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Gov. Greg Abbott, state officials discuss Texas CHIPS Act, semiconductor industry

The Texas CHIPS Act would create the Texas Semiconductor Innovation Consortium and Fund.

AUSTIN, Texas — Gov. Greg Abbott talked about the Texas Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act during a press conference on Wednesday afternoon.

Abbott was joined by Senate Finance Committee Chair Joan Huffman, House Appropriations Committee Chair Dr. Greg Bonnen and other state officials at the press conference at the Texas State Capitol.

The CHIPS Act would create the Texas Semiconductor Innovation Consortium and Fund. According to a press release from Abbott's office, this would help with the state's research and development of semiconductor chip projects and the semiconductor industry.

"This is a race that Texas must win. We must win it for our state, for our workforce, for our national security and for our future," Abbott said Wednesday.

This legislative session, Bonnen has filed House Bill 5174, which calls for the Texas Semiconductor Innovation Consortium as an advisory panel. 

The consortium would "leverage the expertise and capacity of institutions of higher education, industry and nonprofit stakeholders to develop a comprehensive strategic plan to ensure ongoing semiconductor innovation; sustain Texas leadership in advanced semiconductor research, design and manufacturing; and attract public and private investment in the state related to research, development, commercialization and manufacturing of semiconductors," according to the bill.

The bill also addresses the Texas Semiconductor Innovation Fund, "a dedicated account within the General Revenue Fund." This fund would be used to "provide appropriations to state entities and institutions of higher education as matches for semiconductor manufacturing and design projects; and issue grants to private businesses with an established presence within the state of Texas to encourage economic development related to semiconductor manufacturing and design."

Bonnen's bill was filed on March 10. Read it in full.

It could also help train the workforce needed to support this industry. John Sharp is the chancellor for the Texas A&M University system. He said each year, about 8,000 A&M engineering grads can help fill these roles.

But industry experts say these investments alone aren't enough to keep attracting manufacturers to Texas. The Chapter 313 property tax incentives that lured so many semiconductor companies here are now gone.

"We need to couple it with property tax abatement, a new program here in Texas, because we would have seen our last fab unless we had that incentive tool that we lost late last year," said Tony Bennett, president of the Texas Association of Manufacturers.

Huffman also filed a bill, Senate Bill 2288, on March 10. This bill would call for the Texas Semiconductor Innovation Consortium as an advisory panel and also touches on the Texas Semiconductor Innovation Fund. Read SB 2288 in full.

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