Top politicians in Oregon tried to convince a top official in the Biden administration on Wednesday, 5 April 2023, that Oregon is a strong state in the national semiconductor industry. Now, lawmakers have passed a bill that they hope will make it easier to get steroids by injection.
Senate Bill 4 was given final approval by the House of Representatives on Thursday, 6 April 2023. This was Oregon’s first significant attempt to use more than $200 million in state spending to get more money from the federal government.
With solid support from both parties, the chamber voted 44-10 to pass the bill and send it to Gov. Tina Kotek to be signed. This was a result that had seemed likely for weeks.
“We knew we would need to rise to the occasion and today we’re doing that,” said state Rep. Janelle Bynum, a Happy Valley Democrat who co-chaired the special committee that developed the proposal over eight weeks. “We’re delivering on that goal and seizing that opportunity.”
SB 4, which has two main parts, is meant to get semiconductor companies to choose Oregon as a place to grow or open a new business.
In one part of the bill, $210 million is set aside. Most of this money will go to grants and loans that companies in the semiconductor and advanced manufacturing industries can use to buy land for new facilities, build on it, and do research.
Lawmakers think companies that want these payments will also try to get some of the $52 billion the government offers through the 2022 CHIPS and Science Act to boost domestic semiconductor manufacturing. Thursday, Kotek’s spokeswoman said that the governor’s office had received one official letter of interest in the money and that more will likely come soon.
The bill’s second and more controversial part gives Kotek the power to change the urban growth boundaries that limit where people can build around Oregon cities in a way that has never been done before. Lawmakers made this rule because they were worried that Oregon didn’t have enough large plots of land for the industry to attract a significant semiconductor facility, like a new factory.
Under the bill, Kotek can change growth limits until 2024 if she thinks that’s the only way a semiconductor project can move forward. She can do this for up to eight sites, six of which can’t be more significant than 500 acres, and two of which can be any size.
This land-use part of SB 4 has been criticized by farmers, environmental groups, and Republican lawmakers who worry that giving Kotek power could lead to losing valuable farmland. Most of the talk has been about protecting the farmland around Hillsboro, the center of the state’s semiconductor industry.
“I cannot in good conscience give the governor super-siting authority to take lands and bring them into the urban growth boundary,” state Rep. Ed Diehl, R-Scio, said during a debate on Thursday. “That is not the Oregon way.”
Other lawmakers disagree with the decision to spend more than $200 million from Oregon’s limited budget when they don’t know exactly how much they’ll have to pay in the two-year budget starting in July. These numbers won’t be estimated until May.
Farrah Chaichi, a Democrat from Beaverton, voted against the bill because she said that semiconductor factories use a lot of electricity and clean water.
Even with these criticisms, members of both parties supported SB 4. They saw it as a once-in-a-generation chance to help the state’s economy for decades.
Since the 1970s, Oregon has been a significant player in the United States semiconductor industry. Today, it employs about 15% of the nation’s semiconductor workers and is a vital part of making chips, the most important part of modern electronics. Many of these jobs are based on a big Intel campus in Hillsboro.
Even though Oregon has a long history, it recently lost out to other states in the race to get significant new facilities. Ohio, Texas, Arizona, and New York have all won these projects and are expected to fight hard for federal CHIPS Act money.
In light of this, Oregon’s congressional delegation members asked U.S. Secretary of Commerce Gina Raimondo to come to Oregon on Wednesday, which she posted on Twitter. Raimondo met with U.S. Sen. Ron Wyden, U.S. Rep. Suzanne Bonamici, Kotek, Bynum, and other officials who said Oregon should get a lot of federal money.
“If I do say so myself, we rocked it,” Bynum said on Thursday. “She was impressed.”
Now that SB4 has been passed, lawmakers are highlighting tax breaks that could help Oregon get more semiconductor work. After a tax break for research and development ran out in 2017, bringing it back is an important goal.
On Wednesday night, lawmakers on a committee called the Joint Semiconductor Committee got their first look at what this kind of credit might look like. State Sen. Mark Meek, D-Oregon City, and Rep. Nancy Nathanson, D-Eugene, made a rough draft of a plan that would give up to $10 million in tax breaks to companies that spend more on research and development in the state.
Nathanson and Meek both said that the proposal is a better deal than similar tax credits offered by other states that are also competing for semiconductor investment.
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