What's at stake:
A new Costco for North Fresno is heading to the city council for approval in the next few weeks.
In a unanimous vote Wednesday night, the Fresno Planning Commission recommended to approve the relocation of Costco farther north near El Paseo – and exempt Costco from paying roughly $40 million in city developer fees — money the city could have used to fund bus routes and bike and pedestrian trails.
The new Costco on Herndon in northwest Fresno would generate about 130,000 miles of car trips, according to official documents. The city’s new mitigation program, meant to discourage suburban sprawl, charges $295 per unit; for Costco, that comes to roughly $40 million in foregone fees.
The 5-0 vote – with two commissioners absent – recommends the City Council exempt Costco from paying the fees, clearing the way for the long-stalled relocation from Shaw Avenue.
To defend the project’s new climate analysis, the city has fallen back on a 12-year-old greenhouse gas plan adopted during the Obama administration.
“They’re trying to say something is on fleek in 2026,” Daniel Brannick, a local attorney who sued the city over the relocation project in 2024, said of the city’s reliance on the older plan. “A 12-year-old document doesn’t fly in 2026. It’s out-of-step.”
Last July, Fresno County Judge Jonathan Skiles ruled that Fresno’s environmental analysis for the Costco was fatally flawed because it relied on a 2021 climate action plan which the courts threw out in 2024. Skiles also found the city had violated its own zoning code by approving a warehouse operation for the Costco that the code does not allow in commercial zones. The City Council rescinded all project approvals last November.
The relocation, planned roughly two miles north of the existing Costco’s 1985-era Shaw Avenue store, continues a long Fresno trend: anchor stores leaving the Shaw and Blackstone corridors for the city’s northern edge — moves that produce few new jobs while accelerating blight in the city’s legacy neighborhoods, research has shown.
Only two members of the public spoke at Wednesday night’s hearing — Brannick, the attorney, in opposition, and Doug Jensen of Jenco Farms, the seller of the 22-acre site for Costco, in favor.
Does Fresno want to save Costco $40 million instead of building pedestrian trails?
Brannick saved his sharpest criticism for the city’s vehicle-miles-traveled mitigation fee program — a citywide system designed to offset the climate impacts of new development by funding traffic-reduction projects elsewhere.
The program is engineered to handle roughly 67,429 miles of VMT across all of Fresno’s pipeline development, Brannick said. The new Costco alone would generate about 130,000 — nearly double what the city’s program was meant to accommodate.
The exemption is a window into how the costs of sprawl go unaddressed due to city planning decisions.
Had Fresno’s planning department applied its VMT program — to make the true costs of sprawl visible to developers — Costco might have weighed rebuilding its existing Shaw Avenue store and keeping a major anchor that delivers foot traffic to the city’s aging commercial core. But, the planning department charged $0 instead of $40 million.
The basis for the exemption is a grandfather clause: The city and Costco’s lawyers say the project was already in the permits pipeline when the VMT program was adopted late last year.
Eric Phillips, a land-use attorney with Burke, Williams & Sorensen representing Costco, told the commission the VMT fee program expressly excluded projects in process that had completed their transportation analysis.
“There therefore is no legally feasible mechanism to apply that as mitigation to the project,” he said.
Brannick described the vote as a massive giveaway. The Costco EIR was redone this year — after the city created the developer mitigation program.
“The amount of money that is potentially being foregone here is almost twice the city budget deficit,” said Brannick. “Even paying half would close the city’s budget gap.”
The exemption is also unusual by California standards. The city of San Diego’s equivalent rate is $1,400 per unit of VMT — nearly five times Fresno’s. The county of San Diego’s is even higher: $19,000, or roughly 64 times more expensive than Fresno’s $295 rate.
Meaning if a comparable Costco were proposed today in San Diego under that city’s program, the same trip generation would trigger roughly $180 million. In Fresno, the planning department let the fringe shopping center go up paying nothing.
On the climate analysis, Phillips, Costco’s attorney, said the updated review does not rely solely on the 2014 climate change plan, but takes “a conservative approach” that looks at multiple metrics across state, regional and local plans.
For years, Fresno officials have raised the specter of Costco fleeing across the river to push the project through quickly at the city council.
Days after Judge Skiles’s July 2025 ruling, City Councilmember Mike Karbassi told GV Wire’s “Unfiltered” podcast that Costco could “jump the river, go to Madera, or to go to Clovis or anywhere else.”
But last month, the Governor’s office poured cold water on those threats.
Newsom’s office recommended Madera County to charge about the same as the city of San Diego: $1,515 per VMT. In other words, Costco moving to Madera would cost the popular warehouse a ballpark $200 million in mitigation fees – if they actually applied the governor’s recommended fee towards a similar number of car trips in the Fresno location.
What the city did this time
The planning commissioners did not discuss the exemption of the fee, which went into effect late last year. City planner Steven Martinez told the commission the revised environmental impact report only re-did one section: greenhouse gas emissions and climate change.
Rather than write a new climate action plan, the city took a different approach. The new analysis evaluates the project against whether it would conflict with state greenhouse gas reduction goals, and whether it would conflict with applicable greenhouse gas plans at the state, regional and local levels. For both, Martinez said, the city concluded the project would have a less-than-significant impact.
To address the part of the ruling about whether a ‘warehouse use’ is allowed, the city offered a new legal argument on the zoning question. The 219,216-square-foot warehouse and its roughly 47,000-square-foot delivery operation, the city now argues, are a single integrated “large-format retail” use — not a separate distribution warehouse. As a backup, the city contends the delivery space qualifies as an “accessory use” to the retail floor, citing comparisons to Walmart Supercenter, Best Buy, Lowes and Home Depot.
Commissioner discussion and vote
Commissioner Gurdeep Shergill pressed Costco’s planning consultant on neighborhood traffic, citing the Sentry and Lennar housing developments and Rio Vista Middle School in the surrounding area. They were assured by Costco’s planning team that those traffic routing patterns were addressed.
After the public hearing closed, Shergill made the motion to recommend approval; Commissioner Jacqueline Lyday seconded. Commissioners Lyday, Linda Calandra, Diaz, Shergill and Vice Chair Kathy Bray voted yes. Chair Peter Vang and Commissioner David Criner were absent.
Next steps
The project goes to the Fresno City Council in two weeks on May 21 for a final vote on the rezoning, plan amendments, conditional use permits, and certification of the environmental impact report.
Brannick told the commission he’ll be back.
