Illustration: Aïda Amer/Axios
Commerce Secretary Howard Lutnick is brainstorming how to rework the CHIPS and Science Act as President Trump trashes it, sources familiar tell Axios.
The big picture: Money for domestic semiconductor manufacturing has been appropriated, contracts have been signed, and there's little chance Congress votes to repeal the law.
- But Lutnick is looking for ways to target requirements the administration considers "woke," and to funnel any money from those costs back to the government or for more awards, sources familiar told Axios.
For example, the law's Davis-Bacon requirements mean companies have to pay the local prevailing wages on public works projects for laborers and mechanics.
- The law also requires manufacturers to provide child care for their workers.
- Lutnick is considering getting rid of such requirements to cut costs by renegotiating contracts, sources said.
- President Biden signed a law last year to exempt certain CHIPS Act projects from some environmental permitting requirements.
Behind the scenes: Sen. Todd Young has had ongoing conversations with the administration at multiple levels about implementation of the CHIPS program, per his office.
- Sen. John Cornyn, Rep. Michael McCaul and their respective staffs have no meetings scheduled with NIST as of this time, according to their offices.
What they're saying: "President Trump was given a resounding mandate by the American people to restore common sense in government and reinvigorate American manufacturing with his America First economic policy of tariffs and deregulation," White House spokesperson Kush Desai said in a statement to Axios.
What we're watching: Trump has said tariffs and tax incentives are the best way to get companies to build in the U.S. — not grants.
- Companies may welcome getting rid of government requirements and oversight.
- CHIPS isn't the only Biden-era program that Commerce is aiming to change: Lutnick announced on Wednesday he's launched a review of the BEAD program and the department is "ripping out" its "pointless requirements."
Reality check: The Trump administration is looking into reopening the terms of CHIPS contracts while it guts the offices responsible for implementing the law.
- The end result would be less oversight over companies using federal dollars.
Editor's note: This story has been updated to include a statement from the White House. It has also been updated to reflect that Sen. Cornyn and Rep. McCaul have not met with NIST.
