UNIVERSITY CITY — The City Council put the final stamp of approval Monday on a $190 million Costco-anchored development to transform the intersection of Olive Boulevard and Interstate 170.
Webster Groves-based Novus Development expects about $70 million in future taxes generated by the development, captured through tax increment financing, to help finance the the project.
University City officials say the agreement will capture $15 million in new tax revenue to be used exclusively on programs in University City’s poorer Third Ward.
The council’s vote Monday follows more than a year of discussion on the project, which drew opposition from people concerned about how it would forever change the northwest entrance to the suburb by requiring the buyout of dozens of homes and displacing longtime businesses in a corridor known for the international flavor of its restaurants.
Though many Third Ward residents were skeptical of the proposal, others saw it as a rare opportunity to boost property values and capture tax dollars to reinvest in a neglected part of town.
The latest version of the agreement with Novus was recommended for approval to the council by University City Manager Gregory Rose on May 27.
A consultant’s error substantially overestimated the amount of expected tax revenue and forced the city and Novus to renegotiate the agreement in February.
University City officials also say the new center will protect the suburb’s revenue if Chesterfield leaves the St. Louis County sales tax pool, which divvies up revenue among dozens of municipalities, including University City.