However, before that can be done and the first stage, costing up to $15 million, starts, the council will seek the views of residents and ratepayers.
That was one of two steps taken yesterday at an extra ordinary meeting of the council to start the project, proposed by its own company, Waitaki District Health Services Ltd (WDHS), and Waitaki District Health Services Trust.
While the council wholly owns WDHS, the proposal is to separate that from the ownership and operation of the village, although there would be some co-operation and consultation between the three companies.
The second step was to agree to grant a 12-month option to WDHS to buy almost 8ha of council-owned land on Hospital Hill, to be used only for the village.
All the decisions were passed unanimously and the council supported the project in principle. Despite the project's size, it was all done with little discussion, in about 30 minutes.
That was helped by about 40 pages of a report and two workshops during which councillors had heard about and discussed the proposal.
Waitaki Mayor Alex Familton described the village as an ''outstanding proposition'', driven by a future need for integrated retirement care, from individual villas to hospital-care beds.
Council chief executive Michael Ross said WDHS and the council had established the need for services and infrastructure to meet the demand of a growing elderly population.
The district had a significantly higher proportion of residents aged 65 years and over than most areas in New Zealand, and this was projected to increase from 20% to more than 40% by 2031.
Now that the council had proposed to support the project in principle and set up two council-controlled organisations, it needed to carry out the consultation required under the Local Government Act.
The companies have not yet been named but one will operate the care facility and provide care services to residents of villas and apartments, and the other will own villas and issue licences to occupy to residents who buy them.
Profits from the village will be returned to WDHS for expanding health services. Public consultation starts today and submissions close on September 2.
Residents will receive by mail a publication outlining the proposal Anyone who wants to present their submission verbally will be heard on September 10 and a decision is expected to be made on September 24.
The first stage will be 21 villas of up to three bedrooms, 12 apartments, 40 rest-home beds in individual en suite rooms and a community centre with a library, a chapel, technology, media and music rooms, a fitness suite, a gymnasium and a hair salon, plus provision for indoor bowls.
Earthworks may start next year and the stage may take two years to complete.