Almost there: Travis County OKs Tesla incentives, hoping to snag $1.1 billion 'Gigafactory' for Austin
Travis County commissioners approved a 20-year economic incentive agreement with the electric carmaker Tesla to bring a billion-dollar "Gigafactory" to a site in Southeast Austin.
The deal would, at minimum, provide a 70% tax rebate in exchange for a $1.1 billion investment from the company. The proposed factory, according to the agreement, would provide at least 5,000 jobs and produce both the Tesla Cybertruck and its Model Y.
The county's vote, which follows an agreement with the Del Valle ISD school board, brings the Tesla project one step closer to Austin, though the company has not yet said where its next factory will be. At least one other city is still under discussion.
The terms of the deal changed since commissioners last discussed it publicly and now tie tax rebates to increased investment.
Originally, Tesla applied for an 80% property tax rebate on its factory property for the first decade and a 65% rebate for the next. The approved deal provides a 70% rebate for the first $1.1 billion invested over five years. Further investment triggers a higher rebate rate: 75% for $1.1-$2 billion and 80% for anything over $2 billion.
"The structure of the baseline incentive has been reworked to encourage greater overall investment," Travis County Executive Jessica Rio wrote in a summary.
Assuming a $1.1 billion investment over 10 years—and the current operations and maintenance tax rate—Tesla would get rebates of more than $24 million and Travis County would reap around $10.3 million in property tax revenue.
The proposed site of the factory is currently a sand and gravel mining operation. It generates around $6,400 in annual property tax revenue for Travis County.
What Tesla offers
The approved deal also requires Tesla to create a certain number of jobs annually and hire Travis County employees for at least 50% of them under penalty of reduced rebates. The company must also pay a minimum wage of $15 an hour, including to janitorial and food service staff as well as construction workers, even if they are employed by contractors and subcontractors.
If Tesla does not reach at least 75% of the job creation or investment target for a given year, the rebate will be scrapped entirely. If Tesla breaches the contract, it is required to return the last two years' of rebate dollars.
County staff and supporters of the deal argue the rebates are worthwhile not only because of the additional tax revenue that will result from such a sizeable investment but also because of the factory jobs that will be created.
There could also be long-term benefits.
Norris Sebastian, coordinator of DVISD's career and technical education program, called into the Commissioners Court to express his support for the deal. "Tesla … will drive interest and participation in STEM careers for underrepresented student groups," he said. "Remember, Tesla has the cool factor."
But opponents of the deal said it doesn't do enough to protect workers and chastised the county for presenting new terms at the last minute.
Juan Pedro Munoz, a construction worker, said there are no provisions for independent on-site monitoring to protect construction workers against wage theft and other abuses. He also questioned why the county didn't require Tesla to adhere to its own Better Builder standards.
This article has been updated from the original.
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Austin's Delta 8 industry has been turned on its head after Texas health officials clarified that the cannabinoid is on the state list of illegal substances, though it was previously believed to be legal by most retailers, consumers and manufacturers.
House Bill 1325, which was signed in June 2019 by Gov. Greg Abbott, and the Farm Bill, signed into law by former President Donald Trump in 2018, legalized any hemp product containing less than .3% THC. The same bills were thought to have made Delta 8 legal, though the Texas Department of State Health Services added a notice on its website saying it was still a controlled substance as of Friday, Oct. 15.
Both the federal and state governments keep separate lists on what is considered a controlled substance. Marijuana is considered Schedule I, a category reserved for substances with "no currently accepted medical use and a high potential for abuse," both statewide and federally.
Austin-based CBD retailer Grassroots Harvest CEO Kemal Whyte, like many CBD shop retailers, was blindsided by the announcement. Many small businesses rely on Delta 8 for their sales—Green Herbal Care CBD said about 90% of its sales come from Delta 8—and Whyte said he is frustrated by the inconsistencies in the drug scheduling system.
Since 87% of Texans support the legalization of marijuana, at least for medical use, per a recent poll, Whyte said he wonders who this legislation is for.
"It's gonna have a massive impact on small businesses—there's just no way around it," Whyte said. "The reality is, we don't want to push out anything bad for our customers, we want this to benefit our customers and to help them. If we can make money while doing it, that's the American dream. What are we doing, whose benefit is this for?"
Delta 8 surged in popularity after the perceived legalization—consumers enjoyed its lower psychotropic potency, decreased anxiety while using it and the peace of mind as a legal way to get high. So in order to protect their products and livelihoods, both Grassroots Harvest and Austin-based manufacturer Hometown Heroes are taking legal action.
Whyte said Grassroots Harvest is suing DSHS, saying their action is creating negative effects in the market. Meanwhile, a Hometown Heroes spokesperson said the company is in the process of filing a temporary restraining order that would pause the ban on Delta-8 in the state of Texas.
Threats against Delta 8 are not new—DSHS lost a lawsuit trying to make "smokable hemp products" illegal last year and Texas lawmakers had been considering a bill that would make Delta 8 illegal, though it was dropped after the clarification was made.
Hometown Heroes released a formal statement in response to the DSHS rule.
"I need to be clear—we love Texas, we're just choosing to fight for the will of the people in regards to cannabis in Texas," Hometown Hero CEO Lukas Gilkey said in a statement. "(Texas DSHS) are using backhanded ways to create legislation and go against the will of the people."
Whyte laments the fact that it would be easier legally to "open up a strip club that also sells guns," and said he can't post customer testimonials that mention the benefits of Delta 8 without getting hit with a cease and desist from the Food and Drug Administration. Whyte said he isn't opposed to regulation—far from it—he just wants to see it go through the correct channels.
"The fact that they're stunting our ability to communicate with our clients that want to learn about this, you're preventing us from communicating with them and teaching them, or spreading information that we know," Whyte said. "I think that that in and of itself opens up a lot of questions."
Grassroots Harvest still has Delta 8 products on its shelves for the time being but for how long, Whyte doesn't know.
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Austin Public Health and other clinics around Austin are now providing booster shots for all three vaccines, including Pfizer, Moderna and Johnson & Johnson, to fully vaccinated individuals after both Pfizer and J & J were approved by the CDC on Wednesday.
APH and Austin clinics, which were already administering the approved Pfizer booster, will begin distributing shots as soon as Friday.
Those who received the second dose of the Pfizer and Moderna vaccine more than six months ago are elligble to receive a booster if they are over 65 or if they are over 18 and:
- Live in a long-term care environment
- Have underlying medical conditions
- Work or live in high-risk settings, such as schools, hospitals or correctional facilities
Austin-Travis County Health Authority Dr. Desmar Walkes said in a media Q&A Friday that APH is encouraging boosters just as much as they have urged residents to get their first and second doses.
"Boosters are incredibly important to keeping our community protected and hospitalizations low," Walkes said. "If we can stay on top of our vaccinations, we provide protections for our most vulnerable and make it that much harder for COVID to spread in our community."
Eligible residents are free to choose the same booster as their first doses or "mix and match," per the CDC announcement.
Those looking for another dose can simply bring their vaccination card to APH centers or the dozens of Walgreens and CVS locations in the metro, which began administering doses Friday.
Additional updated guidance from the CDC allows for all eligible individuals to choose which vaccine they receive as a "mix-and-match" booster dose. It is advised to remember to bring your CDC COVID-19 Vaccination Card showing the original doses with you when going for booster shots.
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