Tesla Gigafactory

Tesla Gigafactory: NV Recalls Her Lawmakers to Cement $1.3 Billion Tax Breaks for Tesla Motors

Tesla CEO Elon Musk and Nevada Republican Governor Brian Sandoval might have officially confirmed last Thursday that Tesla’s first massive lithium-ion reprocessing and manufacturing ‘Gigafactory’ would be built at the Taho-Reno Industrial Center just outside Reno, NV, but there’s still a lot of things to be done before Tesla’s Gigafactory becomes reality.

Tesla's Gigafactory might be

Tesla’s Gigafactory might be confirmed for Reno, NV, but there’s a lot of paperwork to do before it gets built.

Things like submitting plans, obtaining all the necessary permits, and cementing the massive $1.3 billion in tax breaks promised to Tesla Motors [NASDAQ:TSLA] by Governor Sandoval in order to win the five-state contest to become the Gigafactory’s home.

The former come with time and patience, but the latter has caused Governor Sandoval to recall the Nevada Legislature back to Carson City for a special session intended to finalise pro-Tesla tax breaks.

As the Gnomes News Service details, the call went out some time on Tuesday, with the legislative session due to start at 9am sharp today, local time.

The recall — not unheard of — means that all legislators are compelled to return to Carson City immediately.  Some, like Democratic Sen. Kelvin Atkinson (who also happens to be the Chairman of the Nevada Senate Commerce and Labor and Energy Committee) even tweeted about the recall.

As The Washington Post confirmed moments ago, Governor Sandoval is calling on Nevadan legislators to seize the “extraordinary opportunity” that the state is being offered by Tesla. In the context of the legislative recall, seizing the opportunity translates to approving the $1.3 billion in tax breaks and abatements needed to ensure Tesla’s Nevada Gigafactory factory becomes a reality

While Governor Sandoval needs the Democratic controlled Senate and Assembly to essentially write off $1.3 billion in state revenue in the short term however, the benefits to Nevada far outweigh any negatives.

Up to $1.3 billion in tax breaks are being considered to help Tesla's Gigafactory along.

Up to $1.3 billion in tax breaks are being considered to help Tesla’s Gigafactory along.

During the last economic crisis, Nevada — specifically northern Nevada — was hit especially hard, with high unemployment rates and low business investment. Tesla’s arrival in Reno will not only bring much-needed jobs to the area in the short-term thanks to the hundreds of construction workers needed to build the massive 1,000 acre facility, but also bring an estimated 6,500 jobs to the facility when it is complete.

Then there are the masses of people needed to work in secondary and tertiary industries attached to the influx of an additional 6,500 people into the area, from caterers and cleaners through to teachers, medical staff and emergency responders.

Tally up the income earned from all these extra people in the region, and offering $1.3 billion in tax breaks seems like a no-brainer for both the Nevada Assembly and the Nevada Senate.

As for recalling legislators early, essentially ending their summer holiday a little early? It seems some — Senator Atkinson at least — have no problem heading back to work in order to ensure Tesla’s deal is cemented.

In addition to having some light-hearted fun on the plane ride back…

… Senator Atkinson says the early return gave him an extra opportunity to see his daughter.

And that, as any parent will tell you, is a very good thing.

We’ll bring you more on this special NV session as and when we have it. But how much do you think Tesla should be given in tax breaks to build a factory in Nevada? And should other states follow suit with similar tax breaks for similar green transport projects?

Leave your thoughts in the Comments below.


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  • WeaponZero

    Realistically speaking, no company should get tax breaks. But until we get a federal law that blocks states from competing, as much as necessary. Overall, compared to other deals given by other states for other deals, this one is relatively cheap, 2X below average per worker.

  • Ultimately one of the issues is that while southern Nevada will bear some of the brunt of the tax breaks, we wont see any benefit. So we sacrifice but we don’t see any benefit. nnThe word on the street is southern Nevada wants a medical school in return for granting Tesla these massive tax breaks. Southern Nevada has needed a medical school for a while [1], but who knows if the north will hold up their end of the bargain or continue to successfully play “divide and conquer” with the southern legislative delegation like they’ve done the last 30 years. nn[1] Nevada screwed up big time when they put their med school in Reno and law school in Vegas – it should be the other way around, law school in Reno and med school in Vegas.

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