Understanding the New Semiconductor Legislation

The bipartisan Creating Helpful Incentives to Produce Semiconductors for America Fund Act (also known as CHIPS) has passed both the U.S. Senate and House of Representatives, and President Joe Biden plans to sign the legislation Aug. 9 in a Rose Garden ceremony.

While most media coverage has focused on the bill’s substantial investment in the private sector semiconductor industry, there are several components that are important to state policymakers, particularly in the areas of research, education and workforce development.

The bill is designed to counter increasing competition from China in technological innovation. The $280 billion legislation will “provide for international information and communications technology security and semiconductor supply chain activities, including to support the development and adoption of secure and trusted telecommunications technologies, secure semiconductors, secure semiconductors supply chains, and other emerging technologies.”

The bill will:

  • Support clean water and watershed research in collaboration with state, territorial, local and tribal governments. (p. 148)
  • Support greenhouse gas research, including federal agency coordination with state and local governments. (p. 291)
  • Establish a National Supply Chain Database, through which the federal government will work with state and local governments to minimize “disruptions to the United States supply chain by having an assessment of United States manufacturers’ capabilities.” (p. 357)
  • Support a National Academies study to foster innovative, evidence-based science, technology, engineering and math education practices from pre-K through 12th grade (p. 385)
  • Establish a National Science, Technology, Engineering, and Math Teacher Corps Pilot Program that honors outstanding STEM teachers and “rewards them for their accomplishments, elevates their public profile, and creates rewarding career paths.” (p. 393)
  • Develop initiatives, including scholarships-for-service and postdoctoral fellowships, to support a pipeline of professionals in Artificial Intelligence to meet the workforce needs of state, territorial, local and tribal governments. (p. 425)
  • Fund undergraduate scholarships, graduate fellowships and traineeships and postdoctoral awards in science, technology, engineering and math fields. (p. 459)
  • Work through the Established Program to Stimulate Competitive Research program to expand geographic and institutional diversity in research. (p. 466)
  • Establish a National Secure Data Service demonstration project “to develop, refine, and test models to inform the full implementation of the Commission on Evidence-Based Policymaking recommendation for a governmentwide data linkage and access infrastructure for statistical activities,” in consultation with state governments. (p. 557)
  • Establish the Directorate for Technology, Innovation, and Partnerships to provide grants to public and private sector entities to advance technology research and development. (p. 562)
  • Provide funding for Regional Innovation Engines to “further the development, adoption, and commercialization in key technology focus areas” through partnerships involving State, territorial, local and Tribal governments. (p. 577)
  • Establish technology planning and capacity building awards for state and local governments, among others, to advance the development and commercialization of technologies. (p. 589)
  • Direct the Comptroller General to evaluate the impact of federal science, technology, engineering and math programs on rural populations. (p. 675)
  • Establish Regional Technology and Innovation Hub Program to encourage state, territorial, local and tribal governments to work with other public and private entities to develop innovation strategies to support economic development and resilience. This includes Strategy Implementation Grants and Cooperative Agreements for state, territorial, local and tribal governments to create job training and other workforce programs to meet the needs of local employers. (p. 742)
  • Establish Regional Clean Energy Innovation Partnerships for state, territorial, local and tribal governments to work with other public and private entities “to enhance the economic, environmental, and energy security of the United States and accelerate the pace of innovation of diverse clean energy technologies.” (p. 790)
  • Establish Coastal and Ocean Acidification Research and Innovation program to “to advance our Nation’s ability to understand, research, or monitor ocean acidification or its impacts, or to develop management or adaptation options for responding to ocean and  coastal acidification.” This would include National Oceanic and Atmospheric Administration Ocean Acidification Activities grants for vulnerable state, territorial, local and tribal governments. (p. 821)

Putting American Rescue Plan Act Dollars to Work: Delaware

By Christina Gordley

The American Rescue Plan Act (ARPA) of 2021 provided $195 billion directly to states through the Coronavirus State and Local Fiscal Recovery Fund. States are to use this assistance to:

  • Respond to the negative economic impacts of the public health emergency.
  • Provide premium pay for specific professions.
  • Replace lost revenue.
  • Invest in water, sewer and broadband infrastructure.
  • Provide assistance to disproportionately impacted households and communities.

States have focused on how to best use the funds and sustain long-term economic recovery since the relief was enacted in March of 2021. Recently, the Senate Finance Committee requested the Government Accountability Office begin a review and assessment of how states have used the State and Local Fiscal Recovery Fund. Just as the impact of the pandemic has varied by state and region, the use of funds and the transparency surrounding spending has differed across the country.

Cross branch collaboration and innovation

Generally, the bicameral Joint Finance Committee is responsible for writing Delaware’s annual general fund operating budget. However, the committee is not responsible for allocating federal funds like the unanticipated funds received from the American Rescue Plan Act. In 1977, Delaware established the Delaware State Clearinghouse Committee for the coordination of federal and nonfederal grants to maximize the use of resources. The committee has a unique composition involving policymakers from the legislative and executive branches:

  • The chair of the Joint Finance Committee.
  • The vice chair of the Joint Finance Committee.
  • The controller general.
  • The director of the Office of Management and Budget.
  • The secretary of state.
  • The secretary of finance.
  • One senator appointed by the president pro tempore of the Senate.
  • One senator appointed by the minority leader of the Senate.
  • One representative appointed by the speaker of the House of Representatives.
  • One representative appointed by the minority leader of the House of Representatives.

The clearinghouse committee reviews and authorizes the use of all federal funds entering the state, whether for new programs recommended by the governor or formula block grants established by the federal awards. The committee reviews applications and reports submitted by individual agencies to spend federal and nonfederal grants, including ARPA funding.

Transparency, risk and oversight

Delaware’s Office of the Governor maintains a Rescue Plan Website with an extensive list of projects and initiatives funded by the State and Local Fiscal Recovery Fund. Included in the website is a brief description of each recipient program or project, the total award and the amount spent to date. As of July 26, the committee and Gov. Carney have announced a dedicated use for approximately 100 allocations totaling roughly $630 million of the $925 million received.

The website fulfills the requirement of the U.S. Department of the Treasury Compliance and Reporting Guidelines that the 2021 Recovery Plan Performance Reports submitted to the Treasury be made available on a public-facing website. Delaware goes beyond Treasury requirements to include the January and April 2022 project and expenditure reports that give a detailed breakdown of each item, category, overall amount allocated, amount spent to date and description.

The Delaware Internal Compliance Review Policy for the American Rescue Plan Act is outlined and posted on the website to “ensure proper stewardship” of the funds. The policy is designed to ensure that funds are used effectively and in compliance with federal and state regulations. An internal compliance policy addresses how entities awarding funds should rank and assess the risk of any sub-recipients. A pre-qualifying questionnaire and a formal risk analysis are provided for each project and used to evaluate the possible threat to compliance or damage to the state. In addition to regular reporting, a compliance review will be completed with the use of an outside audit as needed. The Compliance Review Policy provides a list of the various items a subrecipient should be accounting for and establishes the internal control process to set expectations for what to monitor during and after the project timeline. Establishing these guidelines in advance can help to alleviate fraud, measure performance and reduce future audit costs.

Equity and Inclusion

The unprecedented infusion of funds presents an opportunity for states to evaluate their programs and policies while developing approaches to further advance equity for all individuals and populations. States can amend or eliminate programs and policies that unintentionally create a barrier to achieving economic and health equity. For example, Delaware is using rescue plan funds to set up the Tenant Rent-Reporting Pilot Program to subsidize the cost of reporting timely rental payments to credit bureaus. Building a strong credit score is one of the keys to securing a home, vehicle ownership, personal and business loans, insurance and employment that may require a credit check. Participation in the program is voluntary and the pilot program will serve about 400 residents from disadvantaged populations across the state.

In another example, the Delaware Workforce Development Academy was created to increase the participation of women, minorities and disadvantaged individuals in the highway construction industry. Delaware is directing $100 million of ARPA support for the “Community Investment Recovery Fund” to support community centers and nonprofit organizations that provide critical assistance to individuals, families and vulnerable populations, particularly during adverse times. The grant program’s goal is to strengthen the delivery of services, grow a more equitable economy and help address systemic challenges.

Like many states, Delaware is working to ensure an equitable recovery from the impacts of COVID-19. It has utilized funds from the American Rescue Plan Act to invest in education, workforce, housing, communities and health and human services.

This story is the second in a series that will highlight the use of American Rescue Plan Act funds by state governments.

How is your state using American Rescue Plan Act funds to make an impact? You can help The Council of State Governments tell your story. Email [email protected] to let us know how your state is successfully using this funding.

Recommendations for Opioid Settlement Spending

By Ishara Nanayakkara

Multiple state, local and tribal governments have pursued litigation against four U.S. pharmaceutical companies alleging corporate responsibility for the severity of the opioid epidemic. In July of 2021, those corporations agreed to pay a total of $26 billion to settle thousands of individual civil lawsuits. This funding is being used to address the crisis in various ways such as revamping old programs and establishing new ones. Many states have also created committees to make recommendations on how these funds should be allocated. A variety of research-based recommendations are available for policymakers to consider, including:

Distributing Naloxone

The U.S. Department of Health and Human Services has recognized Naloxone as one of the most effective strategies for addressing overdoses. Naloxone is a medicine that can swiftly reverse an overdose when administered into a muscle or given intranasally. But it must be readily available to individuals and a standard part of first responder equipment. The demand for Naloxone is rapidly rising but access is still not widespread. This may largely be due to the high cost of the product and the stigma surrounding opioid use. States are taking action to increase access to Naloxone through Opioid Education and Naloxone Distribution programs. As of 2020, at least 23 states had issued standing orders for local pharmacies, allowing individuals to purchase it without a prescription.

Detecting Fentanyl

Fentanyl is a highly addictive synthetic opioid that is 50-100 times stronger than morphine. This substance is sometimes laced into other drugs, which can lead to overdose and death for individuals that unknowingly consume it. Researchers at The Bloomberg School of Public Health at Johns Hopkins University spoke to individuals that use drugs and found that the significant majority were interested in having their drugs checked for fentanyl contamination so that it could be avoided. The researchers tested three drug-checking technologies—BTNX testing strips, the TruNarc Raman spectroscopy machine and the Bruker Alpha machine—for effectiveness. Fentanyl test strips proved to be safe and easy to use. A one-dollar strip works as a pregnancy test does: a test strip is dipped into a cup containing a few grains of the substance dissolved in water. These tests are highly accurate and can detect even tiny amounts of fentanyl—less than one microgram. These tests can also detect other harmful substances, such as acetyl fentanyl, furanyl and carfentanil. Widespread availability and use of test strips could help prevent accidental overdoses due to fentanyl contamination.


The causes of opioid addiction varies among individuals, but there are common risk factors such as financial and housing instability, untreated mental health challenges and chronic physical pain. There are multiple policies and programs that can address these risk factors, ranging from providing housing assistance to creating programs to help individuals become involved in the community.

Educating young people is one well researched, evidence-based policy to prevent substance use and abuse. There are several long-term programs focused on children in school, such as Fast Track and the LifeSkills Training Program. These initiatives vary in structure, with some focusing on drug education and others on shaping overall behavior. These programs can start as early as kindergarten and have been found to effectively reduce drug and alcohol use and can even modify aggressive behaviors.

As mental health issues such as depression and anxiety are commonly correlated with substance abuse, programs that address an individual’s mental health can also help prevent drug use. Programs that “help people have better outlooks” have been found to increase the sense of purpose and well-being among people who are vulnerable to depression. In addition to providing employment assistance, increasing volunteering opportunities and access to community activities—such as art projects and library visits—reduces isolation and helps individuals remain occupied, thereby improving their mental health.

State, local and tribal governments can also direct funds toward ensuring racial equity as the rate of overdoses and death have been increasing in Black populations. Black individuals make up 5% of drug users, but they constitute 33% of those in state prisons for drug offenses. Increasing equitable access to treatments including medication can help address the issue.

Resources for Governments