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Tesla Gigafactory and Faraday Future deals under scrutiny from Nevada State Treasurer


Nevada State Treasurer Dan Schwartz has been a strong opponent of the deal that brought electric vehicle maker Faraday Future to the state. He went as far as calling it a “Ponzi scheme.”

Schwartz is turning up the scrutiny on the company and dragged Tesla into it by calling for an audit of the deals they made with Governor’s Office of Economic Development (GOED).

The GOED led the negotiations of the incentive packages for Tesla’s Gigafactory 1 in northern Nevada and Faraday Future’s factory in North Las Vegas.

The Treasurer has a problem with the growing authority of the GOED. He is now calling for an audit over those deals, as reported by ThisIsReno yesterday:

Schwartz said he was specifically seeking “more information on the projects GOED funds which have received substantial tax credits and financial assistance from Nevada taxpayers, including Faraday Future and Tesla. Since 2014, the powers granted to GOED have continued to grow.”

He especially has a problem with Tesla being able to transfer its tax credits for cash. Last year, Tesla managed to get ~$20 million by selling tax credits to MGM Grand Casino.

GOED’s Executive Director Steve Hill says that Tesla selling those credits is ultimately a neutral issue for the state, but Schwartz wants to know more. He said:

“The … audit should examine all documents, confidential or not, which were used by GOED in vetting the projects under (state laws) and the documentation which was provided to GOED which ultimately led to the approval of all projects of these statutes,”

Schwartz’s main problem with Faraday Future arose from the fact that he couldn’t get access to the company’s financials, which he claimed were dire. He was partially proven right after financial and legal problems came to light over the past few months, but the company seems to be moving forward recently with its factory.

The GOED says that Faraday Future invested $160 million in the plant so far.

As for Tesla, the Gigafactory reached just over $1 billion in construction costs recently based on accumulated building permits.

Ultimately, the Gigafactory needs to employ over 6,500 people under its deal with the state of Nevada, but the company sees a potential for as many as 10,000 employees following their updated plan to produce 150 GWh of battery capacity at full production in 2020.

Tesla says that it already employs over 1,000 full-time employees at the plant and that’s without accounting for construction workers and Panasonic’s own employees for the battery cell production.

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