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Biden-Harris Administration Distributes $7 Billion for Chip Manufacturing

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  Published in Politics and Government on Sunday, February 8th 2026 at 23:03 GMT by The Messenger
      Locales: Texas, California, UNITED STATES

WASHINGTON - In a move heralded as a landmark investment in American manufacturing and national security, the Biden-Harris administration today, Monday, February 9th, 2026, announced the distribution of $7 billion in grants through the CHIPS and Science Act. This initial tranche of funding, stemming from the $52.7 billion authorized by the landmark legislation, is specifically designed to bolster domestic chip manufacturing, addressing critical supply chain vulnerabilities and positioning the United States to lead in the rapidly evolving semiconductor industry.

The announcement represents a significant escalation of the administration's commitment to reshoring manufacturing capabilities. For decades, the U.S. has become increasingly reliant on East Asian nations - particularly Taiwan and South Korea - for the production of advanced semiconductors. This dependence proved acutely problematic during the COVID-19 pandemic and subsequent global supply chain disruptions, impacting industries ranging from automotive and consumer electronics to defense and healthcare. The chip shortages exposed the fragility of this system and underscored the need for a more secure and resilient domestic supply chain.

Commerce Secretary Gina Raimondo, a vocal advocate for domestic manufacturing, emphasized the strategic importance of the investment. "This isn't just about chips; it's about jobs, innovation, and our national security," she stated. "These projects will create good-paying jobs and help the U.S. compete in the 21st century. We are building a future where America leads in semiconductor technology, not follows."

The $7 billion will be allocated to projects spanning across eight states, fostering a geographically diverse approach to rebuilding the American semiconductor ecosystem. The funded projects are not limited to traditional chip fabrication but also encompass crucial supporting infrastructure, including advanced packaging, materials research, and workforce development initiatives. A detailed breakdown of the initial grant recipients reveals the scope of the investment:

• Arizona ($170 million): Supporting Intel's continued expansion in Ocotillo, bolstering its capacity for producing advanced logic chips. This is expected to create hundreds of specialized engineering and manufacturing jobs.
• Indiana ($18 million): Funding a facility operated by SK Innovation, focused on the development and production of materials essential for advanced chip manufacturing - highlighting the importance of the entire semiconductor supply chain.
• Michigan ($28 million): Contributing to the construction of a Ford electric vehicle battery plant, demonstrating the critical link between semiconductors and the burgeoning EV industry.
• New York ($35 million): Expanding GlobalFoundries' operations in Malta, reinforcing the state's position as a key player in the semiconductor industry and catering to specialized chip applications.
• Ohio ($200 million): A substantial investment in Intel's new mega-factory in New Albany, potentially transforming the state into a major semiconductor hub.
• Pennsylvania ($48 million): Supporting a facility operated by Applied Materials, a leading provider of equipment used in semiconductor manufacturing, improving domestic capacity for producing the tools needed for chip production.
• Texas ($20 million): Expanding Texas Instruments' facility in Sherman, strengthening the state's position in analog and embedded processing chips.
• Wisconsin ($30 million): Supporting a microfabrication facility, contributing to the development of innovative chip designs and manufacturing processes.

Beyond direct funding, the CHIPS Act provides substantial tax credits for investments in semiconductor manufacturing and research. This multifaceted approach aims to incentivize both large-scale capital investments and ongoing innovation. However, experts note that the full benefits of the CHIPS Act will take years to materialize. Building and operationalizing new fabrication facilities is a complex and time-consuming process, requiring significant investment in infrastructure, workforce training, and supply chain development. Furthermore, attracting and retaining a skilled workforce remains a major challenge.

Looking ahead, the administration plans to announce additional rounds of funding in the coming months, targeting different segments of the semiconductor ecosystem. The goal is not simply to replicate existing manufacturing capacity but to establish the U.S. as a global leader in the development and production of cutting-edge chip technologies, including those critical for artificial intelligence, quantum computing, and other emerging fields. The long-term success of this initiative will not only strengthen the American economy but also enhance national security and ensure the U.S. remains competitive in the global technological landscape.