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 Sandoval said the agreement has "changed the trajectory of our
state forever" during the signing ceremony late on Thursday, shortly
after the four bills were unanimously passed by both legislative
chambers.
"Nevada has announced to the world - not to the country, but to the
world - that we are ready to lead," Sandoval said, to applause.
The biggest chunk of the deal won support in day two of a special
session called by Sandoval to implement an agreement for Tesla to
locate its planned $5 billion lithium-ion battery factory in an
industrial park 20 miles east of Reno along Interstate 80.
Tesla, founded by entrepreneur Elon Musk, decided to locate its
factory in Nevada after negotiating with several states, including
Texas, Arizona, New Mexico and the company's home state of
California.
To clinch the deal, Sandoval promised that tax credits and other
incentives would be available for up to 20 years.
The biggest chunk of the deal gives Tesla sales tax exemptions for
20 years, a perk estimated at $725 million. In addition, the company
would save more than an estimated $300 million in payroll and other
taxes through 2024.
The factory is key to Nevada's efforts to revitalize its economy,
which was hard-hit by the mortgage meltdown and the Great Recession,
and has yet to fully recover.
"This is arguably the biggest thing that has happened in Nevada
since at least the Hoover Dam," the mammoth Depression-era project
on the Colorado River that employed thousands and provided
hydro-electric power to the state in the 1930s, said Assemblyman Ira
Hansen, a Republican from Sparks.
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.
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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.
Another provision will require at least half of all workers hired by
Tesla be Nevada residents, though it allows for waivers.
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.
The governor's office estimates the 5 million-square-foot factory
will create an immediate 3,000 construction jobs, 6,500 factory jobs
and 16,000 indirect jobs once completed.
Diarmuid O'Connell, Tesla vice president of business development,
said the factory is crucial to the company's mission of
mass-producing affordable electric cars within three years.
"We’re looking forward to getting going," O'Connell said at the
signing.
(Editing by Sharon Bernstein, Curtis Skinner, Ken Wills and Kenneth
Maxwell; Editing by Catherine Evans)
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