Central Elgin eyes housing to offset industrial tax loss

A recent financial settlement with St. Thomas will chart a “path to prosperity” for Central Elgin, said the township's mayor Andrew Sloan.

A compensation deal announced last month between the city and the township, includes $15 million — two-thirds up front, the rest during five years — and access to wastewater processing to help unseal potential industrial and residential land in Central Elgin. Also announced was the anticipated prospect of developing the lands of the former St. Thomas Psychiatric Hospital owned by the provincial government, which would add tax revenue to Central Elgin.

“I'm very excited,” Sloan said. “I think Central Elgin's best days are ahead of us.”

Sloan said the compensation will be instrumental in the township's next steps attracting economic development.

The deal is in response to the provincial government's hasty enactment of Bill 63 last year to assemble the land tract necessary to land the massive Volkswagen battery plant, causing Central Elgin to lose 450 hectares (1,200 acres) of its land to neighbouring St. Thomas. One-third of the annexed land was industrial-zoned, costing the township tax revenue and considerable industrial development possibility.

“The industry that will come because of Volkswagen, there's a tremendous need for housing," Sloan said. “The more housing we can provide, the more jobs we can attract and that is the goal.”

The VW plant, operated by its subsidiary Powerco and expected to open in 2027, is expected to employ 3,000 workers.

The prospect of residential development on the sprawling lands of the former St. Thomas Psychiatric Hospital, which are in Central Elgin, offer a path to prosperity, Sloan has said.

Although the lands are owned by the provincial government, the sale of the former psychiatric hospital on 162 hectares (400 acres) of attractive real estate, will satisfy several appetites.

The provincial government will turn over unused land costing it nearly $1 million a year to service, to be used for residential development, which serves the provincial government's goal of building more homes. For Central Elgin, more homes will help recoup tax revenue lost when its land was annexed by St. Thomas.

“Where they're going to win is obviously the tax revenue that's going to come their way that doesn't exist today,” said Elgin-middlesexlondon MPP Rob Flack, associate minister of housing in Doug Ford's government.

The site is one of two surplus land tracts on which the provincial government will spend almost $100 million under a pilot project to repurpose lands for residential use.

Once the property has been remediated, the site will be prepared and repurposed to make it available for housing, Flack said.

Sloan suspects “a host of different developers” will be eyeing the site when it's put up for sale.

But building homes on the site won't happen overnight.

As per the provincial's initiative to build more homes faster, Flack said he'd like to have the land prepped and sold for development “yesterday,” but a more realistic timeframe would be in two to three years.