The CHIPS Act has had a major economic impact in Arizona, bringing major companies like Intel and the Taiwan Semiconductor Manufacturing Company here to build massive facilities and bring thousands of jobs to manufacture semiconductor chips. Lawmakers did it by offering them generous tax credits and subsidies to come. The same has been true around the country, where chip manufacturers have invested billions in similar plants.
Now, President Joe Biden is poised to sign a bill that proponents say will make that even easier. The bill weakens federal environmental reviews for certain semiconductor projects to get them off the ground faster. The National Environmental Policy Act, or NEPA, process is a notoriously lengthy one that will soon be fast-tracked for companies that received the CHIPS Act subsidies.
The bill unanimously passed the Senate last year, and the House passed it just last week — but not without objections from some Democrats, like environmental hawk and longtime Arizona lawmaker Raúl Grijalva.
Chris Camacho, president and CEO of the Greater Phoenix Economic Council and a proponent of the CHIPS Act, says today’s semiconductor plants are not those of the 1950s. Camacho joined The Show to discuss.
Full conversation
CHRIS CAMACHO: Well, I think as this bill moves swiftly and unanimously through the Senate, there was a lot of discussion about the importance of moving through the NEPA process expeditiously. There are over $450 billion of investment that have been made in the last three years tied to the Chips and Science Act across 28 states. So we're excited about moving through this NEPA process in accelerated form. And I think it's going to be good for the country in terms of critical defense positioning.
LAUREN GILGER: OK. So let's talk about before we talk about the environmental aspect of this. First, just tell us a little bit about the impact that the CHIPS Act has had here in Arizona. So far, it's been big like the numbers are big, right?
CAMACHO: I don't know that we've seen this kind of investment scale and scope in Arizona's history. We've had over $135 billion of investment made in the semiconductor sector. And since 2020 40 companies have made announcements to launch facilities here And now naturally, the mainstays TSMC and Intel get a lot of the acclaim, but companies like Amcor and their advanced packaging facility as well as ASM and their capital equipment manufacturing, which was announced a few weeks ago at Scottsdale, this is really having regional and statewide impact with thousands of jobs and this is a really important time for our state as we continue to diversify our economic position.
GILGER: OK. So let's talk about the environmental aspect here. This particular bill, the president is expected to sign soon would make that process faster. It is a notoriously long process. Have we seen that environmental review process hinder production here in terms of the semiconductor industry?
CAMACHO: Well, there are a lot of concerns when you're talking about these kinds of billion dollar fabs that are producing chips that go into a number of our defense sectors, important project projects and products. And at the same time, the scale and speed in which they need to operate has historically been a challenge. And so this NEPA process on average can take anywhere from four to five years of environmental reviews and in our world time kills deals, time kills projects.
And while we want to maintain alignment with the Clean Air Act and Clean Water Act, which which this bill will require, we want to ensure that an expeditious move of this kind of investment happens. And I can tell you that these kind of firms are investing in Asia, they're investing all over the world. And we want to ensure that the United States is a very competitive position as well.
GILGER: OK, what are the long term impacts of that? Like if, if these environmental review processes do sort of kill deals, as you're saying here, like what could that mean for the broader industry.
CAMACHO: Well, you know, capital goes where it's, it's welcomed and accepted. And again, the alignment with, again, the Standard Clean Air Act and Clean Water Act, that's going to be those laws are going to be abided by. This just accelerates the process to move through this NPEA review with all of these federal agencies that have oversight of that process.
We believe this is going to move these companies to make more investments faster and at the same time shore up these critical national defense assets that we have and that we need going forward.
GILGER: So the bill was bipartisan unanimous in the Senate but it did not come without criticism. Senator Mark Kelly obviously was a big supporter of it. He was a, you know, cosponsor of the original bill, the CHIPS Act. But Representative Raúl Grijalva from Arizona here, the top Democrat on the Natural Resources Committee, has called it unconscionable.
Like there are concerns about the semiconductor industry's history of leaving behind superfund sites like the impact on the communities where they're built. I wonder like, do you think those kinds of concerns have been balanced enough in this legislation?
CAMACHO: Well, one thing I have observed very directly with this new age of semiconductor investments, very different than what you saw in the ‘50s and ‘60s and ‘70s in the United States, companies like TSMC have have made it public, they're no longer going to use specific environmentally hazardous chemicals like NMP or PFAS, which are very well known out in the environment community.
So there's there's commitments there, there's commitments by companies like Intel that continue to invest in Arizona's watershed. So these companies, you know, largely by the influence of their stakeholders are becoming or had become much more environmentally conscious and friendly and in many respects are now the kind of stewards of the environment as they're creating these jobs and making these investments.
So, you know, everything's a balance. But I think this is you know, a great bipartisan bill. Kudos to Senator Kelly and his leadership. He and I have traveled around the world working with the semiconductor companies and actively listened to what they prioritize. And, and again, I think this finds a bipartisan balance in getting a really strong piece of legislation through that will not only secure our foundational defense position but also drive significant number of jobs for Americans and again, for Arizona, specifically 40 companies adding tens of thousands of supply chain jobs in Arizona. You know I don't know of a period in time where we've seen this kind of intense investment and job creation in our state.
GILGER: Are we trusting the companies themselves there essentially to, to police themselves when it comes to these environmental regulations then?
CAMACHO: Well, I think specifically on the Clean Air Act in terms of VOCs and NOx emissions as well as TDS and the water lines, the Cleaner Act and clean, the water standards are going to enforce or ensure that the public has visibility to the kind of discharge that they have for their facilities and, or the kind of air emissions that these companies would have. They're gonna have to still abide by the current laws on the books. So we feel very confident in what these companies’ plans are going forward.
GILGER: Last question for you, Chris, I mean, you're interested in economic development for the state, right? So quality of life has to obviously be a part of that. Do you think broadly environmental concerns like these are a part of that calculation when we're talking about major development, major industry like this?
CAMACHO: Well, it is always a balance. And what I can tell you too is, you know, unfortunately, the manufacturing industry gets the stigma of smoke stacks and poor air quality. And that, that was your 1950s, you know, steel worker steel manufacturing, you know, back east. These facilities are modern, they're clean, they're state of the art. They really are a different image of what many people think manufacturing is. And I've traveled around the world all over Western Europe to Asia and then our domestic locations of these factories and you know, they are high tech clean manufacturing with, with billions of dollars of new state of the art capital equipment invested in them, not just the four walls, you know that secure them.
So, you know, I'm excited about the impacts of the semiconductor sector and going forward, Arizona is gonna continue to be known as semiconductor central. And these kind of accelerated pathways to move through a NEPA process is vital for our ability to compete globally, for these kind of investments.