Officials hope Tesla will provide 'green' -- in cash and cars

Officials hope Tesla will provide 'green' -- in cash and cars
By Jessica A. York/Times-Herald staff writer and Richard Bammer
Posted: 02/16/2009

Vallejo is aggressively working to attract a "green tech" car manufacturing plant to Mare Island, though a different location may already be a foregone conclusion.

"We've had contact with them as recently as a week ago," said Jason Keadjian, spokesman for master developer Lennar Mare Island.

"Clearly, Mare Island offers a number of competitive advantages, including large buildings and infrastructure, the ability for expansion and a skilled work force, as well as a tremendous location within the Bay Area," Keadjian added.

The San Carlos-based Tesla Motors is one of many companies the developer's broker has been in contact with, Keadjian said. In fact, Tesla is a company it has been "aggressively pursuing since 2006," he said.

In January, Tesla, which produces electric-powered cars, announced that its search for a new California site would begin again after a San Jose site was rejected for economic reasons. That city was the second recently contemplated by company officials, who had first looked to a New Mexico site in 2006.

Tesla's business, which allows car owners to drive without fueling up at gas pumps, would fit nicely with Vallejo's reputation for using solar energy, Vallejo City Councilmember Stephanie Gomes said.

"It would really be fantastic for us and Mare Island," she said. "Maybe that could work into a niche for us."

Mike Ammann, president of Solano Economic Development Corp. in Fairfield, would hardly be surprised if Tesla Motors officials were again eyeing Mare Island as a possible site to develop.

He said Tesla, while considering Vacaville and San Jose, had previously scouted the former naval shipyard, with its dozens of airplane hangar-sized buildings, as a possible place to set up a manufacturing facility.

Ammann said details of the Obama administration's Economic Recovery Act, which the president wants to sign today, will factor into the company's decision to locate at Mare Island -- or at another abandoned military base in California, such as Alameda Naval Air Station in Alameda or Castle Air Force Base in Atwater.

He said Tesla officials are seeking $300 million to $400 million in start-up costs but cautioned the Bay Area-based firm, while a leading contender for the cash, is competing against several other electric vehicle companies for largely the same amount of taxpayer money.

"If Tesla takes the federal dollars, the location would have to be what's called a 'brown field,' an old military base, like Mare Island," said Ammann, adding, "It's more than likely" that the federal government will encourage, if not require, companies to locate on the old military bases.

"There will be some kind of criteria, if they take the money," said Ammann. "Obviously, Mare Island and others will be in the game."

He said Vacaville and San Jose are considered "green enterprise zones" and are unlikely though possible sites for a Tesla plant, given the federal guidelines.

Vallejo Community Development Analyst Annette Taylor said city officials renewed their efforts to attract the company last month after hearing that San Jose site was "not feasible, given current economic conditions and poor venture capital environment."

"Because Tesla is a desirable company, the city is doing whatever we can to bring it to Mare Island," Taylor said.

In early communications, company officials indicated they were looking for a site very close to their South Bay home base. Keadjian, of Lennar Mare Island, said he did not know if that plan had changed.

Recent news reports have indicated that the company is closing in on a favored site, though a Tesla spokeswoman reached Friday would not disclose any details.

"(Tesla) have not gone back out to the market since they announced that their previous commitment in San Jose had fallen through," Keadjian said Friday. "So, we have updated them with information about Mare Island ... We're not taking anything for granted; it has been announced that they were close to making an agreement in the past. It's not over 'till it's over."

The San Jose Mercury News contributed to this report.

Contact staff writer Jessica A. York at (707) 553-6834 or jyork@thnewsnet.com.