Lawmakers in Nevada have passed several bills that will provide Tesla Motors tax breaks that could reach a total of $1.3 billion, along with several incentives.
The passed bills represent a crucial step in securing a deal with Tesla Motors for the construction of a massive electric car battery factory in Nevada.
A huge portion of the passed bills, which gained approval from the senate of Nevada and ready to be forwarded to an evening assembly of the same day, received support on the second day of the special session that was ordered by Republican Governor Brian Sandoval.
The special session looked to set up a deal for Tesla to construct its proposed lithium-ion electric car battery factory in Nevada, specifically in an industrial park located 20 miles to the east of the city of Reno along the Interstate 80 highway.
Tesla Motors chose to construct its planned factory, which will be worth $5 billion, in Nevada after going into negotiations with several other states, including Arizona, New Mexico, Texas, and California, where the company is located.
In an effort to secure the agreement with Tesla Motors, Sandoval made promises that the tax breaks and other incentives will be enjoyed by the company for up to 20 years, if approval is received from the legislature.
According to Assemblyman Ira Hansen, Tesla's decision to construct its $5 billion factory in Nevada is the biggest thing that would happen to the state since the construction of the Hoover Dam. The Hoover Dam was a massive project initiated during the Great Depression, located on the Colorado River, that provided thousands of people with jobs and generated hydro-electric power to Nevada in the 1930s.
Just as the Hoover Dam rejuvenated the economy of Nevada in the 1930s, the factory of Tesla Motors is expected to do the same for the state, which was heavily affected by the Great Recession and the mortgage crisis and has not yet fully recovered. The $5 billion factory is expected to create 3,000 jobs in construction, 6,500 jobs in the factory and 16,000 other indirect jobs.
Included in the approved bills was one that phased out and removed tax credits from the 1970s for insurance companies. The elimination of the provision freed up tax credits ot around $125 million, spread through five years starting in 2016, that can be transferred to Tesla Motors. Tax credits for the film industry amounting to $70 million, approved only last year, were also eliminated, to be transferred to Tesla Motors.
Another passed provision is the requirement that at least 50 percent of the workers that Tesla Motors will hire for the factory will be residents of Nevada.
Tesla Motors informed Sandoval that the company will be donating $37.5 million over five years to Nevada public schools starting in 2018, with the funds going to science, technology, math and engineering programs.
