Costa votes to boost America’s Semiconductor Competition

WASHINGTON – Congressman Jim Costa (CA-16) voted to pass the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, which now heads to President Biden to sign into law. This bipartisan legislative package will provide $54 billion in grants over five years to semiconductor manufacturing and research along with 5G wireless deployment, an investment that will improve the American supply chain by reducing U.S. reliance on Asian imports for microprocessors used in manufacturing everything from smartphones, refrigerators to cars.

"Semiconductor chips are essential components to our national security, smart devices like cell phones and appliances, and other technologies that are essential to our everyday lives,"said Costa. "We must stop depending on foreign countries for key components and invest in American manufacturing. This legislation will equip us with the tools to compete against China by accelerating groundbreaking technologies while creating good-paying reliable American jobs!"

Semiconductor chips are essential to products Americans use in their everyday lives including mobile phones/smartphones, laptops, televisions, washing machines, refrigerators, and cars. Only 12% of chips are manufactured domestically, compared to 37% in the 1990s. Many foreign competitors, including China, have invested heavily to dominate the industry.

The CHIPS and Science Act will ensure the U.S meets its capabilities to produce the most advanced chips at volume across the globe.

• Lowers costs for American consumers – by making more critical semiconductor components in America, helping end the shortage of chips that have driven up the price of everything from cars to consumer goods.

• Creates 100,000 new good-paying jobs – creates strong, innovative jobs building hi-tech manufacturing facilities here in America.

• Ends our dangerous dependence on foreign manufacturers – bringing critical semiconductor manufacturing back to America instead of overseas where it can be threatened by our adversaries.

• Expands Emerging Technologies – investing $1.5 billion to expand access to American-made 5G technology network. It can act as a distributed data center that performs processing tasks for traffic control systems to improve the flow of traffic, smarter electricity grids to reduce carbon emissions, and sensors that can early detect and warn of natural disasters.

• Strengthens our National Security – allocating $2 billion for the CHIPS for America's Defense Fund to be used for microelectronic research and development at the Defense Department.

• Prohibits companies from using awarded funds through the CHIPS program for stock buybacks or payment of dividends.

• Requires the recipients of federal financial assistance not to engage in certain material expansions of semiconductor manufacturing in countries of concern, including China, North Korea, Iran, and Russia.

• Advances STEM Research and Development – providing $81 billion to the National Science Foundation (NSF) for research and related activities, STEM education, and major research equipment. This would boost the domestic semiconductor workforce, which faces near-term labor shortages.

A section-by-section breakdown of the bill can be found here.

The full text of the bill is available here.