This week, Governor Andrew Cuomo made a curious announcement of an electric vehicle truck plant to be built at a converted warehouse in the Bronx with the assistance of state and city incentives valued at over $6 million. But six days earlier, Crain’s reported that the city’s Industrial Development Agency approved $1.7 million in tax breaks enabling the Smith Electric Vehicle Corporation to open a new electric truck manufacturing and distribution facility in the Port Morris section of the Bronx.
Cuomo’s November 15 announcement struck me as odd because while the news release had a quote from Bronx BP Ruben Diaz, Jr., it didn’t include a quote from Bronx congressman Jose Serrano. However, Crain’s November 9 coverage of the IDA’s approval of the $1.7 million grant included a supportive statement from Rep. Serrano.
Considering that last year Serrano submitted legislation last year called “e-Drive” allowing the US Postal Service to use a fleet of 20,000 EV delivery vans, his snub is quite telling. That noticeable difference left me to interpret Cuomo’s omission of a Serrano statement as a slap at the long-time South Bronx congressman and a sign of his increasing irrelevance.
Meanwhile, the Smith Electric Vehicles‘ clean technology manufacturing facility is expected to create more than 100 new direct jobs.
The Capitol News characterized Cuomo’s support of the new plant as in conflict with remarks from former deputy mayor Dan Doctoroff, who broadly dismissed the idea of converting old industrial buildings for newer manufacturing uses at a conference on zoning in New York City.
“To return such buildings to manufacturing would be to live in the past,” Doctoroff reportedly said.
Two days after winning the IDA grant, Smith Electric filed a $125 million IPO with the Securities and Exchange Commission. The company plans to start building the all-electric Newton truck (which has range of 150 miles) at the Bronx plant by the second half of 2012.
Green Autoblog says that the IPO is ambitious because Smith missed its 2011 sales target, which the company had projected at 1,000. In its SEC filing, the company admitted that in FY 2011 (ending 09/30), it had only built 320 trucks and had a backlog of 120 vehicles. The company’s filing said it expects to produce 540 new trucks through July 2012, which is when the Bronx plant is expected to open. The company has its manufacturing, sales and service headquarters in Kansas City, Missouri.
In addition to the nearly $7 million in state and city tax credits and grants, the Cuomo administration has committed up to $10 million in federal Congestion Mitigation and Air Quality Improvement funds to pay for state “plug-in” incentive vouchers of up to $20,000 per vehicle produced. That figure assumes that the plant will produce up to 500 trucks if it comes on line in July 2012.
The subsidy grows even larger when you factor in the potential electric rate subsidies from the New York Power Authority’s Recharge New York program and Department of Labor workforce training assistance. Smith would be eligible for up to 10MW of low-cost electric power for its 90,000 square foot facility for seven years. Similar subsidies in the past were valued between $4,000 to $,6000 per job created.
This truck manufacturing facility is a long overdue job-creating business for a borough plagued by double-digit unemployment rates. I hope that this opens the door to other electric vehicles manufacturers wanting to locate here. We need to create the image of a Bronx open to business (and not lining the pockets of insiders).
Do you welcome the Smith EV truck to the Bronx? If you have your own thoughts about the Cuomo-Diaz-Serrano dynamic, leave a comment.
Electric trucks to be made in the Bronx | Crains New York Business.
Read more: http://www.crainsnewyork.com/article/20111109/REAL_ESTATE/111109878#ixzz1eBJ682pW
See my previous comments on the Kingsbridge Armory debacle in New tack needed as Bronx bombs.