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.
Want to read more stories like this one? Start every day with a quick look at what's happening in Austin. Sign up for Austonia.com's free daily morning email.
- Elon Musk seeks to fast-track $1.1 billion Tesla factory in Austin ... ›
- Del Valle ISD OKs Tesla tax deal for Austin factory - austonia ›
- Travis County delays vote on Tesla's proposed Austin factory ... ›
- What Tulsa offers Elon Musk for Tesla's next 'Gigafactory' - austonia ›
- Tesla asks Travis County for 20-year property tax rebate deal ... ›
- Five reasons why Elon Musk and Grimes should choose Austin ... ›
- Elon Musk says $1.1 billion Tesla factory will be in Austin - austonia ›
- Elon Musk says $1.1 billion Tesla factory will be in Austin - austonia ›
- Tesla Gigafactory will accelerate growth in southeast Austin - austonia ›
- Tesla files site plan for Austin Gigafactory - austonia ›
- Tesla announces plans for affordable vehicle - austonia ›
- Austin-area electric freight parts manufacturer Hyliion rings the NYSE bell this week after going public - austonia ›
- Travis County updates economic incentives policy post-Tesla - austonia ›
- Tesla's Elon Musk says Austin factory could hire 10k jobs - austonia ›
After two years of no in-person events, Austin festival South by Southwest has agreed to give 50% of ownership to P-MRC, a Los Angeles company that controls publishing operations for Rolling Stone and Billboard.
The media venture was founded in 2020 and is part-owned by Jay Penske, racer Roger Penske's son and head of Penske Racing and Penske Media.
The move comes after the COVID-19 pandemic left the festival with two years worth of hemorrhaging funds. SXSW organizers were left scrambling for solutions in March 2020 when the city of Austin canceled the festival at the onset of the pandemic. One-third of the festival's 175 year-round employees were laid off, and the festival ran a shortened virtual event in 2021.
SXSW CEO and co-founder Roland Swenson said in a statement that the company is grateful to get aid when they need it most and that they are now looking to the future.
"It has been an incredibly tough period for small businesses, SXSW included," Swenson said. "When Jay Penske approached us with an interest in becoming a partner, it was a true lifeline for us. Both of our companies share a passion for producing high-quality content that helps shape modern culture, so this feels like a natural alliance."
Both of Austin's big-name festivals are now in the hands of out-of-town buyers. In 2014, homegrown festival Austin City Limits was bought in part by LiveNation, who took 51% ownership in Austin live promoter C3 Presents.
.@MLS Commissioner @thesoccerdon and @AustinFC's Minister of Culture and part-owner Matthew @McConaughey will discuss how the League is deepening fan engagement, and how Clubs are becoming cultural mainstays at 10am on Channel 3. ⚽ #SXSW pic.twitter.com/2XFj4XEdwL
— SXSW (@sxsw) March 18, 2021
The fest has captured the essence of Austin arts and culture for 34 years, and it doesn't plan on stopping now. With P-MRC by its side, SXSW said it plans on keeping its unique identity but expanding operations as it prepares for an in-person celebration next spring.
"Since 1987, SXSW has been the world's premier festival centered at the convergence of tech, media, film, and music," Penske said. "Today SXSW continues to be one of the most recognized brands for empowering creative talent and bringing together the brightest creators of our time. As part of this significant investment, we plan to build upon SXSW's incredible foundation while extending the platform further digitally and assisting Roland and his incredible team to bring their vision to even greater heights."
With their future restored, SXSW's newest slogan rings truer than ever: "See you next year at SXSW!"
- These 27 Austin musicians are taking over the SXSW stage - austonia ›
- Austin artists to add to your playlist after SXSW - austonia ›
- SXSW: Bill Hader talks mental health during his SNL days - austonia ›
- SXSW goes virtual for 2021, possible in-person event - austonia ›
- SXSW Music Festival announces showcasing artists - austonia ›
- What to expect at SXSW virtual 2021 festival - austonia ›
- SXSW: Chance the Rapper and Kenan Thompson talk SNL - austonia ›
- Stacey Abrams talks road to representation in democracy SXSW ... ›
Update: Former Travis County deputy suspected of killing 3 in northwest Austin now in police custody
Stephen Broderick is now in police custody for a suspected domestic violence incident that killed three in northwest Austin on Sunday.
After initially being called an active shooting incident, joint local law enforcement and more than 75 FBI agents proceeded with an almost day-long manhunt with three helicopters and on-ground teams for former Travis County deputy Broderick. Police captured him after a 911 caller reported a suspicious man walking along U.S. 290, where he was taken into custody.
Police believe the victims, who have been identified as two Hispanic women and one Black man, knew their assailant. A child was involved but is now safely in police custody. Two of the victims have been identified as former and current Elgin ISD students: Alyssa Broderick and Willie Simmons III.
The school district released a statement offering its condolences to the families. Alyssa was enrolled until October 2020 and played on the basketball team. Simmons was a senior at Elgin High School where he was captain of the football team and had been recruited to play football at the University of North Texas.
Travis County Sheriff Sally Hernandez released the following statement on the incident: "I'm truly heartbroken that a former Travis County Sheriff's Office Deputy is the suspect in such a horrific incident. TCSO is standing by to provide any, and all assistance we can to the families of the victims in their time of need. I'm proud of the integrity and professionalism shown by the men and women of TCSO, APD and other law enforcement agencies, who worked tirelessly throughout the night to locate Stephen Broderick. I'm especially grateful to the vigilant citizen who called 911 after seeing Broderick, and to the Manor PD officers and TCSO deputies who took him into custody this morning."
APD @Chief_Chacon provides updated media briefing in relation to Great Hills Trail incident. - PIO8 https://t.co/47siNWhARI
— Austin Police Department (@Austin_Police) April 18, 2021
During a press briefing at 4:45 p.m. on Sunday, Interim Police Chief Joe Chacon said law enforcement was on the scene for several hours investigating the incident with 41-year-old Broderick.
"We're very sorry that obviously this has happened and we continue to try and locate this individual, we are transitioning from a search in this area to a fugitive search and those efforts will continue until this person is located," Chacon said. "I don't want anyone to think that we're packing up and going home. We're going to continue to look for this individual because he continues to pose a threat to this community."
#texasshooting #masshooting Arboretum shooting Austin. pic.twitter.com/SkIsgDoYHt
— Jamie Hammonds (@jamie_hammonds5) April 18, 2021
This story has been updated at 8 a.m. Monday to include the latest information.
- Three injured in East Austin during Easter festivities - austonia ›
- 2 dead, 4 injured in East Austin fire in winter storm - austonia ›
Formula 1 is returning to Florida for the first time since 1959, announcing that the brand-new Miami Grand Prix will join the calendar in 2022 and Austin will no longer be the only F1 race in the U.S.
Held at the Hard Rock Stadium complex in Miami Gardens, this will be the first race in the Sunshine State in 62 years. With a new track setup, F1 will loop the stadium, home of the NFL's Miami Dolphins.
Excited for @F1 @f1miami @HardRockStadium - a Global Entertainment Destination. This event will bring opportunities for so many and will be world-class. Thank you to @gregmaffei #chasecarey #stefanodomenicali @MayorRHarris @Ogilbert @CommishDiaz @MayorDaniella pic.twitter.com/n6dDDD1cPX
— Tom Garfinkel (@TomGarfinkel) April 18, 2021
The new 3.36 mile circuit has 19 corners, three straights and potential for three DRS zones, with expected top speeds of 198 mph.
Now with two races in the U.S., F1 President Stefano Domenicali said they will avoid having back-to-back events by keeping the Miami Grand Prix separate from the U.S. Grand Prix, which is held at Austin's Circuit of the Americas.
The date of the race has yet to be confirmed, though Domenicali said he expects the first race in a 10-year deal to take place in the second quarter of 2022. Austin's race will take place on Oct. 24 this year.
"The USA is a key growth market for us, and we are greatly encouraged by our growing reach in the U.S. which will be further supported by this exciting second race," Domenicali said.
Miami will mark the 11th race location in the U.S. since the Championship began in 1950: Circuit of The Americas in Austin; Dallas, Texas; Indianapolis, Indiana; Sebring, Florida; Riverside, California; Watkins Glen, New York; Long Beach, California; Las Vegas, Nevada; Detroit, Michigan and Phoenix, Arizona. COTA was first opened in 2012.
Domenicali said F1 will be working with the FIA and the Hard Rock Stadium to leave a lasting impact on the community: discounted tickets for residents, a program to support local businesses and a STEM education program through F1 in schools.
- NASCAR is making its way to Austin's Circuit of The Americas ... ›
- W Series announce F1 partnership race at COTA in 2021 - austonia ›
- Formula 1 is returning to Austin in 2021 - austonia ›