Watchdog Groups Diss Competition for Tesla Factory as "Race To The Bottom"

Business groups respond, say tax breaks are good for the economy.

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    NEWSLETTERS

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    How much is too much to offer to Tesla for their promise of building a factory in your state?

    How much is too much to give away for a $5 billion battery factory? In the case of the states attempting to do the most to welcome Tesla's "Gigafactory," it's all too much, according to consumer watchdogs.

    Tesla's factory promises thousands of jobs and great economic activity. And so to woo Tesla to their state, leaders across the West are promising tax breaks, incentives and even breaks from environmental law in order to be the one who secures the factory, according to the San Francisco Chronicle.

    These promises are going to far, according to a coalition of public interest groups (PIRGs) that penned an open letter to state leaders, who are reminded that for every tax break, there's less cash for roads, schools, hospitals and everything else.

    "Recently, our states have been pitted into a race to the bottom from which no real winner may emerge," the letter says. "Telsa Motors' proposed "Gigafactory" -- undoubtedly a valuable source of economic growth for its eventual home state -- has been offered to you in an unusual public auction, with the opening bid set at $500 million in public subsidies."

    That bid has since been exceeded or matched by California, Nevada, New Mexico, Arizona and now Texas, which is reportedly offering up to $800 million in subsidies.

    The Bay Area Council, a coalition of some of the area's biggest corporations, defended the subsidy-making in a rejoinder letter offered Wednesday.

    Work has begun on a supposed factory for Tesla near Reno, but apparently the jockeying for the 6,500 jobs is still ongoing.