Earlier this month, the Oakland City Council approved an exclusive negotiation agreement with Costco to develop the city’s first Costco warehouse in West Oakland. The vote to approve the agreement was unanimous, according to an Instagram post from Mayor Barbara Lee.

“Big news Oakland! Costco is officially one step closer to opening!” Lee wrote in the post on Thursday.

While the July 7 approval moves the project along, the opening of a Costco in the North Gateway Development Area of the former Oakland Army Base would still be years away. The exclusive agreement, which Costco will pay $300,000 for, gives the city and the retailer two years to reach a deal, with the option for up to a one-year extension.

Since the former Army base site is environmentally contaminated, part of Costco’s negotiations will include developing a plan to remediate the contamination. Councilmember Carroll Fife, who co-sponsored the resolution alongside the mayor’s office, told SFGATE that it’s during this phase that the city will be listening to community concerns about traffic and environmental impacts, as well as working with AC Transit to reroute buses to the area if the deal does go through.

The project was set in motion last fall when Deca Cos., a San Francisco real estate firm, pitched the city on bringing a Costco warehouse to the site. The last time Oakland considered building a Costco in Oakland at the site was in 2005, but negotiations fell through. Most recently, recycling contractor California Waste Solutions had its eye on the North Gateway site, but the city of Oakland terminated that long-delayed deal in May.

Opening a Costco in Oakland would not only bring hundreds of new jobs to the city but also generate new sales tax revenue for Oakland. Currently, Oakland residents have to drive to San Leandro, Richmond or even San Francisco for their Costco runs, which means that sales tax revenue is flowing to other cities. Oakland residents spend approximately $270 million at Costco every year, according to a city report. 

“My children are adults now, but raising them, it was a staple in my household to go to Costco,” Fife said. “It was always a burden because they are so far away from where we live.”

While residents await negotiations on the long-awaited Costco, the UCSF Benioff Children’s Hospital Oakland is expected to use a portion of the 22-acre Army base site as a temporary helipad while the hospital undergoes renovations, reported the San Francisco Business Times.

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This article originally published at Oakland City Council reveals next phase of plans for city’s first Costco.