Navigating IRA and CHIPS Act Uncertainty with myTrack

In the summer of 2022, Congress enacted two significant pieces of legislation: the Inflation Reduction Act (IRA) and the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act. These laws aim to bolster domestic semiconductor manufacturing and promote clean energy initiatives.  

However, it is unclear whether the incoming Trump administration will fund or modify these subsidies and tax credits. Businesses must navigate this evolving landscape while maximizing current opportunities. 

Strengthening U.S. Semiconductor Manufacturing 

By this point, many people know the details of the CHIPs Act. However, here’s a quick reminder of the high-level specifics.  

CHIPs authorized $280 billion in spending over a decade. Here’s how the money is being used: 

• $200 billion for scientific R&D and commercialization 
• $52.7 billion is for semiconductor manufacturing, R&D, and workforce development $24 billion worth of tax credits for chip production
• $3 billion for programs aimed at leading-edge technology and wireless supply chains. 

Ultimately, the goal is to foster domestic production of semiconductors and microchips. Businesses can get a tax credit for capital expenses associated with semiconductor manufacturing, including constructing semiconductor fabrication plants. 

This funding has spurred the construction of semiconductor fabrication plants, particularly in Arizona and Texas. For instance, Intel received up to $7.87 billion in support of new chip plants across several states  

However, challenges such as labor shortages and stringent expenditure timelines persist. 

Controlling Costs and Meeting Timelines

The CHIPS Act has fueled unprecedented growth in the semiconductor industry. While the funding is a boon, it comes with stringent requirements and expectations for timely expenditure.  

The rapid pace of growth has also created significant challenges, particularly a shortage of skilled workers. To bridge the gap, many businesses are turning to contract labor. Managing contractors effectively while controlling costs and meeting project timelines is essential—and it all starts with the contract. 

The Importance of Standardized Contracts 

Procurement teams invest considerable time and effort into developing contracts that govern the relationship between the company and its contractors. However, the process is often hindered by: 

• Multiple agreement templates lacking standardization
• Inconsistent terms, conditions, and rates 

This lack of consistency can lead to discrepancies, inefficiencies, and suboptimal negotiations. myTrack addresses these challenges by: 

• Promoting Contract Standardization: myTrack ensures terms and conditions are consistent across agreements, simplifying comparisons and enhancing negotiation strategies. 

• Aligning with Best Practices: By fostering alignment with industry standards, myTrack reduces errors and improves overall procurement efficiency. 

With myTrack, procurement teams can streamline contract development, reducing administrative burdens and ensuring compliance with CHIPS Act deadlines. 

Maintaining Facilities Amid Rapid Expansion 

In addition to constructing new facilities, businesses must ensure existing facilities are well-maintained to meet growing demand. Rising labor costs, inflation, and constrained budgets exacerbate these challenges. 

One way to optimize maintenance budgets is to eliminate cost leakage due to over-invoicing. myTrack automates the contingent labor spending process, from purchase order creation to invoicing, by: 

• Enforcing Contract Terms Automatically: myTrack ensures vendor invoices align with agreed terms, eliminating charges for work not performed. 

• Turning Leakage into Value-Added Work: By preventing overbilling, myTrack helps reallocate funds to essential maintenance activities. 

These capabilities allow businesses to maintain facilities more efficiently, meet market demands, and maximize the value of CHIPS Act funding. The CHIPS Act presents a unique opportunity for semiconductor businesses, but navigating its complexities requires precise contract management and operational efficiency. myTrack equips businesses to handle these challenges, ensuring they remain compliant, competitive, and ready to capitalize on this historic funding. 

Advancing Clean Energy Initiatives 

Although the Inflation Reduction Act (IRA) doesn’t explicitly mention it in the title, one of its primary objectives is to accelerate America’s journey toward net-zero emissions. To achieve this, the IRA offers substantial incentives for green energy projects, including tax credits, grants, and loan guarantees. 

The act allocates $500 billion for these initiatives. According to McKinsey, under IRA section 48C(e), companies may qualify for investment tax credits of up to 30% for eligible projects—those that reduce emissions, capture carbon, or involve renewable technologies. 

Navigating the Fine Print 

Accessing these benefits isn’t straightforward. Businesses must comply with several requirements, including the prevailing wage and apprenticeship mandates.  

The prevailing wage combines hourly pay and fringe benefits to ensure fair compensation, while apprenticeship programs foster workforce development. Meeting these requirements involves detailed record-keeping and reporting, which can be time-consuming and complex. 

Ensuring Accurate Workforce Accountability 

To secure IRA funds, companies must provide precise data on their workforce, including who is on-site, their roles, and their pay rates. Without access to real-time data, this can become a logistical nightmare, relying on supervisors and contractors to manually report on workforce composition. 

myTrack solves this problem. By automating the accountability process, it: 

• Collects real-time data directly from access control systems.
• Continuously updates workforce records, eliminating reliance on manual reports.
• Provides a clear, accurate picture of the worker mix and pay rates required for compliance. 

With myTrack, managers can generate force reports effortlessly, avoiding the hassle of sifting through paperwork and ensuring compliance with IRA requirements. 

Optimizing Craft and Skills Ratios 

Achieving the right mix of employees and contractors at various skill levels is essential for productivity and safety. The IRA adds another layer of complexity by regulating journeyman-to-apprentice ratios to promote workforce development and fair labor practices. 

Enforcing these ratios is challenging if vendors only provide this information after the work is completed. Late reporting can lead to missed compliance targets, budget overruns, and project delays. 

myTrack changes the game: 

• Real-time data ensures vendors adhere to agreed journeyman-to-apprentice ratios.
• Supervisors can address discrepancies immediately, safeguarding project timelines and budgets.
• Clients maintain full control over workforce composition, reducing labor costs and ensuring safety compliance.

This proactive approach not only simplifies IRA compliance but also helps prevent costly overruns—especially critical during maintenance or turnaround projects, where every extra day means lost revenue. 

By streamlining workforce accountability and enforcing skills ratios in real-time, myTrack empowers businesses to navigate IRA requirements confidently. It eliminates manual processes, ensures compliance with fine-print details, and helps businesses capitalize on the green energy incentives that drive profitability and sustainability. 

Seize the Day with myTrack 

The IRA and CHIPS Act present historic opportunities for businesses to drive growth, innovation, and sustainability. While the future of these programs under the incoming Trump administration remains uncertain, their current incentives offer a compelling reason to act now.

Accessing these funds requires navigating compliance complexities, detailed reporting, and evolving regulations—challenges that demand a robust approach to data management. With myTrack, your business is equipped to streamline compliance, simplify reporting, and adapt to potential policy changes.

Contact us today to learn how myTrack can help your organization unlock the full potential of the IRA and CHIPS Act, turning challenges into success.