A conditional-use permit (CUP) to allow Costco to build a members-only, 16-pump gas station on a parking lot adjacent to its Signal Hill store may go before the Signal Hill Planning Commission during a public hearing in August, according to planning staff.
The project requires a CUP and zoning-ordinance amendment before the wholesale retailer is able to start construction. The current zoning of the site prohibits a gas-station use, stated Scott Charney, the City’s community development director, in an email.
If the planning commission approves the zoning amendment and CUP, the proposal would then go before the City Council for approval, he said.
Costco plans to build the gas station on a parking lot between the stand-alone Wells Fargo ATM and the main Costco driveway at Dawson Avenue, according to a June 11 staff report for a planning workshop on the project. The property is split between Costco and the owner of the Town Center East retail center.
It is unclear how long the project will take and when construction will begin, Charney stated. Costco representatives could not be reached for comment before the Signal Tribune’s deadline.
According to city staff, the gas station would take out 119 parking spaces at the site. As a way to mitigate the loss of parking, Costco proposes to remove several islands of landscaping on its own property, providing 72 spaces worth of replacement parking. This would result in a net loss of seven spaces and the removal of mature trees at the store’s entrance.
Though no replacement parking is being provided for the Town Center East site, city staff notes that the number of spaces provided just meets the City’s requirement of 761 spaces at the Town Center East property and exceeds the required 551 spaces for Costco.
Costco’s traffic consultant is currently preparing a traffic study on the project, and the public hearing may go before the planning commission in August depending on whether or not the study is completed by then, Charney added.
The City’s traffic consultant has reviewed the site plan and concluded there would be adequate traffic flow but “congestion is inevitable at the main driveway where traffic exiting the gas station will be concentrated,” according to the staff report.
City staff notes that the new Costco gas station may create a boost in sales-tax revenue for the City.
Signal Hill’s sales-tax consultant has indicated that Costco stores that have gas stations generate 15 to 18 percent higher sales than those without gas stations, with the increase attributed to fuel sales and an incremental increase in store sales. City staff also notes that Costco “believes offering a full array of services is critical to the success of the local store.”
Costco has wanted to add a gas station to its Signal Hill location for years but has been restricted by several constraints.
The more than 137,000-square-foot building is smaller than other warehouse stores that currently have gas stations, such as the store in Lakewood that is 14-percent larger than the Signal Hill location. The Signal Hill Costco is also limited by steep slopes to the south, previously abandoned oil wells scattered throughout the site, a multi-family residential complex to the east and the need to maintain adequate parking, city staff said.
The staff report notes that Costco’s warehouse store at 2200 E. Willow St. has gone through a number of additions and improvements throughout the years since the company took over the store from Price Club in 1993.
Recently however, Costco was able to reach an agreement with the owner of the Town Center East retail center that now allows the company to take up a portion of the property owner’s land.
Preliminary plans call for four fueling islands with eight fuel dispensers, providing 16 fuel pumps. The gas station would be covered by a 32-foot by 120-foot canopy, with four externally illuminated signs. There would be three underground additive-storage tanks, with a 30,000-gallon capacity each, and one underground additive-storage tank, with 1,500-gallon capacity.
Unlike other gas stations, the Costco station would only provide access to its members, and a membership card would be required to activate the pumps. The self-service gas station would also have a minimum of one staff person on the site at all times to meet customer-service needs and have limited hours of operation. Proposed weekday hours would be from 6am to 9:30pm, and weekend hours would be from 6am to 7pm.
Signal Hill planning staff notes that the proposed site is located where there was a previously abandoned oil well. In accordance with the City’s Interim Development Standards regarding development projects over abandoned oil wells, Costco has located the well, surveyed its location and conducted a leak test, city staff said.
Staff adds that “the well was not found to be leaking, and a vent cone was installed which allows the project to move forward.” Costco’s survey also documents that the nearest structure to the well, an equipment room, would be 50 feet away, which exceeds the minimum separation requirement of 10 feet.
Charney said there are currently four gas stations in Signal Hill, two of which are partially located in the City. There is a Chevron station across Cherry Avenue at Willow Street and a Unocal station at Cherry Avenue and 28th Street. He said there are also two gas stations, a Chevron and a Unocal, in the north end of Signal Hill on Wardlow Road, however they are both partially located in Signal Hill and Long Beach.
For the Fiscal Year 2013-2014 budget, the City is anticipating gas prices to go down as gasoline consumption continues to decline. As such, the City projects sales-tax revenue from fuel and service stations to be down 4 percent over the previous fiscal year.