Document: Duluth Costco construction expected to begin in fall

Updated: July 07, 2020 09:47 PM

Construction of the region's first Costco Wholesale store is expected to begin this fall, according to a document submitted to the St. Louis County Board.

The document considered as part of Tuesday's meeting says public infrastructure improvements are needed at the site, which is at the intersection of West Arrowhead Road and Haines Road in Duluth. The City of Duluth will consider providing $1.35 million in tax abatement financing and the St. Louis County Board will consider $650,000 in tax abatement financing.

The tax abatement would be only for public infrastructure improvements, not for the actual building. It would include things like turn lanes, water and sewer main work and stormwater management. 

"It's a really busy corridor there, and it still can work and be good for shoppers and safe for workers to get to and from where they need to go to work," Mayor Emily Larson said. 

Construction is expected to be completed by the fall of 2021, the county board document says.

The Duluth News Tribune reported in March that Costco had canceled a purchase agreement for the site. However, Costco has never publicly commented on the project and the city says negotiations have been continuing all along.

Mayor Larson said she never lost confidence, but detailed projects take time. 

"There was really no point at which I felt it wasn't going to go through. There was no point at which I thought, gosh, this has just fallen apart," Larson said. "I think we all wanted to get it right." 

The 160,000-square foot store would be built at the northeast corner of Haines and Arrowhead, on four full parcels of land and part of a fifth parcel. The store would have 725 parking spaces.

The document says the city will require a project labor agreement, prevailing wage rates, and community benefits agreement.

A county public meeting on the proposed tax abatement is set for July 28 at 9:45 a.m.

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