Travis County, Texas — Travis County officials are reviewing a tax rebate agreement with Tesla after the automaker failed to provide sufficient documentation showing it is meeting the deal’s requirements, county spokesperson Hector Nieto said.
The agreement, finalized in 2020, offers Tesla a 70% property tax rebate on the first $1.1 billion the company invests in its Southeastern Travis County gigafactory, and up to 80% for investments exceeding $2 billion. The rebate applies only to a portion of property taxes paid to the county.
Under the deal, Tesla must ensure at least half of the gigafactory’s employees live in Travis County and are paid at least $15 per hour, with the minimum wage adjusted over time according to the Consumer Price Index.
County officials estimated in 2020 that Tesla could save $14 million in property taxes over the first 10 years of the agreement. No rebate payments have been made to date. The compliance review is ongoing because Tesla has not submitted sufficient documentation to confirm it is meeting the requirements, Nieto said.
Travis County also has tax rebate agreements with Apple, Samsung, and HID Global. Nieto said compliance reviews are routine, and rebate payments to those companies typically occur within the same year annual reports are submitted.
Commissioner Margaret Gomez said she will push county staff to verify Tesla’s compliance and pursue legal options if the company is not meeting its obligations. “It is my duty to protect the public’s tax dollars and their best interests,” she said.
Tesla did not immediately respond to requests for comment.
The rebate deal was designed to attract Tesla’s headquarters from Palo Alto to Travis County. The land previously generated about $6,400 in property taxes annually. County documents show property tax revenue from the Tesla site now far exceeds that amount, even with the rebate.
County officials in 2020 described the deal as a way to create jobs and economic opportunity in one of Travis County’s lowest-income areas. Commissioner Jeff Travillion called it a “transformational process,” and Commissioner Brigid Shea said it would provide employment for people without college degrees. The deal passed 4-0, with Gomez abstaining.
Some residents now question whether the agreement benefits the community. At an August commissioners court meeting, residents cited workplace hazards and environmental concerns, urging the court to end the deal.
In 2024, Tesla was fined nearly $50,000 after an employee died at the gigafactory and nearly $7,000 by the U.S. Department of Labor for exposing workers to hazardous chemicals. Residents have criticized the county for offering rebates amid these violations.
