The U.S. Commerce Department has disbursed only about $506.8 million of the $11 billion that the CHIPS and Science Act appropriated for semiconductor research and development, according to a Government Accountability Office report released on 6 August. Manufacturing incentives, by contrast, are flowing on schedule.

The GAO reviewed the state of the 2022 law, the bipartisan statute passed under the Biden administration to strengthen domestic chipmaking and R&D. Its verdict splits cleanly in two. Factory projects are hitting milestones and getting paid. The research side has been largely dismantled.

Since the arrival of the new administration, Commerce has canceled $7.8 billion of the $11 billion R&D appropriation. Most of that money was intended for Natcast, the public-private consortium that ran the National Semiconductor Technology Center until August 2025, when Commerce canceled its $7.4 billion contract and took over NSTC operations itself.

What does the GAO say is missing?

The April 2026 charter Commerce wrote for the NSTC "does not mention the strategy or contain sufficient detail to demonstrate plans for the NSTC to align with" the National Strategy on Microelectronics Research, a requirement of the law, GAO wrote. Commerce has also failed to involve the private sector in establishing its investment fund, another statutory requirement.

The department did not respond to a request for an update on its plans.

Industry figures GAO's critique as overdue. "We need to be the leader in manufacturing as well as in research, both advanced manufacturing technology and advanced designs, and Congress apportioned money to do it," said Donna Dubinsky, serial entrepreneur, former Commerce Department official and, until the contract cancellation, a Natcast trustee.

Her larger point concerns geography. "We are choosing to not invest in future semiconductor technology leadership in the U.S., and I don't understand that choice," she said. "Now it's going to be in Belgium. It's going to be in Tokyo. It's going to be in Korea. It's not going to be in the U.S."

Where has the money gone instead?

Commerce has funded two R&D components of the act: roughly $347 million for metrology research at the National Institute of Standards and Technology, and less than $5 million for the Small Business Innovation Research program.

Outside the canceled NSTC framework, the department has awarded $900 million to xLight, SandboxAQ and I-Pulse, and promised a further $2 billion in preliminary quantum-computing awards drawn from CHIPS R&D funds. Unlike NSTC-era grants, these awards required equity stakes in the recipients.

"They're using these funds for investment in equity, when these are companies that have access to the capital markets," Dubinsky said. "If private capital is serving a sector well, then there's no need for the government to play a role. The whole idea of this program was to provide leverage that would enable substantially more private-sector investment."

VJ Sahi, a partner and vice-president at the funding consultancy Clark Street Associates, offers a gentler reading. "There were no significant developmental awards in flight" within the NSTC, he notes, so the cancellation may have delayed work rather than destroyed it. "The trade-off has been a delay, but it has also provided more available capital, if they can now move to deploy those R&D dollars on a reasonable schedule."

Are the manufacturing incentives working?

By the numbers, yes. As of April 2026, 24 of 144 milestones across 49 CHIPS-funded projects had been completed, with the associated funding disbursed. Since April, Commerce has announced seven more projects: five for USA Rare Earth, one for Bosch at $225 million, and one for Powerex.

GlobalWafers, the Taiwan-headquartered silicon-wafer maker, is building production facilities in Texas and Missouri with direct-grant support. The milestone payments have arrived without friction, according to Brent Omdahl, senior vice-president of government affairs. The company finished phase one of its Texas plant last year and received the promised $200 million shortly afterward.

"Obviously everybody in industry got perhaps a little anxious when President Trump, at the beginning of the administration, said he didn't like the direct-grant program," Omdahl said. He has heard of no government demands for equity positions, a worry among industry watchers at the time. The administration's changes to the grant program have, if anything, made the work run more smoothly, he said.

GAO expects a majority of CHIPS manufacturing projects to be complete by 2028, with all finished by 2033. Whether the research half of the statute recovers a schedule of its own will depend on a Commerce strategy that, as of the report's publication, does not exist on paper.