New Albany complex could grow more quickly to a $100 billion behemoth with federal incentives approved.
“Things like the CHIPS Act passing and other things in the future working in our favor could take us well beyond what the initial announcement was,” said Columbus Partnership CEO Kenny McDonald.
Uncertainty in the overall economy and global “geopolitics” remain, but the bill marked a critical step for the Intel (Nasdaq:INTC) project, he said.
“The company, their supply base and certainly all the local partners here in Ohio have been moving forward in good faith,” McDonald said. “I have a high degree of confidence in the integrity of the partners.”
The bill had been a bipartisan effort in both chambers, and passed the Senate with considerable Republican support. But the House version passed by a vote of 243-187, largely along party lines.
GOP members said that although they supported this bill, they decided to reject it because the Senate announced a separate bill is advancing that raises taxes and invests in alternative energy. Only 24 Republican members broke ranks to support the measure.
The $52.7 billion in federal CHIPS incentives aim to increase semiconductor manufacturing in the U.S., whose share of global production has fallen to 12%. Incentives take the shape of grants, including for legacy chip production, loans and workforce development.
Intel had started site prep but delayed a ceremonial groundbreaking for its initial $20 billion, two-facility semiconductor fabrication complex in New Albany while the bill was stalled. The company has said since January that incentives would increase the scale of the complex.
“It will be a game-changer with tens of billions of dollars being invested in what may end up as the largest semiconductor manufacturing complex in the world,” U.S. Rep. Joyce Beatty, a Democrat from Columbus, said during the floor debate Thursday televised on C-SPAN. “The United States will be the leader in the economy of the future.”
The Ohio delegation had reached “general consensus” in support of the measure, McDonald said in an interview ahead of the vote.
“It’s one of those moments, a good example of people coming together around a national issue,” McDonald said. “The leadership the Senate showed, and (Ohio) Sens. (Sherrod) Brown and (Rob) Portman showed, was superior.”
Large fabs are under construction elsewhere in the country. It was not immediately clear how much any one company or project would be eligible to seek.
Incentives ensure that projects can still be profitable when built in the United States, McDonald said.
“Subsidies are pretty extraordinary from international bases,” he said.
Supply chain disruptions showed the country’s vulnerability. Delays of chip shipments from overseas led to a shortage in auto inventory, for example, one of the drivers of inflation.
“Having things closer within the country, it’s not just resilience but supply chain security that matters a whole lot,” McDonald said.