Central Elgin reaches $80M deal with St. Thomas over electric vehicle gigafactory lands

Click to play video: 'What will Volkwagen’s new EV plant impact be on St. Thomas?'
What will Volkwagen’s new EV plant impact be on St. Thomas?
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The Mayor of Central Elgin announced on Friday that the municipality has finally reached what it calls a “historic” deal with the City of St. Thomas over land annexed for Volkswagen’s electric vehicle battery gigafactory.

In March of last year, MPPs passed Bill 63, or the St. Thomas – Central Elgin Boundary Adjustment Act, 2023, which allowed St. Thomas to annex 600 hectares from the municipality of Central Elgin for what the province called an “investment-ready mega site.”

The boundary adjustment compensation announced Friday will see Central Elgin receive an immediate $10 million, with another $5 million received over a five-year period starting in 2027.

Central Elgin will also gain access to a total of 7,700 cubic metres per day of wastewater treatment capacity “at flow rates equal to City of St. Thomas rates,” which the municipality says will help expand residential and industrial development.

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The wastewater treatment capacity will also help support redeveloping the former St. Thomas Psychiatric Hospital lands for residential use. Mayor Andrew Sloan added that the province is working with them on the future sale of the hospital lands as part of the recently-announced Site Preparation Pilot Project.

In total, the settlement — “including immediate and future value” — is valued at $75- to $85-million, Central Elgin said in a release.

“This deal not only addresses the present-day affordability concerns that this Council has been elected to address, but it also ensures future opportunity that will continue to drive prosperity for generations to come,” said Mayor Sloan.

“It also sends the message that Central Elgin is a great place to invest amidst this time of unprecedented growth and opportunity for our region.”

Elgin-Middlesex-London MPP Rob Flack shared his congratulations to both Central Elgin and St. Thomas over the agreement, which he said benefits all of Elgin County.

“The investment in the new Volkswagen/PowerCo EV battery plant is bringing economic prosperity, including good-paying jobs, to Elgin-Middlesex-London. Our government is encouraged by this agreement, and we will continue to support the economic growth we are experiencing throughout our region.”

St. Thomas Mayor Joe Preston said he was pleased and excited about the finalization of the agreement and pointed to the partnership between their communities.

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“The opportunities moving forward are extraordinary and through cooperation, we will continue to ensure a brighter future for all.”

— with a file from Marshall Healey

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