Congressional critics are raising legal and procedural objections to the Trump administration’s newly announced $2 billion initiative to invest directly in quantum computing companies. According to the critics, the plan stretches the intended purpose of CHIPS and Science Act funding passed during the Biden administration while giving the federal government an unprecedented equity stake in emerging technology firms.
The controversy erupted after the Department of Commerce disclosed plans to distribute $100 million investments to a range of quantum startups in exchange for ownership stakes, alongside a separate $1 billion commitment to a newly created quantum chip fabrication company backed jointly by IBM and the federal government. The initiative is intended to accelerate U.S. leadership in quantum computing, a technology viewed as strategically important for national security, cryptography and advanced scientific computing.
But lawmakers and policy observers are questioning whether the administration has the legal authority to use funds from the CHIPS and Science Act for the effort.
Rep. Zoe Lofgren (D-CA), the ranking Democrat on the House Science, Space and Technology Committee, accused the administration of diverting money Congress specifically appropriated for semiconductor and microelectronics research.
“This announcement is illegal and troubling on so many levels,” Lofgren said in a statement released after the awards were announced. “These funds were appropriated by Congress specifically for microelectronics R&D, with a focus on semiconductor technology — not quantum technology.”
According to the administration’s plan, the largest portion of the funding will go toward the launch of a new company called Anderon, which will function as a dedicated fabrication foundry for quantum processing units. IBM and the federal government would each contribute $1 billion to the venture, while IBM would also transfer intellectual property, personnel and manufacturing assets into the company.
The arrangement immediately raised questions about both the selection process and the government’s role as an investor.
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Lofgren, who represents portions of Silicon Valley, argued that Congress never intended CHIPS Act research funding to be used for manufacturing incentives or government equity investments. “The Congressional record is quite clear that Congress did not want the government taking equity stakes in companies using these funds,” she said. “There has also been zero transparency to Congress or the public on how these awards were selected or their terms.”
Her office further noted that the funding in question originated under Section 102 of the CHIPS and Science Act, which authorized billions of dollars for microelectronics research initiatives including the National Semiconductor Technology Center and advanced packaging programs. Manufacturing incentives, the statement said, were separately authorized and appropriated by Congress.
As noted by Ars Technica, the overlap between semiconductor technology and quantum computing hardware is “only partial, at best,” potentially complicating the administration’s legal justification for redirecting the funds.
Critics have also questioned whether conflicts of interest may have influenced the process. Lofgren pointed to reports that Dario Gil, the Department of Energy’s Under Secretary for Science and a former IBM executive, was involved in discussions surrounding the awards while IBM emerged as the largest beneficiary.
The administration has framed the investments as necessary to preserve U.S. competitiveness in a field widely viewed as critical to future economic and military advantage. Quantum computing remains years away from broad commercial deployment, but many researchers believe maintaining a diverse ecosystem of competing technologies is essential while the industry determines which architectures can scale effectively.
The structure of the program, however, has amplified concerns that the federal government is effectively picking winners in a still unsettled technology market. Ars Technica noted that IBM’s Anderon foundry would primarily support “transmon”-based quantum chips, potentially favoring one approach over rival quantum technologies being pursued by other companies.
Despite the objections, opponents may face difficulty blocking the initiative quickly. The Ars report said any legal challenge would likely require a plaintiff able to demonstrate direct harm from the diversion of CHIPS Act funding, a process that could take years to resolve in court while the money is already being distributed.
