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.
