Sorry Las Vegas, Tesla went where Tesla wanted

As the northern part of the Silver State recently landed its second major economic development project this year, a bold question has been lingering in Southern Nevada: Did the South get a fair shake?

While government officials say Tesla Motors, which recently announced it would plant its forthcoming $5 billion battery Gigafactory near Reno, decided on its own to avoid Las Vegas, community leaders and commentators in the Las Vegas Valley are more skeptical.

It doesn’t help that the deal-making Sandoval administration’s first big “get” involved incentives for Apple to invest $1 billion on a data center and a purchasing center in Sparks and Reno.

“It’s a clear question in many people’s minds,” said Cam Walker, a member of the Las Vegas Convention and Visitors Authority and a Boulder City councilman. “When projects like Apple and Tesla go up North, and Nevada doesn’t have the same benefits to share in Southern Nevada, it’s a clear question.”

The “North Versus South” debate comes up often in business and official circles, but does a rift really exist? Do state leaders love the North better than the South and show their love by sending all the new jobs that way?

Depends on who you ask.

Officials in the Governor’s Office for Economic Development say Tesla was equally welcome to set up shop in Southern Nevada, and the company toured at least four potential sites near Las Vegas. Tesla, they say, simply liked the massive industrial park east of Reno better.

For its part, Tesla has said it chose Nevada over states offering bigger financial incentives because it’s easier to do business here, but the company hasn’t said why it chose The Biggest Little City in the World over Sin City. Factors cited by corporate relocation analysts and others center on location — proximity to the company’s Bay Area factory and headquarters; easy commute from Lake Tahoe, where many Silicon Valley billionaires own vacation homes; and relative closeness to Silver Peak, where lithium for batteries is mined.

When Tesla announced it would build its battery factory somewhere in the Southwest, economic development agencies in several states — including New Mexico, Texas, Arizona, California and Nevada — sprang into action, getting their pitches in line to woo the booming electric car maker.

In Nevada, agencies such as the Las Vegas Global Economic Alliance took a day and gave Tesla executives tours of several potential sites in Southern Nevada, based on the company’s criteria for real estate. After a single day of tours in December, the LVGEA’s work was done; Tesla would conduct the rest of its negotiations solely with the governor’s office.

“Our office doesn’t tell companies where to locate or expand,” said Steve Hill, director of the Governor’s Office of Economic Development. “That’s a decision made by the customer. We show them all the opportunities across the state, and it’s the company’s choice where to narrow the search and, ultimately, where to locate.”

To Hill, the North-South debate is a flimsy one. While in other circles, Gov. Sandoval is referred to as “The Governor of Reno,” an elected leader in the highest office who favors his hometown over Las Vegas, government officials will tell you no one is playing favorites in the governor’s office.

“It’s a discussion topic that comes up at times,” Hill said. “Our focus is on the whole state.”

Others are more skeptical. David Damore, a UNLV professor of political science, said government officials can deny the North-South divide all they want, but “you just have to look at the outcomes.”

“All the people in key positions are Northern Nevadans,” Damore said. “This is a continuation on an age-old story in Nevada; it’s just another chapter.”

Eric Herzik, a University of Nevada, Reno political science professor, said you can chalk up the debate to nothing more than grousing and politics.

“If a major project ends up in the North, Southern Nevada immediately says, ‘Wait a minute, we can use this money more than they could,’ ” Herzik said. “It’s classic: ‘Well, the North is getting this, so the South must be suffering.’ ”

But experts say Southern Nevada has been doing quite well on its own.

When the Great Recession crumbled the state’s gaming industry, it didn’t take Las Vegas casinos too long to bounce back.

“Once the Nevada economy began turning around after the Great Recession, Las Vegas was doing better. It was recovering faster than the rest of the state,” said Stephen Brown, head of UNLV’s economics department.

Because Reno’s gaming scene hasn’t really recovered, Brown said, the North might have needed the Tesla plant more.

Back in Boulder City, Walker said he wouldn’t be surprised if another major project went to Reno, but he’s optimistic Southern Nevada will soon get some of its own victories.

“They’ll be coming,” Walker said. “We just haven’t seen the right one.”

Contact reporter Ed Komenda at ekomenda@reviewjournal.com or 702-383-0270. Follow him on Twitter @ejkomenda.