GRESHAM, Ore. — Oregon has long held a reputation for high-tech companies and workers, earning the "Silicon Forest" nickname. After signs of a slump in that industry just a few years ago, big microchip manufacturers in the state have been spending big to expand their businesses lately — and now the feds and the state are pouring buckets of taxpayer dollars in to help.
For background, President Joe Biden signed the $280 billion CHIPS and Science Act into law over the summer of 2022. The main thrust of the bill was to help jumpstart domestic semiconductor manufacturing by handing money out to companies who can do that kind of work.
Right away, Oregon lawmakers began working aggressively on legislation that would make the state a competitive destination for that expansion. They even touched one of Oregon's sacred cows, the urban growth boundary — carving out a few exceptions for large manufacturing plants with very particular needs.
Ultimately, Oregon passed its own CHIPS bill tailored to fit the federal one. Now, funding from both bills is beginning to make the rounds. Friday marked a celebration of that funding's arrival, with stakeholders extolling what it will do for Oregon's future.
Investing in Gresham
Microchip Technology, a 35-year-old Arizona-based company, has a global revenue of about $8 billion each year and 22,000 employees worldwide. Its chipmaking factory in Gresham has been there for 20 years, growing from 60 workers to 900 during that time. Soon they'll add another 300.
The Gresham facility just won a $72 million grant from the federal government and another $11 million from the state of Oregon — all of it earmarked for expansion.
Ganesh Moorthy is president and CEO of Microchip, and he was present at the celebration in Gresham on Friday.
"That expansion in Oregon will effectively triple the output for Microchip from this facility," Moorthy said. "And that happens over a number of years, but it brings manufacture of semiconductors in the U.S. up significantly."
Right now, only 12% of the global supply of semiconductors is made in the U.S.
Microchip has committed to spending $800 for ramping up its operations in Gresham. After his formal remarks, Moorthy said that the people of Gresham will see a number of changes due to this growth, above and beyond the facility itself.
"There will be a number of things, there will be part of it which is a facility expansion — some of that work is underway already. There will be new equipment that will come in, that will be part of how we grow the output from the facility," Moorthy said. "There will be people that we hire. Then there will be a spillover effect on all of the supply chain that is there to help us, whether that be direct through manufacturing or indirect to help us with growing the workforce: child care, various other things that are going to be needed for our employees on the site."
Oregon state Rep. Janelle Bynum, an engineer herself, said Microchip's expansion is the type of thing she'd hoped for when she helped push Oregon lawmakers to support the semiconductor industry.
"I give Microchip the highest praise for their new partnership with Portland Opportunities Industrialization Center and Rosemary Anderson High School to conduct a semiconductor training program," Bynum said. "One of the things I talked about in our meetings in the legislature was that we weren't gonna just focus on large corporations, we were going to make sure that this made it down into our communities and that, again, that our kids had something to look forward to."
Gresham Mayor Travis Stovall said the new and existing jobs will have a lasting impact.
"The path from poverty to prosperity for folks, many times is something that is interrupted by access to certain things," Stovall said. "Access to education, access to training, all of those things. These types of investments open up jobs within our community where folks who live here can work here ... 'cause that's an impediment to getting family-wage jobs, if you've gotta travel all the way across the region. So, the expansion that you're seeing here at Microchip is going to be phenomenal for the folks who live here in Gresham and the surrounding cities."
Oregon CHIPS
While Friday's event marked a win for Microchip Technology and Gresham, Oregon's other high-tech giants haven't been neglected. Along with Microchip, Intel and Hewlett-Packard have each finalized contracts with the state to receive funding through the Oregon CHIPS Act.
“Oregon’s leadership in semiconductor research and manufacturing is a catalyst for our economy,” Gov. Tina Kotek said in a statement. “These projects will create new jobs in a variety of fields, promote workforce development in counties throughout the state, and will support these companies in obtaining additional resources from the federal government to compound the impact they’re making in Oregon.”
HP, which has facilities in Benton County, will receive $9.5 million. Intel will receive $115 million to fund expansion on its Washington County campus, its largest in the world.
The Oregon CHIPS Act set aside $190 million total for grants and loans to support semiconductor expansion. It also put aside $10 million for land to be used for manufacturing sites and another $10 million for a "University Innovation Research" fund, intended to help public colleges secure federal research grants.
Another $50 million was set aside during the 2023 legislative session for these contracts, Gov. Kotek's office said, and it's expected to be handed out during the short 2024 session that begins in February. The full amount will depend on what lawmakers decide during the session.