The White House launched a politically potent high-tech program this year. There's a reason you haven't heard of it.
A Biden administration program aimed to pour billions of dollars into technologies of the future in the U.S. heartland. Instead, it’s been starved by Congress and potentially destined to stay that way.
When Congress created the Regional Technology and Innovation Hubs program two years ago — part of a massive plan signed by President Joe Biden to bring tech manufacturing dominance back to American shores — the idea had support from both parties, and came with potential political payoff in both red states and blue.
The idea was to seed new innovation centers in at least 20 regions across the nation. Part of the 2022 CHIPS and Science Act, the program called for spending $10 billion over half a decade to turn those regions into globally recognized centers for technologies like quantum, biotech and lithium batteries.
Since then, Congress’ spending chiefs have provided less than a fifth of the planned funding for Tech Hubs, and the Commerce Department has given major grants to only 12 locations. At times, the future of the program has seemed so unclear that some regional winners found themselves checking with Washington to be sure the money would actually come through before a new administration is sworn in.
“Knock on wood they get it done before the election,” said Zachary Yerushalmi, a leader of the Elevate Quantum Tech Hub in Colorado and New Mexico.
The Tech Hubs program was built on a big idea with a checkered history: that a well-placed injection of federal money can drive economic recovery and innovation in key areas. Previous attempts at government-subsidized regional business clusters have had mixed results. In one Florida example, a $500 million plan to develop a biomedical hub over 15 years failed to break even and dramatically missed job creation targets.
For that reason, Tech Hubs was built around larger, more ambitious projects. Mark Muro, a senior fellow at Brookings Metro who co-wrote research that inspired Tech Hubs, said the program was born from “an impatience with small ball,” and a dream of “making some really big investments and see what happens.”
It never got the promised amount of money, and turned into something of a small-ball program after all. But with a well-placed scattering of federal cash across the U.S., the Tech Hubs program seemed designed at least for an impressive stump speech and a deep well of political support.
“I'd be campaigning on it. It was a big, big win for the state,” said former Nevada Gov. Brian Sandoval, a Republican and now a university president involved in his state’s hub, which won $21 million to advance lithium ion and EV batteries.
That political victory lap never happened either. The program’s rollout was overshadowed by political turmoil: The announcement of the 12 winning regions came just days after the disastrous debate performance that took Biden almost totally off the public stage. Biden didn’t give a speech to mark the occasion, as he had for the program’s earlier milestone. Vice President Kamala Harris gave the program a short mention in a September press release.
“This is a missed opportunity,” said Shalin Jyotishi, a policy strategist at the New America think tank. “If these appropriations don’t come to be, … it's not going to be a successful pilot of science and tech based industrial policy if that happens, and the political impetus of that is there might be even more of a reluctance for certain members to support programs like this in the future.”
The Tech Hubs program is small by the standards of multibillion-dollar government spending schemes, but so far almost universally popular — with people who have heard of it.
Commerce Secretary Gina Raimondo says it’s the program she has heard the most from lawmakers about, and Democrats are already trying to capitalize on its potential to win friends nationally. But it has largely been absent from candidates’ national messaging.
The Democratic Party’s 2024 platform takes a brief victory lap for the program: “We’ve designated more than 30 tech hubs in communities from Reno, Nevada; to Charlotte, North Carolina; to North Central Pennsylvania,” the platform reads, lumping the 12 funded projects with 19 others named as finalists last year. The platform pledges to keep America in the lead in “fields of the future, like AI, biotech, quantum computing, advanced materials, and more” — all focuses of Tech Hubs.
The GOP platform doesn’t mention Tech Hubs by name, but it too vows to “champion innovation” in emerging industries, exactly the kind of investment Tech Hubs is built on.
For all the theoretical support, the rollout of Tech Hubs has been modest. According to the original CHIPS Act, Tech Hubs was supposed to have gotten $2.95 billion from Congress over the past two years. Instead, it has received $541 million, just 18 percent of the size of the initial vision.
The reason for the severe trim is a broader underfunding of the CHIPS Act. The 2022 law called for nearly $53 billion to subsidize the semiconductor industry (the “CHIPS” part of the legislation), which Congress appropriated. But the rest of the law — a basket of science programs and research investments — has been mostly starved by Congress, with key agencies being asked to do more work with little, if any, additional funding to support them. Shortfalls have hampered the National Science Foundation and the Commerce Department’s Economic Development Administration, where Tech Hubs is based.
Appropriators have blamed the reduction on last summer’s debt ceiling deal, which flatlined all non-defense spending. In March, House Science Chair Frank Lucas (R-Okla.) told POLITICO he was “disappointed that we can’t provide funding to match what we authorized in CHIPS and Science,” but, “unfortunately, in our current fiscal environment we have to make difficult decisions and that’s reflected in the budgets for these agencies.”
Some also blame the White House for not selling the program more effectively, observing that Biden seemed to struggle to explain to the public why Tech Hubs mattered.
In October 2023, Biden announced the 31 tech hubs finalists across the nation that would be eligible for larger grants. Radio host Charlamagne tha God, in an interview at the time, said Biden bungled his messaging by not offering details on jobs the hubs would bring.
“Yeah, it’s good that you’re making all these investments in tech and everything else,” Charlamagne said in an interview with POLITICO at the time. “But what does this mean, for regular everyday people?”
In early July, the Commerce Department announced a dozen winning proposals across 14 states, the awards ranging from $19 million and $51 million. In the midst of a presidential campaign, this was a clear chance to tout the administration’s largesse to swing states; the grants included Georgia, Nevada and a big award to Wisconsin.
But the opportunity vanished in the tumult surrounding Biden’s late June debate performance. In a July press release, Harris offered a pre-written quote praising the selections, and the president never gave another speech promoting the program. Instead, officials from the Commerce Department visited winning projects in Reno, Nevada; Manchester, New Hampshire; and Miami.
"Literally, Vice President Harris gave the remarks for the Tech Hubs announcement, like her name is on the press release. And then with Governor Walz, you have the direct connection in his state. It's so unusual that this isn't made more of a campaign priority," Jyotishi said. "Messaging is the biggest missing link."
Former President Donald Trump's campaign did not respond to questions about whether he supports the program, and if he would advocate for more funding.
The Harris campaign didn’t answer that question either, but pointed POLITICO to a fact sheet released last week, in which Harris proposed funding a new network of incubators and innovation hubs, with the goal of making sure small businesses are “reaping the broader benefits of investments in semiconductor factories, Tech Hubs, and more.”
It said that network would draw from existing government programs, but did not specify which ones.
Although the majority of Republican lawmakers voted against the CHIPS and Science Act that established Tech Hubs, many later trumpeted projects in their states. Several lawmakers pledged to keep working to get more funding, but none offered specific plans.
Alabama GOP Sen. Katie Britt, who took office after the law was passed, touted her state’s tech hub, which was a finalist that didn’t advance to the next stage. She promised to land more federal money. "I firmly believe the Birmingham Biotechnology Hub merits further federal investment,” she said in a statement, and I remain committed to seeing it proceed in the Regional Tech Hubs program.”
A number of other lawmakers of both parties have promised to deliver it more money, but not much appears forthcoming so far. Biden requested that Tech Hubs get an extra $4 billion in fiscal year 2025, the House and Senate appropriations committees have suggested providing it far less, $41 million and $100 million respectively.
Despite its political popularity, the program’s spotty rollout and poor funding has alienated some of its initial supporters. Rob Atkinson, the president of the Information Technology and Innovation Foundation think tank and Muro's co-author who initially proposed the Tech Hubs concept in a 2019 paper, thinks the administration has spread funds too thinly for the program to be effective. He says it has been diluted beyond recognition — “virtually nothing like” his original proposal, which called for a $100 billion program concentrated in at most 10 metro areas — to appease political interests, and did not think Congress should appropriate more money without a reform.
“The administration looks at this as, if we're going to get more money, we got to get as many places getting money to get buy-in for it, without an overarching strategy or vision,” said Atkinson. “This is not peanut butter. This is not everybody gets something. This is about a national goal. We're going to get three to five places that can really, really compete with Shanghai or compete with Bangalore."
EDA Deputy Assistant Secretary for Policy Cristina Killingsworth said in an interview that the selections were not “a process that was influenced by politics in any way.”
“Finding large sums of funding in this environment is never easy,” she said. “But we are confident that with the bipartisan support we have for the program and with the president's robust support, that we will be able to do additional rounds of implementation grants in the future.”
For now, the program’s budget will not allow it to open another significant round of funding — leaving both the existing winners, many of which had projects that EDA did not fund, and the next set of hopefuls waiting on Congress. Some plan on exploring private investment or other federal sources of funding in the meantime.
The dozen Tech Hubs that won awards in July will not see the money arrive in full for a while. The EDA says it is rushing to get the awards out. It recently started the process of signing contracts and dispersing grants, which will continue on a rolling basis over the coming months.
While hubs wait, they’re making preparations to place orders, hire staff and start deploying their technologies.
"Getting all of the paperwork lined up is a pretty hefty effort,” said Tim VanReken, regional innovation officer for Montana’s Headwaters Tech Hub that won $41 million. “The other thing that we're focusing a lot on is road mapping out what our actual implementation work is going to look like.”
Killingsworth said she believes the program will continue to receive support “regardless of who's in power where.” But that hasn’t stopped some hub leaders from fretting the money could be clawed back by a future administration.
“People are committed,” Beth Conerty, who leads Illinois' iFAB Tech Hub, told POLITICO. “Everybody's just kind of holding their breath to see what the outcome of November is."
She expects to receive funding by October but had worried aloud to agency officials and legislators “a lot” how secure the funding would be after the election. “We had six different meetings with federal reps from the state, and so we were expressing this concern,” Conerty said.
Other hub leaders were more optimistic. Rob Simpson, CEO of CenterState, which leads New York’s Tech Hub, is waiting on a $40 million award.
“There’s a focus on getting contracts wrapped up, which hopefully will provide everybody with some certainty and predictability,” said Simpson. “But I'm not losing sleep over it. I look at the bipartisan nature.”
In the absence of higher-level attention, Commerce officials are touring the 12 winning hubs and 19 future hopefuls by the end of the year to raise their profile, as the EDA checks with lawmakers to see if there are any more pathways to fund them.
“It is important that we help connect the dots for our constituents,” said Ben Walsh, the independent mayor of Syracuse, part of the New York tech hub, “and help them understand what programs are funding what projects, and why.”
Otherwise, he added, “until some of these investments truly take off, I expect that people won't be completely satisfied.”