A new Costco could be coming to Tucson’s southeast side, with the city offering millions in incentives to help bring the project to life.
The new Costco plans to be built at 9748 E Old Vail Road. It’s expected to generate about $22.7 million in sales and property tax revenue during its first five years. Over the long term, the project could bring in about $47.3 million annually to the local economy and create more roughly 320 jobs.
To help make the development happen, Tucson is using its Site-Specific Tax Incentive Program, which allows qualifying retail projects to receive a portion of the sales taxes they generate. The funds are meant to reimburse developers for costs like permits, fees and public infrastructure improvements.
The incentive tied to the Costco project was initially estimated at about $7.3 million. However, the company agreed to reduce that amount to $4 million. The remaining $3.3 million will go toward road improvements along Old Vail Road, including repaving and other upgrades between Rita and Houghton roads.
Because projects like this require a traffic study, the city found about $3 million in upgrades are needed, including a new traffic signal and a turn lane…