Forget the latest Hollywood film noir and spend some time learning about this story instead. The story is that of Reno, Nevada, and the location of the original Tesla Gigafactory. The historical drama, a true story, unfolds with twisting and dark details.
The story came to light due to the notable new podcast series The City (USA Today’s investigative podcast). Episode 4 of season 2 is titled “West World.”
“We go east of the city, where wild horses roam and business is booming. City boosters say Tesla is driving New Reno, but the truth is darker and more complicated than it first appears.”
The historical melodrama is filled with dark misdeeds, flamboyant financial shifts, legal battles, imprisonment, death by murder, arson, and brothels. Brothels, bankruptcy, cons, con men, extortion, a fleeing criminal, a returning criminal, Swiss bank accounts. …
The City initiates in 1955 as Joe Conforte opens the Mustang Ranch brothel. The City does a fine storytelling job. No need to retell other than to say that, eventually, many twists and turns result in the Mustang’s end. It is padlocked by federal agents.
Is brothel life over for the large area of Nevada? No. Lance Gilman bought Mustang Ranch from the federal government on eBay. Go figure.
And finally, the land was sold and bought again for the Tesla Gigafactory.
Benjamin Spillman, of Reno Gazette-Journal, reports of positives in the economy from the Tesla Gigafactory. The Governor’s Office of Economic Development in 2018 reported a 55% increase in manufacturing employment in the Reno-Sparks area since 2014. The continuing inside story of the factory is vast due in part to the overwhelming size of the Gigafactory.
The City tells the tale before and after. Robin Amer for The City keeps the modern tale as compelling as the old tale of the area. I’m pointing out some key parts of the transition (according to The City), but I encourage you to listen to the whole podcast or read the transcript. It is fascinating.
Rebranding the city. Drive east from Reno 20 miles and “New Reno” springs to life.
Robin Amer: “Now, the 2014 arrival of the Gigafactory was a game-changer for Reno’s economy, bringing with it 7,000 jobs. And last fall, the state hosted a summit to celebrate that accomplishment.”
Governor Brian Sandoval relates at the celebration, with Elon Musk present: “And it was October of 2010. The unemployment rate was 14.3 percent. Nevada led the nation in bankruptcies. We led the nation in foreclosures.”
Sandoval asks Elon Musk, “So, when you came over that hill over here and and you see this, this landscape, did you look at it and say, this is the place?”
Elon Musk: “Yeah [laughs]. This is beautiful. You know, there’s like ten thousand wild horses here? I mean, this really looks like something out of a, it’s like the idyllic Wild West. It’s incredible. ”
Elon Musk: “You know, I think this is very much the land of opportunity here. Like, feels like freedom, right here. Feels like freedom. OK? That’s good.”
Savvy journalist Amer: “But it wasn’t just the wild horses that drew Musk here. Something much more fundamental—something much more Old Reno—influenced his decision.”
Freedom. The same freedom that fueled Old Reno’s vice-based economy of quick divorces and legal gambling, well, it’s attractive to corporate America, too. No income taxes. Lightning-fast project approvals.”
Later in the podcast, reporter Anjeanette Damon states: “But it’s not just the wild horses that really drew the CEOs here. The selling point is the lack of government bureaucracy—the same permissiveness that in the past encouraged the capitalization on vice. Now it’s the cornerstone of Silicon Valley’s expansion into Northern Nevada.”
If you recall, states were competing hard for the Tesla Gigafactory and Elon Musk navigated the incentives quite well. Nevada prevailed. Although, as the Verge reported, the cost proved controversial. “The state offered an incentives package that was the largest in Nevada history.” Tesla could take in nearly $1.3 billion in tax benefits for building its Gigafactory in Nevada through the next 20 years.
The Gigafactory found its location during a major housing dip in what some consider a fitful struggle wresting Reno’s “soul.” Some of the stories of Tesla employees are quite hopeful, especially considering the prior “opportunities” in the area.
Getting back to the podcast and the rapid choice of location, Amer states: “When Elon Musk went looking for a place to build his battery factory, he was under tremendous pressure. He had promised the world the mass production of the Model 3, an all-electric sedan that was supposed to be somewhat more affordable than the luxury sports cars his company had been making. He needed a factory fast. So he needed a place where he could build it with as little red tape as possible. And a guy named Lance Gilman had just the spot.”
Housing is another, a more haphazard side of the story. That quick transformation has led to quite a housing crisis. Employees consider RVs, among the slim choices on the table.
Anjeanette Damon for the Reno Gazette-Journal documents some details of the story, including one of the high school students who found employment instead of continuing on to college. An at-risk student at her school, Isabelle West got an interview with Tesla. “And it took two weeks, but when that phone call (came in), my mom was right there with me,” West said. “And I was like, ‘I got the job!’”
West started as a production associate making $14.50/hour and now plans to become an engineer. The Tesla experience and opportunity inspire and offer more than could have been imagined in the area otherwise. The story is a positive sequence of growth. Tesla has also funded her education as she’s acquired more skills. “Tesla kind of helped me figure out myself,” she said.
Isabelle, one of the lucky ones, also struggled with a place to live while she worked at the out-of-the way Tesla Gigafactory. Again, she is one of the better stories that Reno Gazette-Journal reporter Anjeanette Damon relates. Eventually, she proved her worth and Tesla did find her and other employees safe housing.
The area finds many housing needs unmet. Robin Amer estimates that today there are 12,000 people working at the Gigafactory. The county had around 4,000 people. How prepared was the area for lighting fast increasing of health care needs, emergency services, and housing compared to the need before?
In other areas of the country, we find tent cities and homeless on the streets coupled with the development of high-income housing, often new and empty or empty part of the year. When a landlaord can get high amounts for a property or apartment, they don’t lower prices to affordable rates. Damon notes that apartment vacancy rates are near zero in Reno, and prices are sky high.
This story that Damon relates brings to mind the jacked up prices of bottled water during a hurricane. Housing is so desperately needed that landlords are playing a mean game — because they can. “The median housing price has spiked to $400,000. And no-cause evictions are up 300% as landlords sell out to new landlords, who in turn raise the rent.”
RGJ continues that even Tesla’s Musk has lamented the lack of local housing, saying, “It’s the biggest constraint on growth at the Gigafactory.”
Tesla is playing catch-up.
“We’re looking at creating a sort of housing compound just on the site of the Gigafactory, using high-quality kind of mobile homes, which I think would be great because then people could actually just walk here,” he said at a 2018 tech summit.
Tesla does help employees find housing, as it did Isabelle. The other stories are traffic, traffic, tents, and small RVs, because, thus far, that housing compound has not been built. The nearby highway has gone from 5,100 to 19,000 vehicles a day in three years. Traffic from Reno has increased by 50%.
As a response to the Gigafactory project, responding to desperate need, the Reno City Council has been reacting to the housing shortfall. It has expanded the homeless shelter. It has also initiated dorm-style workforce housing. And with other such insightful projects around the country, the city council plans a tiny-home village. RGJ quotes, “We could have done better … when it comes to zoning and other things that would encourage more affordable housing, more infill, more multi-family,” said Mike Kazmierski, who heads the Economic Development Association of Western Nevada. “It’s time to play catch-up.”
Think of the need for EMS, as well. How fast can an emergency service rev up for the rapid need?
I return to Robin Amer and The City podcast:
“But when a giant corporation can come to town and build a mega factory at a breakneck pace, things can go wrong. And just as the dancers working in Old Reno’s strip clubs face difficult working conditions, so too do the workers in New Reno’s factories.
Officer Fritz: “Yes, this is Officer Fritz with the Tesla security department, 1 Electric Avenue. We are requesting EMS for a middle-aged male. He was electrocuted.”
Caller: “We need an ambulance. We have a female employee that her, she got her hand stuck between two modules and she’s bleeding pretty bad.”
Robin Amer: “Tesla’s Gigafactory helped jumpstart Reno’s economy, but it came at a cost. One that New Reno boosters working hard to kick strip clubs out of downtown don’t like talking about. One that leaders who scrambled to bring Tesla here didn’t really plan for or address.”
Many thanks for the excellent storytelling and reporting by The City. Listen to the podcast here.
Go behind the scenes of Episodes 4 and 5 with @AnjeanetteDamon and get an inside look at our investigation of the factory jobs fueling “New Reno,” and the “Old Reno” jobs inside the city’s strip clubs. https://t.co/mROOk5gFLB
— The City Podcast (@thecitypod) November 22, 2019
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