A company linked to San Francisco-based Substrates Corp. is developing an advanced semiconductor manufacturing facility that could invest billions of dollars and create 2,000 jobs in Texas.
According to an application with the Texas Comptroller’s Office, an organization called America’s Foundry Bryan, LLC is applying for tax incentives under the recently enacted Jobs, Energy, Technology and Innovation Act for a 3 million-square-foot project on 288 acres of land owned by the Texas A&M University System in Bryan.
The potential investment is described in the filing as a “first-of-its-kind cutting-edge, pure-play foundry manufacturing project that will bring cost-competitive semiconductor manufacturing back to the United States.”
American Foundry Bryan already received tax incentives from the Bryan City Council earlier this month for the development, dubbed “Project Factory One.”
The facility will be built on an undeveloped portion of the Texas A&M RELLIS Education and Research Campus in Brazos County.
Substrate has signed an agreement with Texas A&M University and has “indicated interest in co-investing,” the filing states.
The project is expected to have a total investment of more than $12.6 billion over a six-year construction period. The project’s planned start date is scheduled for the fourth quarter of this year.
The application states that the project will involve a staggering capital investment of $108 billion over 40 years in buildings, machinery and equipment, creating a total of 2,000 full-time jobs by 2035.
More than 2,000 construction jobs will also be created associated with the initial project.
The average starting salary will be in the six-figure range and will continue to rise as job openings increase.
The JETI Act is a state alternative to the controversial Chapter 313 tax abatement program.
Under the JETI Act, if a jobs-boosting project is located within an Opportunity Zone, the company can receive a tax abatement of up to 50% to 75% of the property value for 10 years, as opposed to the 100% school tax abatement offered by Chapter 313.
The project is located in an opportunity zone and is within the Bryan Independent School District.
Twelve states have offered incentives for the facility, but three, including Texas, are front-runners.
The company said confidentiality agreements prevented it from discussing potential proposals from Oregon and New York, but both states figured prominently in the site-selection process because of their focus on semiconductor manufacturing.
The filing specifically cites support for New York chip maker Micron Technology Inc., a move that has come as a sore point for many involved in Texas economic development after Texas missed out on up to $100 billion in investments that Micron pumped into the state several years ago.
However, the Texas JETI program is attractive to America’s Foundry Bryan. The company says that while the JETI program offers the company greater benefits than the New York incentive program, without the benefits of the JETI program, the New York program would be significantly more favorable for the company’s property tax burden.
Substrate is also pursuing tax abatements with Brazos County along with grants and funding related to the Texas Semiconductor Innovation Fund, the Texas Enterprise Fund, the Texas Enterprise Zone Project Designation, the Texas Skills Development Fund and the U.S. CHIPS Incentive Program.
If the project is located in Bryan, the city will offer an 80 percent tax abatement for the first five years of the contract with the company, and a 50 percent abatement for the next five years.
The 10-year period (2030-2040 school years) for which American Foundry Bryan is seeking the JETI Act tax break involves properties with taxable values ​​ranging from more than $10 billion to more than $11.5 billion per year.
