OVERVIEW….

Since its founding 2006, SolarCity has become America’s largest solar power provider but Elon Musk has taxpayers and lawmakers to thank as his company has received government subsidies, grants and tax breaks worth over $2.5 billion.  Yet, at the same time, it’s taxpayers who are paying the price — SolarCity hasn’t turned a profit since going public in 2012 and Fortune reported in February 2016 that shares of SolarCity have “tanked by over 35%” following a “weak earnings report of missed forecasts and downward adjustments on future sales.”

And like Musk’s other businesses, SolarCity’s history is also marked by targeted campaign contributions to key government officials and those officials have in turn touted Musk’s “vision” for their respective states.  For example, SolarCity executives have donated thousands of dollars to Democratic Senators Dianne Feinstein, Barbara Boxer, Chuck Schumer and Harry Reid, while SolarCity has had a significant presence in each of their states while benefitting from tax breaks and subsidies.  And SolarCity was one of the biggest financial recipients of President Obama’s massive 2009 “stimulus” while Mush cultivated his relationship to the nation’s top Democrat with tens of thousands of dollars in campaign contributions.

One writer for the Reno Gazette-Journal perhaps said it best recently after Musk announced he was pulling over 500 jobs out of Nevada because the State Utility Commission lowered the massive tax subsidy SolarCity was receiving – “Musk’s actions in New York and Nevada have made it clear that Musk’s empire is built on taxpayer subsidies and political influence; the essence of crony capitalism.”

ADDITIONAL BACKGROUND….

SolarCity’s Success Is Partly Because The Government Provides Subsidies And Enables An Arrangement Called Net Metering, Which Allows Homeowners With Panels To Sell Back To The Grid Any Solar Energy They Don’t Use.” (Noah Buhayar, “Who Owns The Sun?” Bloomberg Business, 1/28/16)

The Los Angeles Times Subsidy Tally For SolarCity Is $2.516 Billion, Including Treasury Grants And Credits, Rebates, And Tax Exemptions From States.

  • SOLARCITY: $2.516 billion total
  • $750 million — New York State cost to build solar panel factory
  • $1.5 billion — Estimated value of 30% subsidy for solar installation since 2006, including at least $497 million in Treasury grants
  • $5.6 million — Oregon tax credits and rebates
  • $260 million — New York local property tax exemptions (Jerry Hirsch, “How It Adds Up Three Companies, $4.9 Billion In Government Support,” Los Angeles Times, 5/30/15)
  • SolarCity Has Received Nearly $500 Million From A Federal Government Tax Credit

SolarCity Has Benefited From Nearly $500 Million In Direct Grants From The Treasury Department

SolarCity Has Reportedly Received $497 Million “In Direct Grants From The Treasury Department.” “The federal government also provides grants or tax credits to cover 30% of the cost of solar installations. SolarCity reported receiving $497.5 million in direct grants from the Treasury Department. That figure, however, doesn’t capture the full value of the government’s support.” (Jerry Hirsch, “Elon Musk’s Growing Empire Is Fueled By $4.9 Billion In Government Subsidies,” Los Angeles Times, 5/30/15)

 SolarCity Received “Millions In Federal Tax Credits While Losing $322 Million Since 2008.” “A California-based solar company backed by several Obama supporters has been receiving millions in federal tax credits while losing $322 million since 2008, raising concerns about the company ‘becoming the next Solyndra.’” (Joseph Weber, “Solar Firm Linked To Obama Donors Could Be ‘Next Solyndra,’ Senator Warns,” Fox News, 11/20/13)

As Of October 2015, SolarCity Has “Been Profitable In Only Two Of The 12 Quarters Since Its Initial Public Offering.” “The biggest U.S. rooftop solar provider, whose largest shareholder is Elon Musk, said Thursday installation growth will slow as it seeks to become cash-flow positive. Instead of lauding the conservative approach from a company that’s been profitable in only two of the 12 quarters since its initial public offering, investors pushed the shares down the most on record.” (Chris Martin, “SolarCity Focus On Turning A Profit Making Investors Unhappy,” Bloomberg Business, 10/29/15)

SolarCity “Has Not Turned An Annual Profit Since Going Public In 2012.” “Though SolarCity boasts a market capitalization of $3.8 billion and says it has roughly 14,000 employees, it has not turned an annual profit since going public in 2012.” (Susanne Craig, “Despite Risks, Cuomo Bets On Solar Power To Lift Buffalo,” The New York Times, 10/25/15)

SolarCity Has Been One Of The Largest Recipients Under Obama’s “Stimulus” Program

SolarCity Has Been One Of The Largest Recipients Of The Federal Cash Grants Under The Stimulus’ Program. “The solar companies received money through the Treasury’s $13 billion program, known as the 1603 program, which used funds from President Obama’s stimulus initiative to offer cash grants to clean-energy developers.  … SolarCity, SunRun and Sungevity have been by far the largest recipients among companies installing solar panels on homes. Working heavily in the sunny states of California and Arizona, the three firms collected hundreds of millions of dollars in federal cash grants to pick up a share of their costs on thousands of home installations during the past three years.” (Carol D. Leonnig, “Three Big Solar Firms Face Federal Inquiry,” The Washington Post, 12/14/12)

SolarCity Will “Effectively Operate In New York Tax Free”

“SolarCity Won’t Have To Pay Sales Tax On The Equipment, And The Governor’s Tax Reforms This Year Zeroed Out The Corporate Tax For Manufacturers. So SolarCity Will Effectively Operate In New York Tax Free.” (Editorial, “Elon Musk Scores Again,” The Wall Street Journal, 9/29/14)

SolarCity, In Return, Promised To Employ 1,460 Jobs For Five Years, “A Subsidy Of $103,000 A Year” Per Job, And Spend $5 Billion In Capital “If Its Operation Last That Long.” “In return SolarCity has agreed to employ 1,460 jobs at the facility for five years, which breaks down to a subsidy of $103,000 a year per head. That’s more than three times Buffalo’s median household income. SolarCity has also promised to spend $5 billion in ‘combined capital, operational expenses and other costs in the State of New York’ over 10 years, if its operation last that long.” (Editorial, “Elon Musk Scores Again,” The Wall Street Journal, 9/29/14)

State Subsidies: Oregon

The Oregon Department Of Energy Awarded SolarCity $11.8 Million In Tax Credits Under A Program For “Job Creation And Retention,” But SolarCity Used A Company That Relied On Prison Labor To Execute The Project

“Elon Musk’s Energy Company SolarCity Used Multi-Million Dollar State Tax Credits To Fund Prison Labor For Its Solar Panels.” (Steve Birr, “Elon Musk’s SolarCity Used Prison Labor To Build Taxpayer Subsidized Solar Panels,” The Daily Caller, 10/29/15)

SolarCity Was Awarded $11.8 Million In Tax Credits By The Oregon Department Of Energy For A Project Under An Oregon Program That Was To Advocate Job Creation And Retention For Oregon Workers. “The Oregon Department of Energy issued $11.8 million in tax credits to SolarCity for the $27 million project under a state program advocating ‘job creation and retention’ for Oregon workers, reports Grist.” (Steve Birr, “Elon Musk’s SolarCity Used Prison Labor To Build Taxpayer Subsidized Solar Panels,” The Daily Caller, 10/29/15)

“The Solar Panel Project Launched In 2012, Aiming To Build Two Of The Largest Installations In The State On Two University Campuses In Oregon.” (Steve Birr, “Elon Musk’s SolarCity Used Prison Labor To Build Taxpayer Subsidized Solar Panels,” The Daily Caller, 10/29/15)

SolarCity “Went Through An Energy Company … That Builds Solar Modules” In An Oregon Prison “Through Inmate Labor.” “Instead of stimulating the local employment market, however, SolarCity went through an energy company named Suniva, a Goldman Sachs-backed vendor that builds solar modules in Oregon’s Sheridan Federal Prison through inmate labor. Grist reports that prisoners were paid less than a dollar an hour for their work.” (Steve Birr, “Elon Musk’s SolarCity Used Prison Labor To Build Taxpayer Subsidized Solar Panels,” The Daily Caller, 10/29/15)

Musk Hired Former Obama Strategist To Lead Grassroots Movement For Solar Energy

The Washington Post: “SolarCity Hires Former Obama Strategist To Ignite A Grass-Roots Movement For Solar Energy” (Matt McFarland, “SolarCity Hires Former Obama Strategist To Ignite A Grass-Roots Movement For Solar Energy,” The Washington Post, 12/17/14)

SolarCity Hired Jon Carson “To Lead Its Grass-Roots Effort To Put Solar Planels On Every Roof In The United States.” “SolarCity has brought on Jon Carson, a former campaign strategist for President Obama, to lead its grass-roots effort to put solar panels on every roof in the United States. The idea is to use the tactics of a grass-roots political campaign to influence consumers’ energy decisions.” (Matt McFarland, “SolarCity Hires Former Obama Strategist To Ignite A Grass-Roots Movement For Solar Energy,” The Washington Post, 12/17/14)

Carson Worked For Obama In Several Capacities

Carson, Before Serving In The Obama White House, Was “The National Field Director For President Barack Obama’s Campaign In 2008,” And Previously Worked On Several Other Political Campaigns. “Jon Carson is the former Director of the Office of Public Engagement. Previously, he served as the Chief of Staff at the White House Council on Environmental Quality (CEQ). Before joining the Administration, Jon was the National Field Director for President Barack Obama’s campaign in 2008 and worked on the Obama transition team. Carson also managed Tammy Duckworth’s 2006 general election campaign in Illinois’ 6th Congressional District and has worked on many political campaigns over the last decade, including Al Gore’s 2000 presidential campaign.” (The White House, Accessed 12/19/15)

In 2013, Carson Became Executive Director Of Organizing For Action. “I’m Jon Carson, the new executive director of Organizing for Action. I hope you’re as excited as I am for this new organization, and for what our grassroots movement can accomplish in the next four years.” (Organizing For Action, Accessed 12/19/15)

  • Organizing For Action “Grew Out Of Obama’s Campaign Machine.” “On June 30, Organizing for Action, a nonprofit group that grew out of Obama’s campaign machine, sent out a flurry of e-mails to potential donors announcing the impending conclusion of OFA’s fiscal quarter and requesting recipients chip in before midnight.” (Sidney M. Milkis and John W. York, “If The Obama Presidency Is Winding Down, Why Is His Group Organizing For Action Ramping Up?” The Washington Post, 7/29/15)

Political Contributions Of Note Made By SolarCity’s Leadership

Members Of SolarCity’s Leadership Have Contributed To Presidential Candidates, Federal Campaign Committees, And Political State Parties Or Politicians In States Where SolarCity Has Received Subsidies, Incentives, Or States Where SolarCity Has A Call Center Or Production Operation. (Center For Responsive Politics, Accessed 1/31/15)

 

Contributions To Presidential Candidates And Federal Campaign Committees
Year Of Contribution Contributed By Amount Contributed Recipient
In 2008 Lyndon Rive $750 Barack Obama
In 2008 Lyndon Rive $3,000 Democratic Congressional Campaign Committee
In 2012 Peter Rive $2,500 Barack Obama
In 2010 John Stanton $1,000 Searchlight Leadership Fund, Harry Reid’s Leadership PAC

(Center For Responsive Politics, Accessed 1/31/15)

 

Contributions To Political State Parties Or Politicians In States Where SolarCity Has Received Subsidies, Incentives, Or States Where SolarCity Has A Call Center Or Production Operation
Year Of Contribution Year Of Contribution Year Of Contribution Year Of Contribution
In 2012 Lyndon Rive $1,000 Tulsi Gabbard (HI)
In 2010 John Stanton $2,500 Harry Reid (NV)
In 2010 John Stanton $1,500 Barbara Boxer (CA)
In 2011 John Stanton $1,000 Dianne Feinstein (CA)
Since 2011 John Stanton $3,000 Ben Cardin (MD)
In 2010 John Stanton $1,000 Gabrielle Giffords (AZ)
In 2010 John Stanton $1,000 Mike Thompson (CA)
In 2010 John Stanton $500 Michael Bennet (CO)

 (Center For Responsive Politics, Accessed 1/31/15)

Connecting Contributions To Federal Politicians

In 2011, Senator Harry Reid’s Office Released A Press Release Praising Solar Panel Installation Agreement Of Which SolarCity Participated In. (Senator Harry Reid, “Reid Applauds Historic Solar Power Announcement For Military Housing In Nevada,” Press Release, 11/30/11)

In 2015, Senator Harry Reid’s Office Released A Press Release Regarding Solar Projects In Nevada And Praised Solarcity’s Innovation. (Senator Harry Reid, “Reid Statement On Department Of Interior Approval Of Three Nevada Solar Projects,” Press Release, 6/1/15)

In 2010, Senator Barbara Boxer’s Office Released A Press Release Regarding Her Tour Of Solarcity, Which The Senator Said Was “An Innovative New Company That Has Succeeded In Creating Jobs By Investing In New Clean-Energy Technologies.” “Last week I traveled to Foster City, California to tour SolarCity, an innovative new company that has succeeded in creating jobs by investing in new clean-energy technologies. Here I got to see first hand how SolarCity was able to grow its business even in the midst of the worst economic crisis since the Great Depression, adding good private-sector jobs right here in California. This company is helping consumers and businesses save on their energy bills by installing solar systems in 500 communities across California, Oregon, Arizona, Colorado, and Texas.” (Senator Barbara Boxer, “Senator Boxer: Investing in Clean Energy and Creating Jobs,” Press Release, 7/26/10)

SolarCity PAC Contributed To Senator Schumer

So Far In The 2016 Cycle, SolarCity’s PAC Has Contributed $5,000 To Chuck Schumer. (Center For Responsive Politics, Accessed 1/29/16)

During The 2014 Cycle, SolarCity’s PAC Contributed $2,500 To Chuck Schumer. (Center For Responsive Politics, Accessed 1/29/16)

Senator Schumer Hailed The Tax Credit Extension And Noted He Also “Secured A Modification” That Allows Solar Developers To Benefit From The Year They Commence Construction

Senator Schumer, At The SolarCity Construction Site, “Announced That, After His Urging, Congress Has Extended The Federal Solar Investment Tax Credit Tax (ITC), Which Will Help Boost Clean Energy And Create New Jobs At Solar Companies Like SolarCity.” “Standing at the SolarCity construction site at Riverbend in Buffalo, NY, U.S. Senator Charles E. Schumer today announced that, after his urging, Congress has extended the federal solar Investment Tax Credit Tax (ITC), which will help boost clean energy and create new jobs at solar companies like SolarCity.” (Senator Chuck Schumer, “Schumer: Recently Renewed Solar Tax Credit Will Be A Game Changer For Western NY & SolarCity,” Press Release, 12/22/15)

 

Musk’s Extensive Lobbying Effort: SolarCity

In 2015, SolarCity Hired Multiple Lobbying Firms

In 2015, SolarCity Paid $150,000 To Podesta Group For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2014, SolarCity Paid $200,000 To Podesta Group For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2013, SolarCity Paid $200,000 To Podesta Group For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2012, SolarCity Paid $100,000 To Podesta Group For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2012, SolarCity Paid $40,000 To Smith-Free Group For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2010, SolarCity Paid $170,000 To McBee Strategic Consulting For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

In 2010, SolarCity Paid $180,000 To McBee Strategic Consulting For Lobbying. (Center For Responsive Politics, Accessed 12/20/15)

  • SolarCity Hired McBee Strategic, “The Lobbying Firm At The Center Of The Green-Energy Subsidy Universe.” “Musk has also recruited some of K Street’s best-connected Democratic lobbyists. In the weeks after Obama’s election in 2008, SolarCity and Tesla both hired McBee Strategic, the lobbying firm at the center of the green-energy subsidy universe.” (Timothy P. Carney, “Green Energy Stimulus Profiteer Comes Under IRS Scrutiny,” Washington Examiner, 10/15/12)

SolarCity Lobbied Various Issues, Including Taxes:

In 2015, SolarCity Lobbied On Taxes:

chart-1

(Center For Responsive Politics, Accessed 12/20/15)

In 2015, SolarCity Lobbied On Energy:

chart-2

(Center For Responsive Politics, Accessed 12/20/15)

SolarCity: The Next Solyndra?

SolarCity Received “Millions In Federal Tax Credits While Losing $322 Million Since 2008.” “A California-based solar company backed by several Obama supporters has been receiving millions in federal tax credits while losing $322 million since 2008, raising concerns about the company ‘becoming the next Solyndra.’” (Joseph Weber, “Solar Firm Linked To Obama Donors Could Be ‘Next Solyndra,’ Senator Warns,” Fox News, 11/20/13)