In late September, Gov. Andrew Cuomo announced new agreements with Intel, IBM, GLOBALFOUNDRIES, TSMC and Samsung that will result in US$4.4 billion of investments over the next five years to create the next generation of computer chip technology. The state said the investments were secured in competition with countries in Europe, Asia and the Middle East.
R&D facilities will be located in Albany, Canandaigua, Utica, East Fishkill and Yorktown Heights. In addition, Intel separately agreed to establish its 450-mm. East Coast headquarters to support the overall project management in Albany. The projects will result in the creation and retention of approximately 6,900 jobs, said the state, broken out in this manner:
- 800 at CNSE Albany NanoTech Complex;
- 950 at IBM — Yorktown Heights and IBM — East Fishkill;
- 450 at SUNY Institute of Technology (SUNYIT) in Utica;
- 300 at CNSE’s Smart System Technology & Commercialization Center in Canandaigua;
- 1,500 construction jobs in Albany and 400 in Utica;
- 2,500 existing jobs retained in Albany, Canandaigua and East Fishkill.
No private company will receive any state funds as part of the agreement. However, New York State will invest $400 million over a five-year period in the SUNY College for Nanoscale and Science Engineering (CNSE) in Albany, including $100 million for energy efficiency and low-cost energy allowances. All tools and equipment acquired through the investment will be owned by CSNE, established 15 years ago with this sort of investment in mind.
CNSE in August welcomed a $23-million expansion from Moser Baer in Canandaigua that will create 60 new jobs in the manufacture of organic light-emitting diode (OLED) lighting panels. The project was aided by state matching funds of $3.4 million and a $3-million federal EDA grant secured by U.S. Sen. Charles E. Schumer, who also announced his effort to have the Department of Defense establish a $30-million secure chip fabrication facility at CNSE’s Smart System Technology and Commercialization Center of Excellence (STC) in Canandaigua.
After construction is completed in January 2012, Moser Baer has a long-term growth plan to expand and create an additional 150 jobs at the facility, which could involve up to $30 million in additional facility upgrades and $150 million in new equipment. CNSE STC is partnering with Finger Lakes Community College to establish a two-week cleanroom operator training program, developed with input from Moser Baer, to feed qualified applicants into the company’s employment pipeline.
As for the new multibillion-dollar, multi-multinational announcement, “This agreement puts New York on the forefront of the next generation of technological innovation,” said Brian Krzanich, senior vice president and general manager of manufacturing and supply chain at Intel. “This is our first major investment in the State of New York, and we commend Governor Cuomo for creating a business-friendly environment to foster growth and to make New York a nationwide leader.”
“This year is IBM’s centennial year and our company has been inventing, innovating and leading for 100 years — all of it with our headquarters right here in New York State,” said Dr. John E. Kelly III, senior vice president and director of IBM Research.
The investment in the state is made up of two projects. The first, led by IBM and its partners, will focus on making the next two generations of computer chips. The commitment by IBM brings its total investment in chip technology in New York to more than $10 billion in the last decade. The second project, a joint effort by the five companies, will focus on transforming existing 300-mm. technology into the new 450-mm. technology. The new technology will produce more than twice the number of chips processed on today’s 300-mm. wafers, thus lowering costs to deliver future generations of technology with greater value and lower environmental impact.
In addition, the project will include a private “Made in NY” initiative to support the potential purchase of $400 million in certain tools and equipment from companies around New York State. And the companies will support a $15-million fund to increase the role of minority and women owned businesses.
“These technology developments may facilitate the possibility of building a 450-mm. plant in New York state,” said the press release from the governor’s office, citing a price tag of more than $10 billion for such a facility.
Already Better Than Advertised
“The unique mix of industry and technology partners located in New York is a key component of our strategy of expanding our local operations, including the Fab 8 campus in Malta, N.Y., which will be the world’s most advanced semiconductor fab when it is completed in early 2013,” said Ajit Manocha, CEO of GLOBALFOUNDRIES at the big announcement in September. In other words, the company already had a lot going on, most recently breaking ground on its Admin 2 office building at the Fab 8 complex in June. The 221,000-sq.-ft. (20,531-sq.-m.) building, targeted for LEED-Gold certification and for an August 2012 completion, is designed to ultimately accommodate up to 1,500 office workers, although the company only expects to fit-up and equip 30 percent of the building at first, enough to support 450 employees.
Also in June, an updated economic impact study put together by business economist and former U.S. Under Secretary of Commerce for Economic Affairs Dr. Everett Ehrlich concluded that the Fab 8 project, originally announced in October 2008 by AMD, has not only met or exceeded its targets thus far, but strongly validated the burgeoning “Tech Valley” region as a cluster to be reckoned with alongside such semiconductor capitals as Silicon Valley; Austin, Texas; and Portland, Ore. As if to illustrate the point, CNSE recently has welcomed locations from nanotech companies RMTS (relocating from Colorado) and Nanolab, a Silicon Valley-based analytical services firm that will invest $1.5 million in a new lab.
The study said the GLOBALFOUNDRIES project will lead to about 6,500 new jobs in the area. “Key suppliers of engineering services and production inputs to the Fab 8 facility are beginning to locate in the area in order to be near the facility,” it said. And all has been accomplished despite the dreadful economic climate of the past three years, and the dramatic intra-company changes within AMD since the Luther Forest Technology Campus site was first announced in June 2006.
GLOBALFOUNDRIES’ goal of 1,205 direct jobs has grown to 1,450, and the total number of projected indirect jobs has blossomed from 3,000 to more than 5,000 since the 2008 announcement when both the project and the company were created, the latter as a spinoff of AMD in partnership with Advanced Technology Investment Co. (ATIC) from Abu Dhabi. Moreover, because of a 40-percent increase in clean room space announced in July 2010, the entire complex has grown by 42 percent to 1.7 million sq. ft. (157,930 sq. m.).
Through end of May 2011, ATIC had invested over $6 billion, to acquire the former manufacturing assets of Advanced Micro Devices in Dresden, Germany ($2.1 billion in March 2009) and the assets of Chartered Semiconductor Manufacturing of Singapore ($3.1 billion in December 2009) as well as an estimated $1 billion to construct Fab 8. “Through the end of 2012, ATIC will invest another approximately $6 billion in manufacturing capacity in Dresden, Singapore and New York with initial construction to begin in Abu Dhabi,” said the company in June.
Upstate Tour
Here are a few industrial development highlights from the non-Gotham part of New York:
Among the 20 winners of funds from the Obama administration’s $37-million Jobs and Innovation Accelerator Challenge, a multi-agency competition to support the advancement of 20 competitively selected, high-growth industry clusters across the country, was the Finger Lakes Food Processing Cluster Initiative. Nine counties are involved in the program, supported by Rochester Institute of Technology, Center for Integrated Manufacturing Studies (RIT-CIMS), the grantee.
The Chemung County Industrial Development Agency in September was awarded a grant of $800,000 from Empire State Development to assist Sikorsky Aircraft Corp. in its expansion to an existing 120,000-sq.-ft. (11,148-sq.-m.) facility in Horseheads. The company, which has outgrown its former facility, will redevelop, renovate and purchase machinery for their new operations at the former Wings of Angels Aircraft Museum building, located at Elmira Corning Regional Airport. Total project cost is $12.7 million. The project will retain 591 existing jobs and has already created 196 new jobs, with additional job creation expected through 2016.
Québec-based Cascades Inc. in late June said its Norampac division will invest in Greenpac Mill LLC (Greenpac), a corporation created with the Caisse de dépôt et placement du Québec (the Caisse), Jamestown Container and one other industry partner, for the purpose of constructing and operating a new containerboard mill adjacent to an existing Norampac facility in Niagara Falls, N.Y. The $430-million project comes as Cascades, which has most of its operations in Canada, continues to consolidate its own physical plant holdings, closing a Norampac corrugated converting mill in Le Gardeur, Que., and a Norampac containerboard plant in Burnaby, B.C.
Greenpac has been granted $60 million in brownfield tax credits administered by the New York State Department of Taxation and Finance, and $9 million in Empire Zone tax credits. In addition, the New York State Energy Research and Development Authority (NYSERDA) provided a $3.7-million incentive through its Industrial and Process Efficiency Program to purchase and install energy-efficient process and support systems. Finally, 10 megawatts of low-cost power have been granted by New York Power Authority (NYPA). Ground was broken in September for the new plant, which will create 108 new jobs.
Other pending projects which have applied for assistance to the Niagara County Industrial Development Agency include a $20-million, 11-job expansion by Olin Corp. in Niagara Falls. The plant’s products include chlorine, caustic soda, hydrogen, hydrochloric acid and bleach. Olin is requesting a 15-year industrial PILOT, sales tax abatements and mortgage recording tax abatement. The agency’s cost-benefit analysis calculates that the project will have an annual economic impact of approximately $3.7 million.
Orange County is among the leaders in project attraction outside New York City since Jan. 2010, according to the Conway Data New Plant Database, having welcomed major facility expansions or locations from President Container (relocating 200 jobs from New Jersey) and tortilla chip maker Medora Snacks in the Town of Wallkill, Continental Organics in New Windsor, and fragrance firm Takasago International Corp. in Harriman. Maureen Halahan, president and CEO of the Orange County Partnership, says seven of the 21 gubernatorial appointees to the seven-county Mid-Hudson Regional Economic Development Council (including her) were from Orange County. Through the year’s first nine months, the Orange County Partnership and its partners provided assistance on five attraction deals that will result in nearly 300 new jobs and the absorption of more than 1.2 million sq. ft. (111,480 sq. m.) of manufacturing/distribution space in the county.
Among the projects still aiming for the county is the 400-job Taylor Biomass Energy project, whose planned funding includes $100 million in pending federal loan guarantees that were in federal budget peril before being restored in April. The Montgomery Project will be a three-part, integrated system that converts the organic biomass portion of mixed solid waste to electric power through gasification.
After announcing a $400-million investment in its South Korean operations in May, rolled aluminum producer Novelis announced in July it will invest approximately $200 million to expand its operations in Oswego. Novelis is the world leader in aluminum automotive sheet, with more than 50 percent of the global market share for aluminum sheet used for making structural components and exterior body panels. The company expects to hire approximately 100 new employees at Oswego over the next two years leading to start-up of the new equipment in the summer of 2013. In addition to incentives from the State of New York and Empire State Development, the County of Oswego Industrial Development Agency is providing additional support.
Ripe for Renewal
A 50-job, $2.1-million investment will add two production lines to Pactiv‘s packaging plant in Canandaigua in Ontario County, thanks in part to a $750,000 grant to the city from New York State Homes and Community Renewal (HCR) that was expedited and secured by the Ontario County Office of Economic Development. The same office has approved a $400,000 low-interest loan to Pacemaker Steel and Piping of Rochester, Inc. to encourage the affiliate of 118-year-old Utica-based Pacemaker Steel and Piping Co., Inc. to expand in the Village of Manchester.
In August, Empire State Development (ESD) announced that Germanow-Simon Companies, an umbrella for two manufacturing operations — Tel-Tru Mfg. Co. and G-S PLASTIC OPTICS — that have existed in the heart of Rochester since 1916, will expand in Monroe County. The $3.2-million project will include renovations in three buildings in which Germanow-Simon Companies operates, two of which are more than 100 years old. The project will create 25 new jobs while retaining 77 current employees, and is made possible through $250,000 in Excelsior Jobs Program tax credits from ESD, the city’s provision of a grant and low-cost financing of an EPA loan; a sales tax exemption from the County of Monroe Industrial Development Agency (COMIDA); and energy efficiency assistance from the NYSERDA’s New Construction Program.
“This project is a model for the adaptive reuse of century-old, inner-city, multi-story manufacturing buildings in urban areas and will re-establish a platform for the future growth of our high-tech manufacturing operations,” said Andy Germanow, president and owner of both companies.