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New CHIPS Law aims to bolster domestic production of semiconductor chips

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ROCHESTER, Minn.-President Joe Biden signed the $280 billion dollar CHIPS Act into law on Tuesday. 

U.S Sen. Tina Smith tells KIMT the new law aims to beef up domestic production of semiconductor chips and advanced semiconductor chips. 

Cars, farming equipment, military technology, medical technology and much more utilize chips. 

Smith said only 12% of chip production used by the U.S occurs in the county, which is a decrease from 37% in the 1990s.

The law will allocate more than 54 billion dollars for financial incentives for companies to build chip facility's domestically, according to Smith. 

However, federal dollars can only be used for the creation or expansion of chip facilities. 

"The company can not turn around and use those dollars for stock buybacks or increasing the compensation for their CEOs, it has to go into building out those manufacturing facilities, which is good for our domestic supply of chips and also is going to be really good for jobs in the United States," Smith said. 

Smith said the new law also allocates funding for research like fusion, which can be obtained through grants. 

"The University of Minnesota will have access to some of those research dollars, so the great researchers here can have some support and help to buildout the next innovation they are dreaming up, right here in Minnesota," Smith said. 

You can read an overview of the new law here

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