California Is Among 5 States Bidding For $5 Billion Tesla Motors Battery Factory
LOS ANGELES (CBSLA/AP) — California is one of five states bidding for a $5 billion factory that Tesla Motors plans to build so it can crank out batteries for a new generation of electric cars.
The package of economic incentives that each state offers will help determine where Tesla builds the factory — Nevada, California, Texas, Arizona or New Mexico. Tesla CEO Elon Musk has said the winning state will shoulder about 10 percent of the total cost, meaning at least $500 million worth of incentives.
Tesla already has done initial preparatory work on a potential site near Reno, Nevada and plans to prepare one other site in coming months. California is already home to Tesla's headquarters and assembly plant.
Here are some incentives and advantages the state can offer:
— Tax and hiring credits: Legislation passed this year offers a tax credit of 17.5 percent of wages for full-time employees for 15 years, totaling up to $31 million a year that could be split between a battery manufacturer and other industries including aerospace manufacturing. A hiring credit of 35 percent of wages is available if Tesla locates in a region that has high unemployment and poverty, for wages above certain benchmarks, until 2029.
— Sales tax exemption: New legislation waives the state's share of sales tax, 4.19 percent, on the first $200 million in equipment purchased.
— Waiver of environmental rules: Some lawmakers are advocating waivers on a host of California's complex environmental review laws that would allow for much quicker building permitting.
— Other advantages: Tesla already has its headquarters and car assembly plant in the San Francisco Bay area.
A final decision is expected by the end of the year.
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