American Foundries Act of 2020

II 116TH CONGRESS 2D SESSION S. 4130 To require the Secretary of Commerce to award grants to States for the construction of microelectronics manufacturing and advanced research and development facilities, to authorize the Secretary of Defense and the Director of National Intelligence to fund the construction of micro- electronics manufacturing facilities for national security needs, and to authorize additional amounts for microelectronics research and develop- ment, and for other purposes. IN THE SENATE OF THE UNITED STATES JULY 1, 2020 Mr. COTTON (for himself, Mr. SCHUMER, Mr. REED, Mr. RISCH, Ms. COL- LINS, Mr. KING, Mr. HAWLEY, Mr. JONES, Mrs. GILLIBRAND, Mr. RUBIO, and Ms. HASSAN) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Trans- portation A BILL To require the Secretary of Commerce to award grants to States for the construction of microelectronics manufac- turing and advanced research and development facilities, to authorize the Secretary of Defense and the Director of National Intelligence to fund the construction of microelectronics manufacturing facilities for national se- curity needs, and to authorize additional amounts for microelectronics research and development, and for other purposes. VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 4130 IS Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘American Foundries 4 Act of 2020’’. 5 SEC. 2. GRANTS FOR CONSTRUCTION OF MICROELEC- 6 TRONICS MANUFACTURING AND RESEARCH 7 AND DEVELOPMENT FACILITIES, AND WORK- 8 FORCE DEVELOPMENT. 9 (a) GRANTS FOR STATES WITH DEMONSTRATED IN- 10 TEREST IN CONSTRUCTING MICROELECTRONICS MANU- 11 FACTURING AND ADVANCED RESEARCH AND DEVELOP- 12 MENT FACILITIES.— 13 (1) IN GENERAL.—Not later than 180 days 14 after the date of the enactment of this Act, the Sec- 15 retary of Commerce, in consultation with the Sec- 16 retary of Defense, shall commence carrying out a 17 program on the award of grants to States described 18 in paragraph (2) to assist in financing the construc- 19 tion, expansion, or modernization (including acquisi- 20 tion of equipment and intellectual property) of 21 microelectronics fabrication, assembly, test, ad- 22 vanced packaging, or advanced research and develop- 23 ment facilities. 24 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 4130 IS (2) STATES DESCRIBED.—A State described in 1 this paragraph is a State that demonstrates to the 2 Secretary of Commerce the following: 3 (A) Documented interest from a microelec- 4 tronics company, that has a demonstrated abil- 5 ity to build and operate microelectronics fab- 6 rication, assembly, test, advanced packaging, or 7 advanced research and development facilities, in 8 constructing, expanding, or modernizing a com- 9 mercial microelectronics fabrication, assembly, 10 test, advanced packaging, or advanced research 11 and develop facility, or documented interest 12 from a public-private consortium that has a 13 demonstrated ability to build and operate an 14 advanced research and development facility in 15 the State. 16 (B) Documented interest from a private 17 entity to provide funding to support the con- 18 struction, expansion, or modernization of the 19 facility that is the subject of the interest docu- 20 mented under subparagraph (A). 21 (C) Commitments from such microelec- 22 tronics company or consortia to worker and 23 community investment, including— 24 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 4130 IS (i) training and education benefits 1 paid for by the company; and 2 (ii) programs to expand employment 3 opportunity for economically disadvantaged 4 individuals. 5 (D) Commitments from regional edu- 6 cational and training entities and institutions of 7 higher education to develop curriculum or en- 8 gage in workforce training, including program- 9 ming for training and job placement of eco- 10 nomically disadvantaged individuals. 11 (E) Guaranteed State-level economic incen- 12 tives for the construction, expansion, or mod- 13 ernization of the facility described in subpara- 14 graph (B), such as site development, tax incen- 15 tives, job-training programs and State-level 16 funding for microelectronics research and devel- 17 opment. 18 (3) LIMITATION ON GRANT AMOUNT.—A State 19 may not be awarded more than $3,000,000,000 20 under paragraph (1). 21 (4) USE OF FUNDS.— 22 (A) IN GENERAL.—A State receiving a 23 grant under paragraph (1) may only use the 24 amount of the grant to finance— 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 5 •S 4130 IS (i) the construction, expansion, or 1 modernization of a state-of-the-art micro- 2 electronics fabrication, assembly, test, ad- 3 vanced packaging, or advanced research 4 and development facility with respect to 5 which the State demonstrated to the Sec- 6 retary documented interest under para- 7 graph (2), or for similar uses in state of 8 practice and legacy facilities as deemed 9 necessary by the Secretary for national se- 10 curity and economic competitiveness; 11 (ii) to support workforce development 12 for such facility; or 13 (iii) to support site development for 14 such facility. 15 (B) RETURN OF FUNDS.—A State awarded 16 a grant under paragraph (1) shall return any 17 unused funds to the Treasury of the United 18 States on an agreed-upon timeframe determined 19 by the Secretary prior to issuing the funds. 20 (C) RECOVERY OF CERTAIN FUNDS.—If a 21 microelectronics entity receiving grant funds 22 under this subsection engages in increased lev- 23 els of joint research and development, tech- 24 nology licensing or transfer, or investment in- 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 6 •S 4130 IS volving sensitive technologies with entities 1 under the foreign ownership, control, or influ- 2 ence (FOCI) of the Government of the People’s 3 Republic of China or other foreign adversary 4 during the period of the grant, as determined 5 by the Secretary as part of a periodic review of 6 whether a microelectronics entity participating 7 in the program specified in this subsection is 8 under foreign ownership, control, or influence, 9 the Secretary shall recover the amounts pro- 10 vided by the Secretary under this subsection. 11 (5) PROHIBITION.—If pursuant to the periodic 12 review of foreign ownership, control, or influence 13 specified in paragraph (4)(C), the Secretary deter- 14 mines that a microelectronics entity is under the for- 15 eign ownership, control, or influence of the Govern- 16 ment of the People’s Republic of China or other for- 17 eign adversary during the period of the grant, such 18 entity shall be prohibited from participating in the 19 program specified in this subsection. 20 (6) NONRELOCATION BETWEEN STATES.— 21 (A) PROHIBITION.—A State may not use 22 any amount of a grant awarded under this sub- 23 section to induce the relocation or the move- 24 VerDate Sep 11 2014 21:28 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 7 •S 4130 IS ment of existing jobs from one State to another 1 State in competition for those jobs. 2 (B) REMEDIES.—In the event that the 3 Secretary determines an amount of a grant 4 awarded to a State under this subsection was 5 used in violation of subparagraph (A), the Sec- 6 retary may pursue appropriate enforcement ac- 7 tions, including— 8 (i) suspension of disbursements of the 9 grant awarded; and 10 (ii) termination of the grant awarded, 11 which may include the establishment of a 12 debt requiring the recipient of the grant to 13 reimburse the amount of the grant. 14 (7) IMPLEMENTATION.—The Secretary shall 15 carry out this section acting through the Director of 16 the National Institute of Standards and Technology. 17 (8) REPORTS AND NOTICES.— 18 (A) SECRETARY OF COMMERCE.— 19 (i) REPORT ON IMPLEMENTATION 20 PLAN.—Not later than 90 days after the 21 date of the enactment of this Act, the Sec- 22 retary shall submit to Congress a report on 23 the plans of the Secretary to carry out the 24 program required by paragraph (1). 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 8 •S 4130 IS (ii) NOTICE OF PENDING AWARD.— 1 (I) IN GENERAL.—Not later than 2 30 days before awarding a grant to a 3 State under this subsection, the Sec- 4 retary shall submit to Congress a no- 5 tice of the intended award. 6 (II) CONTENTS.—Each notice 7 submitted under subclause (I) shall 8 include a description of the State to 9 which the Secretary intends to award 10 a grant under this subsection, the 11 project or projects for which the 12 amount of the grant is intended to be 13 used, specifics on the planned use of 14 the amounts of the grant for that 15 project, and the rationale of the Sec- 16 retary for awarding the grant. 17 (B) COMPTROLLER GENERAL OF THE 18 UNITED STATES.— 19 (i) BIENNIAL REPORT.—Not later 20 than 1 year after the date on which the 21 Secretary of Commerce submits the report 22 under subparagraph (A)(i) and not less 23 frequently than once every 2 years there- 24 after, the Comptroller General of the 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 9 •S 4130 IS United States shall submit to Congress a 1 report on the activities carried out under 2 this subsection during the previous year. 3 (ii) CONTENTS.—Each report sub- 4 mitted under clause (i) shall include, at a 5 minimum, assessments of the following: 6 (I) How the program is being 7 carried out and how recipients of 8 grants are being selected under the 9 program. 10 (II) How other Federal programs 11 are leveraged for manufacturing, re- 12 search, and training to complement 13 the grants awarded to States under 14 this subsection. 15 (III) Outcomes of projects sup- 16 ported by grants under this sub- 17 section, including the construction, ex- 18 pansion, or modernization of a micro- 19 electronics fabrication, assembly, test, 20 advanced packaging, or advanced re- 21 search and development facilities, re- 22 search and development, workforce 23 training, employment, wages, and hir- 24 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 10 •S 4130 IS ing of economically disadvantaged 1 populations. 2 (9) AUTHORIZATION OF APPROPRIATIONS.— 3 There is authorized to be appropriated to carry out 4 this subsection $15,000,000,000 for fiscal year 5 2021, with such amount to remain available for such 6 purpose until September 30, 2031. 7 (b) CREATION, EXPANSION, OR MODERNIZATION OF 8 MICROELECTRONICS MANUFACTURING FACILITIES AND 9 CAPABILITIES FOR NATIONAL SECURITY NEEDS.— 10 (1) INCENTIVES AUTHORIZED.—The Secretary 11 of Defense and the Director of National Intelligence, 12 in consultation with the Secretary of Commerce, 13 may jointly enter into arrangements with private 14 sector entities or consortia thereof to provide incen- 15 tives for the creation, expansion, or modernization of 16 one or more commercially competitive and sustain- 17 able microelectronics manufacturing or advanced re- 18 search and development facilities capable of pro- 19 ducing measurably secure and specialized microelec- 20 tronics for use by the Department of Defense, the 21 intelligence community, critical infrastructure sec- 22 tors of the United States economy, and other na- 23 tional security applications. 24 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 11 •S 4130 IS (2) COMMERCIAL MANUFACTURING.—A facility 1 constructed, expanded, or modernized with an incen- 2 tive provided under paragraph (1) may— 3 (A) be principally oriented toward commer- 4 cial manufacturing; or 5 (B) devote surplus manufacturing capacity 6 to the production of commercial microelec- 7 tronics. 8 (3) RISK MITIGATION REQUIREMENTS.—A facil- 9 ity constructed, expanded, or modernized with an in- 10 centive provided under paragraph (1), or the compo- 11 nents thereof, shall— 12 (A) have the potential to perform fabrica- 13 tion, assembly, package, test, or advanced re- 14 search and development functions for classified 15 and export-controlled microelectronics; 16 (B) include management processes to iden- 17 tify and mitigate supply chain security risks; 18 and 19 (C) be able to produce microelectronics 20 consistent with applicable trusted supply chain 21 and operational security standards established 22 under section 224 of the National Defense Au- 23 thorization Act for Fiscal Year 2020 (Public 24 Law 116–92). 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 12 •S 4130 IS (4) NATIONAL SECURITY REQUIREMENTS.—In 1 the provision of incentives under paragraph (1), the 2 Secretary of Defense and the Director of National 3 Intelligence shall jointly give preference to private 4 sector entities and consortia that— 5 (A) have participated in previous programs 6 and projects of the Department of Defense or 7 the Office of the Director of National Intel- 8 ligence, including— 9 (i) the Trusted Integrated Circuit pro- 10 gram of the Intelligence Advanced Re- 11 search Projects Activity; 12 (ii) trusted and assured microelec- 13 tronics projects, as administered by the 14 Department of Defense; or 15 (iii) the Electronics Resurgence Initia- 16 tive (ERI) program of the Defense Ad- 17 vanced Research Projects Agency; 18 (B) have demonstrated an ongoing com- 19 mitment to performing contracts for the De- 20 partment of Defense and the intelligence com- 21 munity; 22 (C) are approved by the Defense Counter- 23 intelligence and Security Agency or the Office 24 of the Director of National Intelligence as pre- 25 VerDate Sep 11 2014 17:26 Jul 14, 2020 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S4130.IS S4130 pamtmann on DSKBC07HB2PROD with BILLS 13 [Text truncated for display. 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