BUFFALO, N.Y. — Empire State Development (ESD) said it expects to finalize a letter of intent by the summer to extend Tesla's lease of its gigafactory in South Buffalo.
The new deal would increase the rent the company pays for the state-subsidized facility from $1 per year to $2 million through the end of 2029, the original expiration date, and $5 million annually for an additional five years. However, Manhattan state Sen. Brad Hoylman-Sigal said the state Legislature should examine if that's the best path forward.
"I think we're in bed with someone in Elon Musk who has demonstrated over the last couple of months, but I would argue over the last couple decades, that he has no integrity and he's a snake oil salesperson," Hoylman-Sigal said.
The Democrat is sponsoring a bill that would require ESD to perform an audit of the state's current contract with Tesla and if it finds the company has not met its obligations, to either terminate the deal or claw back money it paid for the facility.
"Elon Musk is calling for waste, fraud and abuse to be eliminated from the federal government and it turns out he may be one of the biggest beneficiaries of waste, fraud and abuse in New York state," he said.
Assemblyman Pat Burke, D-Buffalo, who represents the district where the factory is located, said he supports reviews of state contracts in general. He admitted he is not a fan of Musk, who is leading the U.S.’s Department of Government Efficiency (DOGE), responsible for laying off federal employees and cutting funding to programs.
"He has caused damage to our federal government that was going to take a very, very long time to recover from. I just don't know if his company can be separated from him," Burke said.
He said he was not approached by Hoylman-Sigal or the Assembly sponsor about the bill. However, he has his own proposal which would require companies at state-subsidized facilities to open their doors to lawmakers and their staff when they visit, specifically addressing concerns over Tesla's lack of transparency.
"What's actually going on there, you know, like you may not actually be able to see that with a scheduled visit. What would be nice is if we can go and see how our public dollars are actually being used," Burke said.
Conservative policy analyst Ken Girardin has long been critical of the Buffalo Billion keystone project championed by former Gov. Andrew Cuomo. He noted while Tesla has met contractual job requirements, that contract has been repeatedly revised and is not what was initially promised.
"New York should have been looking for a new tenant for the South Buffalo factory a long time ago," Girardin said. "The bigger problem is that state lawmakers are going to spend a lot of time fixating on this one bad deal and not doing the serious self-reflection about how many other bad deals they've not only consented to but actually promoted."
According to ESD, there are no new incentives. Tesla is planning to build its DOJO super-computer in Buffalo and the state says if it does not make its promised investment of $350 million by the end of this year and $500 million by the end of next year, the $2 million rent would double. Tesla must also maintain its statewide job commitment, which will be 3,000 for the remaining term, or face penalties through the duration of the extension.