Intel receives $8.5 billion in CHIPS Act funding to bolster chip production in four states

The U.S. Department of Commerce and Intel Corporation reached a non-binding preliminary memorandum of terms to offer up to $8.5 billion in direct funding via the CHIPS and Science Act to the company in hopes of creating jobs and logic chips in four states.

Intel plans to invest over $100 billion in the United States over the next five years. It also plans to expand its operations in Arizona, New Mexico, Ohio, and Oregon, which it estimates will create over 10,000 manufacturing jobs and nearly 20,000 construction jobs, according to a statement from the U.S. Department of Commerce.

“Today’s announcement is a massive step towards ensuring America’s leadership in manufacturing for the 21st century. With this agreement, we are helping to incentivize over $100 billion in investments from Intel – marking one of the largest investments ever in U.S. semiconductor manufacturing, which will create over 30,000 good-paying jobs and ignite the next generation of innovation,” U.S. Secretary of Commerce Gina Raimondo said. “This announcement is the culmination of years of work by President Biden and bipartisan efforts in Congress to ensure that the leading-edge chips we need to secure our economic and national security are made in the U.S.”

The chips Intel produces will be used in developing AI and military technologies, the release said.

“The CHIPS for America program will bring semiconductor manufacturing back to the U.S. and create a vital R&D ecosystem to keep it here,” Under Secretary of Commerce for Standards and Technology and NIST Director Laurie E. Locascio said. “The innovation sparked by this proposed investment would strengthen America’s technological and research leadership and significantly help enhance our nation’s manufacturing capacity while strengthening communities and creating good-paying jobs.”

Intel plans to bolster investments in Chandler, Arizona; Rio Rancho, New Mexico; New Albany, Ohio; and Hillsboro, Oregon.

Intel plans to construct two new leading-edge logic fabs in Chandler while updating an already-existing one. It will use the facilities to produce its most advanced chip, Intel 18A.

The investment will result in 3,000 manufacturing and 6,000 construction jobs, the release said.

Similarly, Intel plans to modernize two fabs in Rio Rancho to bolster semiconductor production. Its investments will support 700 manufacturing jobs and 1,000 construction jobs, the release said.

Intel also plans to construct two new facilities in New Albany that will support 3,000 manufacturing jobs and 7,000 construction jobs, the release said.

“New Mexico has been the proud home of Intel manufacturing for more than 40 years, and just recently we celebrated the completion of a cutting-edge manufacturing facility that is providing thousands of jobs to New Mexicans,” New Mexico Governor Michelle Lujan Grisham said in a statement. “The historic CHIPS and Science Act, signed into law by President Biden, is bringing a fresh wave of investments to our state. I am thrilled that Intel will benefit from this legislation and continue to be at the forefront of technological innovation.”

The effort in Ohio is the largest private-sector investment in state history, as The Center Square reported earlier this week. The company is spending $20 billion to create the new chip facilities in New Albany. However, it is getting $2 billion in incentives from the state, not including anything that may come from the city and the county. The company expects that its chip facilities in the state will be operational in either 2027 or 2028.

Plus, Intel will modernize its operations in Hillsboro and have the world’s first High NA EUV lithography equipment. The company's investments there will create thousands of construction and manufacturing jobs, the release said.

Other than the $8.5 billion from the federal government, Intel will receive up to $11 billion in loans from the CHIPS Program Office. Plus, the company will claim the Department of the Treasury’s Investment Tax Credit, good for up to 25% of its qualified capital expenditures.