Overall, states and localities have recently promised eight new semiconductor projects $14 billion in disclosed subsidies over the last three years. The communities making these commitments expect to spend $605,000 for every new job created.
Despite misstatements made by some public officials, the CHIPS and Science Act does not require states to match federal spending. In fact, it doesn’t stipulate that companies receive any direct state or local subsidies at all. In fact, the Commerce Department’s program guidance explicitly discourages the use of tax abatements and other kinds of direct corporate subsidies with limited spillover benefits to the broader regional economy. Instead, it calls for parallel investments in infrastructure, public education, and workforce development.