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Editorial: CHIPS Act needs bold action by Legislature

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For a state that often moves too slowly or too late, the push to remake Oregon’s competitiveness in the semiconductor industry has shown some promising urgency. Amid a nationwide scramble to land some of the $52 billion in federal CHIPS Act funding, a legislative committee last week advanced a bill that provides $200 million in grants and loans to help chipmakers expand in Oregon. also gives Gov.

Tina Kotek the power to convert parcels of land that are currently off-limits to development to be available for industrial use. And Democratic and Republican legislators are working together on several other bills to provide the incentives, credits and other components identified as vital to Oregon’s competitiveness. Such quick, bipartisan action reflects widespread recognition of how critical the semiconductor industry has been to Oregon’s prosperity over the years.

But for all the work that has been done, legislators have not yet matched the extraordinary opportunity that the CHIPS Act presents with the boldness needed to secure Oregon’s future in this global industry. Even SB4′s innovative provision to give the governor new power in land-use designations allows for too much uncertainty and legal delays that could dissuade chipmakers from investing in Oregon. And opposition from the public to potential industrial expansions close to Intel’s campuses in Hillsboro show exactly why legislators need to be clear and firm in sending the message that ensuring semiconductor development is a priority for them and for Oregon.

With a little more than three months left in the legislative session and the clock ticking on CHIPS Act eligibility, legislative leaders and Kotek must address weaknesses in SB4 and deliver on the other tax credit, incentive and workforce development reforms necessary for Oregon to capitalize on this opportunity. Legislators need look back only a year to remember why Oregon has reason for concern. Intel, Oregon’s largest corporate employer, announced in January 2022 that it would invest a minimum of $20 billion in building two new chip plants in Ohio.

Oregon, which lacks parcels of 1,000 acres or more in the metro area, wasn’t even in the running. But even companies with smaller projects encounter obstacles to growing in Oregon, as Colin Sears, the regional development officer for Business Oregon, testified during a legislative hearing last January. Since July 2021, three semiconductor companies seeking parcels of 200 acres or more removed Oregon from consideration due to the lack of an adequate site, he said.

Considering that the industry pays higher-than-average wages, and employs 40,000 Oregonians – with holding a high-school or community college degree – the lost opportunity should weigh heavily on policymakers. The lack of land isn’t just a concern for chipmaking factories. In fact, the bigger test for Oregon will come later this year when the government begins accepting proposals for CHIPS Act research and development funding.

The government has been clear in its desire to increase such semiconductor technology work in the United States, and Oregon, where Intel conducts most of its research and development, is perfectly positioned to benefit. Intel’s advanced work would help draw other companies and suppliers, bringing jobs, investments and millions more in tax revenue. “That is Oregon’s prize,” Andrew Desmond, Oregon Business Council’s economic development policy director, told the Oregonian/OregonLive Editorial Board last week in discussing a research and development hub.

But creating such a hub around Intel also means confronting the need for more land around Hillsboro and North Plains – a prospect that . And while SB4 seeks to speed up the process for allowing such development, it fails to sufficiently clear legal barriers that can add months or years of delay and includes obstacles that don’t recognize the realities of how these investments are made, critics note. For example, , the bill requires the governor to have a specific project before she converts a parcel for industrial use – injecting a level of uncertainty that may send companies with high-dollar investments to look elsewhere.

And unsnarling land-use policies is only one part of what the industry needs, according to the roadmap produced by the state’s semiconductor task force, which included top politicians, business executives and educational leaders. Robust research and development tax credits – unlike the previous anemic credit Oregon offered years ago – will play a critical role in luring companies to a research-and-development hub and bring Oregon in line with most other states. The state should also make significant investments in workforce development, boost research at public universities and commit to other incentives, the task force urged.

No doubt that the Legislature is being asked to take a gamble in passing so many significant changes. The work of revising Oregon’s land-use law, developing new tax credits and providing new incentives that both attract business and protect Oregonians’ interests is a daunting challenge, especially under tight timelines. But the bigger gamble is assuming that the semiconductor industry won’t look elsewhere if Oregon fails to address the constraints that businesses have long highlighted.

Oregon leaders should recognize that this moment calls for bold action that only they can deliver. .


From: oregonlive
URL: https://www.oregonlive.com/opinion/2023/03/editorial-chips-act-needs-bold-action-by-legislature.html

DTN
DTN
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