Mayor Bob Foster has recommended to the Long Beach City Council that they approve a flurry of tax incentives and economic bonuses to offer to Tesla Motors, an electric automobile manufacturer which has been negotiating with both the cities of Long Beach and Downey in an attempt to build a production plant for their upcoming electric four-door sedan called the Model S.

Downey mayor Mario Guerra last week told several media outlets that his city was nearing a deal with Tesla that would ensure the plant would be built in Downey. Guerra is an outgoing mayor – who has been very vocal about his success in attracting the automaker – and the Downey City Council will elect his replacement next week. Nothing official has been heard since last week’s announcement from Guerra, and the Long Beach City Council will vote on the recommendation during their next meeting on Tuesday, December 8.

“I feel very comfortable in our dealings with Tesla and we will be having an official announcement very shortly,” said Downey mayor Guerra in a phone interview with the lbpost.com this afternoon.

The incentives that Long Beach may offer to Tesla include:

  • A 50% sales tax rebate for a term of 10 years
  • A $2 million loan for facility improvements for 10 years
  • More than $37,000 in tax credits for hiring qualified employees (per employee)
  • Certain property, furniture and fixtures purchased may be deducted as business expenses
  • A worker incentive package that includes services such as employee recruitment, screening and training to be performed by the Workforce Investment Network

The Mayor’s recommendation estimates that the entire package of incentives is worth more than $28 million to Tesla.

Tesla Motors has accepted $5,000 deposits from more than 500 interested buyers of the Model S, which is slated to be delivered in late 2011; meaning that Tesla has accepted millions for a car that does not yet have a place to be constructed and is expected to: secure a deal on a property, retrofit that property to produce automobiles, and have completed Model S automobiles delivered to deposit-paying customers in less than two years.

Councilmember Gerrie Schipske issued a statement in an e-mail this afternoon.

“Finally. Finally. Finally,” she said. “I am glad that after all the pushing and prodding to get the City actively involved in recruiting jobs to the Boeing Property it may be happening.”

News that Tesla Motors was considering building the Model S in Long Beach was first revealed by lbpost.com columnist Nancy Pfeffer in this article. On the heel of the announcement that Downey was nearing a deal with Tesla Motors, we pointed out similar deals that Tesla has reneged on in the past and financing difficulties they may have in the future in this article.

Disclosure: lbpost.com co-founder Shaun Lumachi is a Pacific Gateway Workforce Investment Network board member.