Friday, May 20, 2022

Ohio woos Intel’s chip plant with $2B stimulus package

COLUMBUS, Ohio ( Associated Press) – Ohio has offered Intel Corp. nearly $2 billion in incentives to secure a new $20 billion chipmaking factory that the company says will help ease global shortages and create a new market in the Midwest. It will help in setting up a technology centre.

The state’s director of development said Friday that state leaders say the combination of tax breaks and incentives is possibly the biggest by what Ohio says is the biggest economic development deal in its history.

Santa Clara, California-based Intel, the world’s second largest chip maker, announced a week ago that it has selected a site outside Columbus for two new chip manufacturing facilities.,

If Congress approves the $52 billion bill, Intel executives said the complex could grow much larger and more quickly. which will invest in the chip sector and help ensure more production in the US

Intel CEO Patrick Gellinger said that with six additional factories, Ohio’s total investment could exceed $100 billion in a decade, making it one of the world’s largest chipmaking sites.

The shortage of computer chips, which are mostly made in Asia and used in everything from handheld video games to automobiles, has become a growing concern and was exposed during the pandemic in the US and Europe.

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According to the Semiconductor Industry Association, the US share of the worldwide chip manufacturing market has declined from 37% in 1990 to 12% today.

Intel wants to move fast on its Ohio plants, which will support its line of processors and manufacture chips designed by other firms. Construction is expected to begin this year, with production going online at the end of 2025.

State development director Lydia Mihalik said Ohio’s proposal includes $600 million to help Intel offset the cost of building factories, which are more expensive than those in Asia.

The state will pay about $700 million for road construction and water infrastructure upgrades, including a system that will allow the plant to reuse wastewater.

The state legislature this summer approved a 30-year tax break that would allow Intel to save $650 million.

The state’s share will be money well spent because the Intel facility will not only create jobs, but also make Ohio more attractive to industries like auto, aviation and defense that rely on the chips, Mihalik said.

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“These investments will not only ensure that the project is successful here, but will also support the region by enhancing local infrastructure to support future development,” Mihalik said.

JobsOhio spokesman Matt Englehart said the state’s privatized Office of Economic Development, Jobsohio, will provide up to $150 million in combined economic development and workforce grants to Intel.

In addition, the City of New Albany said it would give Intel a 30-year, 100% property tax exemption that the company manufactures in its business park, The Columbus Dispatch reported.

The two factories on a 1,000-acre site in Lick County, east of Columbus, are expected to create 3,000 company jobs — many of them highly skilled — and 7,000 construction jobs. The facility will support thousands of additional jobs for suppliers and partners, Intel and local and state officials said last week.

State officials said Ohio beat out 40 other states for the project.

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Nation World News Desk
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