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WEST SENECA AMONG FINALISTS FOR SILICON CHIP PLANT

In an economic development version of the popular television show "Survivor," West Seneca has made the handful of finalists for the next chip fabrication plant in New York.

More than a dozen localities across the state began trying a couple years ago to get "pre-permitted" for a chip plant, the new economy prize typically bringing thousands of high paying jobs and spin-off development.

An industrial park off Route 400 is one of four serious contenders remaining, according to state officials. Most other sites, such as ones in Rochester and Rensselaer County, have dropped out to pursue more immediate opportunities. Dutchess County is off the list because it landed a $2.5 billion IBM plant last year.

Getting a site shovel-ready is the easy part. The real trick is beating out global competition to attract an Intel, Texas Instruments or another technology giant.

"Our strategy worked as far as IBM in Poughkeepsie, and we hope to replicate that in other parts of the state," said David Pietrusza, a spokesman for the Governor's Office for Regulatory Reform, which runs the SEMI NY chip plant initiative. "We don't rank the remaining sites, because it's really apples and oranges. They're all at different stages of development and each one has its own strengths. Any type of ranking system would be artificial."

West Seneca's strengths are 300 developable acres adjacent to a 230-kilovolt power grid, more than 3 million gallons of water available per day from the Erie County Water Authority for the water-intensive wafer fabrication process, interstate highway access, and a nearby metropolitan area work force.

The short term prospects for New York to attract another chip plant are tempered by the current economic downturn. Intel has slowed completion of a new plant in Colorado Springs and Motorola is laying off more than 10 percent of its 130,000 chip plant workers worldwide.

Chip sales grew 37 percent in 2000, but they likely won't hit forecasted growth of 22 percent this year, according to the Semiconductor Industry Association in San Jose. The reason is an oversupply of unused chips produced in last year's boom. And a slowdown in chip sales usually means a lull in construction of new chip fabrication plants.

West Seneca may have to stay in the hunt for years before its hand becomes a winner.

"As much as we hear that there's a downturn right now. The long-term trends are still there and the need for chips is still there," said David Lawrence, executive director of the West Seneca Development Corp. "We are aware of some site searches going on right now. That's about all I can say. Is anything hot right now? No."

Wallkill, in Orange County, already has a site that has been pre-permitted, meaning a plant could be built and opened within 15 months because all wetlands, historic preservation and other regulatory issues have been addressed.

Aurelius, in Cayuga County, has a 219-acre industrial park located in an Empire Zone, carrying significant tax credits, which has also been approved as shovel ready.

The West Seneca site should be certified by summer after a supplementary environmental impact study is completed by TVGA Engineering of Elma, Lawrence said.

Marcy, in Oneida County, is also far along in the pre-permitting process.

A site in the town of Clay, near Syracuse, is still alive but farther behind in the process, Pietrusza said. The industry slowdown could give Clay ample time to complete the process and become a serious contender.

The Capital Region Semiconducter Task Force, operating separately from the governor's initiative, is trying to pre-qualify sites in the Albany area. The Capital Region has the advantage of a 300-millimeter wafer prototyping and work force training initiative being developed at SUNY-Albany.

Thomas Kucharski, president of the Buffalo Niagara Enterprise marketing initiative, sees the prospects for landing a plant in West Seneca as a "long shot."

"At the worst, we've got a developable site ready. A fab plant would be great, but so would a research and development campus or a software facility," said Kucharski, who recently returned from an economic development conference in the Silicon Valley.

IBM's new plant in East Fishkill will manufacture 300-millimeter chips, which are bigger and more powerful than the older generation 200mm chips. The state offered IBM more than $500 million in economic development incentives to lure the project creating 1,000 jobs.

"New plants go on line as new technology goes on line. We're a computer-driven society now and there's no sign of that trend slowing down. We're just going to see more powerful chips doing more and more things in our society and you're going to need new places to build them," said Pietrusza.

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