On Monday, the Biden administration declared its intention to allocate $1.5 billion in government funds to support the expansion of domestic production by the computer chip company GlobalFoundries in New York and Vermont.

This announcement marks the third instance of direct financial assistance granted to a semiconductor company under the 2022 CHIPS and Science Act.

Enacted to address the challenges in the semiconductor industry, this law empowers the government to invest over $52 billion, aiming to rejuvenate computer chip manufacturing in the United States and promote advancements in research and development, the Associated Press reported.

“The chips that GlobalFoundries will make in these new facilities are essential,” Commerce Secretary Gina Raimondo said on a call with reporters. “They power sophisticated military equipment, electric vehicles. They assure smartphones have the latest features, enable faster Internet connections for Americans.”

Apart from the direct financial support, the government is set to offer loans amounting to a maximum of $1.6 billion. The overall collaboration of public and private investments is anticipated to reach approximately $12.5 billion.

GlobalFoundries plans to allocate the funding towards financing the construction of a cutting-edge chip facility in Malta, New York.

Additionally, the funds will be utilized to augment production at its existing plant in Malta as part of a strategic partnership with General Motors and to revamp its facility in Burlington, Vermont.

These initiatives are projected to generate 1,500 jobs in manufacturing and 9,000 jobs in construction over the next decade.

Written by B.C. Begley