By BF Editors
From the May / June 2023 Issue
The launch of Business Facilities Economic Development Organization (EDO) Awards recognizes economic developers’ efforts toward growing their communities. Record-breaking projects and creating new pockets of economic growth are the brass ring communities aim to secure. These 2023 EDO Awards winners characterize tenacity from the grassroots level to securing multimillion-dollar projects.
Semiconductor Industry Growth: Following the “Great Recession” of 2008, state officials envisioned a new approach to economic development. In 2011, then-Governor Brewer established the Arizona Commerce Authority (ACA), a public-private agency overseen by the best minds in the private sector. One of the agency’s earliest goals was to attract high-paying jobs, and semiconductors were at the top of the list. In 2020, TSMC announced a $12 billion investment to build a new fab in Phoenix. In 2021, Intel broke ground on an expansion, investing $20 billion for two additional fabs in Chandler, bringing its total chip factories in Arizona to six. TSMC would grow its investment to $40 billion in December 2022, with plans to build two of the world’s most advanced fabs and hiring 4,500 people in Phoenix. According to the Semiconductor Industry Association, Arizona leads the nation in semiconductor investment since 2020, at over $60 billion. In September 2021, the ACA launched the first-of-its-kind National Semiconductor Economic Roadmap (NSER). Published in December 2022, it provides a 10-year blueprint for increasing U.S. competitiveness.
Said Sandra Watson, President and CEO, Arizona Commerce Authority: “The future of the global semiconductor industry is in Arizona. Since 2020, Arizona has attracted more investment from the semiconductor industry than any other state thanks to our premier business climate, talented workforce, and robust innovation ecosystem. The ACA is focused on the future with the National Semiconductor Economic Roadmap, a ten-year, industry-led plan for increasing U.S. competitiveness in semiconductor manufacturing and strengthening supply chain resiliency.”
Business Climate: In 2022, North Carolina welcomed 151 business recruitment, development, and expansion projects, for 27,144 new jobs and more than $15 billion in capital investment. Two of those were the biggest economic development projects in state history. Vietnamese electric vehicle and battery company VinFast announced 7,500 jobs with a $4 billion investment in Chatham County. Home-grown semiconductor manufacturer Wolfspeed announced 1,800 jobs with a $5 billion investment in Siler City. This was made possible by the hard work of the Economic Development Partnership of North Carolina (EDPNC), its partner the North Carolina Department of Commerce, and other state and local organizations. Also in 2022, the EDPNC Business Development team saw the highest number of projects (102) referred to the Business Recruitment team in its history. Of these, 62 represented foreign direct investment (FDI), and 40 were domestic, surpassing pre- and post-pandemic numbers for the team.
Said Christopher Chung, CEO, EDPNC: “North Carolina has been successful in attracting new and expanding businesses because of our transportation infrastructure, low cost of business, our welcoming and diverse population, and especially our highly skilled workforce. Our top-rated education system and workforce development programs produce the 21st-century workforce that foreign companies are looking for, including the largest manufacturing workforce in the Southeast and one of the strongest pools of STEM-educated workers in the nation.”
Green Program: Empire State Development (ESD), New York State’s chief economic development agency, led a multi-agency, multi-partner coalition that drew Micron Technology, Inc.—one of the world’s largest semiconductor companies and only U.S.-based manufacturer of memory—to invest $100 billion to build the largest fabrication facility in the history of the U.S. in Clay, NY. This investment, which will create 9,000 Micron jobs and thousands of construction jobs, validates ESD’s longtime economic development strategy, involving collaboration with federal and local partners. The state’s $5.5 billion in Green CHIPS incentives were pivotal in attracting Micron. The agreement with Micron establishes a $500 million Green CHIPS Community Fund, the first in the nation, that ensures residents directly benefit from the company’s presence. Micron will also implement a Green CHIPS Sustainability Plan designed to mitigate its greenhouse gas emissions and environmental impact, including utilizing 100% renewable energy, attaining LEED Gold status, and committing to greenhouse gas emission targets and reporting.
Said Hope Knight, President, CEO, and Commissioner, Empire State Development: “I am proud of Empire State Development’s leadership in the multi-partner, multi-agency coalition that drew Micron to make its historic $100 billion investment in New York State. Our continued strategic approach to growing the semiconductor industry, strengthened by our first-in-the-nation Green CHIPS program and the federal CHIPS and Science Act, will help to ensure other industry leaders will join us here in the Empire State to build the future.”
Flexible Incentive: Mississippi created the Mississippi Flexible Tax Incentive (MFLEX), a streamlined universal tax credit that may be used to offset a company’s state tax liabilities. MFLEX is designed with simplicity in mind to meet the needs of new and expanding businesses by offering more flexibility than the state’s current tax incentive offerings. MFLEX eliminates the need for multiple applications for incentive programs, and it provides transparency to companies and state stakeholders regarding the value of credits awarded. Planned capital investment must exceed $2.5 million and a company must create more than 10 jobs to qualify. The MFLEX credit is calculated based on investment in manufacturing and/or non-manufacturing equipment and its construction costs, the number of net new full-time jobs expected to be created, and the project’s average annual wages. Annual reporting to validate a project’s job and investment performance is required. Eligible companies can use this credit against a variety of tax liabilities, including state income, franchise and sales and use taxes and the withholding tax employers are required to withhold from employee wages.
Said Laura Hipp, Deputy Executive Director, Mississippi Development Authority: “MFLEX represents a game-changing opportunity for companies looking to expand or relocate in Mississippi. This innovative incentive provides a simplified, streamlined approach to accessing tax credits and applying those credits to best fit the company’s needs. By maximizing companies’ incentive utilization and tying tax credits directly to investment and job creation, we are creating an even more transparent and business-friendly environment in Mississippi. We are proud to offer MFLEX as a powerful tool to help drive economic growth and create new job opportunities for Mississippians.”