of the $8.5 billion grant, highlighting its pivotal role in enabling Intel to manufacture cutting-edge chips crucial for various industries, particularly in artificial intelligence and military applications.

Director of the National Economic Council Lael Brainard underscored the federal funding’s significance, complementing Intel’s $100 billion private investment commitment to facilities across the country. Brainard hailed Intel’s investment as a pivotal element in America’s resurgence in leading-edge semiconductor manufacturing after a four-decade hiatus.

The allocated funding will be specifically directed towards the construction of new facilities and the expansion and modernization of existing ones in Arizona, Ohio, New Mexico, and Oregon.

Enacted in August 2022, Biden’s CHIPS and Science Act encompasses $52.7 billion in subsidies to fortify domestic semiconductor production, coupled with a 25% tax incentive for investments in domestic chip endeavors amounting to approximately $24 billion, garnering bipartisan support in Congress.

Despite the United States being the birthplace of semiconductors, less than 10% of the world’s chips are currently manufactured domestically. Raimondo emphasized the urgency of rectifying this dependency on foreign production, particularly for leading-edge chips, citing economic and national security imperatives.

Last month, the administration articulated an ambitious objective for the CHIPS Program, aiming for approximately 20% of the world’s leading-edge chips to be domestically produced by 2030. The forthcoming announcement is poised to accelerate progress toward achieving this goal, according to Raimondo.

Moreover, administration officials anticipate that the funding and ensuing facility expansions will generate 30,000 jobs. Wednesday’s announcement also encompasses a $50 million allocation for training and nurturing the local workforce.

Biden’s visit to Chandler coincides with his three-day campaign tour of battleground states in the southwest, which commenced in Reno, Nevada, and Las Vegas before proceeding to Arizona, where he also visited Phoenix. The tour will conclude in Texas, with stops scheduled in Dallas and Houston.