Inside Texas’s $948 Million Semiconductor Innovation Fund
by Will Ramirez, on Oct 12, 2026, 9:30:00 AM
Texas is a national leader in semiconductor manufacturing, and the state is spending heavily to keep it that way. Its primary tool is a grant fund that, three years in, has been announcing new awards regularly.
For semiconductor manufacturers, suppliers, and research institutions weighing where to build, the Texas Semiconductor Innovation Fund is an increasingly central part of the state’s pitch — and it recently made another marquee award.
Recent Program Activity: What Changed
On July 9, 2026, Governor Abbott announced a $33.6 million Texas Semiconductor Innovation Fund (TSIF) grant to Texas Instruments to support a roughly $700 million capacity and technology expansion at its 300-millimeter wafer fabrication plant in Richardson. It was one of a series of 2026 TSIF awards.
The 2023 Texas CHIPS Act (House Bill 5174) created TSIF and the Texas Semiconductor Innovation Consortium, and the Texas CHIPS Office administers the fund. Lawmakers initially appropriated $698.3 million and added another $250 million in 2025, for roughly $948 million in total appropriations; announced awards and actual disbursements are different, and smaller, measures. Recent awards include $250 million to Samsung Austin Semiconductor for its Taylor fab, $13 million to Texas A&M’s Cyclotron Institute for semiconductor research and testing, and approximately $11.6 million to advanced-materials maker Soulbrain for a new facility and U.S. headquarters in Taylor.
Program Overview: How the Fund Works
TSIF awards grants to Texas public and private entities — private companies as well as institutions of higher education — for semiconductor manufacturing, design, and research projects. Private-business awards are reimbursement-based and governed by the grant agreement, while TSIF also supports eligible higher-education initiatives through its statutory funding mechanisms. The program is administered by the Texas CHIPS Office within the Governor’s Economic Development & Tourism Office, with strategic input from the Texas Semiconductor Innovation Consortium.
For private applicants, job creation and capital investment are important scoring factors. The program FAQ states that an application will not be disqualified solely because the project creates no jobs or yields no capital investment; other evaluation criteria and eligibility requirements still apply. Applicants need an established Texas presence, and the application requires an authorized community representative’s support signature; federal CHIPS funding and a local incentive award are not prerequisites. Because the landing page and the detailed FAQs frame some requirements differently, companies should confirm project eligibility with the Texas CHIPS Office.
Why It Matters
State semiconductor funds have become a common tool as chipmakers choose among a handful of states courting multibillion-dollar fabs. TSIF gives Texas a discretionary, deal-by-deal grant to help close the gap on a project’s economics, and the program has remained active through 2026.
For companies, TSIF may be combined with other Texas incentives — including local property-tax agreements and, for the largest capital projects, the JETI program — though each program carries its own eligibility and award terms, so the total package, rather than any single program, is what to evaluate.
What Companies Should Do
Semiconductor manufacturers, equipment and materials suppliers, and design firms planning a Texas project should engage early and build the capital-investment, job-creation, and economic-impact case the program weighs, along with the required community-support signature. Because private-business awards are reimbursement-based and milestone-driven, aligning the grant agreement with the project’s construction and hiring timeline is essential, and project eligibility should be confirmed with the Texas CHIPS Office.
Given the fund’s finite appropriation and ongoing awards, companies should also engage while appropriated funds remain available rather than assume the window stays open indefinitely.
How SSG Can Help
Site Selection Group helps companies evaluate and pursue discretionary state incentives like TSIF as part of a competitive location strategy. We model grant value against total project economics, compare Texas against competing states, assemble the local support and performance case these programs require, and coordinate the mix of state and local incentives that determines a project’s overall package.
Program details verified against primary sources as of September 30, 2026. Program rules, application status, and administrative guidance can change; confirm current details with the administering agency before acting. This article is provided for general information and does not constitute tax or legal advice.
