Frequently Asked Questions: Facilities for Semiconductor Materials and Manufacturing Equipment

Application information can be found at on the CHIPS website and the CHIPS Incentives Application Portal. For further details on the application process and submission requirements, please refer to the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO. All application materials must be submitted through the CHIPS Application Portal.

The NOFO amendment re-opens and extends the period of acceptance of applications, which was originally open from December 1, 2023, through February 1, 2024, so that concept plans will now be accepted through November 1, 2026.

Currently, only concept plans are being accepted. For applicants that are invited to advance to the full application phase, the CHIPS Program Office will communicate full application submission dates to applicants individually upon notifying them of their advancement. 

In the full application stage, the applicant should be prepared to submit “Sources and Uses of Funds” information that details costs and capital sources for each project; audited company financials; a summary financial model with project cash flows, including an income statement and balance sheet information; and detail on the applicant’s incentive request from the CHIPS Incentives Program. Please note that the full application requires financial information beyond what was required for the Concept Plan including: a financial model, operating losses and other cash outflows, workforce development costs, and other uses of funds. Applicants may submit their own financial model but have the option of using the linked Financial Model Template. We encourage applicants to use this updated version. For more detailed information, see Section IV.H.8 (“Financial Information”) of the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO.

The Department may contact applicants at any point during the process to obtain additional or clarifying information. The review process may include interviews with applicants and consultation with outside contractors or experts if deemed necessary to assist in the merit assessment. Applicants should be diligent in ensuring that their applications are responsive to the requirements set out Sections IV.E, IV.F, IV.G, and IV.H in the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO. Concept plans and full applications will be reviewed upon receipt to determine eligibility, completeness, and responsiveness to these requirements. Concept plans determined to be ineligible, incomplete, or nonresponsive will be rejected. Full applications determined to be ineligible, incomplete, or nonresponsive will be returned to the applicant.

Applicants must understand the statutory requirements and should reference Section I.B.2 (“What are the eligibility requirements for funding under this NOFO?”) of the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO. Applicants should make sure their applications are compliant with the statutory requirements with documentation where necessary. Applicants are required to: 

1. Be covered entities seeking incentives for investment in the construction, expansion, or modernization of facilities and equipment in the United States to produce materials used to manufacture semiconductors or semiconductor manufacturing equipment.
2. Have been offered a covered incentive
3. Have made commitments to worker and community investments
4. Have secured commitments from regional educational and training entities
5. Have an executable plan to sustain the facility without CHIPS funding
6. Have documented its workforce needs and produced a strategy to meet such needs
7. Have determined the type of semiconductor technology produced at the proposed facility
8. Have developed an executable plan to identify and mitigate relevant semiconductor supply chain security risks.

Each applicant must provide a letter from a state or local government entity offering a qualifying covered incentive, indicating the estimated size and nature of the incentive. The incentive must be offered for the purposes of attracting the proposed project. 

A “covered incentive” may take many forms, including a tax incentive for the purposes of constructing, expanding, or modernizing a facility within that jurisdiction. A covered incentive can also take the form of a workforce-related incentive (including a grant agreement relating to workforce training or vocational education), any concession with respect to real property, funding for research and development with respect to semiconductors, or any other incentive determined appropriate by the CHIPS Program Office.

The offer of a covered incentive may be contingent (e.g. on certain project milestones being met or the project being awarded CHIPS incentives) but must be an offer and not just include a potential incentive the state or local entity may or may not offer. Any contingencies need to be clearly specified in the letter. Prior to receiving a CHIPS Incentives Award, the applicant may be required to provide additional information demonstrating to the Department’s satisfaction that the covered incentive has been or will be received.

For consortium members, the covered incentive requirement may be satisfied by one letter that names and offers an incentive to all eligible facilities in the consortium being proposed for construction, expansion, or modernization. However, the Department will also accept multiple letters. See more information in Section IV.H.3 (“Covered Incentive”) of the amended NOFO for Facilities for Semiconductor Materials and Manufacturing Equipment.

Note: CPO understands “letter” for the purpose of this requirement broadly to be a written correspondence approved or signed by the state or local government entity that includes the offer, which could include a contract or memorandum of understanding.  
 

The CHIPS Program Office and the Department recognize that protecting confidential business information from public disclosure is important both to applicants and to the success of the program. Please see Handling of Confidential Information for more information. 

The CHIPS Incentives Program application portal requires an applicant who has submitted a concept plan or full application to agree that neither the applicant nor any of its affiliates will issue any press release or otherwise publicly disclose the status of the concept plan or full application or the contents of any communications with the CHIPS Program Office or the Department of Commerce without the CHIPS Program Office’s prior written consent. The disclosure restriction applies to the public disclosure of any and all communications, including regarding the status of a submission, sent by the CHIPS Program Office to the applicant or affiliate. It does not apply to the public disclosure of communications, including the fact of submission, authored and sent by the applicant or its affiliate to the CHIPS Program Office. 

Yes. The recipients and amounts of Federal financial assistance awards will be made public after the awards are made. 

CPO recommends using the Financial Model Template and accompanying Financial Model Template Instructions for the Full Application. The use of this financial model template is optional; however, the full application requires the submission of a completed financial model. 

The CHIPS Act provides that funding is available to covered entities “to incentivize investment in facilities and equipment in the United States” for the fabrication, assembly, testing, advanced packaging, or production of semiconductors, materials used to manufacture semiconductors, or semiconductor manufacturing equipment. Applicants must therefore demonstrate how the CHIPS incentives requested will incentivize the applicant to make investments in facilities and equipment in the United States that would not occur in the absence of CHIPS incentives.  

For applications containing projects that have already been announced or begun construction, the applicant should include other ways that the requested incentives would change the nature, scale, or speed of the investment. 

As stated in the amended NOFO for Facilities for Semiconductor Materials and Manufacturing Equipment, applicants should submit audited consolidated financial statements at fiscal year-end for each of the last two years, and interim financial statements for the current fiscal year. If the applicant entity does not have access to audited consolidated financial statements, they must explain why not.  

For the financial model, CPO is looking for a comprehensive assessment of the project’s finances. Therefore, the financial information, including the key income statement, cash flow statement, and balance sheet information, should reflect project-based financials.

For the purposes of an application, a "project" is a set of capital expenditures for the construction, expansion, or modernization of a facility. Organizations proposing multiple projects or facilities that are not co-located with one another should submit separate concept plans and applications per project location for consideration.

The Department has laid out three objectives for its investments in semiconductor materials and manufacturing equipment facilities: (1) strengthening supply chain resilience, (2) advancing U.S. technology leadership in semiconductor materials and manufacturing equipment, and (3) supporting vibrant U.S. fab clusters. Through this amended NOFO, the Department is particularly focused on the third goal: supporting vibrant U.S. fab clusters.

Through the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO, the Department is particularly focused on projects that advance U.S. clusters. But the Department is open to projects that support any of the economic and national security objectives outlined in the NOFO.

Yes. The Department is interested in projects that advance clusters by closing critical gaps in the U.S. supplier landscape. Often, projects will accomplish this goal by locating near fabs to reduce the burdens associated with transporting critical supply chain inputs. But that is not a requirement, and the Department welcomes projects that support clusters in other ways, including by providing critical materials or equipment to fabs in multiple areas.

Through its investments in the semiconductor supply chain, the Department wants each CHIPS-funded cluster in the United States to be supported by dozens of suppliers, including many that will be investing in the United States for the first time to close critical gaps in the U.S. supplier ecosystem. 

Note that the Department does not intend to use CHIPS dollars to physically relocate existing facility infrastructure in the United States to another U.S. jurisdiction. Rather, the Department hopes CHIPS funding will incentivize suppliers—some of whom may currently have no footprint in the United States—to build new facilities or additional capacity to support U.S.-based clusters.

Yes. As defined in this funding opportunity, semiconductor materials facilities are facilities for the manufacture or production of materials used to manufacture semiconductors, which are the chemicals, gases, raw and intermediate materials, and other consumables used in semiconductor manufacturing. 

Ultimately, applications will be evaluated based on the extent to which they meet the evaluation criteria laid out in the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO, including the extent to which the application addresses the program’s economic and national security objectives. 

As defined in the amended second funding opportunity, semiconductor materials facilities include facilities that manufacture or produce raw and intermediate materials, and semiconductor manufacturing equipment facilities include facilities that produce the subsystems that enable or are incorporated into manufacturing equipment. These suppliers to a supplier may apply for funding so long as they meet the other eligibility requirements in the funding opportunity. 

Ultimately, applications will be evaluated based on the extent to which they meet the evaluation criteria laid out in the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO, including the extent to which the application addresses the program’s economic and national security objectives. 

If you are a potential applicant for a project related to a semiconductor material facility or a semiconductor manufacturing equipment facility — as these facilities are defined in the Notice of Funding Opportunity, see Section I.B.1 of the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO — then you are eligible to apply for funding even if a portion of your business is not related to semiconductors.

Applying as part of a consortium during the full application phase will be a similar process as the concept plan phase. Each member of a consortium seeking funding for a project eligible for CHIPS Incentives must submit their own separate concept plan and full application. As part of the full application, consortium applicants will be asked to submit a “consortium narrative” detailing other members of the consortium and setting forth the overall strategic vision of the consortium, among other relevant information. Applicants that are part of the same consortium should submit the same information in their consortium narrative.

Funding will be awarded on a per-project basis to consortium members proposing to construct, expand, or modernize a facility eligible under this funding opportunity. For more information, see Sections I.B.4 (“May applicants apply for funding under this NOFO as part of a consortium, and if so, how?”) and IV.G.2 and IV.H.2 (“Consortium Narrative”) of the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO. 

Funding will be awarded on a per-project basis to consortium members proposing to construct, expand, or modernize a facility eligible under the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO.

There is no specific floor or ceiling for the number of projects that may be included as part of a consortium. However, in evaluating projects submitted as part of a consortium, the Department will consider the extent to which the consortium’s strategic vision advances economic and national security, and the extent to which a given project is necessary for achieving that vision. Thus, the Department strongly encourages consortia to be selective in choosing projects.

No. Each member of a consortium that seeks CHIPS funding for a project eligible under the amended Facilities for Semiconductor Materials and Manufacturing Equipment NOFO will have to submit their own concept plan and full application. They will not be required to share business confidential information with other members of the consortium. 

In addition, the CHIPS Program Office (CPO) recognizes the importance of protecting confidential business information from public disclosure. CPO and the Department will follow applicable laws, including, for example, the CHIPS Act, the Trade Secrets Act, and the Freedom of Information Act (FOIA), to protect such information. See Handling of Confidential Information.

A strong, long-term workforce strategy is critical to achieving the economic and national security goals of the CHIPS Act. Applicants must demonstrate commitments to workforce recruitment, training, and community investment consistent with 15 U.S.C. § 4652(a)(2)(B)(ii). The workforce strategy should be consistent with Executive Order 14278: Preparing Americans for High Paying Skilled Trade Jobs of the Future, and Executive Order 14173: Ending Illegal Discrimination and Restoring Merit-Based Opportunity. Applicants whose projects involve more than an incidental amount of construction will be required to discuss their strategy for investing in their construction workforce. That strategy must include a workforce needs assessment; a recruitment, retention, and training approach; a job quality approach; and metrics and milestones. All applicants must comply with all applicable Federal labor and employment laws, including but not limited to Title VII of the Civil Rights Act of 1964, the Fair Labor Standards Act, the Occupational Safety and Health Act, and the National Labor Relations Act, which protects employees’ right to bargain collectively and engage in concerted activities for the purpose of workers’ mutual aid or protection.