Commissioners voice support for Tesla factory, community investment plan

The Travis County Commissioners Court defended tax breaks for Tesla’s factory in East Austin and approved the company’s plan to donate $750,000 as part of the tax incentive deal.

This is more than double the amount – $298,000 – the electric vehicle manufacturer is required to spend based on the $2.9 million in tax breaks it received in 2022. Tesla received a total of $64 million in state and local tax breaks to build the factory.

No one spoke in opposition during the meeting Oct. 17, and commissioners unanimously approved the spending plan. 

When the 10-year tax incentives were proposed in 2020, supporters said the new factory was a once-in-a-lifetime opportunity to provide jobs and investment in Travis County. They urged commissioners to act quickly to prevent Tesla from selecting another site. 

A coalition of labor, environmental and community organizations opposed the deal. They pointed out Tesla’s record of factory safety violations and allegations of wage theft. They noted that the $15 minimum wage approved for the Tesla factory is not a living wage in Travis County. Tesla factories are not unionized, and workers earn about one-third less than union workers at the Big Three automakers. During the rushed negotiations, opponents decried the lack of deliberation, transparency and oversight. 

The practice of corporations pitting cities against each other for tax rebates is controversial. Opponents claim that the benefits for corporations far outweigh the benefits for local communities. Austin competed with Tulsa, Oklahoma, to land the Tesla factory. 

In defending the agreement during the meeting Oct. 17 meeting, Precinct 2 Commissioner Brigid Shea acknowledged the controversy but pointed out the economic benefits the factory brings to Travis County. 

“We heard from a lot of people. They weren’t all that excited about the richest man in the world (Tesla CEO Elon Musk) getting these tax exemptions,” Shea recalled. 

“What was there previously was a sand and gravel operation. What Travis County got in property taxes from them was $642,” Shea continued. “For anyone who still complains, these guys are creating a minimum of 5,000 jobs.”

Told the actual total is 15,000 jobs, Shea said, “This is phenomenal. I’m just hearing that number today.”

Precinct 1 Commissioner Jeff Travillion pointed out that the factory provides opportunities for children who had few opportunities before.

“When kids in Del Valle, kids in Manor, Elgin, Pflugerville have access to these types of opportunities, then the easier it becomes to get to our goal of 50 percent employment from folks who live in the county,” he said. 

The $750,000 spending plan includes $376,880 for additional teachers at Del Valle Independent School District, $100,000 to support student career development, $100,000 for sustainability and environmental programming at local schools and $75,000 to the Austin Area Urban League for training in sustainability.

Photo made available through a Creative Commons license.

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