New York state announced this week that it will penalize Tesla and Panasonic if they don’t hit the employment targets at their massive shared facility in Buffalo, which was largely built with taxpayer funds.

Howard Zemsky, an official in Governor Andrew Cuomo’s administration, announced this week that his office is pressuring Tesla and Panasonic to diversify their product output at the shared facility in Buffalo, New York. The Tesla-owned facility leases space to Panasonic, the technology giant that produces batteries for Tesla’s cars.

“I think we have to work with Panasonic and Tesla to diversify the product base that they have at RiverBend,” Zemsky said this week.

The state dumped millions of dollars into the Buffalo factory with the hopes of bringing job growth to the region. Since the plan was conceived, the factory has been home to a series of scandals. Several high-profile bribery convictions were made last year in connection to the various construction agreements for the factory facility.

Under their agreement with New York state, Tesla and Panasonic must have 1,460 people working at the Buffalo facility by April 2020. If they fail to meet this requirement, the state can impose a penalty of $41.2 million. This week, Cuomo administration officials announced that they are “absolutely” committed to imposing this penalty if the requirement is not met.

The Buffalo Gigafactory has been the source of scrutiny since it opened in 2017. Breitbart News reported earlier this month on allegations that Tesla had been fabricating their production output in Buffalo.

“Some weeks we produced enough solar modules for zero homes and probably the best I saw was maybe four homes in a week, so that is alarmingly scary to obviously be a part of a company who doesn’t have any sense of urgency to tackle these issues and get them working correctly,” one insider said.

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