On Wednesday (March 29, 2023), the Oregon Senate approved a plan to invest $210 million into the state’s semiconductor sector—Oregon Capital Chronicle photo by Amanda Loman. Oregon’s state senate approved the CHIPS Act on Wednesday, which would help the state compete for semiconductor projects and federal funding to grow the industry.
Thousands of new jobs and millions more dollars for mental health, housing, and other services could be brought to Oregon as a result of Senate Bill 4, which would invest $210 million to give the state a competitive edge and make it a more significant player for research and manufacturing projects in the semiconductor industry.
The majority, $190 million, would go toward grants and loans for Oregon-based semiconductor firms that are looking to grow with help from the federal government.
Sen. Janeen Sollman (D-Hillsboro) and Sen. Tim Knopp (R-Bend) both voted for and sponsored the legislation in the Senate, which ultimately passed with a 21-8 vote. The House has not yet voted on the proposal.
“What a great win,” Senate President Rob Wagner, D-Lake Oswego, told Sollman, hugging her after its passage. The bill’s backers see it as crucial to Oregon’s economic future. Money aside, it also offers resources for understanding and complying with Oregon’s intricate land use regulations.
For annexation by cities, the plan would give Governor Tina Kotek the power to designate some areas beyond urban growth boundaries (the invisible line that restricts where cities may develop) as industrial property. Hillsboro plans to expand by hundreds of acres in the northwest portion of the town, creating an area of around 800 acres that might house a massive factory.
Semiconductors are a significant industry in Oregon, and the state’s economic development agencies are actively courting high-tech firms.
After the hearing, Sollman told the Capital Chronicle, “These are tomorrow’s jobs.” “These are jobs that can lift families from poverty to prosperity. We heard it over and over again in our hearings.”
Semiconductors power everything from refrigerators and medical equipment to secret military technologies and automobiles, essential to modern life.
“What this does, honestly, is it doubles down on the future, and the future, there’s no question, is high-tech semiconductors and these high-paying jobs,” Knopp said in an interview. “And that’s why I think it’s important for Oregon to keep its dominance in this area.”
As part of its efforts to make Oregon competitive for the almost $53 billion in grants and tax credits the U.S. offers, a bipartisan, bicameral committee of 14 members backed the measure earlier this month. This year, according to the federal CHIPS and Science Act, the Department of Commerce will fund semiconductor R&D and production. This law was approved by Congress a year ago.
The measure is the Legislature’s primary reaction to the federal legislation, although it is one of many recent initiatives to meet the demands of the semiconductor sector. Plans to extend the internet, create more houses, and make child care more cheap and accessible are just a few examples. Last year’s $200 million workforce training plan focused on manufacturing and healthcare employment.
In a separate announcement last month, Kotek offered a $1 million award program to assist small and medium-sized businesses s submit competitive grant proposals to the federal government. After the regulations for the awards have been finalized, the state agency Business Oregon will release changes online.
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Only California and Texas have more inhabitants employed by the semiconductor sector than Oregon, which employs more than 40,000 people. Approximately 1.3% of Americans call Oregon home, yet the state is home to 15% of the country’s semiconductor workforce.
Intel, headquartered in Washington County and employing almost 22,000 people, is the biggest private employer in Oregon. Fifteen of Oregon’s 36 counties are suppliers for Intel. Among the eight senators who voted against the measure was Republican Stayton senator Fred Girod. Sen. Brian Boquist (Independent, Texas) was one of seven opponents. The others were all Republicans.
Girod, the lone dissenter on the budget-writing Joint Ways and Means Committee, said that legislators shouldn’t commit to the cash until May’s revenue projection is out.
“We have no idea the exact amount of money we have to budget here,” Girod said. “If we have a big cut in the May forecast, that austere budget is going to get ugly.” The measure isn’t the only piece of semiconductor-related legislation this year. Incentives for businesses to invest in R&D are now drafted as part of another law in the legislative process.