Surprise could be in the running for $5B Tesla factory

 

 

 

 

 

 

 

 

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Mike Sunnucks  Senior Reporter-Phoenix Busines Journal

Jun 3, 2014, 7:00pm MST UPDATED: Jun 3, 2014, 8:46pm MST

The Phoenix suburb of Surprise could be a serious contender to land Tesla Motors’ much coveted $5 billion electric battery factory.

The Surprise City Council will meet in a private executive session Tuesday evening to discuss a possible new business operating at the Southwest Railplex development.

An official with knowledge of the Tesla site selection says the Surprise council will discuss a possible $50 million incentive package aimed at bringing the 6,500-worker factory to the West Valley.

The Surprise Railpark sits at the intersection of Waddell and Litchfield roads in the West Valley. It already has Foreign Trade Zone status that offers businesses a 5 percent property tax rate instead of the 18.5 percent paid by most businesses. Apple’s new Mesa manufacturing plant and Intel’s Chandler semiconductor campus are also in Foreign Trade Zones.

The development also sits on the BNSF railroad line. A railway link is one of Tesla’s requirements for the factory. Tesla is looking for a 500- to 1,000-acre parcel for the factory that could total as much as 10 million square feet.

Another official familiar with the Surprise location said there is more than 500 acres of available land. City officials from Surprise declined comment, as did various Phoenix-area economic officials.

The Phoenix Goodyear Airport area could also be in the bidding mix for Tesla as the company narrows its site selection process for the so-called Gigafactory.

The city of Phoenix owns the Phoenix Goodyear Airport that is adjacent to a Union Pacificrail line. A Tesla effort there could entail a bid involving a private developer as well as the cities of Goodyear and Phoenix.

The Phoenix Goodyear Airport area is also a military reuse zone offering businesses that locate there a number of tax breaks, including a 5 percent property tax rate, job training credits and exemptions on construction.

Any Tesla package will be done in conjunction with the Arizona Commerce Authority andGreater Phoenix Economic Council. Officials said the Arizona Tesla bid could start out at $50 million with tax breaks, workforce help and other incentives.

Tesla — like Apple when it located in Mesa — requires economic developers and local officials to sign nondisclosure agreements.

Tesla will soon narrow its factory site selection to two sites and then pick a winner. It could also be soliciting offers from locations in Buckeye, Goodyear and Pinal County.

Tesla is considering locating in northern Nevada, Texas, New Mexico and its home state of California, as well as Arizona.

Mike Sunnucks writes about politics, law, airlines, sports business and the economy.

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http://www.bizjournals.com/phoenix/news/2014/06/03/surprise-could-be-in-the-running-for-5b-tesla.html?ana=e_phx_bn&u=gSklYpPXQRpogm/Yl2twnQ09b2fd52&t=1401859197

 

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