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ARTICLE · 23 MAY 2023

Prevailing Wages And More: Developer And Contractor Obligations In CHIPS Act-Funded Construction Projects

Jones Day
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With the Commerce Department now accepting and entertaining funding requests for the construction, expansion, or modernization of semiconductor fabrication facilities in the United States...

United StatesReal Estate and Construction
Tarek Abdalla
Tarek Abdalla
Aaron L. Agenboard
Aaron L. Agenboard
David Birnbaum
David Birnbaum
Tonya Blosser Braun
Tonya Blosser Braun
Scott Cowan
Scott Cowan
Brian Easley
Brian Easley
Jessica Kastin
Jessica Kastin
Jonathan M. Linas
Jonathan M. Linas
Roy Powell
Roy Powell
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In Short

The Situation: The CHIPS Act provides over $50 billion in the form of grants, loans, loan guarantees, and other programs to incentivize semiconductor manufacturing in the United States. The U.S. Department of Commerce recently began accepting applications for funding of projects covered by the CHIPS Act.

Background: A requirement of receiving CHIPS Act funding is compliance with the prevailing wage obligations of the Davis-Bacon Act ("DBA"). The Obama administration previously interpreted a nearly identical requirement in the American Recovery and Reinvestment Act of 2009 to require contractors and subcontractors to comply with all DBA obligations, not just the prevailing wage requirements, and the current administration appears to interpret the language of the CHIPS Act the same way.

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