Tesla won more than $330 million in tax breaks from Nevada on Thursday for the company’s commitment to a major expansion of its sprawling vehicle battery facility east of Reno, including construction of a new electric semi-truck factory.
The approval from the Governor’s Office of Economic Development came as Gov. Joe Lombardo cited the benefits of good-paying jobs and a nearly decade of local economic development around Tesla’s massive Gigafactory.
“Tesla has far exceeded every promise they made back in 2014,” said Lombardo, a Republican who chairs the board made up of top elected state, education and business officials.
The agreement is the latest to mark Northern Nevada as a centerpiece of the US transition to green energy, as the administration of Democratic President Joe Biden seeks to move away from gas-powered vehicles in a larger fight. against climate change.
Lombardo took office in January and proposed a two-year state budget of $11 billion. He tweeted a photo of himself January 24 with Tesla CEO Elon Musk in the industrial park east of Reno-Sparks and called the pending deal “an incredible investment in our state.” Musk also owns it Twitter and the rocket company SpaceX.
However, the $330 million figure remains secret until monday because of a nondisclosure agreement between Tesla and state officials.
That drew complaints from some lawmakers in the Democratic-controlled state Legislature about having only three days to review a 20-year tax cut.
“There is little or no opportunity to explore how this deal will affect the supply of housing, public schools, public safety, and other important government services in the region,” Sen. Dina Neal said in a statement. The Democrat from North Las Vegas is the chair of the Chamber’s Revenue and Economic Development Committee. Neal did not immediately respond Thursday to messages seeking further comment.
Lombardo’s statement said Tesla spent $6.2 billion on the existing 5.4 million square foot (501,676-square-meter) Gigafactory, which the governor said provides 17,000 construction jobs and more than 11,000 “high-paying permanent jobs.”
Tesla plans to make another $3.6 billion in capital investments, creating 3,000 new jobs at an average hourly rate of $33.49 with health insurance for 91% of its employees.
The company plans to add 4 million square feet (371,612 square meters) of production space at two new factories in the Truckee-Reno Industrial Center, about 20 miles (32 kilometers) east of Reno-Sparks on Interstate 80.
One plant has the capacity to produce batteries for 1.5 million light-duty vehicles a year, the company said. One has Tesla’s first production line for electric hybrid trucks. Musk said the goal is a battery range of 500 miles (805 kilometers) when towing an 82,000-pound (37,000-kilogram) load.
Public support for the deal came from the White House and Mitch Landrieu, Biden’s infrastructure chief; from the University of Nevada, Reno President Brian Sandoval, a Republican who as governor of Nevada approved an initial $1.3 billion Tesla abatement deal in 2014; and a factory preschool that said it would expand its hours to accommodate the workers.
Three elected lawmakers in rural Storey County, where the Tesla factory is located, praised the region’s economic benefits. But they said the county, which has only 4,100 permanent residents, deserves more tax revenue to support infrastructure and services including police, fire and EMS.
Tom Burns, executive director of the Governor’s Office of Economic Development, said in a statement that Tesla’s Gigafactory is driving the state’s manufacturing industry and establishing lithium-ion batteries as the state’s eighth largest export.
A Nevada-based recycling plant for electric vehicle batteries won a $2 billion green energy loan from the Biden administration in February.
On Wednesday, a federal appeals court refused to block the construction of the largest lithium mine in the US, which is set to be dug in Northern Nevada, while the court considers the claims of conservationists and tribes that the government illegally approved it to rush the production of raw materials for electric batteries auto.
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