Costco on track to open July 2018 following economic development deal


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On Nov. 14, Pflugerville City Council approved an economic development agreement allowing plans for the Pflugerville Costco store to move forward.

“It’s no longer speculative—they’re coming,” Pflugerville City Manager Brandon Wade said.

The agreement states the Pflugerville Community Development Corporation, the Travis County Emergency Services District No. 2/Pflugerville Fire Department and the city will provide a maximum of $6.25 million to fund infrastructure costs for the Costco store. The agreement will last 15 years or until the maximum amount is reached, whichever happens first.

“It was a creative approach, and it required a lot of coordination to get everybody on board,” Assistant City Manager Trey Fletcher said.

The PCDC and ESD will each provide $1.5 million and the city will provide $3.25 million, all of which will come from sales tax proceeds.  Each group will contribute half of the sales tax proceeds they receive from sales at the store to Costco infrastructure costs and will retain the remaining half.

“If anything, [Costco’s] presence actually has the potential of driving the tax rate down,” Wade said. “This is a remarkably good deal and we are very fortunate to get it, and the citizens of this town are going to be the primary beneficiary of it from all sorts of aspects.”

In return, the agreement requires Costco to construct the 150,000-square-foot facility, make a capital investment of $15 million, comply with the city’s unified development code and obtain a certificate of occupancy. Costco will also be required to construct a detention pond. If these requirements are not met, the incentive payments will cease.

Costco officials hope to start construction as soon as possible, likely in January 2018, and open the store at the end of July 2018, Fletcher confirmed. The economic development agreement is a big step in that direction.

“I don’t see any significant impediment to them moving forward at this point,” Wade said.

The Pflugerville location of the wholesale shopping chain will be located on 16.13 acres of land on the southeast corner of Kelly Lane and the SH 130 frontage road. A preliminary site plan includes a 150,170-square-foot warehouse, 3,912-square-foot liquor store, 630-square-foot optical exam area and 750 parking spaces. It will be the fourth Costco location in the Austin metro area.

As far as traffic concerns go, Wade acknowledged there will likely be an increase in traffic in the area but said traffic will continue to be an issue as Pflugerville grows.

“It’s not Costco itself; it’s just the growing pains that Pflugerville is going to be going through for the next 30 years,” Wade explained.

Wade also pointed out that other cities have not experienced additional traffic problems after opening Costco locations, largely because the average peak hour for Costco shoppers is at 10 a.m. on Mondays, thus not competing with rush hour.

“Where Costco may indirectly cause more traffic is by drawing more retail around it,” Wade said.

Fletcher said the store will hopefully result in some additional development in the vicinity.

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  1. Orlando M Muniz

    So it sounds like they are not going to do anything about addressing the increase of traffic…. great!

  2. I personally was in email conversation with city manager Brandon Wade over the summer and pointed out the traffic nightmare for those that live up Kelly Lane this Costco would bring.
    – He agreed that the empty land across at 130 south and 45 was a better option but claimed the city could do nothing to force Costco to purchase that land instead. (Maybe not but the city did not have to approve this project at its current location.)
    – I pointed out that Kelly Lane is the primary option for those that live in the neighborhoods along it. ( Some of the most expensive neighborhoods in Pflugerville I might add). Option 2 is Colorado Sand Dr. which takes you through a residential area. Bad idea.
    – A traffic survey was done over the summer which wouldn’t accurately reflect traffic patterns because school was not in session. You have an elementary, middle and high school right smack in the middle.
    – The intersection at 45 and 130 is already one of the most dangerous in the city as people are always attempting to “beat the light”. I imagine vehicle accident will go up as the wait to get through the area time increases significantly.
    Everybody has shopped at the Austin Costco. Night or day it’s always a traffic nightmare. All of those people that shop there that don’t live nearby will now be swarming to a Pflugerville store at an intersection that cannot handle it. Ultimately, people will be less likely to move to Pflugerville (expansion is almost entirely limited to West Pflugerville do to available space) and this Costco, and the traffic it brings, will not be a strong selling point. Those that do live in the effected area will be more inclined to move. Translation : a negative impact on property tax revenue long term.

  3. I really hate this development already. It looks monstrous. I live in Avalon and it already takes me 8-10 minutes to just get out of my community on a busy morning. The only hope I have is that Costco will take some of the tax burden from us, and NOT drive down our property values. I love this area, and I like Costco, but not together. Sigh.

  4. Its astonishing that there has not been more public outrage, by residents who live in neighborhoods on kelly lane, about the costco location. The city of Pflugerville clearly does not have the best interests of its residents in mind. Like many other commenters have said, there are several large plots of land along fm685, south of stonehill and the stupid water park, on the market for retail development. How the decision to build a discount mega store in close proximity to affluent residential neighborhoods is beyond me!

Kirby Killough
Kirby Killough joined Community Impact after working in broadcast news. She is currently the editor for the Round Rock, Pflugerville and Hutto edition of Community Impact.
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