Brad Bonkowski: Tesla not primary driver in Carson City

Editor’s note: The Nevada Appeal presented the Carson City Board of Supervisors, the mayor and city manager an opportunity for a column. Supervisor Karen Abowd will appear next Sunday.

We’ve all heard the astounding news: Northern Nevada has 50,000 jobs coming in the next five years and needs 9,000 new housing units for all the new employees and their families. The Tesla Gigafactory will generate $100 billion in economic impact over the next 20 years, according to Gov. Brian Sandoval. While this will be terrific for the region, I question what the impact will truly be here in our State Capitol.

Here’s what we know: Tesla isn’t open yet, and Carson City’s actual unemployment rate is below 7 percent. Our industrial vacancy rate, an indicator of primary job availability, is also below 7 percent. How much of this is due to Tesla? As of today, probably zero, as the employment and industrial vacancy rates have been dropping steadily for several years. Our more immediate concern is a lack of available buildings and skilled workforce which is keeping us from taking advantage of the many potential company relocations along with their associated jobs and housing demands.

Based only on the anticipated ripple-effect, Tesla is expected to bring 764 new, indirect jobs to Carson City over the next 18 years. We anticipate a population growth rate of 4.8 percent in 2016, which should be maintained through the year 2020. Carson’s City’s population is 55,274 today, and is expected to increase to almost 70,000 by 2033. That’s 42 jobs a year for the next 18 years, which is not explosive job growth in and of itself. When you add the impact of dozens of Tesla vendors that are on their way to Northern Nevada, the effect intensifies. This is before considering the impact of Ghost or Switch opening facilities in Northern Nevada. So it will not necessarily be Tesla that will make the most significant impact for Carson City, but more of a cumulative regional effect that will drive continued growth in population and jobs.

Demographers use complicated analytical formulas to forecast job and population growth which includes multipliers and indirect effects. This is great data, and fancy math, but anything more than five years out is really just an educated guess. We certainly use this data in making projections and in noting economic trending, along with an abundance of additional information like how many new retail businesses and office users are opening in town, and year over year sales figures.

Based on the data available to me, my answer to what the Tesla effect will be for Carson City is:

Carson City is in good financial and economic shape, and our current actions are placing the City’s future on the right path. Future population, commercial and residential expansion must still comply with Carson City’s Growth Management Plan for building permits and water usage, preventing uncontrolled growth or development. The Tesla-effect certainly exists, and ultimately may be responsible for 5 to 10 percent of the positive activity we see — job and population growth, etc. The impact is real and positive, but is one piece of the puzzle in our overall economic picture and can certainly not be considered the primary driver.

Ward 2 Supervisor Brad Bonkowski can be reached at bbonkowski@carson.org or 283-7073.