Sematech's relocation decision unlikely today

Consortium continues talks with state about incentives to stay in Texas

By Kirk Ladendorf
AMERICAN-STATESMAN STAFF
Thursday, August 14, 2003

The International Sematech research consortium probably will keep its headquarters in Austin, but the consortium's board of directors is unlikely to take any formal action at today's meeting at Sematech headquarters on Montopolis Drive.

A final decision had been anticipated from the meeting, but Sematech continues to negotiate a contract with Texas Gov. Rick Perry's office that would provide an estimated $200 million over five years to help extend Sematech's research effort for developing advanced manufacturing technology for microchips.

The state funds are expected to support the creation of a proposed Advanced Materials Research Center that would be managed by Sematech and involve researchers at several state universities in Texas.

"Until the contract is completed, there is nothing for the board to discuss," said Anne Englander, Sematech's communications director.

Englander said Sematech is generally happy with the progress of negotiations with the state. Funding for the first $40 million of state support is expected to come from the $295 million Texas Enterprise Fund, which was created by the Legislature in this year's session to support projects that bring jobs to Texas.

Sematech, which has been in Austin since 1988, employs about 500 people here. The consortium generated alarm among local business leaders last year when it announced that it would move part of its research effort to Albany, N.Y., after New York Gov. George Pataki pledged about $160 million for the project.

Some Sematech backers have said that Austin might lose all of Sematech to New York unless Texas stepped in with incentives.

Sematech, which is composed of 10 major technology companies based in the United States, Europe and Taiwan, is regarded as the leading research consortium for the chip industry. Its board is expected to approve a five-year strategic plan that will cover the organization's budgets -- and headquarters address -- through 2008.

kladendorf@statesman.com; 445-3622