WASHINGTON – The stretch of upstate including Buffalo, Rochester and Syracuse has been chosen as a federally designated “tech hub,” giving the region a chance at upward of $75 million in funding aimed at transforming its economy into the Silicon Valley of the microchip industry. Senate Majority Leader Charles Schumer, who pushed both for creation of the tech hub program and the unusual three-city coalition that won that designation, is scheduled to visit all three cities on Monday to announce the award.
“The area will be designated one of America’s first federal tech hubs, and it’s going to help us transform I-90 into the semiconductor superhighway,” Schumer, a New York Democrat, said in an interview preceding the announcement. The Buffalo-Rochester-Syracuse bid was one of 31 designated as tech hubs. Nearly 200 communities or regions had submitted bids for that recognition. The most important step in the tech hub process is yet to come, however. The 31 tech hubs will now compete with each other to be one of five to 10 bids selected to receive $50 million to $75 million to jumpstart their economic redevelopment efforts.
Schumer said he is confident the joint upstate bid will make the cut and win the money when the federal government decides to award winners sometime in the coming months. “Just as I worked very hard to get us designated a tech club, I will work just as hard and I believe just as successfully to get us some real dollars,” Schumer said.
The Buffalo-Rochester-Syracuse proposal, dubbed the “NY SMART I-Corridor Tech Hub,” will be the only federal tech hub focused on the semiconductor industry, Schumer’s office said.
That is particularly important amid a federal effort to “reshore” the industry, whose tiny but powerful microchips are used in everything from computers to cars. The industry was born in the U.S., but Taiwan, Japan and South Korea now produce more microchips, and China is catching up fast.
Informed in part by a microchip shortage during the Covid-19 pandemic, Schumer and senators from both parties grew concerned in recent years that the concentration of the industry overseas posed both economic and national security concerns. That being the case, Schumer authored and fought for the “CHIPS and Science Act,” the 2022 legislation that aims to both revive U.S. microchip production and create new tech hubs in economically disadvantaged regions.
Not long afterward, Micron Technology announced plans to build a microchip manufacturing facility near Syracuse that will be the nation’s largest, employing upward of 9,000 people. And that is just the start, said New York Gov. Kathy Hochul, who lobbied for the region’s tech hub designation during several recent trips to Washington.
“This is something that will forever alter the trajectory of Western New York and upstate,” Hochul told The Buffalo News. “This changes everything.”
Then again, the economic value of the tech hub designation won’t be known for months. As the U.S. Department of Commerce weighs how to split the $500 million that Congress has set aside for the tech hub program, local officials will continue pressing for that money to come to upstate New York – and they are confident that it will.
“We meet all the criteria,” said Rep. Brian Higgins, a Buffalo Democrat who also made a strong push for the tech hub designation. “It’s an area that’s experienced a lot of disinvestment as it relates to manufacturing, and the very essence of this program is to introduce these kinds of investments into areas where they don’t currently exist.”
Higgins noted that the region also has another asset that communities in other states don’t have: the most powerful U.S. senator, who’s been lobbying both the Department of Commerce – which manages the tech hub program – and tech companies on behalf of upstate.
“I think that we have good political leadership with Senator Schumer,” Higgins said.
Several sources also noted that Buffalo, Rochester and Syracuse teamed together on the effort, whereas most tech hub applicants were based in only one community. That meant the upstate bid has the potential to have a far greater economic reach that some of the other proposals, which will likely increase the chances that it lands federal funding.
“By advancing a truly regional plan across Buffalo, Rochester and Syracuse, we have laid the groundwork to open the NY SMART I-Corridor to significant federal investment and position our region to play a leading role in our nation’s quest to increase domestic manufacturing of semiconductors as both an economic engine and a national security imperative,” said Dottie Gallagher, president and CEO of the Buffalo Niagara Partnership. “We should celebrate not only this designation, but the unprecedented collaboration among the NY SMART I-Corridor consortium that made it possible. It sets the bar for how we should be approaching economic development moving forward.”
Rob Simpson, president of CenterState CEO – a Syracuse-based economic development group – agreed.
“Securing this highly competitive award is an acknowledgement by the federal government of the leading-edge nature of the corridor’s combined assets and cements this region’s place within the global semiconductor industry,” Simpson said.
Schumer – who is pushing for the tech hub program to eventually get $10 billion in funding – listed those assets.
“We have lots of good things that help us get tech in Western New York,” he said. “We have an ample water supply. We have an ample electricity supply. We have a great workforce, and we already got that grant that helps us train the workforce.
“And,” Schumer added, “we have a majority leader.”