NEW ALBANY, OH — SEPTEMBER 09: Intel CEO Pat Gelsinger, Gov. Mike DeWine joined by politicians and business leaders break ground ceremony for Intel’s new semiconductor manufacturing site, September 9, 2022, in Licking County, Ohio. (Photo by Graham Stokes for the Ohio Capital Journal / Republish photo only with original story)
Ohio officials are trying to get federal funding for Intel’s multi-billion dollar manufacturing facility, but as the months go on and as a new administration gets closer, tensions are rising.
Tech giant Intel broke ground in the Buckeye State more than two years ago, promising $20 billion for a semiconductor manufacturing plant that would create tens of thousands of jobs.
Semiconductors are the chips behind e-commerce, social media, cars, computers and everything that utilizes digital technology, which nowadays is just about everything.
This wouldn’t have been possible without the CHIPS Act, which President Joe Biden signed in August of 2022. The immediate economic impact was supposed to be major. The plant will create 3,000 high-paying jobs, 7,000 construction jobs and tens of thousands of additional jobs.
But that hasn’t happened yet.
Intel told OCJ/WEWS in February that their goal of starting to create chips by late 2025 isn’t possible anymore.
It was a historic moment for Ohio, but is it just history now?
“This has been something that has been lingering for quite some time,” Gov. Mike DeWine said.
DeWine and the state have already given billions to subsidize the project, but Intel said the federal government isn’t keeping up its end of the bargain. An agreement was made in the spring for Intel to get $8.5 billion in direct funding and $11 billion in loans, the company said.
“I did reach out to the White House today, to ask them to speed up the money going to Intel,” DeWine told reporters before the general election.
Intel is still planning to stay in Ohio despite the delays, a spokesperson for the company said.
“We’re proud to be building the Silicon Heartland and are well on our way to establishing Ohio One as one of the world’s leading semiconductor manufacturing hubs,” the spokesperson said. “We are committed to Ohio and are going to finish the job.”
But state Sen. Bill DeMora, D-Columbus, who has been advocating for the central Ohio area as the Intel project gets going, said the blame doesn’t just fall on the administration.
“Intel needs to do the stuff that they’re required to do, and then I think the federal government’s willing to give them the money they promised,” DeMora said.
The U.S. Department of Commerce requires businesses to comply with their regulations in order to get the money. We asked both the government and Intel where they were stuck. Intel was unable to provide comment on “private conversations.”
It is possible that Intel has fully complied and the negotiation process is just taking a long time, but DeMora believes that they would have no problem getting the money if they would just comply.
“There’s probably some obstinance on both sides,” the senator said. “We can get this worked out because we need to get Intel going and get them up and running.”
But the project is facing even more challenges than just a slow rollout of money.
Before the election, U.S. House Speaker Mike Johnson (R-LA) said the Republicans would “probably” try to repeal the CHIPS Act.
“I expect that we probably will, but we haven’t developed that part of the agenda yet,” Johnson told a reporter who asked if he would try to repeal the legislation.
The speaker noted that it was important for national security, but went too far.
“You’ll have 100% agreement by President Trump and all in Congress what we were opposed to is that it had too much crammed into it,” Johnson said.
After swift backlash from Democrats and concerns from Republicans, Johnson retracted his comment, saying he misheard the question.
But the doubt was already cast on the future of the Silicon Heartland.
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U.S. Senator-elect Bernie Moreno is standing strongly behind the Intel project and said a repeal isn’t coming, but on Wednesday, he said the legislation could use some work.
“I could see a modification of it to move from grants to maybe tax incentives and just a better operational execution of that,” Moreno told reporters.
However, the following day, the same group of Statehouse reporters asked Moreno what he wanted tweaked from the CHIPS Act.
“I’m going to confess, I haven’t read it,” Moreno said. “And one of the things you’ll find with me is I’m never going to comment on a bill that I haven’t read.”
He continued that, at a “high level,” it was too intrusive to the company’s business.
“It’s telling them too many things of how to run their company,” he said. “I would have preferred it to be more of a tax incentive program than a grant program because government can’t help itself.”
At the end of the day, the senator-elect said, Intel is going to “thrive” in Ohio.
Moreno has been texting with Intel CEO Pat Gelsinger, he said, and they will work together to make sure the project is successful. Intel confirmed this.
“The idea behind the CHIPS and Science Act began in the first Trump Administration and maintains strong bipartisan support,” an Intel spokesperson said. “Restoring America’s semiconductor manufacturing leadership is integral to the country’s economic competitiveness and national security. As the only American company that designs and manufactures leading-edge chips, Intel has a critically important role to play and we look forward to working with the Trump administration on this shared priority.”
This, combined with the company’s financial trouble, is concerning to DeMora and other Ohio officials.
Intel’s stock has dropped more than 50% in the last year while the industry has grown more than 120%. After spending 25 years on the Dow Jones Industrial Average, Intel was replaced on the index by Nvidia, a leader in artificial intelligence, on Friday. The company also had mass layoffs in October, cutting 15,000 jobs, slashing its workforce by 15%.
“I think there’s a definite possibility that Intel could pull out and say ‘We’re done,’ especially if their stock continues to fall,” DeMora said.
Some officials in Ohio have privately worried that Intel will become another ‘Foxconn’ scandal. In 2023, Ohio-based Lordstown Motors filed for bankruptcy and sued international manufacturer Foxconn for failing to live up and follow through on their massive investment deal.
Still, DeWine is confident that the project will succeed.
“It’s important to Ohio, it’s important to the future, I think, of this country,” the governor said. “It’s now time to get this done.”
Follow WEWS statehouse reporter Morgan Trau on Twitter and Facebook.
This article was originally published on News5Cleveland.com and is published in the Ohio Capital Journal under a content-sharing agreement. Unlike other OCJ articles, it is not available for free republication by other news outlets as it is owned by WEWS in Cleveland.
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