Will Nevada Taxpayers Get Good Deal on Teslas Gigafactory

Will Nevada Taxpayers Get Good Deal on Tesla's Gigafactory?

Sept. 5, 2014
"California lost, and Nevada won, but at the point of a huge incentive," said Thilo Koslowski of Gartner.

Nevada beat California in landing the $5 billion battery factory. But at what cost wonders Thilo Koslowski, automotive practice leader at  technology research company Gartner.

"This is taxpayer money, and it's quite a bit of money," Koslowski, said in an article in the LA Times.

 "California lost, and Nevada won, but at the point of a huge incentive."

The LA Times outlined the breath of the incentive package that was offered to Tesla.

Under the terms of the proposed deal, according to Nevada documents, Tesla would receive up to a 100% tax abatement for the next 20 years for all sales tax, and up to a 100% tax abatement for the next 10 years for all real property tax, personal property tax and modified business tax.

Tesla would also receive a transferable tax credit of 5% of the first $1 billion it invests in the state, and of 2.8% for the next $2.5 billion.

The governor's office said the deal would include a $5-billion investment over the next three to five years, and a subsequent investment of an additional $5 billion over the following five years.

In addition to 6,500 factory jobs, at $25 an hour for each position, the Tesla deal would create 16,000 other jobs — including 3,000 construction jobs — while increasing state employment by 2% and regional employment by 10%.

The state said Tesla would also make a direct $37.5-million contribution to Nevada K-12 education, beginning in August 2018, and provide the University of Nevada Las Vegas with $1 million for advance battery research.

And what does the state get for this investment?  Over 20 years the “total fiscal impact” is estimated at $1.9-billion. This would include $430 million in state revenue, $950 million in local revenue and $500 million in K-12 education revenue.

About the Author

Adrienne Selko | Senior Editor

Focus: Workforce, Talent 

Follow Me on Twitter: @ASelkoIW

Bio: Adrienne Selko has written about many topics over the 17 years she has been with the publication and currently focuses on workforce development strategies. Previously Adrienne was in corporate communications at a medical manufacturing company as well as a large regional bank. She is the author of Do I Have to Wear Garlic Around My Neck? which made the Cleveland Plain Dealer's best sellers list. She is also a senior editor at Material Handling & Logistics and EHS Today

Editorial mission statement: Manufacturing is the enviable position of creating products, processes and policies that solve the world’s problems. When the industry stepped up to manufacture what was necessary to combat the pandemic, it revealed its true nature. My goal is to showcase the sector’s ability to address a broad range of workforce issues including technology, training, diversity & inclusion, with a goal of enticing future generations to join this amazing sector.

Why I find manufacturing interesting: On my first day working for a company that made medical equipment such as MRIs, I toured the plant floor. On every wall was a photo of a person, mostly children. I asked my supervisor why this was the case and he said that the work we do at this company has saved these people’s lives. “We never forget how important our work is and everyone’s contribution to that.” From that moment on I was hooked on manufacturing.

I have talked with many people in this field who have transformed their own career development to assist others. For example, companies are hiring those with disabilities, those previously incarcerated and other talent pools that have been underutilized. I have talked with leaders who have brought out the best in their workforce, as well as employees doing their best work while doing good for the world. 

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