There Is $25 Million for a Chip Design Center, and Long Island Can Host It

Empire State Development has opened a competitive application round for up to $25 million in capital grant money to build a semiconductor design center in downstate New York. The announcement came from the governor's office on September 10. Concept papers are due at 2 p.m. on October 26.

The eligible sites are New York City, Nassau County, Suffolk County, and the Hudson Valley counties of Westchester, Rockland, Orange, Dutchess and Putnam. Nassau and Suffolk are named in the eligibility language, not implied by it.

Design is not fabrication, and that is the whole point

New York has spent the better part of a decade recruiting semiconductor manufacturing, and that recruitment happened upstate, where the land, the power and the water are. Fabrication plants are enormous industrial facilities and they were never going to land in Nassau County.

Chip design is a different business entirely. Design firms do not manufacture anything. They use software to produce the blueprints for advanced chips, and the physical chips get made somewhere else, frequently at the upstate plants the state already paid to attract. Design is an engineering and software activity. It needs talent, capital and proximity to customers rather than acreage and substations.

That is why the state is putting the money downstate. The stated purpose of the center is to incubate startup chip design firms, train chip designers, and connect those firms to the manufacturing and research operations elsewhere in New York. It is the front end of an industry whose back end is already here.

Who can apply, and who cannot

The application is open to nonprofit organizations, academic and research institutions, and multi-entity consortia led by an eligible nonprofit fiscal agent. A for-profit company cannot be the lead applicant.

Read the third category carefully, because it is the one that matters to a Chamber audience. A consortium has members, and the requirement is that the entity leading it and holding the money be an eligible nonprofit. Private companies participating as consortium partners is the ordinary shape of these awards. Any member considering that route should confirm the terms directly with Empire State Development before the October deadline rather than assume them.

Long Island has the institutional side of that equation in unusual density. Nassau and Suffolk hold a major public research university, a national laboratory, a state college with an engineering and technology focus, and several private universities. The eligibility rules describe institutions this region actually has, which is not true of most parts of the state named in the same paragraph.

What a $25 million capital grant physically is

This is capital money, which means buildings and equipment rather than salaries and programming. A design center needs specialized space: controlled environments, heavy electrical service, high-density computing, secure areas and laboratory fit-out. Twenty-five million dollars of capital does not get spent on software licenses. It gets spent on construction, mechanical and electrical systems, and equipment installation.

If a downstate applicant wins and the site is in Nassau or Suffolk, that is a construction and fit-out program in this region, procured by an institution rather than a developer, with the procurement rules that come with public capital.

The date that matters is October 26

Concept papers close at 2 p.m. that day. That is the point at which the field of applicants is effectively set. Anyone hoping to be named in an application as a partner, a supplier or a workforce collaborator has about six weeks, and the conversation has to happen before the paper is filed, not after an award is announced.

What it means for members

If your business builds, wires, conditions or fits out technical space, identify which Long Island institutions are likely to apply and make contact before October 26. Being named in a concept paper as a regional partner costs nothing and is worth considerably more than a cold call after an award.

If you sell professional services, an incubator is a machine for producing small companies that need accountants, lawyers, insurance, IT and staffing. A design center on this Island would put that pipeline within driving distance, and the firms that are known to the institution early are the ones the startups get referred to.

And if you employ engineers, note what the center is actually meant to do: train chip designers. That is a new supply of technical graduates competing for a relatively small number of local employers. In a corridor where unemployment sits in the mid threes, an institution proposing to produce engineering talent is worth your support on the record, and a letter from a Chamber member carries weight in an application file.