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Senate introduces key bill to end first day at Faraday special session

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Michelle Rindels / AP

The Nevada Senate begins a special legislative session Wednesday, Dec. 16, 2015, in Carson City to consider incentives for electric carmaker Faraday Future. Gov. Brian Sandoval called Nevada lawmakers into the special legislative session starting Wednesday to approve tax breaks and incentives for the electric carmaker, which wants to build a $1 billion plant in North Las Vegas.

Updated Wednesday, Dec. 16, 2015 | 10 p.m.

Sandoval, Faraday News Conference

Dag Reckhorn, left, global vice president of manufacturing for Faraday Future, and Nevada Governor Brian Sandoval applaud during a news conference at the Sawyer State Building in Las Vegas Thursday, Dec. 10, 2015. Reckhorn and the governor discussed plans for the Faraday Future electric-car factory in the city of North Las Vegas. Launch slideshow »

CARSON CITY — A special session of the Nevada Legislature convened this afternoon to consider a deal to bring electric car startup Faraday Future to North Las Vegas, where it plans to build a $1 billion manufacturing plant.

Gov. Brian Sandoval called the expected session late Tuesday.

In the proclamation, Sandoval delineated subjects legislators can consider — generally, tax abatements and transferable tax credits from the state, authorizing municipal bodies to offer incentives, providing for infrastructure expansion, and funding a workforce-training program.

Legislators have been arriving in Carson City throughout the day today, though a number already were in town this morning for a meeting of the Legislature’s Interim Finance Committee.

Throughout the day, we’ll be updating this story.

Senate comes back for just a few minutes to introduce SB1

A little over four hours later, the Senate reconvened just after 9:30 p.m. to introduce SB1, the big omnibus bill that includes the tax abatements and incentives to allow the state to issue bonds and change provisions of tax increment areas. The bill also addresses the rail and water infrastructure projects at Apex.

The Senate will reconvene as a committee of the whole at 10 a.m. Thursday.

Assembly introduces workforce training bill, adjourns until Thursday morning

Just before 7:30 p.m. this evening, the Assembly introduced AB1, a bill relating to the workforce training program announced last week, and immediately adjourned. The bill establishes specifics of the so-called Workforce Innovations for a New Nevada, a program to provide “customized workforce development services” to certain businesses in the state, according to the bill’s text. For Faraday, that means training auto manufacturing workers. The bill also specifies that any workforce recruitment program must also include a workforce diversity action plan approved by the Governor’s Office of Economic Development.

The Assembly was called to order at 6:30 p.m., took about a half-hour recess to notify the governor and Senate that they were in session, came back just before 7 p.m. and passed a series of procedural resolutions. The body will reconvene as a Committee of the Whole at 9:30 a.m. Thursday. Assembly Democrats and Republicans will caucus separately tonight to discuss the bill.

Assembly Speaker John Hambrick also said earlier in the evening that the session would likely go until the middle of the day Friday. “We will be having a Friday session,” Hambrick said. “I strongly suggest you make evening flights.”

Senate called to order, called to recess

The Senate was called to order at about 5:30 p.m. Wednesday evening, after which it immediately took a vote to send committees to the governor and Assembly to notify them that the Senate is in session. It then took about a half-hour recess to wait for the committees to return. The Senate was then briefly called back into order to pass a series of procedural resolutions to allow the Senate to make decisions more quickly than it would in a regular session. At about 6:10 p.m., the Senate again went into recess until the call of the chair. Senate Majority Leader Michael Roberson said that would be at about 8 p.m.

During one of the recesses, Roberson said the main bill for the Faraday deal will go to the Senate first and that two smaller bills would start in the Assembly. He also said that the committee of the whole for the Senate would start at 9 a.m. Thursday and that he expected the session would be over by mid-day on Friday.

Workers from building and construction unions protest Tesla

Today, a handful of members of the Building and Construction Trades Council of Northern Nevada stood outside the Legislature building protesting last year’s Tesla deal.

Members of the organization were mainly unhappy about the Tesla workforce requirement, which required that half of Tesla’s workers have to be from Nevada. A similar workforce requirement is expected with the Faraday deal. Protesters would like the local-hire requirement to be higher.

“Local workers should absolutely have first shot at every job on the project,” said Russ James from District Council 16, a unit of the International Union of Painters and Allied Trades.

Apex, not Faraday, main focus of the special session

Click to enlarge photo

Rendering of planned Faraday Future auto plant in North Las Vegas.

The discussion about this week’s special session will be framed around opening economic opportunity at the 18,000-acre Apex Industrial Park in North Las Vegas.

“It’s frankly less about one particular company and more about the region called Apex in Southern Nevada,” said Democratic Senate Minority Leader Aaron Ford. “It provides the opportunity to put the infrastructure in an industrial park in that area to draw this businesses and other businesses out there.”

Democrats are pushing for a workforce diversity requirement in the legislation, looking at the way that Faraday’s workforce can represent and benefit the diverse population in North Las Vegas.

Another point of discussion will be the way to secure water for Faraday at Apex — pumping groundwater to the factory instead of building a higher cost pipeline, which would be a long-term solution to Apex’s water woes.

Assemblyman Derek Armstrong, the Republican chair of the Assembly’s committee on taxation, said that building infrastructure at Apex would create stability for the economy. “The capability of having such a huge industrial park in that area will allow us to attract other companies,” Armstrong said. Still, he added that “the devil is in the details,” and he’ll have to wait and see how the bills are written.

Second special session not ruled out yet

Several legislators have been tossing around ideas for a second special session.

Ford is rooting for the one suggested by Sen. Ruben Kihuen last week. Kihuen, who is running for Congress, asked his colleagues to call themselves into a second special session of the Legislature as soon as the first one finishes to ban those on the no-fly list from buying guns. Two-thirds of Legislature would have to vote to call themselves into session.

Asked whether that seemed feasible, given the Republican control of the Legislature, Ford said he didn’t really know. “The Democrats can’t do it alone,” he said. “It’s going to be incumbent upon Republicans who have a sensible approach to gun control and safety in this area to work with us to make that happen.”

Questions raised about the Faraday deal

The conservative Nevada Policy Research Institute raised concerns about whether the Chinese government will benefit from the Faraday deal in a report.

Last week, Chinese billionaire Jia Yueting, the CEO of Leshi Internet Information and Technology — a company often referred to as the “Netflix of China” — announced that he was a founder and investor in the company. Jia last year announced plans to build an electric car.

The report questioned whether any tax abatements or incentives the Legislature passes for Faraday (but also available for any other company willing to make the same investment) would either directly or indirectly benefit the Chinese government through the company’s ties. It also asked whether Faraday intends to focus on selling its cars in the United States or whether they would be sold internationally.

It also had questions about how the economic projections about Faraday were calculated, some of which may be answered by a report recently made public on the Governor’s Office of Economic Development’s website.

The two authors of the report — the institute's executive vice president Victor Joecks and communications director Michael Schaus — also had specific questions about how much the car would cost and how the car would be “styled.”

The list of registered lobbyists grows

More than 100 lobbyists from more than 70 organizations have registered so far for the special session. They represent a broad swath of interests: labor unions, municipal bodies, chambers of commerce and others.

Republican political strategist and powerhouse lobbyist Pete Ernaut of R&R Partners will lobby on behalf of Faraday, along with three of his associates.

Extent of Sandoval’s presence in the Legislature unclear

It’s not yet clear how much the governor will be around the Legislature over the next few days. The plan right now is that Steve Hill, director of the Governor’s Office of Economic Development, will testify before both houses of the Legislature, but the governor could testify, should a need arise, said the governor’s spokeswoman, Mari St. Martin.

More details on Faraday’s economic impact

A report by Applied Analysis details the $87.5 billion economic impact Faraday Future is expected to have on Clark County over the next two decades. It was released ahead of the special session.

Faraday will initially hire 50 workers this year with a total payroll of $2.4 million. That will expand to 4,500 employees and a $206.1 million payroll by 2023, according to the report.

The company also is expected to generate 9,100 indirect and induced jobs.

All of those jobs are expected to support about 30,000 people, most of whom are expected to live in Clark County.

Over 20 years, the company is also projected to generate about $770 million in direct and indirect taxes — after deducting the $215 million in tax abatements and incentives being sought.

A separate analysis by the state demographer calculates a similar total economic impact of $81.6 billion and 11,397 total jobs.

UNLV economics professor Alan Schlottmann, in a Dec. 10 letter attached to the end of the report, asks legislators to consider the potential risk associated with a startup like Faraday and how the state can meet the company’s workforce demands.

An early morning plane flight for some legislators

A handful of legislators caught a 6 a.m. flight from Las Vegas to Reno.

Some waiting passengers speculated a Republican presidential candidate would be on the flight to get to campaign events later today in Reno, but, ultimately, none of the candidates boarded.

Waiting in a rental car line, Sen. Patricia Farley said she still knew little about the deal, and the secrecy around Faraday concerned her. (Chinese billionaire Jia Yueting only recently acknowledged he is a founder and investor in the company.)

Farley also said she hoped that the bills wouldn’t be rushed through the Legislature.

Faraday Future officials up north, too

Officials from Faraday Future are in Carson City for the special session but will not be present during the proceedings.

Dag Reckhorn, Faraday’s vice president of manufacturing, and company spokeswoman Stacy Morris will be in town to answer questions that may arise, but they have no plans to meet with individual legislators, Morris said.

Sun reporter Cy Ryan contributed to this report.

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