Intel gets tax breaks while local authorities lose revenue, claims policy org

Report accuses corp of getting subsidies for its fabs from Oregon and New Mexico that deprive those states of vital funds 

Intel has become the latest target for Good Jobs First, which questions why the chipmaker continues to receive tax breaks from key states, long after setting up shop there, and laying off thousands of workers in those regions.

The non-profit organization, which promotes accountability in economic development, says the chipmaker promised billions of dollars in investment and thousands of high-tech jobs for the areas surrounding its manufacturing plants in Hillsboro, Oregon, and Rio Rancho, New Mexico.

Its report, The Bleeding Edge: How the Public Pays the Costs of Intel’s Semiconductor Manufacturing, claims that Intel's property tax breaks cost these communities more than $1.2 billion in lost revenue since 2015, and the brunt of the shortfall has largely fallen on schools funded by those local governments.

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For Oregon, Good Jobs First says that property tax abatements from Intel's use of the Strategic Investment Program (SIP) exempted it from at least $1.14 billion, while Hillsboro schools lost $891 million in revenue from 2017 through 2025.

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During the same timeframe, Intel paid Oregon $552.4 million in fees, or less than a third of the value of its tax breaks.

In New Mexico, the figures are lower, but still significant. The report puts Chipzilla's property tax exemptions from Industrial Revenue Bonds (IRBs) at $99.6 million in foregone revenue since 2017, while Rio Rancho’s Public Schools lost an estimated $43.4 million over the same nine-year period. Here, the company paid $41.6 million in required payments in lieu of taxes from 2017 through 2025, shared among affected local governments.

Good Jobs First also notes that despite these subsidies, Intel was awarded billions under the CHIPS Act funding from the US federal government.

However, the situation with that is somewhat complex, as the company secured an initial $7.86 billion under the Biden administration, of which $2.2 billion is believed to have been paid out.

The incoming Trump administration, however, decided to rethink the scheme, and ended up making an $8.9 billion deal for 10 percent of Intel’s common stock, made up of the remaining $5.7 billion of the CHIPS Act cash plus an additional $3.2 billion under the Secure Enclave program to make semiconductors for the military.

At the same time, the chipmaker is estimated by Good Jobs First to have laid off more than 4,700 workers at its facilities in Oregon and New Mexico over the past three years, as the company wrestled with restructuring efforts and dramatic losses.

(These are just a fraction of Intel’s total layoffs during the period.)

The issue, according to the non-profit, is that these sites are established Intel facilities which the company has operated for decades. They already have the facilities, infrastructure, skilled workers, and other necessities that a new site might require investment for. Are continued tax breaks truly necessary, Good Jobs First asks, or are they just subsidizing business decisions Intel would make anyway?

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It says Intel’s track record in Oregon and New Mexico should be taken as important lessons for other communities considering becoming a home to semiconductor manufacturing, and recommends questioning whether state and local tax breaks are even necessary.

"Tax incentives are supposed to encourage investment, not provide companies with an ongoing stream of public support for decades," said Good Jobs First Research Analyst and report author Kristan Wong Karinen.

 "Intel has received tax breaks at these campuses for generations, and local leaders should be asking hard questions about why those subsidies are still necessary, especially with the billions of dollars in federal grants and tax credits they receive from the CHIPS Act."

We asked Intel for a statement regarding these claims by Good Jobs First, and in response it told us: "Intel works closely with governments in the regions where we operate to leverage incentives that support leading-edge semiconductor R&D and manufacturing. We are not providing additional details beyond what's available in our annual reports."

Recent targets for the non-profit have been datacenters, and the states offering tax incentives for developers and operators to build within their jurisdiction. Some states were losing billions in lost revenue to server farm projects, while others were failing to disclose their tax shortfall. ®