Unusual Lawrence project would use Costco tax revenue for separate site

Lawrence officials are being asked to consider a $1.3 billion development plan that would use sales taxes generated by Costco, a store in northwest Lawrence that is not part of the project, to help pay for attractions elsewhere in town. The proposal is tied to K-10 Development Group LLC and Wichita businessman Phil Bundy.

About $200 million of the project would come from STAR Bonds, a state financing tool that captures sales-tax revenue from a defined district for entertainment and tourism development. The district would wrap around the south and west sides of Lawrence, beginning near Haskell Indian Nations University and running west and north along K-10. The plan would move in at least two phases, with The 1059 in south Lawrence near U.S. Highway 59 and the South Lawrence Trafficway, and Beacon Landing west of the trafficway near Bob Billings Parkway.

The unusual part is not the scale of the project but the source of the money. In most incentive deals, taxes from the same development being subsidized help pay the bill. Here, city leaders are being asked whether taxes from a separate Costco store, built by a different developer, should be folded into the district so they can support a different set of buildings and attractions.

Those attractions include a sports-focused venue centered on soccer and other field and court sports, an interactive destination built around board games, and a barefoot nature trail. The development team is also considering a $2 million contribution to Haskell Indian Nations University for campus improvements, adding another layer to a proposal already drawing attention for its financing structure.

Costco’s own Lawrence project has been moving ahead on a separate track. In late January 2026, the company filed a nearly $22 million building permit for a 166,000-square-foot store near Rock Chalk Park. The plan includes a 24-pump gasoline station, tire shop and more than 800 parking spaces. It would be Lawrence’s second Costco outside the Kansas City metro area, after Wichita.

Mayor Brad Finkeldei said in December 2025 that Costco and the new convention center would likely be two of the biggest single drivers of sales tax in Lawrence in the past 50 years. That is why the question of who controls Costco’s tax stream matters so much: if the city allows those revenues into the STAR Bond district, they could help finance a separate entertainment corridor on the south and west edges of town. If city leaders reject the idea, Lawrence’s next round of growth incentives will likely stay tied more closely to the projects that generate them.