Transcripts For CSPAN2 Commerce 20240703

[background noises] [background noises] the committee will come to order. Without objection the chairs authorized to declare recess of committee at any time. Im before we begin secretary has informed us she has only two hours available for this hearing. So in the interest of time Ranking Member and i are remedying ourselves to very brief Opening Statements we are asking the secretary to do the same. Additionally we get as many members as possible a chance to ask questions. And in concurrence with the Ranking Member i ask unanimous consent to limit each members q and a to four minutes without objection. So ordered. Out also like to request unanimous consent to submit to statements for the record for bt the first is from chairman lucas who could not be with us here today. As you know he has had a terrible accident with a bowl, he is a rancher. And he is recuperating. We look forward to his return soon because his leadership is dearly missed. The second as a full Opening Statement from myself without objection we will enter that. So i will recognize myself or one minute for an Opening Statement. So i would say welcome to the science, space, Technology First oversight hearing on the chips for america program. Secretary is we appreciate your willingness to testify today. Thank you for being here. I understand you are in traffic im sorry to hear that. That is not a rare occurrence. Your last minute notice youre only able to dedicate two hours of your time to discussing a 50 billiondollar program is frustrating to say the least to the members of this committee we have a responsibility to receive your use of these taxpayer dollars. And ensure the program is a success. I hope you will at least to commit to meeting in person with any members of this committee whether republican or democrat who are not able to ask the questions they prepared for this hearing. And i hope despite our time constraints we will be able to have a productive discussion today. Congress funded the Chips Program to bolster National Security. And to assure a Semi Conductors can be produced here in the United States on a cost competitive way. The policies advanced by this administration during implementation have been criticized for driving up the cost of doing business. So i expect to be a stronger topic of discussion today along with guardrails to protect our investments from benefiting our adversaries. I look forward to the dialogue that we will have today. I look forward to hearing more about the near term future of the Chips Program directly from the secretary. So thank you secretary raimondo to take the time to join us today. I would now like to recognize Ranking Member of the gentleman from california for an Opening Statement for. Think it mr. Chairman would like you i ask unanimous consent my full statement be made part of the record. In the interest of time i will just say chips for america represents a really historic investment and reassuring our Semi Conductor manufacturing innovation capacity. However, there are challenges in carrying out such an ambitious program. One of the concerns i have which i mentioned to the secretary is what steps the Chips Program is taken to ensure Companies Receiving Funding implement the very highest standard for the handling of toxic chemicals. I come from Silicon Valley where we have seen firsthand the tremendous benefits of the Semiconductor Industry. But also problematic environmental legacy of some chipper production. We have a onceinalifetime opportunity to revitalize the Semiconductor Industry but we also have an opportunity to do it in a way that protects American Workers. With that mr. Chairman i yield back. Thank you very much. I now recognize thank you miss lofgren. I recognize the secretary for her testimony for four minutes. Thank you very much. Thank you and good morning. A few things i am delighted to be here. Secondly i spoke with the chairman yesterday and reassured him i am happy to spend any amount of time with any of you on any topic. Also after speaking with you yesterday we shifted the schedule a bit i will be able to be here for at least two and half hours. I just want to thank you for the chance to be able to update you on the chips and a science act as outlined in detail in my written testimony. We have made significant progress since about a year ago when the bill was passed. As evidence of that we have received more than 500 statements of interest from companies who want to participate and about 100 applications for the Incentive Program. So we arent track to launch the National Semiconductor Technology Center this fall. Which i note many of you will want to talk about. At eda we have launched two initiatives the Tech Hub Initiative the re compete program. We are working as quick as we can too have announcements on both of those programs this fall. I will tell you, both of these programs are massively oversubscribed. In addition nta and noaa are working to implement additional provisions. Happy to talk about any of that. I just want to reiterate what you all know with the chair and Ranking Member have said. If successful in implementing chips and science which is as is the Ranking Member said unprecedented and historic the u. S. Will become the premier destination in the world for where we designed new chip architecture, do research and development and research labs, chips for every end use that scale with American Workers in the United States and a package packagethe most sophisticated cn the world all here on our shores. That is what we are trying to achieve with your support. With that im happy to take your questions. For some to think the secretary for her testimony. The chair would recognize himself for four minutes. Secretary raimondo during negotiations of the chips and science at the Science Committee republicans about strong guardrails that prohibit any company that accepts a grant incentive from expanding or building new advanced Semiconductor Manufacturing facilities in a country of concern including china for 10 years. The language also gives the authority to you, madam secretary, to recover any incentives received should a company be found in violation of this. Could you please provide a short update when the department of commerce rule for implementing the guardrails will be finalized so that we can review it considering the public comment. Ended in may . Yes, thank you for your question. So the answer is very, very soon. In a matter of weeks that will be completed. I am trying to move as fast as i possibly can but more important than going fast is we need to get it right for a special special respect to these guardrails. The whole purpose of the Chips Program is National Security. Until we have the absolute vigilant not a penny of this helps china to get ahead of us. And that none of these companies to receive our money do any research with china or investment in china that in any way undermines our own National Security. So very soon it will be out. And i look forward to working with all of you to work with this program to implement schools rebuts a chips and science act requires guardrails to be part of any agreement or contract the department enters as part of a 39 billiondollar taxpayer back chips Incentive Program. How is it then the department has been accepting for applications from the Incentive Program since march without the guardrails being finalized . And how is the department making it clear what commitments applicants will be required to make when applying for the program if this rule has not been finalized . It makes no sense. s as you can imagine is incredibly complicated applications we are requiring a huge amount of information from these companies. We obviously are not going to make any commitments to any companies. And certainly not give money to any companies until the guardrails are firmly in place. But, we are trying to parallel process so we could move faster. We thought it was prudent to start seeking information so the company could get into a good position to apply while finalizing the guard rail. But obsolete no commitments will be made to any company until the guardrails are in place. Can you commit no application will be approved or monies sent out the door until the guardrails are finalized yes or no . Absolutely. Thank you very much. Becket department is standing up tracks to provide Space Situational Awareness data. Isnt this reinventing the already existing system of the pentagon, very briefly . No, no. We are working on like you say Space Situational Awareness with the pentagon with an interagency who track the commercial satellite and commercial space traffic. Its more congested in space. We have to prevent collisions and the like. With an interagency process i think is necessary. Okay, alright. All right. Chips and science expert bit prevents using chips for stock buybacks. The funding opportunity goes further. It asks applicants whether the plan to engage in any stock buybacks over the next five years and states commerce will quote evaluate applications based on the extent of the applicants commitment to refrain from stock buybacks unquote. Does that mean commerce will deny funding for applicants who plan to engage in any stock buybacks . And if not then how should companies who engage in stock buyback in the normal course what would they think about this provision . Know his answers your question. If you do buybacks you are still eligible to receive the money. But as you know the whole point of this program is for companies to invest in research and Development Manufacturing in the United States. And so we are going to be tough on companies. We want to see what are their investment plans question a Quarter Research and Development Plans . They should be putting their money into investing in america and research and development in america so we perfected taxpayer might we cap be giving them money so they can give it to the shareholders to make more money this is money to race ahead for investments in Semiconductor Industry and our country. It is not a prohibition. But it is a signal to industry that we are serious does not about patting their bottom line for this is about enhancing their ability to innovate in america. Click several more question but i am out of time about technology. I will submit that for the record. So this time i like to recognize the rank of mayor from california per. Thank you and thank you madam secretary its great to see you here. I appreciate the time to talk to earlier about health and safety for workers in the chip industry. As i mentioned in my Opening Statement Silicon Valley has been the home of a chip manufacturing for many years. It is a wonderful opportunity for it has helped to build the valley. On the other hand there has sometimes been a downside. Multiple studies in the 1980s and 90s found that women working at microelectronics manufacturing sites had miscarriages at twice the expected rate. And although the industry has made significant strides in terms of the use of made to prevent exposure to the workforce. I will just note this is from an osha and i will read it. Oshas mandatory pel remain ineffective. However osha recommends that employers consider using the alternative occupational exposure limits because the agency believes that exposures above some of these alternative exposure occupational exposure limits may be hazardous to workers even when the exposure levels are in compliance with osha standards and fact its the apa standards in those cases that need to be applied. I will say this i appreciate your willingness to work with me on this. I look for to vigorously engage with you to see how we can get the great benefits of the chips act but also protect our workforce. Let me ask another question is a company in california it not in my district with an important question. That has brought a policy implications this Company Never offshore and in so as a consequence their costs were higher because labor costs are higher in the United States. They are worried they might be at a disadvantage in the Selection Process because of their higher cost structure. What is the departments general view on using the loan program to use u. S. Only Semiconductor Manufacturers to re finance existing debts if it results in additional Capitol Investments in the United States . What is the view on using our own program to allow u. S. Only Semiconductor Manufacturers for purposes of funding operational and Workforce Development costs and is there concerned about the higher cost structure disadvantaging them in the competition accurate . A couple of reactions mindful of time. On your first point im totally committed to working with you like we talked about. These Companies Use a lot of chemicals, its heavily chemically based and as you say sometimes oshas not enough. Lets figure out better ways to work with companies to secure health and safety. Absolutely break. Brickwork secondly the answer is yes we look well upon using Loan Authority and Grant Authority to help small countries usbased companies to defray the additional costs associate of the cost of u. S. Labor. I would say in a way thats the point of the whole program for the truth of it is you come from Silicon Valley thats were all Semi Conductors once were. Then it was in search of cheap labor that these Companies Went to taiwan malaysia et cetera. Thats the point of the subsidy to allow American Companies and American Workers stay in this business. [inaudible] is a talented team is a piece in the wall street journal about a few months ago. I would welcome any of you to come over to the department to meet this team. We have some top notch investment people topnotch loan expert. We are going to be as creative as possible to structure the money as much as we can to help american businesses. Thank you, mr. Chairman time has expired i yield back too. Yes, maam thank you. Now would like to recognize the gentleman from florida at mr. Posey. Pickwick think it mr. Chairman slightly up that topic regarding noahs misguided east coast regarding the whales we had heard from noaa end thenr hold a workshop on how technology can help protect the whales. It seems like theyre putting the cart before the horse. One thing i have learned since being commerce secretary is the most complicated issues are semiconductor in touch with you i will say this i am personally sympathetic to both sides. We have to preserve the environment and protect the whales but i know a lot of people make a living as fishermen heard so let me come back to the better answer but. For. As a former governor i would not expect you like the way they roll out so i appreciate that answer for. It is complicated there are o subject to lawsuits. So permit me too come back to you. I will do that. What are steps department of commerce taken to protect american interests at standard bodies were china has flooded them with height rates of participants and submissions . I worry a lot about this. We have a whole working group inside of commerce just focused on showing up at standards bodies. And exactly what you say. It sounds not sexy and boring except in the chinese rake the standards to favor them that we got locked out. And so i have put a huge priority on reinvigorating our presence at standard setting bodies all over the world. One little example i will give you is we were successful in getting the american chairperson of the itu, the Telecommunications Union because the russians were backing an alternative and we won. Its because we focus on and put a campaign in place because standards really matter. You just answered my next question so mr. Turman tailback valves on the time. Thank you. And now id like to recognize it from oregon brickwork sank into the chair, thinking to the Ranking Member. Thank you madam secretary is good to see up with chips and science actors make historic investments in u. S. Semiconductor manufacturing and supply chain improvements and cuttingedge research and development. The Ranking Member said she represents Silicon Valley i represent Silicon Forest as a representative of the Silicon Forest and excited for the opportunities bruised is that pleasure to host you would oregon madam secretary we heard from Portal Committee college learned how they are preparing to enter the workforce pcc has a program called quickstart which they partner with Semiconductor Leaders like intel for example to provide skilled based training for the next generation of the Semiconductor Workforce. Madam secretary we need more pathways to enter the growing Semiconductor Advanced manufacturing industry. What Workforce Education Program is an apartment investing in to meet the r d goals of chip question but how can congress and the department make these programs accessible to more Diverse Learners including rural and underserved communities . Great question. We had a great visit i was blown away by what i saw the Community College. I should tell you, if you were to say to me what keeps you up at night . Its a long list. The workforce is something i worry about. Right now theres about 100,000 there is a need for industry to have 100,000 Semiconductor Technicians. That number is going to go up to about three and a thousand pretty quickly. Technicians do not need for your College Degree for the committee college is a perfect Training Ground it may be High School Plus program. We are doing a few things as you know were going to stand up and stc has a whole workforce component we encourage universities and Community Colleges took into that. For every ships applicant required a workforce play and what are you going to do. We are asking state; governors myself and convening governors to say and best your state money into workforce programs. Including Community Colleges. The nsf has a couple hundred Million Dollars. Long story short every single thing we are just what the chips money or the r and deep money or outreach it is to try to get states to put skin in the game to do this in. Outsize and goodness we arty have over 50 Community Colleges that we know of that puts out new Training Programs. That is excited by dona cut you off. I prepared in the Diverse Workforce ready to implement the act for the must be axis type quality affordable childcare this is hearing this across. Under your leadership the department is pioneering the requirements that are chip applicants must or should depending upon the size of the award provide childcare for the workers i appreciate this commitment because of the serious challenges in the economy. So it madam secretary what criteria will the department is to evaluate the accessibility and quality of the Childcare Service . How they encourage applicants to partner with diverse range of providers like headstart or homebased Childcare Services . Yes we are asking every company to show us their workforce a plan including a childcare plan. There is no onesizefitsall plate will be different in every state. Its exactly what you say. You cannot hardly workers you need and less women can work for that is not going to happen lesters childcare that is affordable. I am not doing that because it is a social issue but it is a business issue. You talk to any ceo that tied the same thing for. Thank you for it mr. Turman at seo back i request unanimous consent to enter into the record a brief from the center for childcare employment at uc barkley implemented chips childcare requirements and supporting good at paying Early Childhood education jobs. And also mr. Chairman and colleagues this is a good investment in our future to invest in our children for they will be the next generation of Semiconductor Workforce of yelled back. Without objection so ordered. I would now like to introduce excuse me, mr. Garcia the gentleman from california for four minutes a very quick think he was her chair. And madam secretary good to see you again thanks for coming in. I respect and agree with your comments be the biggest threat to the chips act is the workforce right now. If we cannot figure how to get that so i applaud the efforts we need all hands on deck. All demographics both sexes in everyone to participate to support this but okay thank you again for taking the time before the chips was brought to the floor for the boat to help me get comfortable with the requirements the diligence youre putting into make sure. Mr. Chair we spent several hours in the skiff with the secretarys team as well as some corporate subject Matter Experts to make sure we are reporting over the requirements of the dod applications. It would be a terrible thing cars only to find out we have no Industrial Base to service the hypersonic seat weapons of a need in the fight against china. I would like for you to touch on that madam secretary. I also want to thank you. We are getting very positive feedback from my district in Southern California from your team read the engagements you had you described are fruitful. I know it is early. The feedback is very positive it. So i appreciate the execution on that. And last, before i hit it for you due to the interest of time we talked about over the phone a couple of months ago supporting you with an initiative, this trade a fight we are in the china. This a macro issue we have with china being the biggest threat to the United States right now as a pure adversary. We have to figure out i think i thinkyou and i share that opi. I just want to reiterate we are back at your disposal im happy to pull together a Bipartisan Group of folks. Folks like Mike Gallagher on the China Select Committee for both sides of the aisle to come together to help enable you in that process it. It is a long term problem i know in the answers are not easy. But i think it is important that we do get together and serve but in the arc towards eight reciprocal trade agreement. China is doing to us right now things that we should not tolerate. But if we are going to allow them to do it we should at least be able to do it to them and have access to the markets their intellectual property with the agreement should be fair, balanced a reciprocal i think you understand and agree with that. So if you could talk to the requirements. That i also wanted to touch him briefly you are at level of satisfaction. I know its not related to chips. But are you okay with the way treasury right now is currently managing and making sure we are enforcing the sanctions against russia relative to the ukraine conflict . If you could touch on the stew thanks thank you. Okay good morning nice to see you. On the defense Industrial Base think the update since the last time i saw you as we have executed mou with the Defense Department to share information on exactly this issue. So we get from dod what are the defense Industrial Base chips it needs to make sure as you say what we are incentivizing to fulfill those needs. I feel good about that its progress and we are working very closely for the dod and intelligence community. That is a great update. Reciprocity to china by going to sit with you because i only have a minute now. When you are in china i was very clear that allie pay, union pate do business in the United States. Visa and mastercard cannot. Their Autonomous Vehicle they are piloting on our roads right now. We cannot. Their Media Companies everyday are submitting content in the United States, we cannot. It is a long list. It is not fair. Enough is enough lets level the playing field. Ill come visit with you after my trip and maybe we can talk about it. On russia secretary yellen and the whole team is doing a fantastic job under great difficult circumstances. The think i am focused on its export controls. I will be honest it is a brutal day today fights. Every time we find out theyre going on export controls they can we come down on them. It is a little like a whack a wo mole. Russia has been putting these Global Networks together for decades. They are good at getting around a super and like to think we are even better stopping it. Its vigilance. You have to take it to it every day with vigilance. And that is what we dont export controls. Makes sense, thank you. Id like to recognize ms. Stevens from michigan. Thank you, good morning. It is so nice to see it madam secretary pete i was thinking about todays hearing i was reflecting on the incredible workforce at the department of commerce. I know you have been busy setting up a team the chips for america team within the department and implementing a very historic endeavor. And take you up on your offer to come by with the investment crew i if want to ask you a couple of questions. One is about open source central processing units. As you know any wood in the world can contribute the construction of opensource cpus. Which then can be used for products currently there arent requirements or regulations to ensure under source cpus have not had any instruction added by actors like china, russia note mr. Garcia was hung but export control. If you have any reflection on opensource cpus in addition to what you just shared about export controls we are all in years. Also we saw the ccp came down with some restrictions on gilliam and germanium. Gilliam is used in micro electric components of the many electronics. And germanium poses many military applications critical to our national defense. And so given these developments, what industrial policy initiatives has the department considered may be aid chips Like Initiative for Rare Minerals that you could implement if we want to draft another chips 2. 0 legislation surrounding the particular given how critical thats going to be. The chips implementation. And then lastly if you have any other comments around the ships office and the rnd facilities the commercial opportunities that you are going to put forward. Thank you. Okay. Okay, so on that gallium and germanium, that seems clear to me that is there to for tat retaliation. And we are not going to be scared by that point leading to do what were going to do to protect our National Security. And we have allies around the world who will provide Critical Minerals to us. Or we can innovate here. I would welcome the opportunity to work with you or everybody to sit down and make a plan around Critical Minerals. Whats the most important Critical Minerals for products we need for National Product security like chips . If we cannot mind them or process them in our own country where else besides china and the world can we . We cannot be held hostage. And so i would welcome that. The chips team ive been in government now is an executive for more than a dozen years. The chips team is like nothing ive ever created boots over 100 people really top talent working seven days a week im very proud of them. It is a hard job. We will welcome your engagement. On the research and development this a fall, i would say in general this default we will have big announcements on tech hubs, re compete in stc, rnd the bill passed a year ago but weve been working like crazy. The next two months will see announcements on all of that. And we want to work with whoever in michigan or any of your states nonprofit, forprofit weekly can add to the Innovation Ecosystem for. Thank you was that mr. Chair i will yield back. Thank you. Id now like to recognize the general from tennessee. Thank you mr. Chairman madam secretary think of appearing before us today. I have two questions the first is that Radio Access Network pro chips in science act contain funding for grants that could help increase supplier diversity in the Wireless Industry by supporting open Radio Access Networks. Can you give us your thoughts on the program on how these funds can scale new commercial ready vendors . What is at stake if these funds to spur the development and deployment of open brand Wireless Networks . Pricing for the question. As you said this a billion and have thousand chips act. I was is a vitally critically important. We need to secure 5g and 60g network. To protect ourselves. One way to do that and bring down the cost is to have them be open. We put out the first money in august of this year. We put out five and half a Million Dollars for the first awards. We are going to put more money out later this fall. We are very engaged with industry. I have been meeting myself with the wireless carriers. That is the key i think to get the carriers to be open to embracing this instead of just working with incumbent hardware providers. Of. Its a critical innovation fr National Security and im grateful congress put that money in the bill. I will thank you and will work with you to help expedite that. So i thank you very much for your answer. My next question deals with semiconductor tax credits of. Without going into too much detail in section 48di want to let you know we are talking about. Earlier this year commerce issued proposed guidance for the chips act Grant Program that defined a Semi Conductor Semiconductor Devices only. Undefined semi conductive substances such as poly silicon as material. The department of treasury unfortunately relied on this narrow definition in the proposed regulations for implementing the tax credits excluding manufacturing and other facilities in the supply chain. Qualifying for the credit. I feel without domestic poly silicon wafer manufacturing we wont be able to build out our domestic Semiconductor Manufacturing supply chain. So my question, madam secretary, and can you commit to work with the department of treasury to issue final regulations that correctly defined semiconductor to include semiconductor substances such as poly silicon and wafers which is critical parts of the Semiconductor Manufacturing supply chain. As you correctly say this isan treasury will house. Over with you and secretary yellen to look at this issue. Recognizing my authority relates more to the Grant Program. And secretary yellen is in charge of the 25 itc part i hear you, we can follow up. We can talk to the secretaries team. Thank you. With that narrow definition it does exclude a lot of things that are critically important in my view to greatly domestic supply chain. I think what treasury did is there incorrectly lashed onto very narrow definition which we would like to see expanded and brought in. Without a yield back. Likes it recognize mr. Bowman for. Thank you, mr. Chairman thank you madam secretary thank you for being here and for your tremendous work. I am concerned about that re compete program. Many historically marginalized under resourced communities that lack the infrastructure to go after somebody grant money that is available as part of that re compete program. What are your thoughts in terms of supporting these historically marginalized communities and building the infrastructure and accessing the resources necessary to create jobs. And as you mentioned earlier 100k shortage. Can you speak to how to provide more on the Ground Support for historically marginalized communities . It is a great question. The whole point of the re compete program is to make investments in communities that have been historically behind. And our plan is to open a open meritbased process. To pick a handful of places to make fairly significant investments. I know from experience if you are starting with nothing you need critical mass. Which requires a big investment. We are providing Technical Assistance that we can. To help communities to apply. This is initiative got a couple of steps in the process. We are really trying to provide Technical Assistance. That being said im not going to sugarcoat it for this is tough in rhode island the communities are left behind as a result they dont have much of the infrastructure for they dont have a Planning Team they do have money to hire a lawyer to supply the grants. We are doing what we can to recognize that. But in your case or anyones case if you have a community that you think is worthy with some money could be successful then we will reach out to you and help you to help them to apply it. Thank you but ill have my office followup with you on that. We definitely want to partner with you in that conversation. I had another question about regional tech hubs regional tech and Innovation Hubs. I was proud to good trip with the ideas to the bill about how we can bring a minority owned businesses to the table. I can use the hubs to promote Employee Ownership and cooperative Business Models for as we implement how do you building and actually keeping wealth and local communities . Perfectly vulnerable communities as we just talked about. How do you make sure the benefits dont go to Large Corporation and distant investors . With tech hub. Let me Say Something on the Tech Hub Initiative. I have never seen anything like this that is oversubscribed. We are appropriated 500 million. We have received over 400 applications. We are massively, massively oversubscribed 400 applications from 48 states and three territories. We are going through the applications. We are required by statute to designate at least 20. That means 380 disappointed places. And i can tell you these are incredibly high quality applications. So i suppose that is my way of saying i think at some point we should appropriate more money for this. Got 500 million. And this is what we are seeing to compete with try to invest in america. All of the technology in all of our communities. So re compete is for really distressed places. Tech hub not so much for it honestly do want to find places that are really good at some technology. We can take them from good to great. So i do not want you to think this is poor distressed communities. That being said its not just for big companies. The next generation. I dont think of it so much chips is big companies. We start up ecosystem and r d ecosystem a new innovative way of job training. So that is how we think about it. That is the purpose of it. I think we will get that right. Well get into every nook and cranny of the Community Picnic thursday works on superconductive basic Technology Print i want to give them a shout out as well. Thank you so much mr. Chairman and i healed it back. Yes thank you very much. The gentleman from california. Think it mr. Chairman. You have what some have considered to be the key cabinet position. It is really a conglomerate of not a lot of things that did not positively go together. But congress saw fit to bring them together. Conveniently and interestingly were here to talk about the chips active. But what is interesting as two of your key under secretaries your undersecretary notice the bias. And your undersecretary known as director of the pto. When you were in china just days ago, you were bushwhacked to say the least by the launch of 5g phone and the proof china has achieved capability. That was not an accident. They chose you as an important symbol of their accomplishments. The tools that are at your disposal one of them clearly to stop the export of technology that allows what is just occurred to occur. The other one is the one i want to focus on for a moment. Even though the undersecretary for intellectual property the pto director is somewhat independent still falls under yours and the coordination is uniquely yours as the secretary. My question to you is three of the top 10 patent recipients last year were chinese. Only one was american. The reality is a company not able to do business in the United States continue to receive and often clandestinely through proxies, they continued to receive royalties they are patenting the Technology Talk about trees and valleys. I am from telekom gulch, san diego. We are extremely concerned your administration has to find a way to block in a different way for its not just about a particular device going to china from llama or some other entity. The reality is if china is allowed to create blocking Revenue Technology in 5g and telecommunication and a host of areas as they are what i would call ai blocking. Coming up with patents that envision things they have not really reduced in practice. Will be used against us to thwart us. What you doing combination of those and other tools . Let me say this. I would welcome a come sit with you if you have ideas for consideration. We are trying to use every single tool at our disposal, enforcement, patents, to deny the chinese and ability to get intellectual property to advance their technology in ways that can hurt us. I was obviously upset when i saw the announcement. The only good news is we dont have any evidence they get manufactured at scale. Although i cannot talk about any investigation specifically i promise you this. Every time we find credible evidence in the company has gone under export controls we do investigate. But as it relates to ip i will sit with you or have kathy come sit with you if you have ideas on how we can tighten it up i want to hear them. I have been able to meet with kathy. I would love to meet with you. During the time i left the congress for two years my job was to try to figure out how to compete with the belt and rode up at we do not do it well because we dont coordinates the weight chided us in competing against us. I would like to see and technology that we do coordinate yours and other parts of the government. Ill be happy to meet you at your convenience. Thank you, mr. Chairman i yield back. Yes or thank you. And now the gentlewoman from North Carolina miss rossford. Thank you chairman and Ranking Member lofgren for holding this very important hearing today. Thank you madam secretary for being with us. North carolina Semiconductor Industry boasts over 100 Semi Conductor and other Electronic Component Manufacturing Establishments rate over 7600 people employed in the sector and one point to billion dollars in exported product. The passage of the chips in science act was critical in reenergizing and maintaining global competitiveness. National institute of standards and Technology Manufacturing programs are critical to supporting u. S. Domestic manufacturing. Congress authorized significant plus up for both the Manufacturing Extension Partnership and the manufacturing usa program and the chips in act. With the major support from the biden harris administration. As you note congress failed to appropriate funding to these programs at the levels set in chips and science. Set madam secretary, could you talk about the opportunities the United States is losing out on by not supporting the Manufacturing Extension Partnership and manufacturing usa customer cow in a decrease in funding to these programs affect domestic manufacturing . Thank you for your question. I think it is very significant. We talk a lot about securing our National Security. Competing with china. The exchange i just had with congressman issa relates to what we can do on defense. My strongly held view is what we do on offense matters so much more. Theres only so much we can do. She said china is coordinated over the past 30 years this country second its i off the ball of manufacturing. When you dont manufacture it you lose out on innovation and you become dependent on other countries. So every investment we make in mep, it is a great program. You all have them in your state. They are very well run. They help Small Companies to innovation and manufacturing. They are the ones is going to find the next Semiconductor Manufacturing innovation. They next interesting battery technology. I would say it were working hard on the manufacturing usa. We are going to announce the topics this fall. There will be a competition we will stand it up next year. If it is shortchanging our manufacturing usa at short changes american National Security and our ability to invest in her own manufacturing capacity. Investments in quantum information science. Where do you believe the department of commerce should focus its efforts for the next five years through the National Quantum initiative . Im going to have to get back to on that. As a quantum expert i am not. But i will have her team follow up with you. Thank you. And just to tell you why i think that is so important, some of this we are doing catch up. Or are semiconductor stature to other countries would put manufacturing there. On quantum we can be the leaders and we already are may be representing who she will ask about this. But if you have never been to the duke Quantum Science Center to see what is going on for the future it is amazing so thank you. Thank you we do lead the world and quantum. We lead the world in ai and i will follow up with you. X thank you very much. I now recognize a gentleman from florida mr. Franklin pay. Thank you good morning madam secretary appreciate spitting time with us today. Very important topic and it love i loveto talk more about chips. In fortunes i do have your present active follow up on something our office has been trying to get answers to prayerr is much as were tired of talk about the topic that concerns covid i hail from central for the Hurricane Hunters that fly for noaa are in my hometown of lakeland. As a formal naval aviator admitted career practice to not fly into storms was invited at a point to go flying with Hurricane Hunters and i was like afford to do that. Back in july is going so all the paperwork necessary to do that i was surprised to find i would have to supply my status of Covid Vaccine for my vaccine status and be willing to submit to a tester show proof i did i have covid at the time for it that came as a surprise considering there is an end to the pandemic should have done this before but mr. Chairman i request unanimous consent to enter into the record a letter sent to the secretary back in july as well as the department of commerce covid19 Workplace Safety plan that was dated in july of 2023. Without objection pickwick thank you, mr. Chairman. Our staff sgt research finding out why would we still be requiring this . As it turns out i read in your departments own plan the department does not require onsite employers at this status employees and visitors are not required to show proof of negative 19 check covid19 test when entering a doc facility. Regardless of the vaccine status. There is a disconnect there im really puzzled about. Somewhere between your desk and the deck flight level someone has decided to create their own policy. No way do i fall to the folks at the tip of the spear trying to get this done. But 41 of my colleagues and i sent you a letter back in july asking for information about this. Im sure its a languishing in someones inbox i am curious why would noaa still be requiring this, at this time . Particulate organizations is nothing but scientists who presumably are falling sides every day . Thank you for your question but let it say a few things first im sorry we have not replied yet im costly try to ca better and quicker applying you will get your reply this week. Secondly, i dont know and i will look into it. I do know they are very close quarters in these hurricane ande hunters they are tiny. It could be that but i will get you a proper answer. Thirdly i do want to take 10 seconds to say thank you to my team that operates the Hurricane Hunters. It has been an unbelievably busy season will have two Hurricane Hunters they can fly into the thick of the storm for you are braver than i. Theyve asked me too fly it. Im not willing to do that. I am going to take this occasion to ask congress for additional funding we have two planes theyr old we operate a fleet of nine Hurricane Hunters. Theyre all old were they need maintenance i had to take one down during a hurricane because of maintenance to get your proper answer to your questions i do want to say that team is working around the clock. We need congress support to maintain. Work to do fully support them at i would support more resources for them. I do understand was down i was unable to fly into the storm will need the date of the most conservative implication for noaa staff. Our Staff Members of know it required to show vaccine status now . Thats also not in accordance it. Id like to have those answers. Okay the answers we have a policy that is science based as you say. So i will follow up or. For a good thank you madam secretary all yelled back. The gentleman from annoying. Some think the chairman and Ranking Member for convening the hearing and secretary raimondo for your willingness to appear today. On trust to continue the subject of a previous light life i was at meteorologists i really appreciate your support for those who put themselves in harms way. Flight into the hurricane so we have the data to better forecast for the killer storms are going to go. I would invite you to come to our office we can help champion how to find the funding for the Hurricane Hunter aircraft to protect lives and property. Thank you. Chips and science included 15 billion in chips for america fund. 39 billion for implementation for manufacturing Incentive Programs. At 11 billing those for rnd and Workforce Development. 39 billion is a Huge Investment in chips manufacturing. The cost of manufacturing was very high. More at that will be covered by this investment. We need industry to capitalize on the investments made in chips on the last year chips office has stepped up on notice of fundingopportunity announcement. One of those was for the 39 billion for the semi semiconductor Financial Assistance program. Which has received hundreds of statements of inquiry. Point your perspective the investments made their chips in science incentivize the private capitol and the chips and economy on the scale we need . It is a great question. Yes let me say. Although 39 billion is an enormous amount of taxpayer money its an Unprecedented Program it really is a drop in the bucket. Relative to the mission we have to meet. Since the president signed the chips and science act and has been more than three to billion dollars of private investment announced to the Semiconductor Industry. That is why i answered yes to your question. If we continue to go on a path for every dollar we invest there is 10 or more of private capitol. Then i feel good about that. But it is necessary which is why at my job is to cut the best deal possible for the taxpayer to draw in as much private capitol as possible per. How does our investment compare with chinas today . Much lower at much lower. I do not have the numbers in front of me. I think china i will get the exact number, i think they have 145dollar fund just for semiconductors. And they have announced a massive investments, state subsidy and legacy chips much lower. Our private sector is the envy of the world. We are not a state run economy nor do we want to be one. We will compete and win. We are not going to go toe to toe to them for public money we went out innovate them and draw and private sector capitol which is where the question youre asking is so hard. It is the right question we have to make sure it happens. Hundred make sure meet the workforce requirements we go forward . I know that was brought up before. And how can congress be part of the solution . I think Congress Needs to continue to fund workforce. Workforce, apprenticeships, job training, lease or not social programs they are Central Business objectives for america to compete. If you say to me secretary what is success in implementing the chips act question is not just incentivizing its getting colleges and universities to put out three times as many engineers. Its getting every committee college in america to have a Semiconductor Technician Certification Program it is Getting High School students to be taught Vocational Training and things that relate to the chip industry. Continue to fund it dont look at it as a soft investment. Its every bit as important to invest in our people as it is our tanks, missiles, hardware great come appreciate the perspective annealed back. Thank you sir. Now id like to recognize a gentleman from indiana. Thank you, mr. Chairman thank you Ranking Member for holding the session. Thank you for being here madam secretary we appreciate it. My question is among the requirements for those deep within chips of funding must comply with the National Environmental policy act and other environmental laws. But other executive orders. So tying complaint to chips funding means any company applying through any of the funding opportunities including the upcoming one focus on rnd, will need to navigate this process. First some firms carrying out the environmental is familiar. It is resource intensive. In the process given to the band with an capitol they have at their disposal. However the smaller businesses in the Semiconductor Materials and equipment sector there is a real risk the requirement to comply may impact the disbursement of funding or slow down the pace of construction. So here is my question. Jose Chips Program Office Working with this industry partners, particularly Small Business applicants to a sage this concern . How can they chips local office work with local authorities to reduce the potential for duplicative compliance activities that might further delay the construction of new fabs of other Manufacturing Centers . Thank you for your very important question. You are right it takes a long time. I have built a little team in the chips office to do just provide help and assistance, Technical Assistance to applicants so they can have an epub plan which makes sense theres a bipartisan to the Defense Authorization act which would help a lot too. We are going to do everything we can with our own team to help streamline an epa and move it as quickly as is prudent. If congress could pass the amendment the crews kelly amendment in the authorization act it would help us a lot to move faster. The other thing i wanted to say, the way we are implementing chips is we are trying to incentivize states to your point trying to incentivize states to help us with the permitting. And so for example, we encourage states Governors Offices to put in place a single point of contact on permitting for chips its just like in the Governors Office the chips hermetic team. We are trying to interested streamline between the fed and the state requirement we are giving a plus one to states that actually do that. I worry about it myself. And like i said i have a very good team of experts trying to work the system properly so we get it done as quickly as we can. Thank you. That is good to hear of god to give a shout out to my Alma Mater Purdue University breed they are doing a lot of work in this chips area. Theyve come from a small little wafer to up to an 18inch wafer now to make chips. They are training these young people and students. I just want to give them a shout out for their good works in the chips area. I am smiling because one of the best visits i have been taken as my tenure was to purdue. I have loved all of my visits. [laughter] mrs. Daniels is a friend of mine, the former governor. When he did there is amazing i spent the day at purdue went to a chips a job fair in purdue. What theyre doing in chips. It is like right on target. If every community did that in this country there would be no stopping us. They should daniels is my friend to purdue and we really appreciate you taking the time to be there. Yes ive already been one it was a great trip. Im happy to go back. Thank you. Okay, thank you. Id like to recognize the gentlewoman from oregon. Think it mr. Chairman and thank you to the Ranking Member for hauling this hearing. Thank you it secretary to take the time to speak with us today. Before we get started on the questions relate back to my district he mentioned a lot of announcements coming this fall. I know a lot of the money is funding has been appropriated. But how would a shutdown of a Government Shutdown actually affect all of the rollouts and timelines you are facing right now . It would be crushing. When i talk to members of congress they say how come youre not moving faster on chips . Where is this . Where is that . We are literally working 70s to work to work as fast as we can. Not only home to intel and Companies Like Land Research that is in my district and they manufacture chips as well. We host a significant manufacturing hub that contributes to the Semi Conductor supply chain and these are good paying jobs. I hear from the Smaller Companies it was a huge shock for the businesses in the fabrication initially started moving overseas and in some cases these businesses took many years to recover and they may hesitate to fully jump back in because of that experience. As we look to jumpstart this industry, how should we be thinking long term about the support to ensure that this isnt a oneoff investment but that we are really bringing this industry and the jobs back permanently for the long haul . I think a few things. We need to embrace innovation including Artificial Intelligence, which will bring down the cost of a lot of the production in a way that could enable us to keep it in the United States. The other thing honestly thats why we have the chips initiative. Its more expensive to build these facilities in the u. S. Relative to asia and thats why i think this is a good investment. We want to pay workers a good wage and we want labor standards and need environmental standards, so we can to back away from high standards. We need to innovate to bring down cost and then thats why i think its appropriate in this case to have a program of this kind and i also will tell you as i talked to big customers of Semi Conductors, i wont name names, but companies that consume huge quantities, they are increasingly willing in some cases to pay more for usmade. They see how vulnerable they are when they buy the chips from one country in asia. I think they are increasingly willing to do that because it adds business value. As you know the act appropriated 11 billion for orient of the activities including the creation of the National Semiconductor Technology Center you mentioned earlier. Of the existing infrastructure in chips including everything from cuttingedge research in the manufacturing supply chain to highvolume capacity uniquely positions the states to serve as a hub for domestic r d. How are you thinking about leveraging existing resources such as highvolume and factoring capabilities and expensive supply chains to maximize and stc investments . We are thinking of doing that. What we envision is creating a whole network that the n stc we want it to be a neutral sciencebased place or series of places that existing University Hubs and Networks Like you say can kind of hook into. Invest into it so it grows and if we succeed, the n stc will be this neutral sciencebased so all institutions feel comfortable drafting with it. Thank you. I will yield back. I would like to recognize the gentleman from georgia doctor mccormick. Thank you for being here with us today. Its limited so i will get right to the point. A transfer the responsibility for civilian Space Situational Awareness from pentagon to the department of commerce. Since its transferred away from the pentagon most other agencies that are monitoring but you are kind of developing your own system itself. We will leverage of the capacity. We are working with of the inter agency including the pentagon to finalize this. All of that being said, theres a need for a Space Situational Awareness program not that different from the air Traffic Control to keep track of the commercial congestion. I know we are short on time. We have people that are kind of doing that already and they have broader access to more than we would have that we would have to create in the department. My question is why not use those civilian agencies and coordination between commercial and re creating your own infrastructure, which would seem to be much more expensive . We will work with them but we think that its necessary to have our own a proprietary system. I want to talk about china and the massive satellite launch is that they have right now. Basically the same kind of orbit i think around 13,000 that theyve asked to launch two space. Basically my question is what is the department of doing to establish the data sharing and transparency to keep all that in a safe space given the limited ability to share information . On the radar tracking i know its going to get harder as people come up with new technologies and stuff like that. To come to the table and share information to keep our space especially from being on a collision course . Let me do this. My deputy secretary who runs the commerce can get a much better detailed answer to that. Can i come back to you with a proper answer . Final complex question. In the actual hardware that we are producing you mentioned at the act that we rely heavily on the hardware china says we are going to take taiwan. If they do, then we are two years away from even it takes two years to build that kind of capacity locally. Would we then have to deliver a way to keep them from getting that technology and actually reverse engineering have the capability to produce it and not give it to us . And other words how do we keep us where we belong given that the entire capacity is in taiwan right now . My answer to that question i had to do everything single day to increase domestic manufacturing. Im not going to engage in hypotheticals but with china will and wont do i know that we are vulnerable. We buy all the chips that youre talking about the ai checks and all that, none of them are made in america right now which is why ive got to work like crazy every day to bring that manufacturing home as fast as we can. Theres no shortcut around that. Because we need them at a scale. Like a high, its not like you can make a small number for ai. So, unfortunately the only solution at least that i can think of is move faster in america and billed to produce those chipsets scale. It kind of didnt interest that fully we dont have that capability nor do we even have a plan, the plans havent started to be billed for the ai chips. Im worried about that. With that i will close. Id like to recognize the gentlewoman. Thank you mr. Chairman and Ranking Member for holding this meeting today. And mr. Secretary, its good to see you again. Thank you for being willing to appear before us today. I was proud to join you and President Biden earlier this year in North Carolina which is my district for the president s first stop on the investing in america tour and i thank you for talking with us about this chips in science and where we are heading to. Im proud of that in my district it includes North Carolina bioTechnology Center to accelerate North Carolina lifesciences manufacturing coalition, a raise a band and winner of the Economic Development agencies build back better regional challenge. The funding has helped to dramatically increased the capacity of the Education System to prepare North Carolina residents for highquality world paying jobs and expand entrylevel biotechnology Training Programs in ten Community Colleges across the state. North Carolina Central University in my district is also leaving a network of the states hbc you and want to establish six training hubs. How do you believe these programs will complement the efforts of the office to reinvigorate the u. S. Domestic Semiconductor Manufacturing sector . Good morning. Nice to see you. They are meant to work together. They are meant to work together. If we do this right, it will work with manufacturing usa, the tech hubs. As i said, ive been blown away by the 400 applications and 48 states, really highquality applications. So if we do it right we will have a whole web all over america with different investments in different parts of the supply chain in space and quantum and Artificial Intelligence and biotechnology. Planting seeds of innovation all over the place, which then will help the biggest companies, for example, a company like intel that will be making the chips to be that much more successful and innovative so what we are trying to build is a whole ecosystem of the workforce, the research and development and the actual manufacturing. Thank you for that. And im sure youve heard from many that everyone wishes he would just hurry up and get the money out the door. Assuring the capacity was a sufficiently Urgent National priority to rally bipartisan support to enact the chips in science act and to provide the 50 billion in funding. At the same time, when you want and need you to get this right. Can you assure us you are doing everything you can to move as quickly as possible to get the funding out the door, and can you please talk about the timeline for additional funding opportunities and where you see the future of the Chips Program heading . So, look i feel the pressure, i promise you that. I know we have to move fast. We are behind but its more important that we get it right and if we take another month or a few more weeks to get it right, i will defend that because its necessary. By the way, a shutdown sets us back in a huge way. A sending people home and slowing down our work, that would be a huge problem so, yes, i assure you we are moving as fast as we can and we are doing everything we can to achieve the National Security goals that were intended to be achieved by the statutes. The next phase, you know i think that what ive said is the Chips Programs arent wind vectoring but we also have to think about advanced packaging happening in the United States. Its an interesting thing we can make all the chips in america but if we then send them to asia to be tested and packaged, thats a problem so we have to package in the United States and do the research, increased research and development in the United States and i forget who asked me, but to bring down the cost of manufacturing chips that happens through innovation so when you say what comes next i think thats what has to come next. Bending the cost curve so this can be sustainable in the United States. Thank you madam secretary and mr. Chairman, i yield back. Now the gentleman from california. Thank you mr. Chairman. Madam secretary, thank you for the testimony today. This is a topic thats important to me and i think everyone on this dais. Id like to ask about something you just brought up. The issue of packaging. Thats something that i also have been very concerned about because obviously if we cant construct the packaging for these chips and use that to dissipate the heat from them and incorporate in the circuit boards, it doesnt matter where they are made if we are not doing the packaging here domestically that represents an equally potent threat to our supply chain, and yet as you remarked nearly all the packaging is done overseas. I think all of our u. S. Chip manufacturers do their packaging overseas by and large i think 81 of the worlds packaging is done in asia, so i think this is a really potent threat. I know that this is something weve all been talking about. Part of the chips and science act establishes International Advanced Packaging Manufacturing Program and dedicated to end a half billion dollars to get that despond up. Can you give an update on that and your confidence level that we can solve the problem at the same time we solve the chip when manufacturing problem . My confidence level is high because we have to. We have no choice and relative to the question before, its going to require a lot of private sector capital. In our plan, and our strategy planning and strategy paper, which we put out earlier this year, we would like to have multiple high volume advanced highvolume advancedpackaging fe United States. So, several advanced packaging. As you know, you are an expert in this. I hate to use the word like commodity packaging. Im not sure how much of that will be in the u. S. , but certainly the leading edge most sophisticated packaging thats essential for the future. It can only get so small. Im not a scientist, but what i understand is coming to the end of moores law chips can only get so small which means the special sauce is in the packaging and we have to have that in america, period. And i think we well and we are focused on it. Im glad to hear that. A talking about what you just brought up again the fact that we are reaching some of the theoretical limits of the ability to create faster chips using silicone, that highlights the fact that its not the only semiconductor out there. And there is increasing interest in other Semi Conductors, particularly Semi Conductors such as indian falsified that are optical Semi Conductors with higher electron velocities and those will probably be very useful in applications like quantum computing which i know is something we are all very interested in making sure the u. S. Maintains a leadership role on. So i was a little alarmed to hear the efforts recently of establishing scaled production of indian phosphate at locations such as the optics valley in china. Do we have a plan to dedicate some of the funding to increase the production of these optical Semi Conductors in the United States . Yes. I just made a note and i will have my team follow up with you. I dont know precisely which areas, but i can promise we are very focused on it whether its indian phosphate or ciliated. We just had a meeting on it the other day. Weve got to go where the puck is going, not where it is now, which is what youre talking about. So yes im confident we are evaluating all those future technologies and incorporating that into the way we are going to invest the incentives. Glad to hear it. Lets continue the discussion. Thanks for being here today. I yield back. Id like to introduce the gentleman from North Carolina, mr. Jackson. Good morning. Good morning. There are three members from North Carolina and this committee. Youve heard from two of them. They were there. Yes, i saw. They both represent part of the Research Triangle which already has a wonderful reputation for being a technical hub in chapel hill. I represent a new district created in the last census that is the charlotte region and part of my job here is to tell a new story for that region to update peoples understanding because we have earned a reputation as our own tech center for a lot of different reasons. One of the leading Financial Centers and on and on. You said that part of your job is to get the best possible deal for the taxpayer. Want you to do that, but i would be remiss if i didnt use this opportunity to use my voice to update in your thinking what this region means, but it means to the states and to the country. This has grown a lot and it already is a tech hub and would surely benefit from official recognition as such. I think we all know what success looks like for the act 20 years from now. I think we have a vision of what is a successful Semiconductor Industry, immature Semiconductor Industry. My question is what does success look like five years from now. What are the markers that tell you this is headed in the right direction . My sense is that the chip act should be understood as an industry subsidy but as an industry catalyst because we dont have the money to continue to subsidize the industry as the Chinese Government would, so we have to light a very expensive spark and that has to catch fire. Now, youve given me a couple of possible metrics you might be tracking here. The workforce is one, cost of manufacturing going down and is another. Five years from now, what do you want to see thats going to give you confidence that it has produced a flame box. That was well said and i appreciate it. First let me say this on to cubs. We are committed to supporting every tech hub its designated which is to say we have a very limited amount of money. Not every tech hub will get the money. Some of the ones designated well and some wont. But we are working on ways we can use existing funds in the Commerce Department and across the government to support the tech hubs that are designated. When you said you would appreciate being designated, i want everyone to know we are going to put our back into supporting all of the designees even the ones that dont get the tech hub money. Second thing, you know, heres what i think. Five years from now if we do our job right, we will have in construction facilities to do at least, at least two facilities to do leadingedge chip manufacturing. Same thing for leadingedge packaging. Actually five years from now they should be up and running more than in construction so we should have new at scale producing leadingedge chips in the United States. The same thing for packaging and advanced memory at scale. At the nst see will be established. There will be several centers around the country doing research and development. We will have a fund established to make investments and Smaller Companies and we will have oneonone manufacturing usa up and running. So i think the five year mark is a really important market because its the time that they should be coming online and we should be making these chips at scale. The last thing i will say is if we do our job right with all the workforce, you know, we will start to see a totally new way of training people to do the Semi Conductor jobs and its not just Semi Conductors, its its technicians, cyber technicians and such, so it is a pretty grand vision and i think five or six years we will have achieved a lot of that. Thank you. I will yield back. Thank you very much. And now i will recognize the gentlewoman from new york. Thank you, chairman and Ranking Member and a secretary for being here. I am just so privileged to represent the 24th district that has a strong history of tech. We have ibm in upstate new york, the erie canal is one of the first regions to bring us into the industrial revolution, but unfortunately new york has suffered tremendously because of chinese based entities flooding the market with over subsidized cheap goods. Many of the strong domestic manufacturing has moved overseas and we lost industry jobs and brought on huge mass migration in new york as everyone knows. We were the ones that kind of got this started. North carolina has kind of taken over, but we do have an opportunity to bring manufacturing especially the hightech Semiconductor Manufacturing research. We are excited about the advent of the new micron announcement, the facility coming in new york. We think its a great first step. But i want to talk to first of all we talked about the hubs, some of the tech hubs that were going to be funded potentially. My district stands across all of upstate, a huge long district i go from the buffalo region to rochester, syracuse to watertown circling lake ontario. Buffalo, wrong rochester and syracuse come together as a regional approach. The tech hub is a proposal that we are hoping could leverage the Regional Labor market existing Semiconductor Microchip industry. Some of these are holdovers from the original investments many years ago when new york was at its high and draw new investments in the private sector as my colleague from North Carolina talked about its important to get the investment from the private sector which we are seeing. And i just want to also extend some gratitude here because we have other members that are involved in this bipartisan reach on this proposal. The representative that i surround in the rochester area, representative higgins, representative langworthy and also representative williams who serves on the committee. About my question for you, are you aware of the new york smart tech hub proposal are you specifically aware . I am aware of it. I know youre taking that regional approach to come together. As i said before, we have hundreds of applications. All of them are quite excellent, so we are going through them now when we make announcements this fall. The phase two tech hub, is there he still plan or update on the fees . Is that going to be released as well . This fall, yes. Let me ask you something are these going to be contingent on the designation . Can we expect the tech hub designees to be notified as well . What i was saying with congressman jackson, we were required by statute to designate at least 20 and they have to be regionally diverse to make sure the money doesnt just go to cities. So there will be designations and then some will receive like a Planning Grant and then a subset will receive a larger grant. But what i was saying is even if you dont get the larger grant, both your designated, we are committed to providing as much Government Support as we can do all the designees per se other commerce money or other money in the interagency like the sba and as such. The reality is we just need more money for these tech hubs. It was in the chips and Science Program authorized 10 billion appropriated and 500 million. So even the subset of the designees that received the bigger grants, i can tell you this. We have a meritbased team that is going to through to be evaluated all of the ones that are designated are probably worth it like they are highquality but we just dont have enough money. We urge you to obviously choose our tech hub, but we appreciate your hard work. We think we put together a great team and im grateful to all of the representatives for coming back because we, again, we were once the champions of industry and innovation and we need to come back and we have a great opportunity with a Huge Investment. So, we appreciate your testimony. My time is up. I hear you. I have heard from more members of congress on tech hubs than anything else ive done. Its unbelievable. We protect our turf. I love the advocacy. Id like to recognize the gentlewoman from ohio. Thank you mr. Chair and thank you for this meeting and madam secretary, really appreciate you being here. Im going to talk about Something Different than regional tech hubs. It was a joke i guess it wasnt funny. [laughter] similar to my other colleagues, would appreciate your full consideration of the regional tech hub from our community that is not based in one of the largest cities in the state coming from ohios 13th Congressional District we do have a bit of a shadow over us from the larger cities including cleveland, columbus and cincinnati and columbus where central ohio ways, we know that in central ohio the intel project we hear a lot about the work from your agency and what is going to happen but i encourage you to look at us in northeastern ohio as well as other areas that have a lot to contribute to the opportunities to onshore chip manufacturing as well as other domestic energy, excuse me domestic manufacturing in places that are very much used to doing so and have the spirit to do it as well, and not to mention the talent. I want to also thank you for your commitment to northeast ohio. We were in cleveland together as you announced some minority business opportunities, which is important to getting more folks into these industries and recently held a webinar around accessing chip funding for our community. We welcome the Economic Development companies, large businesses, nonprofits as well as the universities and they have a lot of questions. I know that we submitted those to the office and we look forward to the responses that we get from them. Just really want to hone in on the workforce conversation because there is not an industry ive met with that says they are not struggling with the workforce and certainly manufacturing and technology. We experienced that as well and we want to highlight the comment that childcare is not a social issue it is a business decision. Thank you for that. But specifically if you could talk to us about the private businesses and what incentives or encouragement are you sharing with them to make sure we are getting locally based folks on these ohiobased projects . Certainly we take pride in the work we are doing but we want to make sure folks in the communities are accessing them. How are you encouraging and it incentivizing those folks to work with our local employees . Great. Excellent. Thank you. And it was great to visit you. By the way, i again just want to say on the tech hubs, i hear what youre saying and we take that into account. Just because youre in a place that might not be columbus or might not be rally as your colleague said. We are going to take a hard look at the quality of the application, the quality of the technology thats in the community and make those meritbased decisions. With respect to your other question, i would say for the chips money, we are requiring every company that applies as part of their application to show us the workforce plan and ive built a team in the office who just works with these companies to develop their workforce plans. The reason im doing that is because ive got to protect the taxpayer money. I cant give all this money to a company and then have them fail because they cant find the talent they need and the same thing for child care. Youth wont find the talent if you cant hire and retain women so we are asking every company to do what you said what are your relationships with local universities, local high schools, local training partners with local Community Colleges . How are you going to train the people in the community to do the jobs in your facilities . These are massive. 5,000 people could build them, 5,000 people to work there. So thats why when i say the workforce is as important as the technology, it is, and theyve got to train the people in the community if they are going to be successful. Thank you for your answer and mr. Chair i yield back. Id like to recognize the gentleman from new jersey. Thank you, mr. Chairman. And thank you, secretary, for being here today. I took a little bit about the tech hubs as well as im a strong advocate for new jersey. We have a rich history of fostering innovative entrepreneurs and institutions Like Rutgers University are leading the way with proposals for initiatives such as the Regional Technology and Innovation Hub program. Being crucial to recognize the importance of the tech hubs and spirit of innovation. Can you continue talking about the promise of the tech hubs and why they are so important . Ive been to rutgers. I visited rutgers a year or so ago so i saw with my own eyes the impressive work thats happening there in robotics and other areas and the whole point of the tech hubs including if you are successful in new jersey is to find the next leadingedge innovation in Artificial Intelligence, quantum biotech, ai, all the things that would allow america to have a lead in the world, and it starts and in universities. It starts in a lab somewhere and gets translated into a start up a bigger company. The point of the tech hubs is to have a whole network of these little beehives of innovation where you bring together universities with companies, innovators and entrepreneurs and add money to catalyze that kind of cutting edge which ultimately leads to jobs. Every new jersey, think about bell labs, think about all the jobs and innovation in my district i was there the last couple of weeks. Its amazing. Thousands and thousands of companies and people came out of that. Lets recreate that with tech hubs all across the country. The district i represent is an innovation and infrastructure district and continue to have those priorities. We need to continue to find that common ground. Can you talk about export controls and the importance of how we use export controls in our competition with the prc . Yeah, so thats the other side of the coin. The tech hubs is investing in america. Export controls. We have to make sure china doesnt have access to the most cutting edge technology. Since ive been secretary, weve added over 700 prc entities to the entity list. More than one third of all the chinese entities on the list were put there under the Biden Administration and its because we cant be selling our most sophisticated Artificial Intelligence chips or other technology to the prc so that they can get it to put in their military and use it in a way to undercut our National Security. I would say to everyone here they need more funding. We need more export enforcement agents. We need more tech experts like increasingly National Security is about technology and keeping our edge over china, staying ahead of them so we have to control the technology so it doesnt wind up into the Chinese Military. Is there anything now youve anticipated my next question, which was what do we need to do as a congress to ensure that we continue to be on the leading edge of the fight . What i just said, thats it. To support the budget. Bias, once upon a time, wasnt necessarily as important as it might be today. Today when you think about the Chinese Military capacity, you think about Artificial Intelligence, satellites, quantum data. Thats all tech where america leads. So if you want us to protect that fully and vigorously and enforce that, we do need more resources and more people and more technical capacity, technical people who work with us. Thank you. I yield back. Thank you very much. Like to recognize the gentleman from florida. Thank you mr. Chairman and madam secretary. A new and growing 500acre tech campus self of my district has applied to be one of the chips and science act Regional Technology Innovation Hubs. Its a really beautiful project. I encourage people to check it out it shows how the local government can think big. It includes sky water technology, a packaging facility to quadruple its workforce in the next two years and Workforce Development programs through the City Academy High School in two colleges in the district and the university of central florida. Madam secretary, when selecting the hubs how is the department of commerce Economic Development administration taking into consideration local education and Workforce Development capacity especially when the u. S. Semiconductor industry has a worker shortage that can be filled by locally grown talent . Thank you congressman. Im not familiar with the particular application. I will go learn about it but it sounds like exactly the kind of thing we are trying to incentivize, which is what you said. Bring in the high schools, bring in the Community Colleges, the Research Universities, bring in the big Companies Like sky water and focus on an area of technology where you can go from excellent to world class. I do want to make that point especially since tech hubs are so competitive. We are not trying to invest in places this is a National Security program. We want to advance the frontiers of technology. So we are not going to go for places that are distressed or that are pretty good. We want to go for places that are excellent on the technology, make a big investment where they can be a world leading in the technology but anyway the workforce piece of it in some ways is the whole game. You need to have people at work. So it will be the meritbased criteria leans heavily on the workforce component. Just checking out neo city, i got to visit the campus. Its a huge project that would include housing companies. The school is right next to one of the companies where students get to go over there and learn about it. Its going to provide a good model for how we can grow local talent. The massive investments of President Bidens chips and science act will set the tone for the domestic Semiconductor Industry looks like for years to come. So we have the opportunity now to create industry that prioritizes worker safety and wellbeing. Weve had great conversations with of the aflcio. It seems Like Companies are saying new jobs wont necessarily be union jobs and there is a want for substantial ongoing collaboration with unions the Commerce Department and the companies to ensure labor standards are enforced. What steps has congress taken to prevent the race to the bottom in terms of labor and the fact that there is competition with overseas Semiconductor Manufacturers . So, as you said, we are never going to mandate to the company. In the statute for the building of the facility the companies have to make their own decisions with respect to the workers and the facilities. That being said, this administration cares deeply about high labor standards and workplace conditions safety and wages so we are having every company that supplied to give us the workforce plan and we are going to work on that with them to make sure that they have high quality well compensated workforce to do the job. I see that as a taxpayer protection. They need a workforce who can get the job done. Thank you so much. I yield back. Now id like to recognize the gentleman from alabama. Thank you chairman and secretary for your time today. Sec. , your Department Works to ensure the u. S. Leadership and Critical Technologies such as Artificial Intelligence. This leadership depends on the nations ability to bring advanced packaging onshore. Advanced packaging combines the fastest chips specifically gp use and highbandwidth memory chips and certain Design Configurations allowed to optional Language Training and techniques at the heart of ai. Do you have a good a sense of which applicants were types of applicants best meet the advanced packaging needs . We do. As ive said, weve had 400 statements of interest some including leadingedge packaging, and it is part of our strategy to incentivize packaging, because we want to have at least a couple of leadingedge packaging investments in the u. S. As a result of this. Since there is virtually no packaging done in the u. S. , do you feel confident in the discussions with of the companies that work on advanced packaging that you could strike a deal and bring the technologies to the u. S. . I do. The Commerce Department announced about in the years since the chips act was signed into law but the Chips Program offices received more than 460 statements of interest for projects and 42 states . Over august recess i had the opportunity to visit with a large chemical manufacturer in north alabama exploring expansion to support new Semiconductor Manufacturing because of the chips act while significant attention has been given the large fabrication projects announced in states such as california, arizona and new york and ohio. Is that important its important projects in states like alabama, where there is currently no significant presence of chip manufacturers given fair consideration. Can you specifically describe the Chips Program offices efforts so far to ensure that the chips act is implemented as a National Program with opportunities with states like mine that also want to play a Critical Role in the domestic Semiconductor Supply Chain . Yes, i can absolutely assure you of that. This is completely meritbased. There are no states or projects that have advantages over any other. Its based upon who can help us hit our dimension of the program that weve identified in a paper that we put out earlier this year. Of the 39 billion, weve said that 10 billion will be invested in mature chips and also supply chain companies, which would include chemical Companies Like the one youre talking about so we would encourage them to apply, and i promise you they will get a really hard look. Thank you, sec. North alabama is home to a variety of spacebased Technology Research and Development Companies as well as the Marshall Space Flight center both commercial companies and civil space organizations recognize the potential of utilizing microgravity as an environment to make smaller chips. Can you speak to the department of commerce interest to ensure that the regulations implementing the act directly acknowledges and supports the future of this important work and space . Yes. Its a component. Although it sounds crazy to say that 39 billion is not enough money, you know we cant do everything and of these are massive projects, so i can assure you we are looking to do the most cuttingedge work including with ai chips and space related trips to advance the National Security goals and that we will get all applications very seriously. Mr. Chairman i yield back. Id like to recognize the gentlewoman from colorado. Thank you mr. Chair and thank you secretary for coming in to speak with us. I think i would be remiss if i didnt mention colorado is fit to be a tech hub and look to following that process moving forward with you. One of the best things about colorado is the concentration of Research Universities we have that are primed to take advantage of the benefits of the chips and science act. These include universities like boulder, Colorado State and msu denver, which deputy secretary graves visited earlier this year. And while im eager to make sure that these institutions are able to take advantage of the various programs in the chips act specifically or entity and workforce programs, i also want to make sure that other institutions that may be dont have the clout or the recognition of the university of colorado boulder are able to use the programs as well. My district is home to you at the university of Northern Colorado that is a smaller publicinterest institution thats becoming an attractive option for many coloradans. It is perhaps lesserknown then the North Carolina one but it has seen a growing demand for undergraduate students to add more degrees in the stem fields and its offering Computer Science statistics for the first time this semester is a major. Many more students are interested in the Mathematical Sciences and the university i think has been forward thinking and expanding its expertise but i want to make sure even though it is still growing that they can compete with larger universities for the rmd and workforce programs being stood up by the department, so how is the department ensuring the smaller institutions that are still building the programs like unc will be able to engage in partnerships under the various chips oriented the end workforce programs . Thank you. Let me be very clear about this. We wont succeed unless we have Community Colleges, not just of the tier one Research Universities. In some ways a lot of them are already doing their thing. We talked about perdue earlier. We are completely focused on what youre talking about especially when you have a college or Community College like that hooked into a Bigger Network of a statewide system. We need to be operating at every level. I said earlier there is a massive shortage of Semi Conductor technicians and cybersecurity technicians of digital backlog workers. Everyone that that college can put out we can put to work. And by the way, i lived this as governor when i was the governor of rhode island we completely redid our Community College and our nonresearch university for year Grant University to be focused on the Industry Needs and it worked. These students in my experience are incredibly hungry, hardworking and the ones you need to support to get good jobs so its what we are doing. We are reaching out and have 50 Community Colleges around the country that we are kind of working with who said they want to work with us to do what you said like redesign the curriculum to match the needs. Its why we are asking companies to give the workforce plan and they are going to work with them to say have you thought about this college, what are you doing with this university . Vns tc is going to have a big workforce component, Semiconductor Workforce component which will work with these universities. The nsf has a couple hundred Million Dollars per workforce. So across all of the r d programs theres a lot of workforce, and i promise you we are going to go out of our way to make sure its inclusive. That being said, you can put that on my radar so i make sure we focus on colorado. Perfect. I appreciate the concentration on the small institutions and in particular that you are reaching out to make sure they know about the resources you have and with that, my time is expired and i will yield back. Thank you very much. Now id like to recognize mr. Williams the gentleman from new york. Madam secretary, good afternoon. Its nice to meet you. Thank you for being here. Before we get started less than four months in rhode island in 1991 at the school and so if you will indulge me, do you know how long the newport bridge is . You really dont have to answer that. I just kayaked under it. Its beautiful but i can tell you 16 long weeks. Thats how long it is. Corresponding to my time here im proud to represent the heart of the selection empire which is Central New York and as you know, micron announced 100 billion investment. One of the largest in American History to be part of this resurgence in the United States. We have a fantastic application for the Regional Technology Innovation Hub from western new york into Central New York. And this is just, think of the superhighway for the silken empire. We are also in my district home to some of the nations most advanced Weapons Systems and these are systems that require secure, reliable land domestically produced silicone chips so thank you for all your doing. The new Digital Economy is increasing data creation at an exponential rate and thats not hyperbole. Industries like transportation, power generation, process manufacturing and even the Retail Shopping experience are increasingly datadriven. So, Solutions Like Artificial Intelligence and self driving cars create enormous amounts of data to be useful so i want to highlight the tremendous risk the nation faces that the production of memory chips is dangerously concentrated in asia and may i invite your comments on how the office is planning to ensure Domestic Production to protect the United States from relying solely on the overseas production . We do have memory is a focus of our investment program. We put out in the paper we want to have at least advanced packaging and memory exactly as you said. Its not made in america now and we need to change that. One of the perceptions is often focused on the logic portion of the silken chips. We think about these advanced processors but in this datadriven world, the ability to write into and out of quickly to store vast amounts of storage as we know on our phones is increasingly sort of taking over. Are there any positive developments that you would draw attention to beyond the announcement is there any other action or activity going on running through your office . Thats the primary one. As you know theres only two and then micron and we are interested in right now as you say there is no most advanced which is something we need to remedy through this program. And urgently at a scale. Thank you for your time. I yield back. Thank you and now id like to recognize the gentlewoman from pennsylvania. Thank you mr. Chairman and thank you mr. Secretary for honoring the committees invitation to be here today. I am proud of that they have a robust and positive working relationship with of the commission. I commend their commitment to equity. Its been vital in its competitiveness and someone that works historically on the daily lives of citizens to improve not only physical tangible Product Services and infrastructure but also improve the quality of life and standard of living as a proud representative of western pennsylvania, my constituents expect us to address concerns on the implications of ai on the labor and the workforce. Thats fascinating opportunities for the advanced manufacturing. For the opportunity for skills training and education to every worker and that we are truly understanding the ethical implications involved in the concern regarding bias and discrimination investments in the legislation like the chips and science act will only continue to foster more Success Stories like those in my district and across the country through the work thats done. For Industries Like Steel Manufacturing 2inch were american competitiveness and robust opportunities for small and midsized enterprises. First its nice to meet you. I was with you on ai. My question is about how the department is collaborating with other agencies to assure the domestic requirements for tax credit incentives Industries Like Steel Manufacturing. Wherever they are in the statute we and force them. We also maintain tariffs and countervailing duties wherever we need to so we have a vibrant domestic steel district. I was going to ask about western pennsylvanias ecosystem for robotics and the autonomy sector but a lot of folks have been able to ask questions about what i was going to say so i didnt want to overwhelm you with repetitive questions. But with of the development and expansion of the domestic Semi Conductors and other advanced technologies, how was your Agency Working to continually update the Artificial Intelligence Risk Management framework to ensure the Development Initiatives are effective and supporting labor r but not supplanting labor . Working with the white house and across the interagency to put out other frameworks, which is how do we deal with the fact that ai is going to change the way we all work and we have to be there for all workers. Certain jobs will change but we have to use ai to create jobs, not destroy jobs. Jobs will change but we have to make sure they are trained to do different jobs and not left out. Thank you for the consideration the agency will put into yes people who have serious concerns for a quality of life but we want to make sure we are prioritizing workers. I yield back. Thank you very much. Id like to recognize the gentleman from ohio, mr. Miller. Thank you mr. Chairman and madam secretary for being here today and thank you for your patience. You spoke earlier and ongoing talk about the importance of increasing opportunities for the career and Technical Education. I couldnt agree more. So im going to dive right in. What is the commerce doing to ensure the funding goes to projects that will create jobs for americans into do you believe that the workforce has the ability to complete the projects and has the engineers and technicians needed to operate these here in the country . I do but we have a lot of work to do, so i have a team who are helping to figure out the Construction Workforce plans with each of the applicants. Girls and women to do these jobs. Will we do it . Yes but i cannot sugarcoat it its a lot of work. Same thing for ann, pushing the companys governors to up that your curriculum teach people what is relevant so i can get these jobs appeared. Even in the state of ohio and the intel project is coming to columbus which is a couple hours softly seventh district be around 2000 carpenter shortly 2y not for that project. You said the 2 dip in the trade amongst art lovely said about encourage our educational system to promote more the trades k12 Technical Education, an apology for that. I would really like to see it come from the state local level and morbid influx there throughout her entire country. Then doing whats easiest here which is just more federal legislation nobody needs in my opinion. I wholeheartedly agree with you on that request can assume one thing on that . Are the Incentive Program at the tips of money we are putting out or requiring the applicant to come to us with money from the state including workforce. For putting the burden on the company site intel will go to ohio or go to columbus find out what incentive into citizenship programs or whatever put in the application for they apply to us. Or trying to draw forward all of that at the local level. I also started an initiative to 1 million women in construction is about 1 million women right now in america that working construction. Weve got to try to double it progressing out the group actually wrote for here about women in construction. Have a few questions here but im just going to ask. What you think about Technical Education a drawback we are seeing amongst the trade . You contributed to work ethic with norms changing . You talk about innovation. We shift off manufacturing and we have lost him about. We do not have parity where you think it is questioning in cleveland, ohio our steelworkers gets hot in the summer and very cold in the winter its tough at work. Or i can tie the getting paid 120,000 a year right now full pension and they will be millionaires. And our kids going to school be half a million in debt. Im just curious. Its a lot of things maybe we can follow up and we have more than a minute. I think the cultural norms pushing everybody to college and fitness so the right move. 40 of kids to go to College Dropout they have loans no degree and its not a good path. Technical skills, apprenticeships girls should think of themselves as a plumber or a welder. They can do these jobs. The average entrylevel certified nurse assistant our Home Healthcare is like maybe 15 an hour. Those are tough jobs to the average plumber or produce to be 40 bucks an hour underway to 80 bucks an hour. We have good jobs for america. Not everyone has for phd engineer make a good living. Love to follow up with you more later on. My time is ended i yield back too. Yes or thank you very much i know ricky was a gentleman from california. Think it mr. Chair. Thank you for your leadership. I like to ask you questions about Artificial Intelligence. Well continue to be a driver of our economy last or the public release of Large Language Models, individuals and companies now have access to expensive Ai Technology at the fingertip large is going to benefit society. Just a few minutes ago i went on chatgpt simply typed in how to build eight lethal viruses that im very sorry but i cannot assist with that. Then i asked how to build a dirty nuclear bomb and the same answer i cannot assist without. That is because chatgpt is a close ai system. Open source Large Language Models in the guard rails remove pretty easily. I want to know if you are the department of congress has a view whether there should be regulations, open source ai Large Language Models. I agree. Ai has incredible potential especially in healthcare if you think about finding diseases more quickly downside is just as scary. The white house has convened companies to take on involuntary commitments. I think we need to do that as a bridge to this body and Congress Enacting regulations. We have to think about the threat of open model and cope the Regulatory Environment as well. As i understand that you no more than idea. The open models as a generation behind the largest frontier large language model which is to say the pretty powerful. We do need to find ways to regulate and protect the downside to the open models. Thank you. They have put out an ai Risk Management framework has gotten good reviews the Public Sector and private sector. Part of it is simply having organizations think through the issues raised by ai then have a process for working to those issues. Earlier this year end we wrote a letter to the president asking him to apply in this Risk Management framework to the entire federal branch. I would like for you to request and consider like this Risk Management framework to the department of congress and looking at that the be greatly appreciated brick works okay, i will. Lastly will develop on your comment that its not such a great idea to push everyone into fouryear colleges. If you look across our economy there is a huge shortage of skilled workers in the trades. I support your efforts in that regard anything i can do to help incentivize having more people in the trades id like to help you with that. Thank you. Mr. Cason from illinois. Thank you. Mr. Acting chairman, madam chaim secretary nice to see you today. I want to chat a little bit will work debating the chips and signs act our office was concerned with this huge amount of money thankfully we are putting in, how do we make sure taxpayer money is not going to shareholders to buyback programs and how to sweep with those protections in place . Ultimately we were not successful to the strong wacko g to one in there. There is some weaker language in the bill and the legislative process. But as a result of that there is a letter last february to Michael Schmidt in your Office Asking basically what can we do administratively to put the stronger protections in . Grateful for a lot of backandforth we had at your office after words in addition to some the statements your office and you personally have made about giving preference to companies that are not going to engage in buybacks. Having said all of that im a little bit concerned about your exchange at the start of the hearing saying that if a compana prerequisite for funding if a thecompany did not make those commitments. And so to my mind if thats not a prerequisite that could be a possibility we find ourselves in a situation giving money through chips to a company that does not need the money. Essentially displacing private capitol creating what we were concerned about two years ago. Wealth transfer from taxpayers to shareholders. My first question for you is when you say you will be giving preference, new explain mechanically what that means . How are you actually prioritizing winter making these investments . As you well know the statute says our money cannot be as for buybacks. We are going to do everything we can to invest the money in accordance with the statute. What i was saying earlier i think the question was a version of can you guarantee you wont give money to a company that does buybacks . The answer is no, we may. But we have a very rigorous system. Theres like a lot of backandforth with these companies they apply way for months or weeks of discussion they need to show us their books. Toasty Financial Plan choice how much theyre investing in research and development improve to us the need our money to do whatever it is they are doing. I think of it as a balance my number one job is at the National Security goals. Also to protect taxpayer money get a good deal not give any company a dollar more than they need to to hit the mission. And obviously most important to do with the statute says. So it is true we have a preference for companies that want to buybacks. Mostly because we need them to put everything a penny they have into their work force it into innovation and r d. But i cant promise you that a company that does and their business to buybacks or in the past have done buybacks wont receive incentive grant. If we think the business they are in is necessary for National Security and they cant be successful in doing that without incentive. You do all of that they make the voluntary pledge two years from now they violate violate the pledge you have clawback legally can you resorts back . Thank you should have said that before. All of these grants will be sent out. But the x was the Company Received two billiondollar grant we are not going to wire them to billion dollars. They are subject to an investment plan. You get x amount, hit these milestones get why amount if at any point along the way they break any of the conditions that are either depending on what they do we can clawback money or they dont get the next installation. Time but would welcome to continue the conversation and i yield back for. Thank you. The judgment from california californias are recognized through. Thank you mr. Chair thank you madam secretary for your testimony and your leadership. My district in the San Francisco bay area is the hub of innovation economy but the folks are interested in how chips and sciences rolling out. On july the Semiconductor Industry association released a study projected a shortfall of 60000 workers in the Semiconductor Industry by 2030. As you know to address this challenge is chips and signs act authorized a number of workforce develop programs scattered throughout the chips office r and d programs Incentive Programs. I am a veteran of our california Workforce Development board as well as our local workforce investment board. My question is how is the departments overall strategy enabling the Semiconductor Workforce through these programs how that coordination is happening with the existing federal workforce funding streams. But also is there coordination going out with the state Workforce Development board . State and local workforce boards. How is all that being integrated if it is . It is. The way we are endeavoring that coordination is every Company Applies for money and receives the money has to give us a workforce plan that we approve after extensive backandforth. And in that plant what is the state doing . What is the city doing . What is commerce doing . But then also as i said for nsf. We are trying to have a plan in place for every companys proposal. I also have a Workforce Team as ishould say i built a Workforce Team at the chips office and commerce. Just to give you a sense we are really serious about the workforce component and providing Technical Assistance where we can so that everyone has a fulsome workforce plan. My district has 600 Science Companies i just wanted to ask you out collaborates with other agencies such as the fda for example to create frameworks and standards that ensure Biotech Products growth of the regulatory process and efficient way. What kind of coordination is happening to your department and other entities like the fda for example . Exactly what you said. I give so much credit to them. They are neutral science based place that works with industry but also other agencies. I know biotech is one of the top priorities. Think if your leadership with that i yield back. Thank you. A gentleman from the orchids are recognized. Think it mr. Chair i think the chair and Ranking Member folden support hearing. And secretary raimondo for your leadership at the department of commerce. New york state and especially the capitol region the district that i represent ive been a pioneer in computing design, development and manufacturing for 18 years. Today at new york state is home to the worlds most advanced microelectronic breakthroughs including foundational chip innovations that enable ai systems in the worlds most powerful ai supercomputer existing infrastructure with the deep bench of know how it means in your credit is ready to be the linchpin to coordinate activities aimed at alleviating the chips shortage propelling sustainable r d. I understand Selection Committee will soon announce the board of trustees for the nonprofit entity that will construct the and stc. So it madam secretary can you outline a timeline for the announcement of the board and next steps they will take . Yes super in the next couple of months will have an announcement about the board. The first thing they would do is to announce the ceo. What should all happen this fall. Then there will be a process to actually establish the and stc early next year. The decision around how many locations et cetera will all be made at that time. Can you provide insight on the governance structure they will used to operate . We have a Selection Committee now put an initial board in place. That initial board will choose a ceo and then other Board Members and then department of commerce will have a in agreement a Research Agreement similar to what has done for a long time with other entities which will layout all they intend to use the federal money to execute their vision. Thank you. Once the board is selection how does the department intend to ensure Publicprivate Partnerships drive solutions to the grand challenges . The whole thing is a Publicprivate Partnership as a pert statute it is a consortia. We are committed to making this be a purpose built science based neutral effort and as i said there will be a Research Agreement which will lay all that out will hold them accountable to what is in that agreement. Think theres a white paper that was supposed to be issued and has been delayed. Can you share new or Additional Information on the timing and scope of the entity . I just looked at one of my associates because it is coming very soon, this fall i was hoping he would say maybe next week. I guess will stay on it. [laughter] will go with this fall okay. Id several academic institutions in my district that will be critical in educating and training the workforce needed to support industry demands. Puzzles conduct the advanced research for the next generation of chip technology. Could you provide insight into the Department Work across federal agencies to ensure that collaboration with universities will incubate that research in science . That is exactly the plan but we are working with the nsf. We are working very well the dod across agencies to work with universities. The vision would be the universities look someone asked me earlier what success looks like in five years. In five years it is a seamless backandforth between industry startups and universities. We get the inventions coming out of universities out of the lab and into products to make in america. Okay, again i thank you for your response of a thank you for your leadership of mr. Chair i yield back. Thank you. A chair now recognizes itself or four minutes madam secretary i thank you for your time. I may go over some stuff yorty talked about i am not sure. Were bouncing around a lot here. Also chair of the subcommittee for research and technology. We talk anything from Semi Conductors ai hypersonics even a roundtable on Quantum Technology. I kinda want to escalate your trip to china. China has stated by 2045 they went to meet not only just economically but military and socially even in space. From what we are gathering a lot of it they are ahead of us for you to Quantum Technology they spend more than the entire world on developing that. I would like to know it you may have found out. If theres any evidence of that they are ahead of us, behind us, beside us and what you learn there in china . I am as concerned as you are that we cannot let them get ahead we certainly cannot let them get any technology to do things that can hurt us. With respect to ai the u. S. Leads the world and we need to stay there. I also know as you say Chinese Government is putting hundreds and hundreds of billions of dollars into these technologies with the express goal of dominating. So when i was there i was clear that we do not negotiate it coms to National Security. We do not compromise. I was clear we are not going to make any changes for example our export controls which is what i work on. We will vigorously control u. S. Technology so they could not get the technology for their military. As long as they have civil fusion strategy where everything is military thing got in a Companys Technology and take it to the military. We are quite happy tougher than ever to control that technology from getting in the hands of the military. Something dont hold back there, he per se but we do want to hold back their military i was very clear in saying that. I think we should hold back there a comment to them very much america first. Which leads me into my next question which also sits on Natural Resources we put all of the country talk about Critical Minerals the fact buried under three smelters china processes 80 of our Critical Minerals here from what we provide. And as far as taiwan and Semi Conductor we know china threatened to withhold Critical Minerals from them. When i heard you the few minutes i was in her earlier making sure we bring Semiconductors Home and i wholeheartedly agree with you on that. But we have, and this administrative has made at concerted effort to not allow people to mine here in the states. And i do not understand how you can advocate semiconductors here in the country when we tried is already shown that willing to withhold Critical Minerals we are not willing to mine critical manuals here in our own country. I cannot speak to what is been done in the past. I do think youre right we are dependent on them we have to do everything we can to either mine here or on allied chores. And for my part of it im going to do i need to do with export controls to hold them back. But when i think about chips, the chips is just one piece of its the raw material, the rare earth, the critical mineral and we need a holistic strategy on that. Alright i am out of time. I thank you. What do you think the secretary for joining us today and the members for their question. The record roll remain open for 10 days for additional comments and written questions from members. This hearing is adjourned. Thank you. 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