Policy Group Questions Incentive Packages for Ohio’s Intel Plant

by J.D. Davidson


When President Biden signed the CHIPS Act into law Tuesday, it most likely meant a third round of government incentives for Intel and it’s planned $20 billion semiconductor plant in central Ohio, leaving some concerned with the amount of taxpayer money being funneled to the company.

The signing opened $52 billion to companies producing semiconductor chips and another $10 billion to create regional technology hubs across the country. That’s on top of at least $2 billion in initial state incentives for Intel, and an unknown second round of state money.

It’s the unknown amount that concerns groups like Ohio Policy Matters, a nonprofit progressive research and policy group based in Cleveland.

“Policymakers are giving our public dollars to Intel without understanding how they might affect state and local governments’ future ability to provide critical services like public education or trash collection,” said Zach Schiller, Policy Matters Ohio research director. “Ohioans and our elected representatives need to know what tax breaks cost – and what we could be giving up to pay for them.”

The state’s first round of incentives came when Intel announced plans for a new $20 billion computer chip facility in New Albany; incentives and tax breaks amounted to roughly $2 billion, not counting any county or city contributions.

The second round came in July when the General Assembly passed and Gov. Mike DeWine signed the annual capital budget, House Bill 687. That legislation included $3.5 billion for capitol appropriations, along with $600 million for onshoring incentive grants, $95 million for local roads, $110 million for state roads, $101.2 million for local water and sewer projects and $300 million for water reclamation project grants.

The bill also modified some tax incentives and created new ones related “related to ‘megaprojects’ by semiconductor manufacturers that could decrease state revenue by hundreds of millions of dollars across several fiscal years, depending on the level of investments by the semiconductor business and its suppliers in Ohio,” according to the Ohio Legislative Service Commission.

“The size and scope of the Intel deal approved by Ohio’s lawmakers are unprecedented for the state,” Schiller said. “We should expect to know the financial costs and tap the public so policymakers can ensure Ohio makes the most of this huge outlay.”

State and federal incentives continue to receive praise and support from corporate and government leaders. Intel CEO Pat Gelsinger called the CHIPS Act a commitment to leadership and manufacturing.

“We are thrilled to see funding for the CHIPS Act enacted into law. Intel is committed to restoring end-to-end leadership, innovation and manufacturing here in the U.S. We are doing our part and the federal government has now done their part,” Gelsinger said in a statement. “Thanks to President Biden, Secretary Raimondo, bipartisan leaders in Congress and everybody involved in supporting the semiconductor industry. We look forward to working with the Department of Commerce on the implementation of this important initiative.”

Ohio House Democrats said the federal money will help lower costs of everyday goods and create jobs in Ohio and throughout the United States.

“The CHIPS Act will help restore America as a global leader in the manufacturing industry,” said Ohio House Minority Leader Allison Russo, D-Upper Arlington. “This legislation gives American companies and workers the tools they need to compete in the world economy, brings thousands of good paying jobs to Ohio, and reduces costs for families. I am proud that the CHIPS Act is a step towards building an Ohio economy that works for everyone.”

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An Ohio native, J.D. Davidson is a veteran journalist with more than 30 years of experience in newspapers in Ohio, Georgia, Alabama and Texas. He has served as a reporter, editor, managing editor and publisher. Davidson is a regional editor for The Center Square. 
Photo “Intel Plant in Ohio” by Intel


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