Rivian’s plans to build a $5 billion plant in Georgia have hit a roadblock after a judge rejected an agreement that would have seen the automaker receive a huge property tax break.
Plans had called for local governments in the Morgan and Walton counties roughly 45 miles (70 km) east of Atlanta to maintain ownership of the 800-hectare site and lease it to Rivian, exempting the car manufacturer from a projected $700 million in property taxes over 25 years. Rivian had agreed to make $300 million in payments in lieu of taxes throughout this period.
However, Morgan County Superior Court Judge Brenda Trammell has rejected to validate the bond agreement, noting that the development authority that had formulated the plan hadn’t proved that the plant was “sound, reasonable, and feasible.” Trammell added that Rivian should be required to pay regular property taxes due to the level of control over the property it would have.
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The four-county joint development authority and the Georgia Department of Economic Development are considering an appeal.
“We remain undeterred in our efforts to bring high-paying, American manufacturing jobs to Georgia, and are currently assessing all legal options,” they said in a statement to Fortune.
The plan was also set to see the state spend $200 million to buy the site and prepare it. Furthermore, Rivian was set to claim a projected $200 million in income tax credit and $280 million in sales tax breaks on machinery and construction materials. The state also plans to spend $90 million to build a job training center and train workers.
“Rivian’s cash reserves are quickly drying up, thus casting serious doubt on whether it will be able to commence, let alone complete, the project,” Trammell added in her ruling.
A number of local residents banded together to oppose development of the plant and according to president of opposition group Morgan Land, Sky & Water Preservation, JoEllen Artz, are happy with the decision: “It is very fulfilling that we local citizens were able to band together to do so much research in order to bring a great legal team on board and deliver us fantastic results like these.”
