Texas is set to spend nearly $1.4 billion on growing the state’s microchip manufacturing capacity, a move that could set the Lone Star State up as a leading player in the semiconductor industry.
Gov. Greg Abbott last week signed the Texas CHIPS Act, a bill to “encourage semiconductor-related companies to expand in the state, leverage the expertise and capacity at Texas higher education institutions, and maintain Texas’ position as the nation’s leader in semiconductor manufacturing.”
“This morning, I signed into law the Texas CHIPS Act, which will ensure Texas remains the home of innovation in semiconductor research and manufacturing,” Gov. Abbott tweeted. “Proud to work with members of the Texas Legislature to keep Texas the #1 state for semiconductor production.”
The Texas CHIPS Act establishes the Texas Semiconductor Innovation Consortium and Fund, a roughly $1.4 billion spending package aimed at boosting the microchip industry in Texas.
Under the semiconductor innovation fund, Texas will allocate $698.3 million in taxpayer money for the provision of grants and subsidies for companies, universities, and state agencies that conduct or support semiconductor manufacturing and development.
The innovation fund will also spend a separate $666.4 million for the creation of research centers at Texas’ leading universities. UT-Austin will receive $440 million as part of the Texas Institute for Electronics, while Texas A&M will receive $200 million for quantum and artificial intelligence chip fabrication, The Texas Tribune reported.
An additional $26.4 million will be allocated to Texas A&M’s Center for Microdevices and Systems, which will work toward developing the next generation of microchips, according to Yossef Elabd, vice chancellor for research at Texas A&M.
“Most semiconductor companies are already in Texas, a lot of funding is in Texas, we are a very business-friendly state and Texas A&M is the No.1 school in the country for engineering production. It is the best place for chip production growth,” Elabd said, per The Texas Tribune.
“The $1.4 billion investment is a huge message to the entire community that Texas wants to lead the way,” he added.
When it comes to national security, the U.S. needs to be the global leader in semiconductor production and research, according to William Inboden, executive director of the Clements Center for National Security at UT Austin.
“In the 19th century, the key ingredient of military power was gunpowder. In the 20th century, it was petroleum, and now it is semiconductors,” said Inboden, per The Texas Tribune.
“Bringing semiconductor manufacturing back to the United States is an economic and national security imperative; that’s why I wrote the CHIPS for America Act with national security officials from the previous administration,” Congressman Michael McCaul (R-TX), author of the CHIPS for America Act, said in a June 12 news release.
He continued, “The passage of the Texas CHIPS Act solidifies our state as the top spot for investment in the semiconductor industry. I’m thankful Governor Abbott and the Texas legislature are continuing the momentum to help Texas’ semiconductor industry lead our nation — and the world — into the future.”
