The state’s Public Authorities Control Board on Wednesday approved moving a $650 million incentive payment for the proposed computer chip manufacturing plant from Advanced Micro Devices to a new AMD spin-off company.
Meeting at the state Capitol in Albany, the high-level board within the state Division of Budget shifted the incentive from AMD to AMD Fab Technologies U.S., marking final state approval after three months of review.
AMD Fab Technologies will build and own the $4.6 billion chip fabrication factory planned at the Luther Forest Technology Campus.
Once operational, the plant will employ about 1,465 people. Economic development officials expect it to lead to thousands of other high-tech and other jobs in the Capital Region.
The upfront cash is part of a state incentive package previously awarded to AMD to build in New York that will total $1.2 billion.
“The approval to transfer the incentives is an important step in our process to create the new global foundry company and a state-of-the-art manufacturing facility that is expected to bring thousands of new jobs to New York,” AMD Chairman Hector Ruiz said in a statement released by the company.
The state incentives were first approved in 2006, but needed modification because AMD is spinning off its manufacturing operations to a new entity, The Foundry Co. AMD Fab Technologies U.S. will be a subsidiary of The Foundry Co.
Empire State Development, the state’s economic development agency, recommended the changes be approved.
The Foundry Co. will be about 65 percent owned by an Abu Dhabi technology investment fund and 35 percent by AMD, under agreements announced in the last two months. Existing AMD employees will provide management.
AMD officials hope to close on the deal early next year, but need all government approvals first. “Things are moving along very well,” said AMD spokesman Travis Bullard.
As a foundry, the Luther Forest factory will be free to manufacture chips for other companies. AMD, however, anticipates being the first and biggest customer.
AMD had been struggling financially for the last two years, in part because of the high costs of manufacturing. The computer industry has been turning more often to independent “foundry” plants for the actual manufacturing of computer chips.
“The support from the state of New York at all levels has been critical to the creation of The Foundry Company,” said Ruiz, who will become chairman of The Foundry Company.
AMD stated that the average salary at the factory will be about $60,000, and the annual payroll will be about $88 million.
At the same meeting, the state control board also approved $30.3 million in Empire State Development money for construction of electric transmission lines and road improvements at Luther Forest.
Michael Relyea, president of the Luther Forest Technology Campus Economic Development Corp., said about $16 million will go to running new high-voltage transmission lines to the site from both east and west, while $14 million is for paving Cold Springs Road in Stillwater. Cold Springs is now a dirt road, but will be an access road to the tech park.
The LFTC corporation recently opened bids for a 10-million-gallon-a-day sewer line that will connect the tech campus to the county sewer system in Halfmoon. Relyea said those bids ranged from $3 million to $6 million and are still under review. Work would start in the spring.
Meanwhile, the Stillwater Town Board is scheduled to vote tonight on zoning changes sought by AMD. Malta approved the necessary zoning changes last August.
The computer chip maker wants to clear land in the spring and start construction by July. About 1,600 construction jobs will be created during a two-year construction period.