Corruption Charges Delaying Payment For Tesla Plant Contract Workers

Corruption Charges Delaying Payment For Tesla Plant Contract Workers
<a href="">Blomst</a> / Pixabay

Construction contractors working on Tesla’s plant in Buffalo have reportedly not been paid for months. This is because two aides close to New York Governor Andrew Cuomo and six other people involved in the state’s plan to bring Tesla’s solar panel manufacturing to Buffalo have been charged with corruption, according to Business Insider.

Corruption charges to blame

Gov. Cuomo pushed forward an economic revitalization project dubbed the Buffalo Billion project, with the state of New York investing around $750 million into building SolarCity and Tesla’s solar panel production factory in Buffalo, New York. According to The New York Times, federal corruption charges were filed against two former aides close to the governor and six other people in September over the economic revitalization project.

Business Insider says the complaint alleges that the state’s original request for proposals for the solar manufacturing facility was worded in a way that seemed to exclude all bidders except LPCiminelli. Louis Ciminelli, CEO of LPCiminelli, is known as a generous supporter of Cuomo. Ciminelli, his associates, and his relatives have donated around $150,000 to Cuomo’s campaigns over the years, says BI.

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When will Tesla’s contract workers be paid?

As of now, it is not known when the contractors working on the factory, which is nearly completed, will be paid. The contractors were last paid in September for work done in June.  According to The Buffalo News, Howard Zemsky, President of Empire State Development, claimed that the rest of the payment would take “additional time” but that all workers will be paid. Zemsky said the payment process is going through close examination due to the corruption charges.

Tesla has a $150 million investment in the plant; however, it is not responsible for paying the contractors. The construction of the factory started before its recent acquisition of SolarCity and before its introduction of the solar roof. Now, the electric car maker is planning to produce the solar cells and roof panels in Buffalo with partner Panasonic, notes Jalopnik.

Before talks about the Tesla/SolarCity merger started, the plant was meant to be a production facility for the solar company. The clean energy giant had planned for the factory to be up and running this year, but the production timeline was delayed until next year due to SolarCity’s financial constraints, notes BI.

In pre-market trading today, Tesla shares were in the green. Year to date, the stock is down more than 21%, while in the last months, it is down more than 15%.

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