Proposed Boundary Adjustment with West Grey/Hanover

During this term of Council, the Municipality of West Grey (West Grey) and the Town of Hanover (Hanover) have been working together on a plan to mutually benefit the two communities and the region. Without a boundary adjustment, Hanover will run out of residential, commercial and employment lands by the year 2046, as identified through Hanover’s 2019 Local Growth Management Strategy – Scoped Comprehensive Review.

Representatives from both municipalities, and Grey County, have been engaged in discussions to consider growth and prosperity in Hanover and West Grey. Growth refers to economic expansion. Prosperity encompasses overall well-being and quality of life for our collective residents. The ultimate goal is to move development forward for the mutual benefit of job creation and economic opportunities, and to offer a range of housing accommodations.

Around 1,634 acres are proposed to the north and to the east of the current Hanover boundaries. These lands are identified in the map below.

Recognizing that West Grey will no longer receive tax assessment from the lands that will be transferred to Hanover, Hanover will provide financial compensation, in the amount of $10 million, paid in equal installments of $500,000 over a 20-year period to West Grey.

West Grey benefits:

• Financial compensation that can be reinvested into the community, to support infrastructure improvements, and service level enhancements for the benefit of West Grey residents.
• Spin off growth potential in the residential and industrial sectors.
• New development opportunities in Hanover, and by extension West Grey, will provide new services and amenities that will support all residents in both municipalities.  
  

Hanover benefits:

• New lands for commercial, industrial and residential development for the long term future (or long term only).
• Development will result in new assessment and taxes.
• Jobs and houses for residents of the region.

Grey County benefits:

• New revenue through development (new tax assessment, development charges).
• Jobs and houses for residents of the region. 
• Positioning of the south Grey County region as a vibrant economic zone, with shovel-ready lands available for development.

A municipal tax specialist was engaged to develop financial modelling to analyze the future assessment value on the identified mutual prosperity lands. As a result of this modelling, the $10 million compensation to West Grey was proposed to offset the loss of future tax assessment on the lands being transferred. The Agreement and the proposed financial compensation to West Grey provides a simple and predictable payment model and administrative formula for implementation.

Hanover requires 1,600 acres for future growth with consideration for respecting agricultural use and sensitive environmental lands. The need for additional growth lands was identified in Hanover’s Growth Management Strategy in 2019, and in the Grey County Growth Management Study in 2021. These 1,600 acres are beyond what Hanover needs in the short term. However, by adding these lands to Hanover, it gives the Town the ability to make both short and long-term planning decisions, including when infrastructure will be extended to the lands, and how development can be phased over the coming decades.

The Town of Hanover’s proposed plan for the annual payment to West Grey is as follows:

• Tax levy revenue generated by boundary adjustment lands;
• Annual 0.5% tax levy increase, increased by 0.5% each year thereafter until 2030. From 2031 onward, the amount required from the tax levy is incremental and begins to decrease as of 2032; and 
• Investing in Hanover Reserve Funds will be utilized for the first 5 years.

The process to date has included positive conversations between West Grey and Hanover, facilitated by Grey County. A Growing Prosperity in West Grey and Hanover Working Group with representatives from both Councils, senior administration staff and Grey County staff have been meeting throughout this term of Council.

Next steps in the process include the November 19th public meeting, followed by West Grey and Hanover Councils considering the proposed Mutual Prosperity Boundary Adjustment Agreement. Pending approval of the agreement by both councils, a joint submission will be made to the Minister of Municipal Affairs and Housing. The Minister will review, and pending approval, issue a Minister’s Order. Following the Minister’s Order, Hanover and Grey County will complete Official Plan amendments / updates and Comprehensive Zoning Bylaw amendments / updates.

A SCOR analysis (Strengths, Challenges, Opportunities and Risks) assessment was conducted for all options. Amalgamation is more complex with many more factors to be resolved prior to moving forward. The current path forward is considered to be clear, concise and can be implemented faster. The path forward does not preclude future amalgamation conversations. Amalgamation is often perceived to be less costly and would require a comprehensive financial assessment to determine.

Shared services were also discussed. Shared services may not increase tax assessment for the municipality providing the services. In addition, developers prefer to deal with one point of contact (one municipality vs. two municipalities) as would be the case in a shared services model.

A joint public meeting provides an opportunity for residents of both municipalities to receive details of the proposed Mutual Prosperity Boundary Adjustment and share comments for both councils to hear and consider prior to their respective decision on the proposed Mutual Prosperity Boundary Adjustment Agreement. In this situation a public meeting is also required by the Municipal Act.

Both West Grey and Hanover Councils will need to approve the Mutual Prosperity Boundary Adjustment Agreement. Pending approval by each municipal Council (West Grey and Hanover), the next step would be for both municipalities to make a Boundary Adjustment submission to the Minister of Municipal Affairs and Housing. Through a Minister’s Order, the Minister may approve the agreement following their review.

There is no process for residents to appeal a Minister’s Order.

The effective date will be following the Minister’s approval and Restructuring Order.  It is projected to be early 2026.

No specific development is planned but future development is expected to include commercial, industrial and residential. Future Official Plan and Comprehensive Zoning bylaw updates will detail how development will evolve. When the Town of Hanover or the County of Grey update their official plans, or the Town’s zoning bylaw, with specific development designations or zones, there will be further public consultation, including public meetings and the ability to provide further comments at that time.

Yes, farming can continue. Farming has a rich history in Grey County and is a valued part of our regional economy that needs to be protected.

There is no obligation for any property owner to develop their land. All landowners will maintain their right to farm as long as they choose.

Expanding development lands around primary settlement areas is a best practice for reducing overall sprawl and protecting agricultural lands.

Properties from West Grey that come into Hanover will realize a property tax increase based on Hanover’s current tax rate being higher than West Grey’s. Hanover is committed to phasing in this increase over 5 years.

For other Hanover residents, a 0.5% tax levy increase is proposed to be introduced in 2026 each year for the next 5 years to support payments to West Grey for the boundary adjustment.

Properties moved into the Hanover boundary will pay taxes to Hanover.

It will take time for Hanover to build out and extend their water and sanitary infrastructure to the Mutual Prosperity Boundary Adjustment lands. As water and sanitary services are extended to properties, residents will have to connect once services are available. This will take many years and build out will be phased. The cost of connection is not known at this time.

Hanover will provide most services including police, fire, bylaw, and waste management. Road service may be Hanover, Grey County or West Grey through shared service arrangements.

Yes, landowners within the Mutual Prosperity Boundary Adjustment lands will have access to Hanover Public Library and Hanover Parks, Recreation and Culture services.

Residents will be required to comply with all Hanover bylaws. West Grey’s zoning bylaw and the County official plan will continue to apply until such time that Hanover completes updates to their official plan and zoning bylaw to include the Mutual Prosperity Boundary Adjustment lands.