Talking Tesla: Session begins Wednesday in Carson City | SierraSun.com

Talking Tesla: Session begins Wednesday in Carson City

Geoff Dornan
gdornan@nevadaappeal.com

CARSON CITY, Nev. — Still shrouded in a veil of secrecy, the Tesla Motors gigafactory deal inched toward a legislative special session with members of leadership saying even though it’s hours away, they haven’t been fully briefed on the details of the legislation.

Gov. Brian Sandoval at 11:17 p.m. Tuesday posted to Twitter that he had signed the proclamation calling the special session.

Assembly Speaker Marilyn Kirkpatrick, D-North Las Vegas, said it should take five bills to complete the package of tax breaks and incentives worth up to $1.3 billion for Tesla Motors Inc. to build a $5 billion gigafactory in Storey County to make batteries for electric cars.

She said the Assembly and Senate will each meet as a committee as the whole to process the legislation.

She also said that language on two of the measures was completed at 7:30 p.m. The rest would be done by morning.

Caucus meetings were planned Tuesday evening to brief the members in preparation for a session expected not to start until noon Wednesday — in part because of the logistical problems in getting southern and rural members of the Legislature to Carson City.

But several lawmakers said they hadn’t even seen the bill drafts and didn’t think a couple of them will be done until Wednesday morning.

Sen. Pete Goicoechea, R-Eureka, said without seeing the bill drafts, they have little to talk about at this point.

That means the session will likely run well into Thursday before final votes are taken.

A group of mostly Southern Nevada lawmakers arrived early afternoon Tuesday to board a bus for a tour of the factory site 45 miles north at Tahoe Reno Industrial Center.

Assembly Minority Leader Pat Hickey, R-Reno, echoed statements last week by Kirkpatrick saying provisions holding the company accountable to keep its promises are key to legislative support.

“If they don’t build it and they don’t hire (the 6,500 workers) they ain’t getting any (tax breaks),” Hickey said.

Sandoval along with Tesla CEO Elon Musk told legislative leaders and others last Thursday the plant and its 6,500 workers would generate more than 20,000 construction and other related jobs and up to $100 billion for Nevada’s economy over the next 20 years.

Hickey predicted the project would win approval because “both sides stand a lot to gain.”

Paul Enos, lobbyist for the trucking association and Noble Energy said the deal will be a boon to both north and south. He said the plant is so large it will provide jobs to southern construction workers, truckers and others as well as in the north.

Earlier Tuesday the Governor’s Office of Economic Development released a study by Applied Economics of Arizona saying the planned gigafactory will create 3,000 direct construction jobs in the first three years of construction and 1,600 indirect jobs.

In addition, it projects an annual average of 2,300 jobs associated with equipment installation in those first three years for a combined one-time economic impact of $2.4 billion.

As for the operation of the battery factory itself, the analysis says Tesla would open its doors with about 700 jobs and $39.8 million in payroll in 2015. By 2018, the report says, there would be 6,500 jobs at the plant taking home $369.7 million in payroll.

To meet the terms of the deal with the state, the company would make a $1 billion investment in buildings and $3.95 billion in equipment over the first four years. The labor costs to install that equipment were estimated at $1.3 billion.

The indirect jobs predicted by Applied Economics total 16,200 jobs worth $955.3 million a year in personal income.

“This represents a 26 percent increase in the total current GDP of the region, depending on the level of supplier demand that can be met locally,” according to the analysis.

It estimates that spending by employees both directly employed at the plant and those in other businesses tied to the plant will generate up to $10.3 million a year in sales taxes to the school district, $6.5 million to the county and up to $8.2 million to the state. Sales taxes would be 100 percent abated for the full 20 years of the deal but property and business taxes are abated 10 years.

After the 10 years, property taxes would generate an estimated $394.2 million and Modified Business Taxes $40.2 million in direct tax revenues over the second decade of plant operation.

The overall estimated economic impact of the construction and operation of the plant would come to $100.6 billion over the next 20 years.

The analysis says there would also be additional construction impacts related to rail, highway and utility improvements that aren’t included in its 44 pages.