The cities of Buffalo, Rochester and Syracuse are nearing the time to find out whether they will receive about $54 million in federal funding for a “tech hub” initiative aimed at bolstering their semiconductor industries.
“All the hard work has been done, the application has been submitted, we're just waiting, hopefully, to hear some really good news in the next few weeks,” said Dottie Gallagher, president and CEO of the Buffalo Niagara Partnership.
The U.S. Economic Development Administration, the division of the Commerce Department that oversees the tech hub competition, plans to announce the winner in late June or early July.
Once the federal funding is secured, New York state has pledged an additional $10 million, bringing the total for the effort to $64 million.
U.S. Senator Chuck Schumer (center) at the announcement of the technology hub designation in October last year.
Derek Ghee/Buffalo News
The tech hub competition was launched to spur innovation outside hotspots like Silicon Valley. Last year, 31 communities were designated tech hubs out of nearly 400 applications, including the NY SMART I-Corridor entries submitted by Buffalo, Rochester and Syracuse.
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A “tech hub” bid submitted by Buffalo, Rochester and Syracuse would use about $54 million in federal funding to bolster upstate New York's semiconductor industry. Now, teams from the three regions will wait to see whether their proposals are deemed worthy of funding in a competition overseen by the federal agency.
The 31 tech hubs are eligible to receive tens of millions of dollars in federal funding, but only five to 10 applicants are expected to receive funding.
NY SMART's bid focuses on creating a “semiconductor corridor” from Buffalo to Rochester. The federal government has been pushing to boost domestic semiconductor manufacturing for national security and supply chain reasons.
In the Syracuse area, Micron Technology plans to invest up to $100 billion in a semiconductor manufacturing facility. New York state has other semiconductor manufacturing facilities, and near Columbus, Ohio, Intel is investing $20 billion in two semiconductor manufacturing facilities.
Gallagher said that with all this manufacturing capacity combined, studies show that by 2033, a quarter of semiconductor chips made in the U.S. will be produced within 350 miles of a NY SMART corridor.
“Not only will we produce 25 percent of the nation's semiconductor chips, we will be the largest single manufacturing region in the United States,” she said, “with or without additional assistance from the federal government.”
Gallagher said he sees a great opportunity for manufacturers already supplying the semiconductor industry to grow and for other manufacturers to pivot and start supplying the industry.
“We have a great base of existing manufacturers that can take advantage of what the federal government is doing,” she said.
One of the proposals in the NY SMART application is to build a Supply Chain Activation Network led by the University at Buffalo with a budget of $8 million. SCAN aims to build a supply chain network for the semiconductor industry. In Genesee County, Edwards Vacuum has begun construction on a $319 million factory that will produce dry pumps used in the semiconductor industry.
Gallagher said the tech hub designation alone is attracting attention even before the funding is decided. In June, representatives from 20 Taiwanese companies in Micron Technology's supply chain are scheduled to visit Western New York for the tech hub designation.
“We see a real opportunity here,” she said.
Gallagher, who was on a lobbying trip to Congress on Wednesday, said the NY SMART tech hub initiative has strong bipartisan support. One of NY SMART's most prominent supporters is Senate Majority Leader Chuck Schumer, who pushed the bill that created the initiative.
While the three regional bids are awaiting funding announcements, Gallagher said the joint effort has opened up new possibilities.
“We think that the level of collaboration we have now between Buffalo, Rochester and Syracuse just happens to be around semiconductors,” she said, “and we think this is a new way to do economic development throughout the region and leverage the assets and strengths of this entire region for the benefit of Western and Central New York.”
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