Colorado sets new CHIPS zone in Longmont with incentives for semiconductor companies – Denver Business Journal – Denver Business Journal
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At least four semiconductor companies are already included in the new area.
Colorado established its second-ever zone on Thursday that offers special tax incentives to companies in the semiconductor supply chain.
Members of the state’s Economic Development Commission on Feb. 15 set new boundaries for a zone in Longmont that unlocks access to state tax credits in exchange for new job creation, employee training, capital investments and more.
At least four existing companies in Longmont stand to benefit from those credits when they make new investments and apply, according to the Colorado Office of Economic Development and Trade. The zone also serves to lure prospective companies in the industry.
Colorado’s CHIPS Zones were created through state legislation last year that sought to bridge the semiconductor industry into existing tax incentive programs at the state. Through the zones and $75 million worth of state refund certificates, state officials hope to help existing and prospective Colorado companies maximize their potential to receive millions through the federal Chips and Science Act.
CHIPS zones are similar to the state’s existing enterprise zone program, which offers tax incentives to companies only in areas of the state that are in economic distress. To establish a zone, communities must apply through OEDIT, which approved its first CHIPS zone in Fort Collins in July.
The Longmont CHIPS zone is actually three separate entities on the west side of the city, said Dan Salvetti, semiconductor industry manager for OEDIT.
Among the research and development-focused facilities already in the zone are locations for Advanced Micro Devices Inc. (NASDAQ: AMD)., Micron Technology Inc. (NASDAQ: MU), Seagate Technology plc (NASDAQ: STX) and Solidigm, Salvetti told the EDC. The zone also includes Longmont’s Max Tech Center, which offers plenty of space for new and growing companies, Salvetti said.
He said the federal government is poised to give notice of a third round of funding through the Chips and Science Act that would be focused on commercial R&D, meaning the zone could help companies mulling expansion opportunities.
When commissioners approved the groundwork for the new semiconductor and advanced manufacturing incentives last year, Salvetti called the potential to draw down federal dollars from the Chips and Science Act a “once-in-a-generation opportunity.” While other states may be better known for their semiconductor industry, he said Colorado’s ecosystem is strong.
In December, two Colorado Springs companies were the first to take advantage of the state’s tax refund incentive. One of them was Chandler, Arizona-based Microchip Technology. Shortly after it was granted $10 million in state tax refund certifications, the company received $90 million in federal incentives to go toward a $940 million effort to modernize and expand its Colorado Springs campus. Another $72 million in federal incentives will go toward its facility in Oregon.
Commissioners on Thursday, Feb. 15, also took action to retain a Colorado-based industrial manufacturer with $1.2 million in job growth tax incentives.
The unnamed company currently has 54 employees in Colorado and produces parts that are integral to aerospace, medical and other industrial manufacturing, according to OEDIT. The company also offers engineering development and product integration support.
“Project Da Vinci” would create up to 101 new jobs in El Paso County with an expansion plan that includes new product lines and services. The average wage for those jobs would be over $85,000 per year with roles such as engineers, accountants and technicians.
Total Denver-area employees
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