The Atlanta Journal-Constitution
Breaking down $1.5B in enticements for EV maker
What does $1.5 billion look like? To Rivian, it looks like a package of state and local tax breaks, free land and other inducements that persuaded the electric vehicle maker to locate a $5 billion manufacturing plant about an hour east of Atlanta.
What does $1.5 billion buy?
If you’re the state of Georgia, that would be 7,500 jobs, with combined wages that ultimately could total about $420 million per year. That averages out to $56,000 in wages per hire.
Details of the incentive package the state used to lure Rivian were released this past week, months after the project was announced at a state Capitol news conference.
Here’s a breakdown of the enticements:
■ $701.7 million in local property tax abatements
■ $196.9 million for a mega job tax credit
■ $175 million for a machinery tax exemption
■ $111 million for land and grading for the project
■ $105 million for a construction materials tax exemption
■ $89.4 million for training — $62.5 million for a Quick Start training center and $26.9 million for customized recruitment and training programs
■$51.5 million or more for an I-20 interchange and local road improvements
■ $21 million in the form of a direct grant from the state
■ $7.4 million for wetland and stream mitigation.
The state still may need to sell the idea to some Georgians.
The deal has become an issue in the GOP race for governor. Former U.S. Sen. David Perdue, who aims to unseat Gov. Brian Kemp, has painted the incentive package as blatant election-year politics forged in the “dark of night.” He said that if he were governor, he would have nixed the project.
The project also has faced pushback from some residents who live near the site that straddles Morgan and Walton counties. They say Kemp and other state officials neglected to get them on board.
The state has an auto warranty of sorts. Rivian must fulfill 80% of its job and investment promises by the end of 2028 and hold them through 2047, or the state could pull back some of those provisions.
Schools and local governments will recover some of the abated local property tax revenue under a payment in lieu of taxes, or PILOT, agreement. State Economic Development Commissioner Pat Wilson said Rivian will make more than $300 million in PILOT payments over 25 years before the property will be taxed at full value.
Still, some say the price tag is too high.
Greg LeRoy of Good Jobs First, a Washington-based group that generally opposes public subsidies, said that with the state’s incentives breaking down to roughly $197,000 per job, “Georgia taxpayers will never break even on this deal.”
Rivian has said it plans to begin production in 2024 at the Georgia plant, where it expects to eventually manufacture up to 400,000 vehicles a year.