Upstate New York tech hub wins $40M federal investment

Senate Majority Leader Chuck Schumer, who wrote the legislation creating the federal tech hubs and pushed for the Upstate bid to receive funding, was scheduled to announce the funding Tuesday during visits to Buffalo, Rochester and Syracuse. In an interview before the official announcement, Schumer said he was pleased that out of about 400 initial tech hub applications, the Upstate bid was one of only 12 to receive significant federal funding.

“This is not just about bringing national attention to upstate New York,” said Schumer, a New York Democrat. “The federal government says the I-90 corridor is America’s semiconductor highway.”

The funding follows an announcement last October that the upstate offering would be one of 31 tech hubs authorized under the CHIPS and Science Act, Schumer’s landmark 2022 bill aimed at “reshoring” the semiconductor industry.

But not all of those 31 tech hubs will receive federal funding to make investments to strengthen the tech sector in those communities. The upstate bid won the money, Schumer said, because it stood out from the competition.

Upstate New York’s workforce, as well as the fact that chip companies have already begun to locate in the area, contributed to the bid’s success, he said. So did the fact that Buffalo, Rochester and Syracuse decided to apply jointly for a tech hub rather than compete against each other.

“There was so much good stuff here,” Schumer said.

The joint nature of the bid calls on each community to take the lead on a different aspect of the plan to strengthen the region’s tech industry:

• The University at Buffalo will take the lead in improving the microchip supply chain, with the goal of connecting existing semiconductor suppliers in the region to new customers and helping other manufacturers enter the microchip business.
• Monroe Community College in Rochester will lead a workforce training effort to prepare 11,500 workers for a range of jobs from processing technicians and electricians to engineers and software developers.
• Syracuse University will develop a commercialization effort aimed at helping small, medium-sized and minority-owned businesses bring their semiconductor-related products to market.

In a conference call with reporters Monday, a senior Biden administration official, who asked not to be identified by name, said the upstate New York tech hub got funding largely because the region already has a growing chip industry. The funding announcement comes 21 months after Micron Technology, a leading chipmaker, announced plans to invest more than $100 billion to build a manufacturing campus north of Syracuse.

The White House official also indicated that Buffalo’s role in the tech hub will be particularly important.

“The goal here is to enable the supply chain for semiconductor manufacturing to grow in the region as well,” the White House source said.

Dottie Gallagher, president and CEO of the Buffalo Niagara Partnership, said none of this would have happened if Schumer had not proposed and then fought for legislation creating the federal tech hub program.

“This moment marks a turning point for our region, providing significant economic opportunity for all,” Gallagher said. “The consortium of 100 partners from industry, education and philanthropy, along with the bipartisan support of our federal representatives, have made today a reality. This is just the beginning of our efforts to transform the economy of Western and Central New York.”

Rep. Tim Kennedy, a Buffalo Democrat, agreed that the effort — officially named the NY SMART I-Corridor Consortium Tech Hub — will revitalize the region.

“The NY SMART I-Corridor Consortium Tech Hub will pave the way for us to once again lead the country into a new era of supply chain independence, technology innovation and entrepreneurship,” Kennedy said. “With our strong transportation system, network of research universities and diverse workforce, the I-Corridor is poised to transform the economy of Western and Central New York and create a new generation of good-paying jobs.”

Schumer pushed for the CHIPS and Science Act to go beyond upstate New York. He and Indiana Republican Sen. Todd Young introduced the bill in part because they feared that the semiconductor industry was currently concentrated in Taiwan — and thus threatened by mainland China.

That said, Young said on his website that the CHIPS and Science Act “represents a bold investment in our country’s national security and will ensure that America continues to lead the world in technological innovation.”

Speaking to reporters via Zoom, Commerce Secretary Gina Raimondo noted that over the past 20 years, about 90% of new U.S. tech hubs have been located in just five metropolitan areas. She said the tech hub program aims to change that.

“The reality is that there are smart people, great entrepreneurs and leading research institutions all across the country,” Raimondo said. “And we are missing out on enormous potential if we don’t give them the resources they need to compete and succeed in the technology sectors that will define the 21st century global economy.”

Schumer said the bill — and the $40 million now earmarked for the region — offers new hope for the upstate’s long-struggling economy.

“This is a historic event because you know what this means for the future,” Schumer said. “You know how much I’ve always hated jobs leaving upstate New York and people thinking that this beautiful place with its beautiful people is in decline. And now there’s new optimism and new hope because of what’s happened here.”