The State of New York spent about $1 billion on a factory to incentivize Tesla to do business in New York. Now, that factory is being leased for $1 a year, in what even state officials are calling a “bad deal” according to The Wall Street Journal.
Over the last decade, New York invested almost $1 billion in what was meant to be the largest solar panel factory in the Western Hemisphere at 1.2 million square feet. State-of-the-art equipment was purchased for $240 million, and owner Elon Musk said the factory could produce enough solar panels to cover 1,000 roofs each week.
Today, the company is averaging about 21 solar panel installations per week, and much of the factory is occupied by Tesla staff that have nothing to do with the solar energy unit. Most of the solar panel equipment has been sold off for a fraction of what it was bought for.
An analysis by New York State found the factory returned $0.54 cents for every subsidy dollar spent on the factory, and auditors have written down most of the investment.
The ambitious promises of new manufacturing jobs quickly deteriorated, with New York amending the terms of the subsidy, pushing back deadlines and lowering the required number of jobs created 12 times. Tesla now reports it created 1,700 positions at the site, which considering the $1 billion investment, cost taxpayers about $588,000 each.
E.J. McMahon, a senior fellow at the Empire Center for Public Policy, said, “In terms of sheer direct cost to taxpayers, this may rank as the single biggest economic development boondoggle in American history.”
Handouts to mega corporations with little due diligence often end in disaster, and this foolish investment turned out to be a bad deal for New Yorkers.
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