鈥� The Colorado Economic Development Commission gave its blessing Thursday to a plan by Louisville officials to establish a CHIPS Zone in the city that would encompass the Colorado Technology Center business park and.
Louisville is now the fourth city in the Boulder Valley and Northern Colorado with an designation, joining Longmont, Broomfield and Fort Collins.
Functioning similarly to Enterprise Zones, which provide tax incentives for companies operating in economically distressed areas, the concept for Colorado鈥檚 CHIPS Zones was developed on the heels of the $280 billion Creating Helpful Incentives for Producing Semiconductors and Science Act, also known as the CHIPS and Science Act or simply the CHIPS Act. That bill, signed into law in 2022 by then-President Joe Biden, provides support for strengthening the nation鈥檚 position in semiconductor research, development and manufacturing.
The Colorado Tech Center, or CTC, 鈥渋s home to a majority of the City鈥檚 jobs and includes businesses that are already working in the semiconductor and advanced manufacturing industries, as well as spaces that are readily available to accommodate new or expanding businesses,鈥� according to a Louisville memo on the CHIPS Zone boundaries. 鈥淭he CTC includes over 5 million square feet of existing commercial and industrial space. This number is expected to reach 5.8 million square feet at full buildout.鈥�
The memo continued: 鈥淯pon final development, Redtail Ridge is anticipated to contain 2.55 million square feet of commercial space, including an industrial and medical research park. Redtail Ridge will also dedicate 15.1 acres to research/office and facilities for the research, development, manufacturing, fabrication, processing, or assembly of scientific or technical products. It鈥檚 estimated that Redtail Ridge could generate approximately 10,500 jobs.鈥�
Leaders with Redtail鈥檚 master developer, Sterling Bay LLC, told BizWest recently that the project, which has been in the planning and approvals phase for a half-decade, is finally expected to break ground this month.
One of the factors that local officials take into account when establishing the boundaries of a CHIPS Zone is 鈥渢he potential economic impact,鈥� Dan Salvetti, semiconductor industry manager with the Colorado Office of Economic Development and International Trade, said during Thursday鈥檚 EDC meeting. 鈥淪o while there are no semiconductor operations currently in either of these areas, they are zoned properly鈥� to welcome chip manufacturers in the future.
Louisville鈥檚 two non-contiguous CHIPS Zone areas have 鈥� or, in Redtail鈥檚 case, is eventually expected to have 鈥� 鈥渢echnology parks, warehousing, large corporate offices,鈥� Salvetti said. 鈥淎ll of these are appropriate infrastructure that we would want to see in an area where we would put this (CHIPS Zone) designation on. There鈥檚 a strong potential for attracting semiconductor operations to this proposed area.鈥�
Semiconductors are used in every electronic device, from cars to cell phones, military hardware to medical devices, computers to clean-tech equipment.
The Semiconductor Industry Association estimated prior to the passage of the CHIPS Act that the U.S. share of global semiconductor manufacturing capacity has dropped from 37% in 1990 to 12% in 2022. Much of the capacity resides in east Asia, including China and Taiwan.
U.S. Department of Defense officials long have argued for increasing U.S. semiconductor-manufacturing capabilities for national-security reasons. Semiconductors are used in all major U.S. defense systems, and foreign production raises concerns not only about supply chains but also about potential 鈥渂ackdoors鈥� that can be inserted into chips, allowing them to be reprogrammed or shut off.
Additionally, the COVID-19 pandemic and resulting supply-chain disruptions prompted government and private-sector companies to rethink the 鈥渏ust-in-time鈥� global supply-chain model, whereby goods arrive from suppliers only when needed.
