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Consumer Groups Urge Transparency In Tesla Gigafactory Competition

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Wednesday, August 27, 2014   

PHOENIX - Consumer groups in Arizona and other Western states competing to house the multibillion-dollar Tesla Gigafactory are urging transparency in a very competitive process.

Arizona Public Interest Research Group is among several consumer groups that wrote an open letter calling on state leaders to tell taxpayers what incentives they're offering to attract the electric carmaker.

"So let's have an open conversation about what that should be," said Phineas Baxandall, a senior policy analyst for Arizona PIRG. "Let's be transparent about it. And let's make sure that whatever state ends up with this, however the process is, the company is held accountable for actually delivering on the promises that it's making."

Tesla is asking for a minimum of $500 million in incentives from Arizona, California, Nevada, New Mexico and Texas, the states where the carmaker is considering building its proposed factory to make batteries for its popular electric vehicles. Tesla projects the factory will employ 6,500 workers by 2020.

Baxandall said the competition to attract Tesla is so fierce that Arizona or another state could end up paying more to attract the company than it will ever earn back from any economic gain.

"You may want something, but if you pay too much for it, it's ultimately not good for you, no matter how good it may sound," he said. "We just need to have an open conversation about, 'Where is that level? What is this really worth?' "

Baxandall said "incentives" can range from free land and infrastructure to tax credits that companies can redeem for cash.


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