Exclusive: Illinois makes play for billion-dollar National Semiconductor Technology Center

Zoom in: The U.S. government is poised to award the headquarters of the newly created National Semiconductor Technology Center — part of the bipartisan, $280 billion CHIPS Act — to a region that has proven capability in advanced engineering and manufacturing.

• Proponents view the new operation as akin to previous collaborative efforts to achieve massive advancements in nationally critical technology.
• One example: how the Los Alamos National Lab, featured in the 2023 movie "Oppenheimer," brought together world-leading scientists to pursue the atomic bomb.
• "While the manufacturing incentives of the CHIPS Act will bring semiconductor manufacturing back to the U.S., a robust R&D ecosystem led by the NSTC will keep it here," U.S. Secretary of Commerce Gina Raimondo said in April in a statement.

In Illinois, the economic development group P33 is coordinating an effort involving Gov. JB Pritzker, the University of Chicago, the University of Illinois and local companies, to win the NSTC.

• P33 CEO Brad Henderson estimated that the investment required to establish the NSTC will total $2 billion to $5 billion and that it could be awarded in 2024.

Between the lines: Pritzker tells Axios that he has personally lobbied the White House to deliver the NSTC to Illinois, saying it makes sense to locate the operation near the state's multidisciplinary academic, business and federal assets, including the Fermi and Argonne national labs.

What he's saying: "We have world-leading technologists, scientists and institutions, all working closely together and collaborating on both quantum, semiconductor and microelectronics research," Pritzker says in an interview.

• "These are all things that have either originated in Chicago or in the institutions here in the Midwest, or we've seen commercialization from that."

Though universities are often reluctant to cooperate on potentially competitive technology, the leaders of the University of Chicago and the University of Illinois tell Axios that they believe their chances are better working together.

• "It is not about just winning this grant. The goal is to make an impact on the world," says Rashid Bashir, dean of the University of Illinois Urbana Champaign's Grainger College of Engineering, where in the 1950s the inventor of the transistor established the electrical engineering program.
• "We have a long and deep history of being at the forefront of the study of quantum science, physics and chemistry," University of Chicago president Paul Alivisatos tells Axios, noting the existence of the Chicago Quantum Exchange, an academic-private-federal partnership that got $200 million in funds from the state of Illinois.

Yes, but: If there's one region that may have a better shot than any at landing the NSTC, it's a place that's literally synonymous with the first generation of semiconductors: Silicon Valley.

• The Silicon Valley region boasts the Lawrence Berkeley National Laboratory, Stanford University, the University of California, Berkeley and many of the world's most powerful tech companies.
• But Alivisatos, a former director of the Lawrence national lab, said the Midwest is uniquely suited to lead the next generation of semiconductors because of its engineering and production knowhow.

Be smart: Illinois and Chicago could use an image overhaul after a drumbeat of negative headlines in recent years — such as the departure of the headquarters for Boeing and Caterpillar — cast a spotlight on the long-running criticism that it's hard to do business there.

• Pritzker says those were isolated incidents and were offset by wins for the state, such as Kellogg's decision to locate the HQ of its newly split off snacks business in Chicago.
• "The Midwest shouldn't be called Rust Belt anymore but advanced manufacturing country," Pritzer says.

The bottom line: The NSTC would be a major catch for any state.

Go deeper: Illinois Gov. JB Pritzker: The U.S. is "under-investing" in AI and quantum computing