Notably, the City of Austin did not give Tesla any incentives, nor would Tesla have likely wanted them, as the city has one of the most rigorous and transparent economic incentive programs in the country.Ĭhapter 313 is a tax limitation program that allows school districts to cap the amount of property tax that companies pay through a ten-year limitation on their taxable property value. Tesla has pledged to create 5,000 jobs at Giga Texas and provide employment and internship opportunities for Del Valle’s students and Travis County residents.
Tesla wrangled tax incentives to build its Texas factory through two separate programs, each named for their section in the state tax code: Chapter 313 and Chapter 381. Could Austin face a repeat of Buffalo’s experience: grandiose promises of jobs and other economic benefits that fizzle out and leave local and state officials behind to deal with the fallout as the company moves on to focus on its future? “After an exceptional year, we shift our focus to the future, Texas and Berlin,” Musk said on the 2021 fourth-quarter earnings call. There was no mention of the Buffalo factory in any of the 2021 Tesla earnings calls or its annual stockholder meeting. Over $200 million in unwanted manufacturing equipment, purchased by the state government, was recycled and resold. A scathing 2020 New York state comptroller report concluded that the weaker requirements “undermined the intent of the project.” The factory, advertised as the largest solar panel manufacturing facility in the Western Hemisphere, has been a quiet failure, as Tesla has shifted its focus away from solar panels and roofing. Last year, Tesla struggled to meet the job creation targets at its Buffalo factory, which had been repeatedly revised and relaxed. A coalition of labor, environmental, and community organizations railed against the rushed, closed-door negotiations but failed to stop the project.Ĭorporations excel at overselling economic benefits to state and local officials, and Tesla is no exception. Supporters of the project claimed that the new factory, one of the country’s largest, was a once-in-a-lifetime opportunity that would transform the region. Tesla received state and local tax breaks, totaling roughly $64 million, to build Giga Texas. Billed as a “cyber rodeo,” the invite-only event featured fireworks, live music, and a late-evening appearance by Elon Musk, sporting a black cowboy hat and aviators, who boasted about his company’s “ great parties.” Expecting significant congestion and delays from the 15,000 invited guests, the neighboring Del Valle Independent School District sent its students home early.
On April 7, Tesla hosted a grand-opening party at its newest factory, the $1.1 billion, four-million-square-foot Giga Texas in metro Austin. Tesla’s Gigafactory Texas just east of Austin.