Commerce Expands Implementation of Kelly-Led Policy to Provide CHIPS Act Funding to Semiconductor Manufacturing Suppliers

Last week, the U.S. Department of Commerce CHIPS for America Office began implementing the second stage of a key component of Senator Kelly’s CHIPS and Science Act to provide funding for the construction, expansion, and modernization of semiconductor manufacturing suppliers with capital investments below $300 million. In June, the CHIPS office issued a notice of funding for facilities with capital investments exceeding $300 million. 

Together, Kelly’s supplier provisions will expand the impact of the CHIPS Act: accelerating microchip manufacturing investments in Arizona, creating tens of thousands high-paying jobs, lowering costs, and strengthening our national security.   

“Arizona is becoming a global hub for microchip manufacturing because we are attracting investments at every level of the supply chain. By expanding opportunities to all suppliers — no matter their size — Arizona’s microchip manufacturing industry will continue to grow and create more good-paying jobs,” said Sen. Kelly, a chief negotiator of the CHIPS and Science Act. 

Background:  

Kelly worked for nearly two years to negotiate and champion the CHIPS Act, which includes Kelly’s $52 billion plan to boost domestic microchip manufacturing. Thanks to Kelly’s leadership, Arizona is well positioned to become a global hub for microelectronics research, development, testing, manufacturing, and packaging. More than 40 Phoenix-area companies, including several Kelly met with during his recent trip to Taiwan, are actively considering investments to support Intel and TSMC’s combined $60 billion investments in Arizona semiconductor facilities.    

This second Notice of Funding Opportunity will allow smaller companies to apply for financial incentives to support the construction, expansion, or modernization of manufacturing facilities which produce the materials and manufacturing equipment used to produce microchips. The first Notice of Funding Opportunity for suppliers was issued in June for facilities with a capital investment exceeding $300 million. These build upon the initial Notice of Funding Opportunity, announced in February, which helps microchip manufacturers build new factories and expand production. This current funding opportunity is for facilities that cost more than $300 million.