Biden diverges from environmentalists and House Democrats on chip legislation
The White House's objectives regarding the environment and manufacturing have taken a conflicting turn, following Congress's vote and Biden's approval to exempt new microchip factories from additional environmental assessments.
TroibNews 
President Joe Biden is set to sign a new bill that relaxes certain environmental requirements for federally funded microchip projects, despite pushback from environmental groups and House Democratic leaders.
The Building Chips in America Act passed in a contentious vote late Monday, where key committee leaders from the Democratic Party voiced their strong opposition while several Democratic lawmakers sided with Republicans, highlighting a fracture within the party.
In a statement to PMG on Tuesday, a White House official confirmed Biden's plans to endorse the legislation, asserting that it “will allow us to continue our efforts to ensure Americans across the country can benefit from the promise of the Investing in America agenda while protecting communities and the environment.”
Biden’s approval of the bill may exacerbate divisions between the party’s pro-business faction and its environmental advocates, with activists expressing concerns that the legislation is a concession to the chip industry and a potential risk to environmental protections.
This House vote signifies a considerable victory for the microchip lobby, which has campaigned for nearly two years to ease the environmental-impact requirements linked to the multibillion-dollar funding program initiated by the Biden administration for microchip manufacturing.
The 2022 CHIPS and Science Act allocated $39 billion for domestic chip manufacturing, aimed at enhancing U.S. job creation and industrial capacity in a burgeoning global market, while countering China’s influence. However, funding recipients must undergo federal environmental reviews in line with the National Environmental Policy Act (NEPA) before accessing funds—a new expectation for an industry not accustomed to such extensive environmental regulation.
Following the passage of the 2022 law, industry lobbyists began to advocate for exemptions from NEPA for specific projects and sought to expedite the litigation process associated with environmental reviews. They cautioned that without these amendments, the construction of chip facilities—integral to the high-tech industrial renewal promised by Biden—could face significant delays.
The Building Chips in America Act is tailored to diminish NEPA’s requirements for new CHIPS projects. It was passed unanimously by the Senate in December, and during Monday’s vote, GOP leadership pushed for a suspension vote that surpassed the two-thirds threshold, aided by Democratic support from several lawmakers whose states are positioned for major chip manufacturing initiatives.
Despite this, several key Democratic legislators, including House Energy and Commerce ranking member Frank Pallone, voiced their dissent during the House debate. Additionally, Rep. Zoe Lofgren, ranking member on the House Science Committee, urged Biden to veto the bill, stating, “He should veto it,” in an exclusive statement to PMG.
Environmental organizations, including the Sierra Club and over two dozen others, cautioned that signing the bill would jeopardize both environmental integrity and the administration’s climate objectives. “President Biden should veto this. I expect he will veto it,” said Harry Manin, deputy legislative director of industrial policy at the Sierra Club, in a statement to PMG.
However, Biden is also grappling with pressure from the influential microchip lobby, which has maintained a strong presence in Washington. “It’s our expectation that the president will sign the bill into law,” remarked a chip industry lobbyist who requested anonymity due to the sensitive nature of the situation.
The lobbyist stressed the national security imperatives that informed the CHIPS and Science Act and cautioned that the environmental reviews could impede the timely construction of chip facilities—a concern that critics claim has not materialized.
A resurgence in domestic tech manufacturing “is a legacy item, and [Biden] understands that,” the lobbyist noted.
The Commerce Department had not issued a response regarding whether Biden should endorse the bill or how CHIPS projects might be affected if it becomes law. Following the House's decision, a spokesperson for the department reaffirmed Secretary Gina Raimondo’s commitment to collaborate with stakeholders to ensure that CHIPS for America projects uphold both safety and environmental standards.
The Building Chips in America Act would exempt chip projects from NEPA reviews if construction begins before 2025, if they accept only government loans, or if they receive a federal subsidy of less than 10 percent of the overall project expenditure.
Furthermore, the legislation designates the Commerce Department as the primary agency for conducting the reviews—a role it has already begun to fulfill for some significant beneficiaries of CHIPS Act funding.
This change has drawn ire from environmental advocates, who have criticized the Department of Commerce for being too quick to suggest that three project sites pose no substantial environmental impacts. This would limit opportunities for public input and bypass a more thorough NEPA evaluation process.
Some environmentalists warn that reducing environmental safeguards could tarnish Biden’s legacy, with Judith Barish, coordinator of CHIPS Communities United, asserting that the bill compromises a range of administration priorities linked to climate, public health, and its Justice40 initiative. “It’s a missed opportunity,” she stated. “We don’t want to see the legacy of the CHIPS and Science Act being workers getting sick because of toxic chemicals on the job, or children in nearby schools and communities getting sick because of air pollution, or residents with poisoned wells and aquifers.”
Responding to these concerns, Semiconductor Industry Association spokesperson Dan Rosso claimed that the chip sector “is a global leader in promoting environmental sustainability and worker safety” and is dedicated to continuously improving its processes. He emphasized that modern chip facilities implement advanced fabrication techniques alongside rigorous safety standards and emissions controls.
In a brief interview, Sen. Mark Kelly, a co-sponsor of the bill, downplayed the environmentalists’ apprehensions, asserting that the NEPA exemptions in the legislation are “very narrow.”
Brett Hartl, government affairs director for the Center for Biological Diversity, lamented the potential consequences of the law, warning that “this only encourages other industries to use the same tactics.”
Even before the White House's announcement, he seemed resigned to the likelihood of a Biden signature. “I think it’s a done deal, given the votes and sort of how it played out,” Hartl remarked to PMG earlier on Tuesday.
Emma Dumain contributed to this report.
Alejandro Jose Martinez for TROIB News
The Building Chips in America Act passed in a contentious vote late Monday, where key committee leaders from the Democratic Party voiced their strong opposition while several Democratic lawmakers sided with Republicans, highlighting a fracture within the party.
In a statement to PMG on Tuesday, a White House official confirmed Biden's plans to endorse the legislation, asserting that it “will allow us to continue our efforts to ensure Americans across the country can benefit from the promise of the Investing in America agenda while protecting communities and the environment.”
Biden’s approval of the bill may exacerbate divisions between the party’s pro-business faction and its environmental advocates, with activists expressing concerns that the legislation is a concession to the chip industry and a potential risk to environmental protections.
This House vote signifies a considerable victory for the microchip lobby, which has campaigned for nearly two years to ease the environmental-impact requirements linked to the multibillion-dollar funding program initiated by the Biden administration for microchip manufacturing.
The 2022 CHIPS and Science Act allocated $39 billion for domestic chip manufacturing, aimed at enhancing U.S. job creation and industrial capacity in a burgeoning global market, while countering China’s influence. However, funding recipients must undergo federal environmental reviews in line with the National Environmental Policy Act (NEPA) before accessing funds—a new expectation for an industry not accustomed to such extensive environmental regulation.
Following the passage of the 2022 law, industry lobbyists began to advocate for exemptions from NEPA for specific projects and sought to expedite the litigation process associated with environmental reviews. They cautioned that without these amendments, the construction of chip facilities—integral to the high-tech industrial renewal promised by Biden—could face significant delays.
The Building Chips in America Act is tailored to diminish NEPA’s requirements for new CHIPS projects. It was passed unanimously by the Senate in December, and during Monday’s vote, GOP leadership pushed for a suspension vote that surpassed the two-thirds threshold, aided by Democratic support from several lawmakers whose states are positioned for major chip manufacturing initiatives.
Despite this, several key Democratic legislators, including House Energy and Commerce ranking member Frank Pallone, voiced their dissent during the House debate. Additionally, Rep. Zoe Lofgren, ranking member on the House Science Committee, urged Biden to veto the bill, stating, “He should veto it,” in an exclusive statement to PMG.
Environmental organizations, including the Sierra Club and over two dozen others, cautioned that signing the bill would jeopardize both environmental integrity and the administration’s climate objectives. “President Biden should veto this. I expect he will veto it,” said Harry Manin, deputy legislative director of industrial policy at the Sierra Club, in a statement to PMG.
However, Biden is also grappling with pressure from the influential microchip lobby, which has maintained a strong presence in Washington. “It’s our expectation that the president will sign the bill into law,” remarked a chip industry lobbyist who requested anonymity due to the sensitive nature of the situation.
The lobbyist stressed the national security imperatives that informed the CHIPS and Science Act and cautioned that the environmental reviews could impede the timely construction of chip facilities—a concern that critics claim has not materialized.
A resurgence in domestic tech manufacturing “is a legacy item, and [Biden] understands that,” the lobbyist noted.
The Commerce Department had not issued a response regarding whether Biden should endorse the bill or how CHIPS projects might be affected if it becomes law. Following the House's decision, a spokesperson for the department reaffirmed Secretary Gina Raimondo’s commitment to collaborate with stakeholders to ensure that CHIPS for America projects uphold both safety and environmental standards.
The Building Chips in America Act would exempt chip projects from NEPA reviews if construction begins before 2025, if they accept only government loans, or if they receive a federal subsidy of less than 10 percent of the overall project expenditure.
Furthermore, the legislation designates the Commerce Department as the primary agency for conducting the reviews—a role it has already begun to fulfill for some significant beneficiaries of CHIPS Act funding.
This change has drawn ire from environmental advocates, who have criticized the Department of Commerce for being too quick to suggest that three project sites pose no substantial environmental impacts. This would limit opportunities for public input and bypass a more thorough NEPA evaluation process.
Some environmentalists warn that reducing environmental safeguards could tarnish Biden’s legacy, with Judith Barish, coordinator of CHIPS Communities United, asserting that the bill compromises a range of administration priorities linked to climate, public health, and its Justice40 initiative. “It’s a missed opportunity,” she stated. “We don’t want to see the legacy of the CHIPS and Science Act being workers getting sick because of toxic chemicals on the job, or children in nearby schools and communities getting sick because of air pollution, or residents with poisoned wells and aquifers.”
Responding to these concerns, Semiconductor Industry Association spokesperson Dan Rosso claimed that the chip sector “is a global leader in promoting environmental sustainability and worker safety” and is dedicated to continuously improving its processes. He emphasized that modern chip facilities implement advanced fabrication techniques alongside rigorous safety standards and emissions controls.
In a brief interview, Sen. Mark Kelly, a co-sponsor of the bill, downplayed the environmentalists’ apprehensions, asserting that the NEPA exemptions in the legislation are “very narrow.”
Brett Hartl, government affairs director for the Center for Biological Diversity, lamented the potential consequences of the law, warning that “this only encourages other industries to use the same tactics.”
Even before the White House's announcement, he seemed resigned to the likelihood of a Biden signature. “I think it’s a done deal, given the votes and sort of how it played out,” Hartl remarked to PMG earlier on Tuesday.
Emma Dumain contributed to this report.
Alejandro Jose Martinez for TROIB News
