Officials are expecting the California Health Care Facility Stockton to give an economic boost to the area.
While it's being built, up to 1,700 construction workers are expected to be hired.
Once finished, about 2,400 people would be employed at the 1,722-bed facility.
Stockton city leaders and San Joaquin County officials are expected to vote on the settlement Tuesday.
Details of the settlement will be released once the settlement is approved.