In 2022, congressional Democrats and the Biden-Harris administration passed the CHIPS Act into law. This act aims to incentivize the domestic production of advanced computer chips and semiconductors through tens of billions of taxpayer dollars in federal subsidies.

Now two years later, the Biden-Harris administration has agreed to release a portion of a larger pool of funds earmarked for Intel and a new chip fabrication facility it is building in Ohio, according to Cleveland.com.

The $1.5 billion grant that has been released is substantially less than what is needed for the Ohio project that has been plagued by cost overruns and delays and likely won't be completed by the initial deadline or employ as many workers as initially promised.

Funds finally released

In a Tuesday press release, the Commerce Department announced that it had finalized its approval for CHIPS Act grants to Intel totaling up to $7.865 billion for multiple chip manufacturing projects the company was working on in Arizona, New Mexico, Ohio, and Oregon.

Commerce Sec. Gina Raimondo said, "The CHIPS for America program will supercharge American innovation and technology and make our country more secure -- and Intel is playing an important role in the revitalization of the U.S. semiconductor industry through its unprecedented investments across Arizona, New Mexico, Ohio, and Oregon."

Likewise, White House Deputy Chief of Staff Natalie Quillian cheered the move and said, "Today’s award marks another key step in implementing President Biden’s CHIPS and Science Act and the Investing in America agenda to reshore manufacturing, create thousands of good-paying jobs, and strengthen our economy."

Intel and Ohio's governor are pleased

Intel unsurprisingly celebrated the award in a news release and noted that the $7.865 billion was separate from a recent $3 billion contract awarded by the Defense Department and was in addition to a 25% investment tax credit that helped incentivize its $100+ billion investment plans in multiple states.

"With Intel 3 already in high-volume production and Intel 18A set to follow next year, leading-edge semiconductors are once again being made on American soil," Intel CEO Pat Gelsinger said. "Strong bipartisan support for restoring American technology and manufacturing leadership is driving historic investments that are critical to the country’s long-term economic growth and national security. Intel is deeply committed to advancing these shared priorities as we further expand our U.S. operations over the next several years."

Also praising the release of the federal grant money, funded entirely by taxpayers, was Ohio Gov. Mike DeWine, who said in an X post, "Today’s announcement that Intel-Ohio is receiving CHIPS Act funding is a much-needed step forward in the important objective of making the most advanced computer chips in America."

"The DeWine-Husted Administration has never wavered in its pledge to bring these chip manufacturing plants to Ohio," he added. "The work to build the Silicon Heartland now moves forward with even more certainty, advancing our economic and national security to the benefit of the working people of Ohio and America."

Project has not been going as planned

According to Cleveland.com, however, not everybody is feeling positive in Ohio about the long-awaited release of the $1.5 billion grant that will go toward the $28 billion Intel plant in New Albany, construction of which began in 2022 and was supposed to include two fabrication facilities and employ 3,000 full-time workers when it was slated for completion in 2025.

Yet, it now looks like only one fabrication facility will be completed by 2030 and will only employ around 1,500 workers -- which places at risk promises made by Ohio's government to pitch in upwards of $600 million in additional grant funding and $2 billion in tax incentives that were contingent upon the project employing at least 3,000 workers by 2028.

Further, according to the Dayton Daily News, Intel was recently compelled to lay off thousands of workers, could soon be acquired by a rival competitor, NVIDIA, and has discussed plans to restructure and spin off the Ohio plant, once it is completed, to a new subsidiary company.

Regardless, an unnamed senior Biden-Harris official told Cleveland.com, "The Ohio site will be producing chips and operational before the end of the decade. Whether that’s one [fabrication facility] or two fabs, you know, ultimately is going to depend on demand."