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Can a Mexican-American governor save the GOP?

By negotiating a colossal deal with California-based Tesla Motors for it to build a massive battery factory close to Nevada’s state capital, cowboy-booted, tailored suit-wearing Mexican-American Republican Gov. Brian Sandoval has demonstrated he has the tools, brains and sense to lead the GOP out of Obama-inflicted doldrums.

The very fact that left and right-wing groups are protesting the billion dollar deal he constructed — without raiding the state treasury or raising taxes — proves that at worst it is a middle-of-the-road deal and at best an economic bonanza for Nevada.

In the 20 years of the deal, it could add $100 billion dollars in economic activity and multimillions in tax revenues, as well as thousands of jobs, to a state that was bludgeoned by the Great Recession. The battery plant alone will have 6,000 jobs when operating, with an average wage of $25.00 per hour.

{mosads}Sandoval told a crowd on the Capitol steps that Tesla will expand the Reno-area gross domestic product (GDP) by 20 percent and Nevada’s by 4 percent.

Another example of the gigantic future benefits are in Storey County, just outside Reno, where the factory will actually be built. The current county schools have an operating budget of $4.9 million. That will double when the Tesla’s property tax abatement expires in 2024.

The left complains that the deal was not negotiated in public and the right complains that the state constitution doesn’t allow for the state to “invest” in private companies. Neither complaint is viable. If there is any debate on the deal, it belongs in the state legislature, not in court. The deal doesn’t call for any cash investments; it calls for tax forgiveness or abatements in most cases and redirecting revenue loopholes that already exist for other industries (insurance and moviemaking, for example).

Specifically, sales, business and property tax abatements are the bulk of the deal. Job tax credits being made transferrable and marketable, and discounted electricity/energy rates for some years, are other elements that make up the deal. The legislature will consider the deal in a special session this week.

One change that Tesla wants is a direct factory salesroom rather than having to work through dealers, as is the law today.

The battery factory is being built to make batteries for a mass-produced electric car Tesla plans that will sell for around $30,000, in contrast to the $70,000 a deluxe Tesla electric car costs today.

The factory will house 6,000 employees and will be built by as many as 2,000 construction workers with building supplies supplied by thousands more employees of myriad companies that survived the Great Recession and need an injection of business like the Tesla project. The hefty Nevada Hispanic population that makes up a large percentage of the construction business and its satellite suppliers will benefit greatly from the project and will undoubtedly expand its support of fellow Hispanic, Gov. Sandoval.

In making this $1.2 billion dollar deal, Sandoval exhibits a political panache that left the states of Arizona, New Mexico, Texas and California in the dust.

California’s Democrat-risen-from-the-political-dead, Gov. Jerry Brown, the man who ruined California during his previous eight years as governor, failed with a feeble last-minute effort to convince fellow Democrat, Tesla founder and CEO Elon Musk, to build the factory in California.

When embarrassed by the underdog GOP gubernatorial candidate, Neel Kashkari, in a debate the same day Sandoval announced the Nevada victory, Brown dissembled and claimed that Tesla was offered “a bundle of cash” — a bribe — by Nevada. Not true, as the legislation being offered in the Nevada Legislature proves.

Brown ruined California when he personally approved state employee unions. He plunged California’s public education into the same black hole Mississippi and Alabama occupy. He turned California prisons into a gravy train for corrupt unionized prison guards. The Tesla/Nevada deal proves that Brown has lost again.

Despite Brown, California remains the eighth largest economy in the world, and Los Angeles the manufacturing center of the United States. Nonetheless, he and it couldn’t compete with Nevada on the Tesla deal.

Example of California’s negative business climate is the San Diego Padres’ ballpark episode. This writer was on the committee that sponsored the ballpark. Sixty percent of voting San Diegans voted for the park. Hispanic voters that I campaigned for gave the park up to 85 percent approval. Despite losing badly, opponents filed 14 different lawsuits against the project that delayed construction for years. All lawsuits were dismissed or adjudicated in favor of the project. The park was built with $400 million dollars.

Finished, it drew 3 million fans to downtown San Diego, where they spent millions on taxable food, drink and parking in what otherwise had been a warehouse district.

Assuming Sandoval can bring the legislature along, Tesla Nevada will operate in 2017. Using the San Diego ballpark example, no wonder Elon Musk told reporters: “This was not the biggest incentive package. It wasn’t just about the incentives … What the people of Nevada have created is a state where … you can do things quickly and get things done. It’s a real get-things-done state.”

Republican Gov. Brian Sandoval — the highest-ranking elected Hispanic in American government — did well; very, very well.

Contreras formerly wrote for the New American News Service of The New York Times.

Tags Brian Sandoval Elon Musk Nevada Tesla Motors

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