WASHINGTON, DC -- The U.S. Senate voted 64-33 today to pass a version of the Creating Helpful Incentives for the Production of Semiconductors (CHIPS) for America Act, known as ‘CHIPS-Plus.’  This legislation will boost U.S. computer chip manufacturing and reduce U.S. reliance on foreign-made semiconductors.  The bill also authorizes significant investments in scientific research and development initiatives and will boost Rhode Island’s innovation and scientific research ecosystem thanks to language added by U.S. Senator Jack Reed (D-RI).

 

In 1990, the U.S. produced 37 percent of the world’s semiconductors.  But in part due to subsidies to semiconductor manufacturers by China, the European Union, Taiwan, South Korea, and others, today, just 12 percent of semiconductors are manufactured in the United States.  And a global shortage of computer chips in the wake of COVID-19 has continued to ripple through several key sectors of the U.S. economy, including automakers, mobile phone and consumer technology companies, and defense manufacturers. 

 

To encourage homegrown computer chip manufacturing in the U.S., create good-paying America jobs, and address supply chain vulnerabilities in these critical technologies, the CHIPS-Plus package allocates $52 billion for semiconductor research, design, and manufacturing.  It authorizes federal workforce development funds to train more American workers in the in-demand skills needed to build semiconductor chips.  And it includes language that would prevent companies that receive a share of the $52 billion in funding from using that money on stock buybacks or paying stock dividends to shareholders. 

 

“Semiconductor chip manufacturing is a strategic imperative.  This bill will strengthen America's chip-making supply chain and help stabilize our economy and make it more resistant to future chip shortages, while also investing in high-tech research and scientific breakthroughs.  A strong, resilient, domestic semiconductor manufacturing ecosystem is critical to America's national security, economic security, and global stability.  The United States can't rely on other countries to supply us with the chips and technology we need to power our homes, cars, economy, military, and future.  This is a substantial public investment that ensures advanced American manufacturing and innovation stays in the United States and benefits Americans,” said Senator Reed.  “Bringing these jobs home to America, proactively insulating the U.S. from future chip shortages or disruptions, and strengthening America’s capacity to produce cutting-edge computer chips and advanced technologies is a win for our economy and national security.”

 

The bill also includes nearly $100 billion in authorizations over five years – subject to appropriations -- for programs to bolster the National Science Foundation’s work, establish regional technology hubs under the U.S. Department of Commerce, and focus on translating research breakthroughs into real-world commercial applications and products.

 

To help bring new, high-tech, science-related jobs to Rhode Island, Senator Reed led efforts to include language in the CHIPS Plus package to bolster the Established Program to Stimulate Competitive Research (EPSCoR).  EPSCoR is a critical research and development program that’s designed to help states traditionally underfunded by the National Science Foundation (NSF) compete for research dollars by providing money to improve infrastructure and capacity.

 

“The federal government must invest in innovation and this bill will bring more federal R&D funding home to Rhode Island, strengthen our world-class research ecosystem, and fund cutting-edge, breakthrough research that leads to new discoveries and products.  Without this language, it’s possible our state would lose out on millions of dollars,” said Senator Reed.  “I want Rhode Island to serve as a launching pad for new ideas, innovations, and technologies.  This bill invests in helping Rhode Island-based researchers working across a variety of fields develop and commercialize technological breakthroughs.”

 

Specifically, the Reed-backed language in the bill will quadruple the amount of funding authorized for Department of Energy (DOE) EPSCoR over 5 years, while also increasing by fivefold the percent of the DOE research budget that goes to EPSCoR.  The bill will also boost EPSCoR funding up from 12.5 percent to 20 percent of the NSF research budget over seven years.  And it would also require at least 20 percent of NSF scholarship funding goes to EPSCoR institutions by 2025.  These provisions are estimated to bring an additional $1.8 billion in competitive funding to EPSCoR states over that period.

 

The University of Rhode Island and Brown University are expected to receive the bulk of EPSCoR research dollars in Rhode Island and the universities work collaboratively with businesses and other researchers on a variety of programs, including marine, energy, and coastal research projects.  Since EPSCoR launched in Rhode Island in 2004, $88 million has been directed to the state for cutting-edge collaborative research projects. 

 

Now that the measure (H.R. 4346) has been approved by the full U.S. Senate, it must also be passed by the U.S. House of Representatives before it can be sent to President Biden’s desk to be signed into law.