Will the Commerce Department’s Move to Let NIST Run the Semiconductor Technology Center Pay Off?

WASHINGTON, Aug.28, 2025 – In a sweeping administrative reshuffle, US Department of Commerce has recently withdrawn up to $7.4 billion in CHIPS and Science Act funding previously allocated to non-profit NATCAST.

Besides halting the flow of funds as well authority to control National Semiconductor Technology Centre, or NSTC has been withdrawn from NATCAST.

Established to operate the National Semiconductor Technology Centre, NATCAST has faced the ire of US Department of Commerce at a time when the semiconductor sector is being touted as a major growth driver of the country’s economy. 

In a statement, Commerce Secretary Howard Lutnick said setting up NATCAST as an independent entity was done unlawfully under the Biden administration.

Secretary Howard claimed that the CHIPS Act does not explicitly authorise the creation of such a corporation. Control of the NSTC has now been shifted to the National Institute of Standards and Technology, with immediate effect.

Allegations on NATCAST You Should Be Aware of

Government Corporation Control Act: Media reports suggest that Howard sent a letter to Natcast’s leadership, asserting that the arrangement which brought NTSC under the ambit of this non-profit violated the Government Corporation Control Act, which requires specific congressional authorisation for establishing new federal corporations.

Howard has also expressed displeasure over the organisation’s leadership structure, pointing to the presence of former administration officials.

Foundation of Non-Profit: NATCAST, founded in 2023, had been designated with managing research partnerships, advanced packaging initiatives and workforce development efforts under the CHIPS programme.

Few months before it demitted office, the Biden administration increased its support, allocating more than $6 billion for NATCAST activities, alongside an additional $1.1 billion to oversee advanced packaging projects in Arizona.

Activities in Semiconductor Space: NATCAST has drawn on senior expertise from across the semiconductor sector, including former executives from Intel, Synopsys and other leading firms. It has also supported R&D and training initiatives at US universities and opened a flagship CHIPS-funded facility in Albany, New York, which was due to receive an $825 million investment.

With the withdrawal of funds, the future of these projects is now uncertain. The Commerce Department has not clarified whether the money will be redirected or how existing agreements will be handled. The move marks the latest reversal by Lutnick, who has already pulled back federal support from other Biden-era technology programmes in recent months.

Why is Natcast Silent Over the Issue?

The Commerce Department statement has described NATCAST as an “effort to skirt clear legal restrictions prohibiting government agencies from establishing corporations,” and that it was full of “former Biden officials,” making some generalized allusions to nepotism and corruption.

There has been no official statement from NATCAST about the funding cuts, but last week the non-profit did highlight how it was aligned with the priorities of the White House and tried to make clear how important its role was in making the US competitive in the cutting-edge chip industry.

In July, NATCAST celebrated the creation of its new CHIPS for America Extreme Ultraviolet (EUV) Accelerator facility within the NY Creates Albany NanoTech Complex. Designed to accelerate the U.S.'s fabrication of the latest EUV semiconductors, it gives visitors full access to ASML's latest EUV chip design tools. It was also hoped to attract the top talent in semiconductor design and manufacturing, but now the future of the center and any other NATCAST efforts remains uncertain.

In January, NATCAST and the then-Biden administration announced plans to build a further research and development facility in Tempe, Arizona. It was set to open sometime in 2028, but that seems increasingly unlikely to come to pass without appropriate funding.

The Commerce Department is yet to reveal what it plans to use the billions in funding it now has control over.

The Trump administration’s Commerce Department wants to bring this non-profit under its umbrella of control, though, and has announced it will be taking over a large portion of the organization's funds moving forward.

NATCAST, founded in 2023, had been designated with managing research partnerships, advanced packaging initiatives and workforce development efforts under the CHIPS programme.

Inputs from Saqib Malik

Editing by David Ryder