The U.S. Senate advanced CHIPS Act legislation Tuesday night to provide $52 billion for domestic chip manufacturing incentives and research investments with a 25% investment tax credit for semiconductor manufacturing.
The first procedural vote of 64-34 is not final, but some senators are predicting a final yes vote could come as early as next week. They pointed out it won bipartisan support and received more than 60 votes to overcome a Senate filibuster.
Action on the measure comes nearly two years after the bill’s first introduction and later passage by the Senate before it headed to the U.S.House. Lawmakers are eager to push the measure through prior to the August recess and the fall congressional elections. Should it pass the Senate, it would return to the House for final approval before heading to President Biden, who supports it.
One supporter, U.S. Sen. Mark Warner, D-Va., tweeted: “We still have a few more votes & negotiations to get through, but this is a critical step in FINALLY getting this done to cut costs and strengthen our national security.”
Major semiconductor associations including the Semiconductor Industry Association and SEMI praised the preliminary vote. “The bill would spur hundreds of billions of dollars in private semiconductor investments in America, create hundreds of thousands of U.S. jobs and ensure our country has the chips it needs for critical defense applications and sectors of the economy,” said SIA CEO John Neuffer in a statement.
Of the $52 billion, $39 billion would be a grant program available to semiconductor manufacturers like Global Foundries and Intel, but also hundreds of equipment and materials suppliers, as SEMI pointed out. SEMI represents the global electronics design and manufacturing supply chain.
Intel has been a big backer of the legislation as it hopes to win $3 billion for each of the two new fabs it is planning to build in Ohio in coming years.
There is the potential that with more than 60 Senate votes, funding for science research could be added to the measure. The Senate already passed USICA last year with about $190 billion in funds for science research, including quantum and AI.
Senate Majority Leader Chuck Schumer, D-NY, called the CHIPS Act vote a “test vote” on the larger science funding in USICA.
RELATED: Chip industry splits over U.S. CHIPS Act benefits for Intel