DURHAM – Private companies can now apply for $39 billion in federal funds to expand semiconductor manufacturing operations in the United States.  Now, whether any of those funds are coming to North Carolina is up to companies to apply for the program, as of today.

The potential windfall, known as CHIPS for America, is a part of the bipartisan CHIPS and Science Act that allocated $50 billion in federal funds to revitalize the nation’s domestic semiconductor industry.  The United States Commerce Department outlined the priorities of the program in a September news release, the same month that a Triangle company announced plans to invest billions of dollars in the region.

That company is Wolfspeed, which headquartered in Durham and is in the process of constructing a $5 billion semiconductor wafer fabrication plant in Chatham County and expand its Durham facility.  (It has also planned to open a facility in Germany.)

Wolfspeed has said it hopes to “obtain federal funding from the CHIPS and Science Act to accelerate the construction and build-out of the facility.” That act was recently passed by Congress to strengthen semiconductor manufacturing in the U.S.

Other companies want their share, too. The money is meant to support private investment in new factories and can be clawed back if companies use it on stock buybacks instead. Major companies such as Intel, TSMC, IBM, Micron and Texas Instruments have already launched aggressive expansions tied to the support, which will total $52 billion when coupled with funding for research.

Another possible applicant is chip firm Pallidus which recently announced plans to move its headquarters and build a chip facility just outside Charlotte.

Under the CHIPS for America program, the federal funds will be allocated in the form of direct funding, federal loans, or federal guarantees of third-party loans, according to U.S. Secretary of Commerce Gina Raimondo, who spoke at a media briefing about the program’s application process opening.

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‘Not writing blank checks’

But no awards are guaranteed.

“This is fundamentally a national security initiative,” Raimondo said as the application process began. “We are not writing blank checks to any company that asks.”

Raimondo also addressed the topic last week at Georgetown University, laying out four strategic objectives for allocating the funding to spur the semiconductor industry.  That includes ensuring that the United States becomes the home of two, new large-scale clusters of chip fabrication plants and increasing production capacity.

And in order to receive funding, private companies must submit an application that demonstrates alignment with the program’s strategy and vision, which Raimondo summarized as ensuring economic and national security.

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More workers: 100,000 technicians needed

A part of the program, too, will require applicants for the federal funding to disclose workforce development programs and plans to train and hire future workers in the sector.

How many workers are needed in the industry?  According to Raimondo, the United States will need 100,000 more semiconductor technicians over the next decade.

She said in her remarks that the industry must triple its workforce during that time.

“We are in an incredibly tight labor market, labor is hard to find, and we have serious workforce goals that we just have to meet, in order to be successful here,” said Raimondo.  “It’s a math problem, we have to hit these goals, which means we have to be recruiting and retaining.”

Wolfspeed is expected to employ at least 1,800 workers at the Chatham County manufacturing facility.

The Associated Press contributed to this report.

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