It took about five seconds to cap off more than three years of planning as a who’s who of political and business leaders gathered in Malta to sink ceremonial shovels into a pile of dirt, symbolizing the official start of construction on a much-anticipated microchip factory at the Luther Forest Technology Campus.
According to speakers, the building of GlobalFoundries’ Fab 2 is the cornerstone in what is to be an unprecedented period of innovation, growth and prosperity for Upstate New York, particularly in the Capital District.
Governor David Paterson said that it took him some time to come around to the potential of Fab 2, and he flat out opposed the idea in conversations with then Gov. George Pataki.
`I told him I thought this would be one of the poorest investments we could make,` said Paterson.
But at the groundbreaking on Friday, July 24, Paterson was one of many to espouse the idea that Fab 2 is just the beginning for Saratoga County.
`We are going to attract so many new businesses,` said Sen. Charles Schumer. `Firms from around the country and around the world are going to look here now.`
Planners expect that one day, microchip customers and material suppliers will be located at LFTC in order to be near Fab 2.
The area is already home to a number of high tech businesses and with the arrival of Fab 2, more and more people are referring to Saratoga County as Tech Valley.
`We’re very fortunate that from the get go we have tremendous partners in technology in this area,` said GlobalFoundries Board of Directors Chairman Hector Ruiz. `We chose this location for one reason: people.`
Outside the air-conditioned tent, earthmoving equipment was continuing the work started over a month ago to make the 223-acre site ready for construction. What was formerly a dense forest has been rendered bare to make way for the 1.3-million-square-foot facility, where cutting edge processes will be used to create 28 nanometer scale microchips for use in electronics.
Construction is expected to take about a year, with additional time needed to situate the specialized equipment and clean room environment necessary for manufacturing. Production is slated to begin in 2012.
Once at full capacity, officials say the facility will employ 1,465 people. Construction is expected to employ up to 2,000 people.
There is room left on the site to build two additional facilities identical to Fab 2.
The site was originally being eyed by Advanced Micro Devices, who in October of 2008 shed its manufacturing elements and formed GlobalFoundries along with investments from an Abu Dhabi company. AMD is the only buyer of GloFo chips lined up, but the hope is that many companies will have their chips made in Malta.
Many at Friday’s groundbreaking praised the fruition of Fab 2 as an ideal example of how the public and private sectors can coordinate for the good of all. The state is distributing $1.2 billion to GlobalFoundries in cash and tax breaks over a period of 10 years.
`The state of New York reached out to us with an incredibly creative idea of how we could accomplish this,` said Ruiz, who went on to say that LFTC was chosen after a worldwide search.
Others hailed the arrival of the factory as a victory for the American economy. AMD CEO Dirk Meyer noted that the vast majority of advanced microchip manufacturing facilities are located in Asia.
`We felt it was wrong to have the manufacturing capability of this critical industry in one area,` he said. `This is a great day for GlobalFoundries, for AMD, for Upstate New York and for the U.S.A.`
In 2005, AMD closed its last major domestic manufacturing operation in Austin, Texas. It transferred control of Fab 1, located in Dresden, Germany, over to GlobalFoundries when the company was formed.
With groundbreaking made, the towns of Malta and Stillwater, where the plant will be located, are to begin receiving $5 million in community development money. $1 million of that is earmarked for the creation of a 32-acre recreational complex at LFTC.
According to Town of Malta Director of Parks, Recreation and Human Services Audrey Ball, the layout for the ballfields has been completed, but there are no utilities at the site and it will be some time before construction can be started.
The remaining money will be placed in community trusts, where it will collect interest and be used for quality of life improvements.
In addition to the contributions, it is widely believed that the presence of Fab 2 will cause a significant uptick in business all around the area.
`Some of the numbers that were given to us say that our [county] sales tax could double, and that’s certainly a big help to any town,` said Stillwater Supervisor Shawn Connelly.
Town of Ballston Supervisor Patti Southworth said she hopes Fab 2 will mean commercial growth in her town, where a largely residential base means that residents must shoulder most of the burden of school taxes.
`I’m hoping that some of the spin-off businesses will locate in Ballston,` she said. `Our only concern is that there might be only residential development,` which could put more strain on the school system.
Malta itself is expecting to increase in size dramatically. Some of the most hotly debated issues facing town government is how to frame zoning in order to keep development in line with small town sensibilities.
`It’s exciting looking forward to what’s going to happen,` said Supervisor Paul Sausville. `It’s much more than a factory, it’s about the transformation of our society and town into the 21st century.`
While Gov. Paterson and many others at the groundbreaking have been convinced of the merits of the project, there is and always has been public opposition from those who believe it to be a poor investment, an unsustainable drain on resources or a threat to the character of the area.
Paterson, however, said that naysayers will be proven wrong.
`Whatever investment we made will be paid back over and over,` he said. `Our new industries here in New York will consist of knowledge, technology and innovation.`
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