What To Watch At Tesla Special Session, And Is Nevada Paying For Jobs?
The Tesla deal won't be official until the legislators involved in today's special session can hammer out an offer that's acceptable to the electric automaker. The special session starts at noon, and here are a few developments to watch during deliberations.
Will Switch -- the data company based in Southern Nevada -- get some money out of the deal? Jon Ralston reportsthat the company is seeking incentives to build more facilities in Nevada. Will the Tesla benefit a tech company in Las Vegas too?
The deal also has plenty of critics, including eminent urbanist Richard Florida. He penned a piece Monday questioning some of the major tenets of the deal -- including the claim that it will create 22,000 jobs. Even 10,000 is a pretty optimistic figure, Florida says. And here's how the incentive deal will break down according to the different job projections:
But look at how much Nevada is paying per job. If we use the state’s own estimate of 22,000 total jobs, then Nevada is paying more than $56,800 per worker. Using the more reasonable figure of 9,750 jobs, the picture is even bleaker: Nevada is paying nearly than $132,000 per job. Looking just at the direct 6,500 jobs the plant says it will create, the number jumps to more than $192,000 per job. And it the plant ends up creating only half that amount, as some predict, the figure balloons to a staggering $385,000 per job.
On the flip side, the Governor's Office for Economic Development released a report that shows the deal will have a positive impact for the Silver State, despite all the tax abatements.
And it's good to remember that the Tesla deal doesn't involve any money up front. The Reno Gazette-Journal has an article that describes exactly how the incentives and subsidies for Tesla will work.
And of course, R-J columnist Steve Sebelius considers the practical implications of the Tesla incentive deal. The deal will be the biggest tax break in Nevada history. The state, which is relatively new to the incentive game, may want to considering enacting some standards that would apply to all business. That's probably not going to come up at today's session. But if this deal goes through, more will follow. And today's session could set the stage for how those deals happen.
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