Electronics

The PCB Industry Gains Traction On Capitol Hill…And Why It’s Important To You!

Guests David Schild | Uploaded : 12/12/2023


The EEcosystem Podcast

The PCB Industry Gains Traction On Capitol Hill…And Why It’s Important To You!

Wonder if you had the ability to have your PCBs manufactured in the US that were abundant, reliable and the pricing was competitive with offshore suppliers? This is what my guest, David Schild of PCBAA was recently advocating for on Capitol Hill along with PCB Industry executive members. Learn about the significant gains made in this annual event and what the implications will be for engineers like you.

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Transcript

								 Judy Warner:
Hi David, thanks so much for joining us. I'm excited to hear the updates on PCBAA. So before we jump in, some of our listeners may have not heard the first podcast you and I did about the Printed Circuit Board Association of America. So why don't you give us a quick brief on who your organization is and what you're doing and then we're gonna talk about what you've been up to in DC.

David:
Sure, thanks for having me, Judy. I really appreciate this and your long time support of the microelectronics industry. The Print and Circuit Board Association of America was started almost three years ago now by a core group of folks in the PCB and critical material supplier space, all of whom realizes that we needed a voice in Washington. And our mission is to educate, advocate, and legislate. We now have almost 35 members and the group is really focused on making sure. that the same kinds of incentives and the same kinds of public policies that have been enacted to support our semiconductor manufacturing here in the United States apply to the rest of the technology stack. Printed circuit boards, substrates, the critical materials that make those technologies possible.

Judy Warner:
Well, and I think for my audience here, David, it can be because microelectronics is an ecosystem. It's easy to focus on the sexy cool chips and the high-speed digital and RF and all this stuff. And forget that it all sits on top of these circuit boards. And we have really decimated that industry in the last two decades or more. So... Last time we talked, you were telling about the legislation part and your membership was growing with sort of an ecosystem throughout the industry and how we can get some of those funds that are being channeled into the CHIPS Act to get DC to pay attention that unless those CHIPS have something to sit on, CHIPS don't float, right? So...

David:
Chips don't float. You said it exactly right.

Judy Warner:
I know and I love that tagline. So on the back of the wind that I saw that you got a bill introduced with bipartisan support that includes what is it? What's the investment and then a 25% discount on tax credits?

David:
So here in the 118th Congress, we're thrilled that the PCBs, or Protecting Circuit Boards and Substrates Act, H.R. 3249, has been reintroduced by our bipartisan champions, Representative Blake Moore of Utah, and Representative Anna Eshoo of California. And really the bill has two major components. The first thing it does is allocate $3 billion in direct government funding so that the manufacturers of printed circuit boards and advanced IC substrates can go ahead and hire workers build factories, get the tooling that they need, ramp up their production capacity. I think the second and perhaps more important part of the bill is a 25% tax credit on the purchase of American-made printed circuit boards and substrates. And of course, that hits our OEMs, that hits our manufacturers. So if you are buying boards, this is a tax credit that applies to you. This helps with your overall tax burden. If you are selling boards, I think that's a great talking point to lead with. We are incentivizing American production in the same way that the CHIPS Act incentivizes the American manufacturing of semiconductors.

Judy Warner:
Well said. So let's talk about, I know you and many of your key members were in DC recently, so let's talk about what happened there and what you're excited about with this recent visit to DC.

David:
Yeah, we had a great week in Washington and I'm happy to talk about it. You know, our educate, advocate and legislate mission calls on members, and you're one of our supporters, to come to Washington and to actually advocate for the causes they care about. You know, I can tell the story of printed circuit boards, but the people who have been doing this for 10, 20, 30, 40 years in some cases are much better storytellers than I. And so we brought together, I think it was two dozen companies, and we went to DC. We heard from elected officials, folks like Senator Todd Young. Folks like Under Secretary Alan Estevez from the Commerce Department, Representative Nick Lolota from New York about what the attitudes are in Washington right now in terms of reshoring, in terms of global competition with Asia, in terms of how do we make sure that the things that we invent in America get manufactured in America. So that dialogue was really, really helpful. And of course we spent a day on the Hill, right? Wearing out the shoe leather, walking from building to building, office to office, staff to staff to explain the particulars of the PCBs Act. and to solicit direct support and co-sponsorship for that legislation. It was really a great week in Washington. I'm sort of coming down off that busy time in our nation's capital, but I think everybody left feeling like we made a lot of progress. And of course there's a lot of work still to do.

Judy Warner:
Tell us a little bit about when you're wearing out your shoe leather going office to office. What kind of, as you, as a member sort of gave their pitch for moving on towards passing this bill, what were the reactions?

David:
I think first people are still learning that there is a technology stack, that there is an ecosystem. You know, the semiconductor industry did a tremendous job over the last four years of educating every American, I think, on the importance of semiconductors, what they do

Judy Warner:
You

David:
and how

Judy Warner:
bet.

David:
they potter modern life. We have a similar challenge. And so of course, in many offices, we have to lead with, hey, in your district, we're making a piece of high technology that basically makes the modern world possible. It's called a printed circuit board. Here's how it works. We need to invent the next generation of substrates. Here is how those work. And so I think the education part was probably the first part of those conversations. And then what we heard was there's tremendous support to make America more competitive in the global microelectronics marketplace. There is tremendous support for more jobs, more factories, more capacity building in the United States. And of course, we also heard a little bit of caution about federal spending, right? There's a lot of belt tightening going

Judy Warner:
Mm-hmm.

David:
on in Washington. There's a lot of concern about federal spending. That's why I think our bill, which while it does have a significant direct allocation in the way of $3 billion, is more of a demand signal buy it in America bill because it leans so heavily on that tax credit. And I think members and their staffs were receptive to that. But of course, we have to be political realists and understand the way the winds are blowing right now.

Judy Warner:
Yeah, and yeah, as we all know, if we watch the news at all, you know, there's all that banter, that heated banter going on about budgets and all that and where to allocate. So

David:
That's right.

Judy Warner:
I can certainly appreciate that and you taking a realistic stance. But I think that's also an extremely compelling point to say, yeah, but this puts that right back into the economy. Right. It's not extracting. hoping for a return at some point. And it's a critical piece, so good for you. So what else happened while you were there on the hill and just kind of flesh out what that looked at? I saw a beautiful picture of you that I'll share on your website and social media where you're all standing there on the lawn of the Capitol.

David:
Mm-hmm.

Judy Warner:
And I'm like, wow, there's my PCB. friends all gathered around Capitol Hill, which was so refreshing. And it really indicated things are happening. Right. I mean, people are traveling, putting their money where their mouth is and, and really leaning into this, which is wonderful. Um, and I don't think would have happened without the organization of PCBAA. So well done. What other highlights would you share with our audience about what

David:
Well,

Judy Warner:
took place there?

David:
I can't take credit for the weather, but it did shine on us, right? And I like to think

Judy Warner:
Ha

David:
that

Judy Warner:
ha!

David:
it's shining on our industry. And the wind is at our backs, just given everything that's happened with the CHIPS Act, of course. I think one of my big takeaways was that there's a lot of enthusiasm now to get the word out. We talk about going from 2,200 companies making boards 20 years ago to only about 150 companies today. But of course, our tent is big. We want purchasers. We want critical material suppliers. We want assemblers. designers, testers, you know, we recently brought in Matrix. We recently brought in Adventest RDA. We are growing, right? Year over year, we've doubled our membership, but there's so much further to go. And the broader the base we have, the more political impact we have. We went to the offices where we have constituencies in places like Florida, New York, Illinois, California. So if you're out there right now running a PCB company, if you're out there right now running a critical material supplier and you're in Washington state. or you're in Idaho, or you're in Indiana, we want you on the team. There are a lot of membership options out there, and I was just so impressed to sit with our members and hear them say, hey, I have this customer, I have this supplier, I have this business partner, we need to make an introduction because they need to know about PCBA. We're still a young organization, we're still new. I don't expect us to have the reputation that maybe some other trade groups have, but I know we occupy, Judy, a unique space. I know we are doing something that nobody else is doing, which is a sole focus. on American manufacturing of microelectronics and an education mission, which is gonna teach lawmakers at the state and federal level why this technology is so important, what happened to it, why it went overseas, and how we can bring a good amount of it back. I think folks wanna hear about shovel-ready jobs. They wanna hear about the challenges we face with workforce. And they wanna know, as an example, when we make these new next generation semiconductors, where are they gonna go? Are they going to go back overseas for advanced packaging and for meeting with boards or can we do some of that work in the United States? I think the answer is we can with a sufficient commercial demand signal that starts with federal action.

Judy Warner:
And we should, by the way, just for our own national security. The stuff that needs to stay here is, you know, life and limb type technologies, and it's complex and, you know, overseas introduced risks and risk mitigation means building it here. And that 25% tax credit would go a long, long way in addition to the investment. So again, let's get down to where the rubber meets the road. There's engineers listening to us talk right now

David:
Sure,

Judy Warner:
and they're

David:
of course.

Judy Warner:
like, yeah, whatever. How do I deal with my signal integrity on this board? And I'm finding I'm

David:
Mm-hmm.

Judy Warner:
like, well, let's talk about how this impacts engineers across the country, right?

David:
Yeah.

Judy Warner:
Particularly those that either have to build here or they'd like to build here, but they can't. How's this gonna impact them? I know I... I'll tease this up because I think you and I'll be able to meet here is I just interviewed Sean Patterson at Summit Interconnect and he has amazing visions for helping modernize this industry which directly serves engineers but it's a message that I personally feel passionately about but I don't know that I'm always delivering the message so why does this matter to engineers? And why should they pay attention? Why, if you're an OEM, should you become a member? And one last thing, and then I'm just gonna let you run, David, I just came from the International Microwave Symposium, so everything wireless communication, whether it's space or a cell phone. I talked to a purchaser at Northrop Grumman. He said they need to... 12,000 engineers in the next year. Why is it going to matter?

David:
You know, I'll let's start with the engineers, Judy, and great questions as always. I would say if we're gonna make the next generation of semiconductors here in the United States, we're going to need the next generation of advanced packaging and printed circuit boards to be invented here. You know, the president said during the state of the union last year, what we invent here, we should make here. And I wholeheartedly agree. We're gonna make new chips in places like Columbus, Ohio, and Chandler, Arizona. They're gonna need new technologies. If you're on the cutting edge, somebody like Summit is a great example. of printed circuit boards, right, of IC substrates. We want you to invent that here in America. We do. We want you to manufacture it here in America once you've invented it and proved it out. We're going to need a government-incentivized demand signal to make that happen. So if you're thinking, I want to invent this here. I don't want my competition overseas to invent it and manufacture it overseas. Great. We're trying to turn on the demand signal that gives you the runway to make that happen. I would say, you know, you talk about the OEMs. They want to diversify their supply chains in the wake of the COVID-19 pandemic and all the supply chain shortages and challenges that we saw, what are companies trying to do? They're doing reshoring, they're doing friend shoring, and they're trying to diversify their supply base so that no one single supplier, location or company threatens their ability to deliver to their customers. And what I would say is, we think bringing more of your work back to the United States is a great way to do it. gives you that diversity, gives you that security and resiliency. If you're saying, boy, I'm so concentrated in one company or one location on the other side of the Pacific Ocean, this is risky. I don't like this. Great. Let's talk about Indiana. Let's talk about Ohio. Let's talk about New York, South Carolina, Washington State, California, Texas, because having it here where the next generation of semiconductors are going to be built, I think that makes sense. So yeah, look, if you're buying boards, you know, we want to help your bottom line through a tax credit. We want to let your CFO, your head of supply chain, your purchaser sleep a little better at night.

Judy Warner:
Right, and it won't slow down your program and you can be successful and so many other things. I think it's easy for engineers to design a product if they're at a large OEM, they throw it over and put it in their hands of their buyer and say, have a nice day. And they're not necessarily aware or in touch with their board fabricator or they give it to a CM. And so... printed circuit board I think in many ways becomes invisible to the engineer but everything they're doing is depending upon it. So that's why I'm here with you beating the drum.

David:
That's right.

Judy Warner:
So where did you do some news releases? Where can people learn more about what occurred in DC? Have you done write-ups? Where should I point our listeners David?

David:
You know, the best way to stay in touch with what PCBAA is doing is to follow us on social media, follow us on Twitter, follow us on LinkedIn. You'll see an article from me this week detailing what happened in Washington. You're going to hear from publications like PCB00 or iConnect007. You're going to hear from, I think, the folks at EE Times. Of course, people who listen to your podcast are learning a lot more about what happened. But you know, we've got a lot of great imagery. We've got a lot of great stories. I think you'll start hearing testimonials from our members. If you follow us on social, it's hard to miss what we're doing. I think you'll get the

Judy Warner:
Indeed.

David:
story of what happened in Washington. And of course, I want to talk to anybody out there who wants to know more about these issues, who wants to get off the sidelines and get on the team. It's great to have doubled in the last year. It's great to be bringing in new members almost every week. But what I would say is our political effect is tied to our political footprint. Our political footprint reflects our membership. When we were five companies starting out, I was thrilled when we hit 25. 35, I was very excited. We need to be two times, three times, four times as big as that before

Judy Warner:
Mm-hmm.

David:
the snowball effect starts to happen on Capitol Hill. So I would say

Judy Warner:
Right.

David:
get off the sidelines, invest in your own future and government policies that will benefit your company, your industry today.

Judy Warner:
Good pitch. I love it. And by the way, for our listeners, I joined as an individual

David:
Thank you, Judy.

Judy Warner:
member. So there's no reason, you know, in that get off the sidelines, there's no reason why you can't join as an individual or as a small company or as a large OEM. Every person, every company, every aspect of the industry that joins, the voice gets louder. It gets more impactful.

David:
exactly right.

Judy Warner:
And DC has to pay attention and this will direct you directly impact you in many, many ways. So I want to personally give a unsolicited pitch for PCBAA and say, I put my, my hat in the, in the ring and to stand alongside, because I think this is really important for engineers, for OEMs, for really the whole industry. So, um, I will put those links below David, anything else you want to share before I let you go?

David:
No, you know, we're going to be really focused for the remainder of this year on building support for this legislation, on invoking some money in light of the Defense Production Act, you know, being called out for PCBs to fund our American industries. And I think you're going to hear a lot more about growing co-sponsorship, growing support in the House and hopefully the Senate for this bill movement on the National Defense Authorization Act. It's a busy time in Washington. We're not stepping back. We're leaning in on the heels of our annual meeting and trying to do our best for American manufacturing.

Judy Warner:
I think one thing I want to know before I let you go, David, is what are the next steps? And saying that you, you know, the bill's been introduced, you're raising support, you know, I don't know, and I'm sure our listeners don't know about the mechanism of how DC works to actually get a bill passed. What are next steps? And what's the timeframe?

David:
Sure.

Judy Warner:
You know, if you could wave a magic wand that you'd like to get this done in and what are the next steps?

David:
Well, if I had a magic wand, it would be myself and Speaker McCarthy and President Biden, you know, and leaders Schumer and McConnell. And, you know, we'd all have a beer and say, PCBs are great, and that would be the end of it. But barring that opportunity, what we're building on now is co-sponsorship. We absolutely are trying to get more members of the House to join on this bill. I think anybody who voted for the CHIPS Act should be a supporter of this. I think anybody who has American manufacturing in their district or who wants it in their district should be a supporter. Anybody who says... I'm concerned about global competition with China. I am concerned about secure and resilient supply chains. I want our military to have high technology they can count on and trust. To me, that's describing almost every elected official, much less members of the House, but our immediate near-term need is to build co-sponsorship. The committees of jurisdiction where this bill has been referred have to take it up, have to consider it. We may be looking at testimony, we'll certainly be looking at educational efforts. And so, you know, I would say, Juni, in a few months, we should touch base again, if not sooner, to report on how that progress is going. But we are carrying that masthead of we represent the industry into those offices, into newspapers, into online forums, into podcasts, into think tanks, into every forum you can think of to spread the word about what we're doing. We need more light and heat on this industry. And hopefully, you know, we get to a point where people say no mass, right? I've heard enough from PCBA. I want something else in my inbox. Uh, but that's my job. That's my job is to keep it top of mind and to, and to keep pushing until we get over the goal line.

Judy Warner:
Well, David, I think the world of you and I think you're the man to do it. I

David:
Thank

Judy Warner:
really

David:
you, Judy.

Judy Warner:
do. You're tenacious. You're just the sort of tenacious bulldog spirit that we've needed as an industry kind of leading the charge. So thank you so much for your effort and anytime you're ready for an update, I invite you to come back and share with our audience what's going on. And again, thank you so much for your time. I know you're a... pretty busy guy having just come from that big meeting in DC and there's less more work to do. So congratulations on the victory and we wish you continued success and thanks so much for coming and joining me today.

David:
Thank you, Judy. We're very lucky to have you on the team.

Judy Warner:
To our listeners, make sure you go check out the show notes. I cannot overstate the importance of this organization of PCBs that are often the underdog and the uncelebrated hero because chips don't float. And I encourage you to go become a member, connect with PCBAA on LinkedIn, particularly like you said, you won't miss it. And that's how I get my news and also on Twitter. and go get all the news. I'll put those links for you in the show notes. Appreciate you joining us today. David, we'll see you next time. Until then, remember to always stay connected to the ecosystem. Okay, 20 minutes and we're done.