Padilla, Newsom Urge Biden Administration to Reverse Course on Revoking Funding for Commercial Semiconductor Research and Development

Today, U.S. Senator Alex Padilla (D-Calif.) and California Governor Gavin Newsom issued the following statement after the CHIPS Program Office announced it will not move forward with the Notice of Funding Opportunity for the construction, modernization, or expansion of semiconductor research and development (R&D) facilities in the United States:

“Investing in research and development to shape the future of semiconductor technologies is imperative to maintain America’s competitive edge. Without robust support for commercial R&D we risk our global leadership and ability to outpace our foreign competitors in the semiconductor industry. 

“We urge the Department of Commerce to reconsider its decision and ensure investment in commercial R&D through the CHIPS Act to drive innovation and support the resurgence of domestic semiconductor manufacturing. Key investments to spur and scale private R&D activities, in addition to funding for the National Semiconductor Technology Center, will ensure that California’s semiconductor industry remains the global leader of innovation – driving advancements into next-generation technologies like AI, quantum computing, advanced communication, and new energy solutions.

“We’ve seen the Biden-Harris Administration deliver on a number of priorities to bolster the semiconductor industry throughout the country, and we look forward to continuing to work together to ensure our national and economic security.” 

With its initial proposal to bolster domestic semiconductor R&D facilities, the Department of Commerce recognized the critical role commercial R&D – not just federal R&D – will play in ensuring U.S. leadership in semiconductor innovation. The $11 billion for the National Semiconductor Technology Center cannot replace direct commercial investments.

Through the Newsom Administration, the State of California has invested billions of dollars through our R&D Tax Credit and California Competes Program to support the growth and expansion of semiconductor companies with large R&D operatives, including NVIDIA, Applied Materials, and Lam Research. For decades, the state has made parallel investments into public education, research, and workforce that have built the human capital and knowledge pipelines critical to the semiconductor industry. 

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