Tasked with allocating more than $50 billion, including $39 billion in semiconductor incentives, the Commerce Department announced its application process for obtaining funding available through the CHIPS and Science Act, which passed Congress last August.
Companies seeking more than $150 million in government funding must submit a workforce plan for the workers who will operate their facilities and construction workers as part of the application process. The workforce plan must include how they will provide affordable and accessible child care for their workers, among other requirements.
Background: As part of his Build Back Better domestic agenda, Biden proposed a $276 billion national child care plan for low- and middle-income parents with children up to age five. But in 2021 the president scrapped the proposal, which lacked support in the then evenly divided Senate.
Most notably, the funding opportunity also encourages several other Biden priorities, including the use of project labor agreements, the administration’s Good Jobs Principles, and workforce development including support for career technical education and other work-and-learn programs. In addition, the application requires companies to demonstrate sound financial models to receive grants, loans, or other assistance.
Companies applying for the federal money will have to "open the books" so the Commerce Department knows exactly where the money is going and how it will be used, Commerce Secretary Raimondo said. This is particularly illuminating as it now provides an opportunity for the government to have insight into company finances. Read the CHIPS for America Fact Sheet for additional information on the application requirements.
Outlook: The Commerce Department will begin accepting CHIP grant funding applications on June 26. In the meantime, given the split majorities in Congress and recognizing that there is no opportunity for legislative action, linking workplace policy mandates to federal money, as has been done in the CHIP grant funding application process, is a tactic the administration is using to achieve Democratic labor priorities. Member companies should anticipate further such activity over the next two years.