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At the risk of losing the power to make big decisions before the next election, the city council will vote Monday on whether to take precautionary measures to secure the funding needed to buy land for the new electric vehicle battery factory.
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Stellantis and LG Energy Solution want to begin work on the site of their $5 billion battery factory in August. Depending on how many councilors intend to run for re-election, next month the council could lose the chance to apply for the roughly $45 million loan needed to hold its end of the bargain.
“It’s absolutely vital because the joint venture wants to put a shovel in the ground and start moving the earth next month,” Mayor Drew Dilkens said Tuesday. “So because of the municipal elections and because of all the different touchpoints along the way, we have to make sure that we expedite all the required approvals.”
Municipal elections in Ontario will be held on October 24. The deadline for nominations is August 19. After this deadline, the council could find itself in “lame duck” status if less than 75% of councilors choose to seek re-election. Provincial rules prevent lame duck councils from taking several actions, including incurring expenses or assuming liability in excess of $50,000.
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The city intends to borrow about $45 million to acquire land for the new plant, which it will then lease to businesses.
On Monday, council will essentially vote on a recommendation from city staff to provide pre-approval to move forward with loan applications. Infrastructure Ontario approvals will likely take at least two months, according to the city staff report.
To lure Stellantis and LG to Windsor, the city has pledged to round up approximately 225 acres of land at Banwell Road and EC Row Avenue. The city already had about 42 acres. It conditionally acquired the majority of the remaining required properties before the companies announced plans in March to build the Windsor plant.
The city also voted in April to expropriate an acre of residential land. This process is ongoing.
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“Our commitment to seeing this $5 billion investment and 3,000 jobs come to Windsor is that we would make sure we could provide the land to the LG/Stellantis joint venture so they could build a plant,” Dilkens said.
“We have acquired the land we need. We are in the process of obtaining the remaining part. But now we have to finance this acquisition.
The city will use $8 million of the current capital budget to maintain the site, but will borrow $45 million to purchase the land.
The board has already voted to finance the acquisition through a long-term debt plan by issuing debentures to Infrastructure Ontario, an arm of the provincial government, for terms of up to 30 years. .
But there are several hurdles in the process, including the requirement for another approval to go ahead with the funding request.
“To the extent that there is work and approvals required after August 19, when we could potentially be in lame duck status, the board authorizes administration – within parameters and terms that we are all familiar with. – to keep proceeding to make sure we can deliver everything on time,” Dilkens said.
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