Blog School Board Approves $68 Million in Incentives to Bring Tesla Factory to Texas

Tesla’s prospective factory project in Austin has gained support from the Del Valle Independent School District, which voted Thursday to approve incentives to lure the automaker to the area.

The proposal would give Tesla property tax incentives of $68 million and place the Tesla factory on land owned by the district. Tesla is interested in a 2,100 acre parcel at the intersection of State Highway 130 and Harold Green Road.

Travis County Commissioners are also considering whether to grant a 20-year property tax abatement to secure the factory. That particular proposal has experienced some objection from community members and commissioners pushed a vote on the matter until next week.

Tesla is also considering Tulsa for the Cybertruck factory. Chief Executive Elon Musk visiting the city last week, meeting with the Oklahoma governor. Tesla has conducted an enthusiastic campaign to attract the automaker, and has had less opposition from the community. However, Austin has long been the favorite and seems to be lining up the incentives to seal the deal.

 

[bedonnerd]

Texas is great for income tax (it has none?), but its property tax is one of the worst if not The worst in the whole USA. From that point of view, it is not at all unreasonable to ask for relief from property tax.

 

[Ostrichsak]

Texas is great for income tax (it has none?), but its property tax is one of the worst if not The worst in the whole USA. From that point of view, it is not at all unreasonable to ask for relief from property tax.

Many people don't understand that no matter how the slices are cut up, the .gov gets it's whole pie. You can make on slice smaller but the other slices just grow. There's no way to shrink the size of the pie unless the size of the .gov also shrinks. The problem is most also don't realize this every time they pass another "feel good" law that requires more funding to carry out. I digress.

I feel like Texas is a great decision for the Cybertruck factory. It makes a lot of sense and I think Tesla would have gone there even if they hadn't showered them with incentives & subsidies but that's the climate we live in these days when it comes to commerce & growth as far as our government is concerned.

 

[scottfwalter]

It would funny if they produce vehicles in Texas but you would have to buy it from out of state because of Texas' franchise laws.

 

[jerry33]

It would funny if they produce vehicles in Texas but you would have to buy it from out of state because of Texas' franchise laws.

Every new Tesla is another nail in the Dealership coffin.

 

[Economite]

Texas is great for income tax (it has none?), but its property tax is one of the worst if not The worst in the whole USA. From that point of view, it is not at all unreasonable to ask for relief from property tax.

Gee... So Tesla really must not care much about education, since it doesn't want to pay its fair share of the cost of schools.

This is absurd. School districts are there for the kids, not to subsidize industry.

Tesla should be ashamed. So should Texans.

Maybe rather than pay Elon huge salary packages, Tesla should pay its taxes like everyone else.

 

[Economite]

Texas is great for income tax (it has none?), but its property tax is one of the worst if not The worst in the whole USA. From that point of view, it is not at all unreasonable to ask for relief from property tax.

Ultimately, what's important to running public services is the total amount of taxes. Of course if a jurisdiction had no sales taxes it will have higher property taxes than states with a sales tax.

 

[r1666a]

Every new Tesla is another nail in the Dealership coffin.

That’s a lot of nails already!

 

[TexasEV]

Gee... So Tesla really must not care much about education, since it doesn't want to pay its fair share of the cost of schools.

This is absurd. School districts are there for the kids, not to subsidize industry.

Tesla should be ashamed. So should Texans.

Maybe rather than pay Elon huge salary packages, Tesla should pay its taxes like everyone else.

Do you really not understand how the tax incentives work? The school district will be getting millions of dollars more in taxes over the life of the agreement than if Tesla did not build there and the site remained a gravel pit.

 

[JayNJ]

Texas is great for income tax (it has none?), but its property tax is one of the worst if not The worst in the whole USA. From that point of view, it is not at all unreasonable to ask for relief from property tax.

I would venture that my property tax in NJ is much higher than TX and we have sales tax and income tax. It varies greatly town by town of course, but it's about 13k for a 500k house here.

 

[TexasEV]

and place the Tesla factory on land owned by the district.
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No, the land is not owned by the school district.

 

[Agni]

Tesla’s prospective factory project in Austin has gained support from the Del Valle Independent School District, which voted Thursday to approve incentives to lure the automaker to the area. The proposal would give Tesla property tax incentives of $68 million and place the Tesla factory on land owned by the district. Tesla is interested in a 2,100 acre...
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School board getting involved? Why not end their union backed extortion of the taxpayers...

 

[Tomc62]

Gee... So Tesla really must not care much about education, since it doesn't want to pay its fair share of the cost of schools.

This is absurd. School districts are there for the kids, not to subsidize industry.

Tesla should be ashamed. So should Texans.

Maybe rather than pay Elon huge salary packages, Tesla should pay its taxes like everyone else.

Virtually EVERY manufacturer asks for (and gets) tax breaks from the local municipality and school district. Wake up and smell the BS you are shoveling sir.

 

[DadEBoy]

Tulsa for Tesla/Tesla for Tulsa

 

[R1Bill]

Texas property taxes are low compared to California. For two reasons. First, property values are much lower. Second is what most folks miss. Texas has a LOT of new construction. Much of your property tax bill is for paying for the infrastructure. Once that is paid off, the taxes go way down. This the same in many other locations as well, including California. You buy into an older, established neighborhood, your taxes are much lower than in a brand new neighborhood. You buy a ranch, taxes are really low. When you combine that with no state income tax, you overall taxes are well below that of many other locations.

 

[jerry33]

That’s a lot of nails already!

Well, it's a big coffin.

 

[BlueBlazes]

I'm afraid Tulsa is totally out of the conversation now because of the new Supreme Court decision saying that Tulsa (and about half of the state of Oklahoma) is now considered Indian Reservation land. I expect there will be a lot of uncertainty in the business climate there until this is all worked out. Maybe it will only change state criminal law enforcement (which was part of the decision) but no one knows for sure now. I don't think Tesla can even use Tulsa for leverage any more.

 

[jboy210]

It would funny if they produce vehicles in Texas but you would have to buy it from out of state because of Texas' franchise laws.

My guess is a bill to add a direct sales exclusion for companies with operations in Texas will be introduced in the next legislative session. They will probably give it some fancy name like the "Putting Texans to work" bill.

 

[jrwaters1]

Texas property taxes are low compared to California. For two reasons. First, property values are much lower. Second is what most folks miss. Texas has a LOT of new construction. Much of your property tax bill is for paying for the infrastructure. Once that is paid off, the taxes go way down. This the same in many other locations as well, including California. You buy into an older, established neighborhood, your taxes are much lower than in a brand new neighborhood. You buy a ranch, taxes are really low. When you combine that with no state income tax, you overall taxes are well below that of many other locations.

Never lived anyplace where the Taxes went down

 

[jboy210]

Texas property taxes are low compared to California. For two reasons. First, property values are much lower. Second is what most folks miss. Texas has a LOT of new construction. Much of your property tax bill is for paying for the infrastructure. Once that is paid off, the taxes go way down. This the same in many other locations as well, including California. You buy into an older, established neighborhood, your taxes are much lower than in a brand new neighborhood. You buy a ranch, taxes are really low. When you combine that with no state income tax, you overall taxes are well below that of many other locations.

Little bit different in California. Prop 13 ties your property taxes to 1.125% of the original purchase price. There can be yearly increases, but those are very limited (I think it is a 2% increase in the amount of the tax) and this is only triggered if the selling prices are going up. Prop 13 largely decouples your property taxes from the current market value of homes in your neighborhood, which makes sense. After all, your neighbor selling their house for a bunch puts no immediate money in your pocket. Also, it ensures when your retire or otherwise go to a fixed income you will not be forced to sell and relocate because of rising property taxes.

Some younger buyers see this as unfair. But they need to remember older people were their age once. And as they age, these younger buyers will get this same pseudo-fixed property tax benefits as they live in their homes year after year.