Cypress OKs a Costco on Once-Disputed Site

Finally realizing a plan that began 12 years ago -- and then detouring through courtrooms and grabbing national headlines -- the Cypress City Council has unanimously approved construction of the city’s first superstore.

“We are very pleased,” David Belmer, assistant city manager, said Wednesday after the council’s 4-0 approval this week of a 150,000-square-foot Costco on 14.9 acres owned by the Cottonwood Christian Center along Katella Avenue near Walker Street. “We are primarily a residential community with limited shopping opportunities. This project will be the first step in correcting that.”

In addition, he said, the store -- expected to be completed by November -- will generate about $1 million annually in property- and sales-tax revenue.

“It’s more important than ever that cities generate those revenues,” Belmer said, “because more and more city revenues are being taken as a result of the state budget crisis. Communities like ours need to find ways to stand on their own feet financially, and retail commercial development is an excellent way to do that.”

The project was nearly derailed two years ago when Los Alamitos-based Cottonwood, which bought the parcel in 1999, filed a lawsuit challenging the city’s rejection of its plan to use the land to build a 4,700-seat sanctuary, preschool, bookstore, coffeehouse, meeting facilities and youth center.

In August 2002, a federal judge temporarily halted the city’s alternative plans for the Costco, a decision the city appealed.

A year ago, however, the two sides reached an agreement that signaled an end to the nationally watched battle pitting a city’s redevelopment rights against a church’s freedom of religion.

Under the accord, the church sold its 18-acre site to the city for $18.8 million -- a profit of about $5.3 million.

In return, the church won the right to buy a 29-acre portion of the nearby Cypress Golf Course for $17 million from Ed Allred, who also owns Los Alamitos Race Course.

“The way I see it, [it] is nothing short of miraculous,” the church’s senior pastor, Bayless Conley, said at the time.

Said Belmer on Wednesday: “We were very pleased to be given an opportunity to create a situation where both the city and Cottonwood realized their goals.”

Escrow on the deal is expected to close in April, he said.