As anticipated by the Herald and other community leaders, Oregon will not be awarded the third and final R&D semiconductor research facility by the NATCAST. Our State and the City of Hillsboro were finalists in the possible location of the Advanced Packaging Piloting Facility. Senator Ron Wyden, Governor Tina Kotek, Mayor Steve Callaway, and many other leaders laid out a robust plan to attract this facility, including a massive land expansion on the edge of the Urban Growth Boundary. In the end, it was just not enough.
The announcement comes today, right at the end of the Biden Presidency, that Arizona will land the multi-billion dollar facility, and it will be located in Tempe, Arizona. Arizona State’s campus and facilities no doubt influenced this decision. And as the Herald reported a month or more ago, our sources indicated that Oregon’s liberal backdrop and the rugged relationship between Intel and the Biden administration killed our chances. Biden’s people have awarded this last jewel to a Trump-friendly state where the incoming administration will likely not question its funding. Arizona is home to several semiconductor manufacturers and is not reliant on Intel only. Hillsboro’s semiconductor cluster is primarily centered around Intel.
Here is an excerpt from today’s announcement-
Today, the Department of Commerce and Natcast announced the Arizona State University (ASU) Research Park in Tempe, Arizona as the anticipated location for the third flagship CHIPS for America research and development (R&D) facility. The CHIPS for America NSTC Prototyping and National Advanced Packaging Manufacturing Program (NAPMP) Advanced Packaging Piloting Facility (PPF), an NSTC and NAPMP facility, will feature cutting-edge capabilities to bridge the gap between laboratory research and full-scale semiconductor production. It will enable researchers and industry leaders to develop and test new materials, devices, and advanced packaging solutions in a state-of-the-art R&D environment. This newly constructed facility is expected to be operational in 2028 and will play a key role in driving U.S. leadership in semiconductor innovation, economic growth, and national security.”
“A strong research and development ecosystem is essential to ensuring the United States remains at the forefront of semiconductor innovation,” said U.S. Secretary of Commerce Gina Raimondo. “Arizona has long been a hub for technological progress, and this new facility will strengthen our domestic supply chain, drive advanced manufacturing breakthroughs, and secure America’s leadership in this critical industry. Thanks to the bipartisan CHIPS and Science Act, combined with the other two CHIPS for America R&D flagship facilities, we will help bring American innovations to the global market, further securing our national and economic security”
“The PPF will play a critical role in advancing semiconductor innovation across the country,” said Deirdre Hanford, Natcast CEO. “This facility will be a premier destination where researchers from industry, academia, startups, and the broader semiconductor ecosystem will convene to explore, experiment, and collaborate on the next generation of semiconductor and packaging technologies that will power the industries of the future.”
As one of three CHIPS R&D flagship facilities, the PPF will be amplified by Arizona’s robust and growing microelectronics landscape, including leading front-end semiconductor manufacturing and advanced packaging companies, and a vibrant university research environment. The expected partnership with ASU will jumpstart R&D in these areas and leverage the substantial programs underway at the university.
Here at the Herald, we have covered this matter for over a year. The benefits for Oregon and Hillsboro were huge. In our story, Could Hillsboro Land A National Semiconductor Technology Center? The many benefits of landing any one of the three NSTC Research facilities were carefully outlined. Intel is in rough shape, and we all know it. Are we losing their jobs, and how much risk is our economy? Could we see a total collapse of our tech sector? Have we relied on them too much, and are we now tied to a company that made one bad decision after another?
In August, our top story of the year, we took that question on. People here are worried and have every right to be. Now that this final lottery pick by NATCAST, the DOC has gone to Arizona, we must all find our way forward. That will take an honest discussion, and the adults must be in the room. Not just a handful of State leaders meeting in private.
Can Hillsboro And Oregon Survive A Major Disruption At Intel?
Here is my takeaway:
Having lived here since before Intel poured its first foundation. We, as a community and State, will get through this. We do not have to grow anymore at our current rates- our strength is not Intel. It is not computer chips or the companies that make them. Oregon’s undeniable beauty and livability are the main things we need to survive. Have you been to Tempe, Arizona? That folks, is not Hillsboro- it can not even hold a candle to our community or the valley we have. We should not be so quick to pander to Intel, nor any company that panders to Wall Street and is so quick to dump chemicals into our air, use our water and power, and then dump thousands of employees to bump the bottom line up. FABS building computer chips is not a clean industry. They are dangerous. They do not belong parked adjacent to neighborhoods. Accepting and supporting the jobs and industries here is the right play. Getting on our hands and knees and begging for more is not.
Governor Kotek, urged on by Senator Janeen Sollman, Mayor Callaway, and others who accepted campaign money from big landowners on the edge of Hillsboro, fell for the concept that we did not have enough Industrial land. That was a fallacy. The promise of Oregon Senate Bill 4 has been realized, with millions and millions being awarded to computer companies all over the region. Hillsboro has almost 1,000 acres of Industrial land today. However, the distraction of and focus on expanding Hillsboro’s Urban Growth Boundary robbed Oregon of the chance to focus on the real prize. It also was a bad look nationally as the fighting spilled into the National News, sending a message that Hillsboro and Oregon residents did not support Tech, which is invalid. Our leaders made mistakes all along- shame on them for dropping the ball on the 5 years line.
In our article earlier this year –Statewide Potential Benefits For The NSTC Hillsboro Campus Reviewed In Depth – the conclusions were:
The result is a research and job creation engine. Hillsboro and Oregon must, over time, wean themselves off of Chip Production and lean on these high-paying jobs. Here is why:
Semiconductor Facilities are dirty, heavy polluters, and not a first choice in anyone’s backyard.
The resources required for more Fabs are onerous.
Other states, such as Texas, Arizona, Ohio, and New York, are building much larger fabrication clusters than Oregon.
The promise of “High-Paying” jobs is a false narrative. Oregon has actually lost thousands of tech jobs in the last decade despite massive increases in facilities, utility consumption, and government tax incentives. We are backing a dying horse, and we see that in the news daily; Intel is not a company to support.
The 10,000-pound gorilla in the room is AI and Robotics. It is undisputed that robotics and AI will automate the actual production of these computer chips to the point of eliminating at least 50 percent of all jobs in production within 5 to 10 years. Creating more environmentally unsound facilities will lead to a trap of huge financial drains with no revenues.
Oregon is not a place to chase short-term phantom profits by converting more of our farmland- again; we refer to the great man’s quote, Governor Tom McCall.
Tom McCall Demure Beauty
Mike Rogaway at the Oregonian, killed it with his in-depth look at how Oregon lost out on this one. Check his story out right here-
To succeed from this point on, we have to work together. Hillsboro, Oregon, must proactively manage its economic reliance on Intel. By diversifying its industrial base and cultivating a supportive environment for startups and other technology companies, the city can reduce its vulnerability to potential setbacks in the semiconductor industry.
Ultimately, Intel and Hillsboro’s futures depend on a delicate balance of government support, corporate innovation, and community resilience.
With a new Council and Mayor coming in, we sure wish them well. They will be batting clean-up on many issues left behind by the previous administration.
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Meanwhile Hillsboro is still plowing down houses for over in the Sewell/ Meek road area purchased at premium prices with tax payer money. If we were not successful attracting a large semiconductor employers when all the free government money was floating around it does not seem to bode well for the prospects of that area.
The hard truth is that if you subtract datacenters and a few Amazon/ other warehousing facilities you will see that the last 5-10 years has brought very little to Hillsboro. Certainly not enough for the 100s and 100s of acres already squandered.
Hillsboro does not even pretend to care about attracting or facilitating small business, (you know, that kind that is actually owned by its citizens). There is actual need for small industrial out here. Maybe supporting local businesses that are already here would be better than chasing unicorns and ending up with data centers?
Maybe a portion of the North Hillsboro “technology park” should be developed with small users in mind.
You basically nailed everything I have been saying and you obviously understand what is happening. And your right. Hundreds of Millions spent on overpriced Industrial land that the taxpayers may be saddled with for decades- and the interest on those bonds could break a city. We must be aware of what all the investment has brought us- and it is becoming more and more clear that this formua of tax giveways has not worked.
Hillsboro’s previous administration was absolutely peerless when it came to getting fleeced.
As early as 2014, it wanted to turn all of that new land inside its UGB north of Evergreen, west of Sewell and up around Meek into industrial land. Residents went to Salem multiple times to fight it and won, and the city could’ve just taken the hint and worked with them on a residential/commercial solution. But no: They had to keep pressing for industrial and by the time they got their way, their own giveaways of industrial land for data centers east of Sewell had jacked up industrial prices to a point where the homeowners could just take a huge payout and pack it in.
As Justin said, now look at it. Once the latest data centers settle in around Sewell, the city’s pretty much out of industrial options. It’s patently refused to consider more of the light industrial and small business that’s thrived on the east and west sides of the airport (there are few more dynamic small businesses in Hillsboro than Next Level) and north of 26. And the big “Project Azalea/SB 4” savior isn’t coming.
So what now? The new industrial development behind the former VW offices seems to be yet another distribution center (near wetlands and under high-tension lines, no less), the biggest non-residential development in the city is a minor-league ballpark that’s starting its life significantly in the red in tax dollars and offering no new jobs.
The new administration is looking at significant industrial land within Hillsboro’s existing UGB that’s about to go vacant, whether that’s Hawthorn Farm or Jones Farm… or both. It’s looking at less revenue from existing tech businesses both through attrition and through the expiration of gain share. There are recreational fields and tournaments to be recovered, a multimillion-dollar events center that’s still being paid for and underutilized, services to be funded (including schools and new shelters)… and this is all before we address little civic foibles like deferred maintenance.
The biggest draw of the “silicon forest” was never its production capacity or proximity to resources, but the elements Dirk keeps mentioning: The quality of life and proximity to nature. When you make it unaffordable and eliminate the sanctuary that the tech community here felt compared to the more high-paced Valley or other tech hotbeds, you eliminate Oregon’s advantage in that sector.
Apparel and marketing thrive here because this remains a varied testing climate where even top endorsers can conduct business in relative anonymity. If you’re some poor engineer who suddenly realizes that, for slightly less, you can have a house near Skaneatles Lake and either hike the Adirondacks or go see a Broadway show on the weekend… you’re the main reason Hillsboro needs to start thinking small (or at least startup) again.
This really needs to be run as an Op-Ed piece. How would you feel about me posting it in that way? I know there are limitiations on how you use your talents, but this one explains so much about what I have been trying to empart.
Either way thank you for doing this!
Dirk
Dirk I completely agree with your sentiments on Jason’s writing.
His talent is so great that he is linmited by his current work to only plying his trade with them. If you read some of his work, it is truly next level.
Deidre are you local? I am looking for some Law fmaily that is related to the great Orange Phelps!
I’m not local, I live in NC. My brother Wayne is local, and he’s on Facebook.
Appreciate the sentiment, Dirk, but we have to keep it to the comments.
I understand. Gotta feed the goats and have a a good IPA once and a while…guys gotta do what he has to do! Keep the comments coming.
Will do. P.S. I don’t think anyone’s going to pretend that Macy’s was keeping Streets of Tanasbourne afloat, but that location’s closure and the latest erasure of Meier & Frank’s legacy is still a moment worth noting: https://www.axios.com/2025/01/09/macys-store-closing-list-2025