House passes $280 billion package for chips, scientific research and Biden set to sign bill into law — here's what's in it

House passes $280 billion package for chips, scientific research and Biden set to sign bill into law — here’s what’s in it

Posted on

In a 243-187 vote on Thursday, the House approved a $280 billion bill focused on domestic semiconductor manufacturing and scientific research.

The legislation is expected to get signed into law quickly by President Joe Biden, who has called for House passage after the Senate gave its OK in a 64-33 vote on Wednesday.

The bill’s final name is the Chips and Science Act of 2022, following a variety of monikers over the months for versions of legislation aimed at tech issues, including the U.S. Innovation and Competition Act and the COMPETES Act.

One key element for the legislation, which totals more than 1,000 pages, is $52.7 billion for domestic manufacturing of chips

including $39 billion for an incentive program and $11 billion for programs aimed at research and development and workforce development.

In addition, a 25% investment tax credit for semiconductor plants has an estimated cost of $24 billion.

There is also roughly $200 billion for scientific research, including $81 billion for the National Science Foundation, $10 billion for regional technology hubs and $68 billion for the Department of Energy.

This table shows some of the legislation’s funding for scientific research:

U.S. Senate Commerce Committee

Backers of the bill from both parties have described it as meeting critical national-security needs. They’ve emphasized that it aims to prevent companies that receive funding from expanding their microchips manufacturing in China or “other countries of concern,” and the funding also can’t go toward stock buybacks or dividend payments.

“This is the bold action needed to counter investments in innovation made by our foreign competitors, including China, and will help us reclaim America’s global leadership in innovation,” said a statement from TechNet, which lobbies for the technology industry.

But some senators still panned the measure, with Republican Sen. Chuck Grassley of Iowa tweeting that he saw eye to eye with a prominent Vermont colleague who usually votes with the Democrats.

“Bernie Sanders & I almost never agree but he is right about so-called CHIPS bill,” Grassley said on Twitter. “It’s just a huge govt handout to massive/already-profitable companies.”

Earlier this week, the chips measure had been expected to sail through the House with ease, but on Thursday there were concerns that it would face a closer-than-anticipated vote, after Republicans objected to Wednesday’s surprise deal among Senate Democrats on a separate $739 billion healthcare, climate and tax package.

In the end, 24 House Republicans voted for the chip bill on Thursday, and no Democrats voted against the measure, although one did vote “present” rather than “yea” or “nay.”

Now read: Semiconductor stocks have been hit hard, but many are poised for rapid growth. Here are 15 expected to shine through 2024

And see: Chip stocks rally despite an ominous forecast, as U.S. semiconductor funding bill advances in Senate

Leave a Reply

Your email address will not be published. Required fields are marked *