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Tesla passes on New Mexico, but golden parachutes abound

By   /   September 8, 2014  /   No Comments

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WOULD YOU BUY A GIGA-FACTORY FROM THIS MAN?: Tesla Motors CEO Elon Musk chose Nevada over four other states, including New Mexico, as the site for a $5 billion “giga-factory” for his electric car company.

By Rob Nikolewski │ New Mexico Watchdog

SANTA FE, N.M.— We may not have Tesla, and “Longmire” may have been canceled. But, hey, New Mexico, we still have Hatch chile. And golden parachutes.

Thursday, Tesla Motors honcho Elon Musk announced his electric car company will build its $5 billion battery “giga-factory,” promising to employ 6,500 workers, outside Reno, Nev.

The decision means New Mexico joins three states — California, Arizona and Texas — that lost a bidding war to win the contract. I should use the word “win” advisedly, since it was revealed Nevada will cough up as much as $1.25 billion in tax incentives to claim victory in what some called the “Tesla Bake-Off.”  That package of state largesse is unprecedented in size and scope.

But it would be churlish — and economically wrongheaded — to say it was a good thing for Tesla to pass on New Mexico.

The economy badly needs a boost.

“The state has never needed economic-based jobs as bad as they need them right now,” Albuquerque economic development expert Mark Lautman told me just a few days before Musk gave the nod to Nevada. “We’ve got cancer. Our economic base is contracting and … we (need to) do something bold and strategic right now.”

But it was really no surprise Nevada won this five-state, high stakes poker match.

Northern Nevada is just over the state line — a direct shot — from Telsa’s auto plant in Fremont, Calif.  Plus, Nevada has no state income tax and a right-to-work law already in place. The Tesla batteries will be made with lithium, and the only lithium mine in the U.S. is just outside of Reno

Throughout the process, Musk was intentionally cryptic when taking about a site. That was a smart move, because it almost led Gov. Jerry Brown of California to enter the sweepstakes. That no doubt forced Nevada and the other states to make more enticing offers.

Politically, Gov. Susana Martinez will take a hit. Her supporters will say it’s unfair, and there’s some truth to that. Opponents from the left criticized the Martinez administration from opposite angles: You’re not doing enough, cried Senate Democrats while, just a few days before the Tesla decision, a group of liberal social welfare organizations chastised states in contention for potentially giving away the store.

But that all comes with the job in the zero-sum game of politics. If the equation were reversed, Republicans would howl, too.

The Tesla announcement came just days after A&E unexpectedly pulled the plug on “Longmire — an excellent TV show that, while set in Wyoming, is filmed in the Santa Fe area. Why? Because its ratings in the 18-49 demographic were low. Sorry, New Mexico, you’re too old, baby.

Meanwhile, one of the big news stories of the summer was a variation on a familiar New Mexico theme.

Outgoing Albuquerque Public Schools Superintendent Winston Brooks became the latest in a conga line of public sector executives to get golden parachutes.

In fairness, APS defended the $350,000 buyout by saying the district could have been on the hook for $600,000.

But an investigation that led to Brooks’ resignation has been kept secret, even though his buyout is paid with taxpayer dollars. A number of news outlets — including mine —and the New Mexico Foundation for Open Government have filed requests under the Inspection of Public Records Act to get some details.. But, thus far, we’ve been rebuffed.

It’s a familiar story. Earlier this year, the outgoing president at Santa Fe Community College received $500,000 to go away.

In October 2012, Barbara Couture left New Mexico State University after receiving a $453,000 agreement.

State Rep. Bill Rehm, R-Albuquerque, who wants to eliminate golden parachutes from state contracts, estimated recent payouts totaling $4.2 million in taxpayer money — not including the $500,000 payout at SFCC.

Yes, it has been a bummer summer.

This commentary originally ran in the Santa Fe New Mexican newspaper on Sept. 7, 2014.


Rob formerly served as staff reporter for Watchdog.org.