CHIPS Act Funding Opportunities: What Companies in the Semiconductor Ecosystem Need to Know

In recent months, the implementation of the CHIPS and Science Act of 2022 (the CHIPS Act) has seen significant changes at the two programs at the U.S. Department of Commerce (DOC) that are responsible for providing incentives awards to the semiconductor industry: the CHIPS Program Office (CPO) and the CHIPS Research and Development Office (CRDO). Having successfully supported the historic expansion of semiconductor fabrication facilities across the United States, CPO has recently broadened its focus to include strengthening the semiconductor supply chain. Since 2025, CPO has announced awards for several high-impact projects in the semiconductor supply chain, including in the critical minerals sector, further evidencing the Trump Administration’s focus and priority on this sector. In addition, CRDO has recently seen a significant increase in activity, with several major announcements of proposed awards to companies across the broader semiconductor research and development (R&D) ecosystem, especially in the quantum computing sector and compute supply chain. Under new leadership, CPO and CRDO are poised to remain highly active as the key federal incentive programs for the semiconductor supply chain and semiconductor R&D ecosystem.

Two funding opportunities for CHIPS awards are currently open: CPO’s Notice of Funding Opportunity for Facilities for Semiconductor Materials and Manufacturing Equipment (the CPO NOFO) for awards for semiconductor supply chain projects, and CRDO’s Broad Agency Announcement (the CRDO BAA) for awards for semiconductor R&D projects. This Legal Update, the second in a series, provides an overview of each funding opportunity. The CPO NOFO may be of interest to companies and investors considering non-dilutive funding and debt financing for semiconductor supply chain projects, including for critical minerals (especially rare earths such as gallium and germanium), specialty chemicals and gases, and semiconductor manufacturing equipment. The CRDO BAA may be of interest to companies and investors considering non-dilutive funding and equity financing for semiconductor R&D projects, including in advanced lithography, materials science, quantum computing, and other advanced computing. The funding opportunities are available to companies across all growth stages, from venture-backed startups to large publicly held corporations.

CPO Notice of Funding Opportunity

Originally published in September 2023 and amended in October 2025, the CPO NOFO solicits applications for awards to fund the construction, expansion, or modernization of two types of commercial facilities in the United States:

• Semiconductor materials facilities for the manufacture or production, including growth or extraction, of materials used to manufacture semiconductors, which are the chemicals, gases, raw and intermediate materials, and other consumables used in semiconductor manufacturing; and
• Semiconductor manufacturing equipment facilities for the physical production of specialized equipment integral to the manufacturing of semiconductors and subsystems that enable or are incorporated into the manufacturing equipment.

In order to be eligible, applicants are required to meet certain statutory eligibility requirements under the CHIPS Act, including (1) having status as a “covered entity” (as defined in 15 U.S.C. §4651(2)), (2) receipt of an offer of a state or local incentive for the project, (3) commitments to worker and community investment, and (4) receipt of workforce training commitments from regional educational and training entities and institutions of higher learning. Foreign entities of concern (as defined in 15 U.S.C. § 4651(8) and 15 C.F.R. § 231.104) are ineligible to apply for funding under the CPO NOFO.

Funds awarded under the CPO NOFO must be used for the costs to:

• Finance the construction, expansion, or modernization of an eligible facility (or equipment thereof);
• Support site development and modernization for an eligible facility;
• Support workforce development for an eligible facility; and
• Pay reasonable operating expenses for the eligible facility.

The application process under the CPO NOFO consists of two phases. In the first phase, applicants are required to submit a concept plan by no later than November 1, 2026. The concept plan must describe how the proposed project addresses CPO’s core program priorities, which include economic and national security objectives. In the second phase, CPO invites the most promising applicants to submit a full application. After reviewing the full application for eligibility and certain specified evaluation criteria, CPO then proceeds with the due diligence review of the application, the negotiations of final award documents, and finally, the award issuance.

The CPO NOFO gives CPO the flexibility to determine the appropriate form of award depending on the application. This may include a non-dilutive direct funding award (like a substantial majority of awards issued under CPO’s previous notice of funding opportunity) and/or a direct loan. The CPO NOFO does not specify a limit on the aggregate amount of all awards under the CPO NOFO. The total amount of individual awards will vary by project and is not subject to any minimum or maximum other than CPO’s funding authority. However, the CPO NOFO states that projects that lack sufficient scale will not be funded–including, presumably, any projects with capital investments below $20 million. This reflects a preference for high-impact projects that can significantly advance CPO’s core program priorities while maximizing use of CPO’s limited resources.

CRDO Broad Agency Announcement

Originally published in September 2025 and amended in April 2026, the CRDO BAA solicits two types of proposals: (1) proposals from eligible applicants for research, prototyping, and commercial solutions that advance microelectronics technology in the United States and (2) proposals from eligible applicants in which a US government investment would support innovations that advance the US semiconductor ecosystem and further national and economic security. The CRDO BAA identifies the following priority areas:

• Semiconductors, including advanced semiconductor technology research and prototyping;
• Application of artificial intelligence (AI), quantum technology, and biotechnology and biomanufacturing technology for advanced microelectronics R&D;
• Commercialization of federally funded scientific discoveries and technology advancements; and
• Promoting US engagement and leadership in international standards for critical and emerging technologies.

Eligible applicants under the CRDO BAA are domestic for-profit organizations, non-profit organizations, accredited institutions of higher education, Federally Funded Research and Development Centers (FFRDCs), and federal entities. Foreign entities of concern are ineligible to apply. Unless amended to close earlier, applications may be submitted until September 30, 2029.

To apply under the CRDO BAA, applicants are first required to submit a White Paper. After reviewing the White Paper for eligibility and considering certain evaluation criteria described below, CRDO may invite applicants to submit application materials under one of two funding paths: the R&D Project Path or the Investment Fund Path. CRDO has the sole discretion to select a funding path for an application.

Under the R&D Project Path, CRDO can issue awards in the form of non-dilutive direct funding awards to eligible applicants to fund specific semiconductor R&D projects. On the other hand, under the Investment Fund Path, CRDO can issue awards in the form of direct investments in eligible applicants that conduct semiconductor research and prototyping activities, with the goal of “eventually commercializing products and services that strengthen the economic competitiveness and security of the domestic semiconductor ecosystem and supply chain.” The CRDO BAA does not specify a limit on the aggregate amount of all awards under the CRDO BAA, and does not specify a minimum or maximum amount for individual awards.

The CRDO BAA sets forth the evaluation criteria that CRDO will use to determine whether an applicant should be invited to submit application materials under the R&D Project Path or the Investment Fund Path. These include (1) “whether a direct investment in the applicant or funding a specific R&D project would be more effective in spurring innovation in the semiconductor ecosystem” and (2) “whether a direct investment in the applicant or funding a specific R&D project is more likely to provide a positive return on investment for the Government.” These evaluation criteria reflect the dual priority of CRDO under the CRDO BAA of advancing semiconductor innovation and, where possible, ensuring a positive return on investment (ROI) for federal taxpayers.

As a condition of receiving an award, applicants may be required to issue to DOC equity, warrants, licenses to intellectual property, royalties or revenue sharing, or other such instruments as may be required to ensure an ROI. To date, all proposed or final awards announced under the CRDO BAA appear to contemplate an ROI to DOC in the form of minority, non-controlling equity interests in awardees. However, CRDO’s approach to the ROI on awards may evolve over time. The CRDO BAA also specifies certain administrative and national policy requirements that apply to its awards, including requirements relating to intellectual property and domestic production, investment and research security, and reporting.

Recent deal announcements suggest CRDO has been highly active in recent months. On May 21, 2026, DOC announced letters of intent with nine companies, totaling over $2 billion in proposed awards under CRDO. The stated goal of these awards is to advance a portfolio of quantum modalities and expand quantum manufacturing capacity in the United States, including $1 billion to IBM to help fund a new quantum foundry for quantum-grade superconducting wafers at the Albany NanoTech Complex in New York. This announcement was part of a broader administration initiative on quantum computing, with the White House issuing two quantum-focused Executive Orders in June and the Department of Energy launching the Quantum Genesis initiative the same month. More recently, on July 29, 2026, DOC announced letters of intent with seven companies, totaling over $800 million in proposed awards under CRDO, supporting semiconductor R&D in the compute supply chain.

Conclusion

Though they still have significant funding available, CPO and CRDO have been announcing proposed and final awards at an accelerated pace in recent months. Semiconductor supply chain or R&D companies that are exploring funding options—whether non-dilutive direct funding or debt for semiconductor supply chain projects or non-dilutive direct funding or equity for R&D projects—should consider starting the application process promptly. Companies interested in the CPO NOFO should be especially mindful of the NOFO’s deadline for submitting concept papers by no later than November 1, 2026. The Mayer Brown team is available to advise companies considering the CPO NOFO or CRDO BAA as a funding option for semiconductor supply chain and R&D projects. The Mayer Brown team draws on deep experience with the CHIPS Act as well as market-leading National Security, Intellectual Property, and Sanctions & Export Controls practices.