Tesla Deal Signed Into Law - KTVN Channel 2 - Reno Tahoe Sparks News, Weather, Video

Tesla Deal Signed Into Law

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Tesla Motors will receive about $1.3 billion in tax abatements and credits, over 20 years, as part of the deal it made with the state of Nevada. In return, the electric car company will have to invest at least $3.5 billion in the Silver State, in ten years.  The new laws bring an end to a lengthy process of luring Tesla Motors to Nevada. Governor Brian Sandoval's team started talks, in October.

"We've proven once again, that when opportunities come and challenges come, the Nevada family comes together," Sandoval said.

The tax abatements total $1.1 billion over 20 years. That includes $240 million from the state, $530 million from local government, and $340 million from the school district. More than half of their employees have to be Nevada residents, and Tesla has to provide health benefits to their workers.

"Nevada has announced to the world, not to the country but to the world, that we are ready to lead," Sandoval said.

Transferable tax credits make up an additional $195 million through repurposing the home office and film tax credits. The electric car company will get a tax credit of $12,500 per employee, capped at 6,000 workers.  That equals about $75 million. Tesla won't have to pay sales tax for 20 years but in that same amount of time, experts say the company will have an economic impact of $100 billion.

"These are abatements of taxes that would not otherwise be paid," Senator Ben Kieckhefer, (R) Washoe County said. "So, 100 percent of zero is zero. We get nothing if they don't come. So, this is not the state writing a check to a company."

Tesla will also get $50 million in tax credits for their first $1 billion of investments. For the next $2.5 billion, they will get a $70 million tax credit.  No more than $45 million transferable tax credits may be issued in any of the first seven years.

"It means so much for our mission which is to catalyze sustainable transportation by creating a mass market for electric vehicles," Diarmuid O'Connell, Tesla Vice President of Business Development said.

All four bills passed, unanimously, in the Senate and the Assembly. If Tesla fails to meet their requirements, they will have to pay back the transferable tax credits and abatements.

Written by Paul Nelson

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