The Department of Commerce announced that the National Institute of Standards and Technology (NIST) would assume control of $7.4 billion in semiconductor research funding granted under President Joe Biden.
The action could threaten the third flagship CHIPS for America research and development facility in Tempe, Arizona, a semiconductor project announced under the Biden administration expected to become operational in 2028.
Commerce Secretary Howard Lutnick said NIST will take over the National Semiconductor Technology Center (NSTC), a public-private consortium created during the Biden administration, from the National Center for the Advancement of Semiconductor Technology (Natcast).
The department alleged that the Biden administration illegally created Natcast, rendering an agreement that granted the organization up to $7.4 billion invalid.
Lutnick described the private, non-profit corporation as a “semiconductor slush fund” established to manage and disburse taxpayer funds that Congress appropriated for the promotion of semiconductor research and development under the CHIPS Act of 2022.
The department explained that it would reform NSTC’s operations to “align with statutory requirements and increase transparency.” However, it did not reveal how much of the funding has been spent or how it plans to reallocate the money.