Slashdot Mirror
Direct Sales OK Baked Into Nevada's $1.3 Billion Incentive Deal With Tesla
The new battery factory that Tesla has announced it will build in Nevada comes with some nice perks: specifically, with a package of tax incentives, road construction, and legislative protection from the kind of dealer cartels that have hindered Tesla's ability to sell cars in some other states. A Bloomberg wire story gives some details about the size of the deal that Nevada made to attract the company: The biggest chunk of the deal, Tesla's sales tax exemptions, is worth an estimated at $725 million. In addition, the company would save more than an estimated $300 million in payroll and other taxes through 2024. ... Among the bills approved in both houses was a provision phasing out and eliminating 1970s-era tax credits for insurance companies, which backers said would free up about $125 million over five years beginning in 2016 for transferable tax credits to Tesla. The package would also gut a pilot program approved just last year giving tax credits to the film industry, freeing up about $70 million for Tesla. ... Lawmakers also agreed to buy right of way to build a road connecting I-80 and U.S. 50, a project estimated to cost $43 million that will improve access to the industrial park from other regions of the state.
Comment removed based on user account deletion
They are anti-competitive, and bad for the economy.
Frankly, the federal government should put a user fee on them at a prohibitive rate - i.e. 50%, paid out of the money given.
That is, if a state wishes to give a benefit worth $100 million to a company, that company owes $50 million paid immediately.
These things are usually paid to convince someone to build X in Y state, rather than Z state. It is almost never paid to get something built inside the USA, rather than outside the USA.
As such, any benefit to that particular state is outweighed by the loss to another state.
It is even worse when it comes to sports teams. Then, usually the teams make out like a bandit without in any way increasing the economy of the state (in particular, big cities will always get sports teams, even if the city refuses to build a stadium, because the city is where the CUSTOMERS for sports teams live. People in NYC are not going to suddenly decided to root for and see baseball in New Jersey if the Yankees and Mets leave the city. Not even if the stadium is build in Hoboken. Instead, some other team will build a stadium in New York, earn a ton of money from New Yorkers coming to them, then buy good players and suddenly everyone will be rooting for the NYC Metros, or whatever they call themselves (just like New Yorkers don't still root for the Dodgers, after all.)
excitingthingstodo.blogspot.com
This is the correct answer. Northwest Nevada is currently an economic wasteland. The plan is to make it a central hub of the US battery design and manufacturing industry. That applies to a lot more industries than just electric cars. If that plan works, any tax revenue they give up in the short term will be more than made up in the long term.