What Is the CHIPS and Science Act of 2022?

T✤he CHIPS (Creating Helpful Incentives to Produce Semiconductors) and Science Act of 2022 was signed into law by former President Joe Biden on Aug. 9, 2022. The law received bipartisan approval and strong support from the research and business communities.

Understanding the CHIPS and Science Act of 2022

The CHIPS and Science Act of 2022💞 had two main objectives:♎

1. Funding programs previously authorized under the CHIPS for America Act of 2021
2. Authorizing the most extensive, publicly funded, five-year R&D program for applied science and innovation in U.S. history

The act appropriated approximately $52.7 billion to support 澳洲幸运5开奖号码历史查询:semiconductor research and manufacturing. In addition, approximately $200 billion was allocated for investments in semiconductor and other scientific research, technology, education, and training, with a significant portion of the appropriations—along with incentive tax credits for business—intended to fund the federal share of public-private p🌊artnerships. An additional $20 million appropriation was provided to enhance security for memౠbers of the U.S. Supreme Court and their families.

Implementing the CHIPS for America Act

In January 2021, Congress passed the CHIPS for America Act. This legislation authorized the Department of Commerce (DOC), Department of Defense (DoD), and Department of State (DOS) to develop onshore domestic manufacturing of semiconductors. With the United States manufacturing only 10% of the chips it needed in 2022, the law was intended to overcome U.S. dependence on foreign sources for semiconductor chips. The CHIPS and Science Act of 2022 provided funding for projects in the 2021 act. 

The CHIPS and Science Act of 2022 included provisions to protect U.S. national security interests in research and advanced manufacturing. It prohibited funding the expansion or construction of new 澳洲幸运5开奖🥀号码历史查询:advanced semiconductor manufacturing facilities in countries that would present a threat to U.S. national security.

The act also contained directives to protect critical scientific research and technology from security risks presented by individuals, organizations, and foreign nations.

The act’s appropriations included $1.5 billion to advance open-architecture, software-based wireless technologies, and to spur innovation in the U.S. mobile broadband market.

America’s Research an♔d Development (R&D) Lag

As much as 85% of productivity growth in the U.S. has stemmed from technological advances. Most of this has come from partnerships between the federal government and the private sector. However, increasing global competition in technology—along with the fact that U.S. federal R&D spending as a percentage of 澳洲幸运5开奖号码历史查询:gross domestic product (GDP) is near its lowest point since the 1960s—has prompted the effort to reverse these ☂tr💛ends.

Increasing the portion of GDP devoted to R&D spending in critical fields was the second main objective of the CHIPS and Science Act of 2022. The act authorized, in dollar terms, the most significant five-year investment in public R&D in American hi🧸story.

In addition to a dramatic increase in research funding, the act introduced the building of new technology hubs across the country designed to increase the participation of underrepresented populations and locations.

Sp🀅ecific Appropriations in the CHIPS and Science Act of 202🐬2

The table below lists the major funding categories of the CHIPS and Science Act of 2022.

Selected Programs and Initiatives

Department of Commerce (DOC) Manufacturing Incentives: This included $39 billion to build, expand, and modernize domestic facilities and equipment for semiconductor fabrication, assembly, testing, advanced packaging, or R&D. It targeted $2 billion specifically for mature (legacy) semiconductors. Within the incentive program, up to $6 billion was available for the cost of direct loans and loan guarantees.

Department of Commerce (DOC) Research and Development: Up to $11 billion was allocated for DOC research and development at the DOC National Semiconductor Technology Center (NSTC), the DOC National Advanced Packaging Manufacturing Program, the DOC Manufacturing USA Semiconductor Institute, and the DOC Microelectronics Metrology R&D program.

CHIPS for America Workforce and Education Fund: The act included $200 million to kick-start the development of the domestic semiconductor workforce, which faced near-term labor shortages, by leveraging the activities of the National Science Foundation (NSF).

CHIPS for America Defense Fund: $2 billion for the Department of Defense (DoD) went to implement the Microelectronics Commons, a national network for onshore, university-based prototyping, lab-to-fab transition of semiconductor technologies—including DoD-unique applications—and semiconductor workforce training.

CHIPS for America International Technology Security and Innovation Fund: $500 million went to the Department of State (DOS)—in coordination with the U.S. Agency for International Development (USAID), the 澳洲幸运5🌊开奖号码历史查询:Export-Import Bank of the Uဣnited States (EXIM), and the U.S. International Development Finance Corp.—to support international information and communications technology security and semiconductor 澳洲幸运5开奖号码历史查询:supply chain activities, including supporting the development and adoption of secure and trusted telecommunications technologies, semiconductors, and other emerging technologies.

Public Wireless Supply Chain Innovation Fund: $1.5 billion through the DOC National Telecommunications and Information Administration (NTIA)—in coordination with the National Institute of Standards and Technology (NIST), the Department of Homeland Security, and the Director of National Intelligence, among others—was intended to spur movement toward open-architecture, software-based wireless technologies, and to fund innovative, “leap-ahead” technologies in the U.S. mobile broadband market.

Investment Tax Credit (ITC)—$24 Billion

At an estimated cost of $24 billion, the act also provided a 25% investment tax credit to companies that invest in semiconductor manufacturing. Based on a bipartisan bill, the Facilitating American Built Semiconductors (FABS) Act, this credit covered both manufacturing equipment and constructing semiconductor manufacturing facilities.

Research and Innovation—$169.9 Billion

National Science Foundation (NSF): Provided $81 billion for significant investments in science, including the development of an NSF Directorate for Technology, Innovation, and Partnerships to accelerate the development of national and economic security-critical technologies. Additional investments were to be made in basic research, building a science, technology, engineering, and math (STEM) workforce, building broad-based research opportunities, and expanding rural STEM education.

Department of Commerce (DOC) Technology Hubs: The act allocated $10 billion to the DOC to create 20 geographically distributed regional technology hubs focusing on technology development, job creation, and expanding U.S. innovation capacity. Another project was appropriated $1 billion to support persistently distressed communities with economic development activities.

National Institute of Standards and Technology (NIST) Authorization: The act provided $9.68 billion to NIST to advance research and standards development for industries of the future. This included but was not limited to, research on greenhouse gas measurement, digital identity management, biometrics, advanced communications, and artificial intelligence. Subjects covered included artificial intelligence, cybersecurity, advanced communications technologies, and semiconductors. Other appropriations were set to support small- and medium-sized manufacturers with cybersecurity, workforce training, and supply chain resiliency. The act also sought to promote competitiveness in international standards.

National Aeronautics and Space Administration (NASA) Authorization: Provided authorization for the Moon-to-Mars Exploration Campaign, including the return of America to the moon. Other programs sought to maintain the International Space Station through 2030, extend NASA’s enhanced-use lease authority, support NASA’s search for life beyond Earth, advance U.S. aeronautics leadership, and enhance NASA’s technology, infrastructure, and workforce. The act also invested in developing planetary defense measures to protect Earth from asteroids and comets.

Research Security to Protect Federal Investments in the U.S. R&D Enterprise: This legislation required the NSF to maintain a Research Security and Policy Office to identify potential security risks, conduct outreach and education to the research community, establish procedures and policies on research security for the Foundation for Energy Security and Innovation at the Department of Energy (see below, under “Additional DOE Science and Innovation Provisions”), and to conduct risk assessments of applications and disclosures. The act further prevented federal research agencies from participating in foreign talent recruitment programs.

Department of Energy (DOE): Reauthorized fundamental research and development activities performed by scientists at the DOE, the National Laboratories, universities, and private companies to advance our understanding of the atom, the cell, the Earth’s systems, and the universe.

Additional DOE Science and Innovation Provisions: Established a Foundation for Energy Security and Innovation at the DOE to foster partnerships among government, industry, startups, and outside funding organizations to increase funding opportunities from the private sector, accelerate commercialization of technologies, and provide workforce training in energy security and innovation fields.

CHIPS for America Update January 2025

In January 2025, the National Institute of Standards and Technology published a report o🎶utlining progress under the CHIPS Act. As of that month, the following had been mobilized:

• Nearly $300M in workforce funds to support over 25 CHIPS-funded manufacturing facilities across 12 states.
• $250M investment in the National Semiconductor Technology Center (NSTC) Workforce Center of Excellence
• Over $200M in private capital towards new and incumbent worker training and retention
• Over $300M in new funding for semiconductor workforce development from 14 states
• Over $55M through CHIPS Research and Development (R&D) in workforce funds for advanced packaging, measurement science, and related fields
• Joint investment commitments to the $200M National Network for Microelectronics Education, a cross-agency and public-private collaboration across the Department of Commerce, the U.S. National Science Foundation (NSF), and the NSTC Workforce Center of Excellence

Also in Ja🦄nuary, the Departmဣent of Commerce announced funding for:

• $105 million to Analog Devices
• $79 million to Coherent
• Up to $10.3 million to Epitaxy Technology
• Up to $52.1 million to Sumika Semiconductor Materials Texas

The intent behind these investments is to give the companies a jump start on expanding and modernizing their facilities and creating more jobs in Massachusetts, Washington, Texas, and Pennsylvania.

The Bottom Line

The impact of the 𒉰CHIPS and Science Act of 2022 on domestic chip supplies may not be felt immediately due to the lead time required to build and start up domestic manufacturing facilities. Similarly, investments in R&D usually require long periods of trial and error before new technology becomes mainstream.

Overall, the legislation is lauded for boosting the science and technology sectors, providing subsidies for manufactu🍷ring semiconductors in the U.S., and addressing China’s anti-competitive trade practices. The CHIPS and Science Act of 2022 represented a massive investm🌸ent by the U.S. in science and technology and is one of the most decisive moves yet in positioning the U.S. to be the recognized international leader in semiconductor manufacturing, scientific research, and innovation.