The controversial plans to raze the park and rebuild an Ottoman-era army barracks on the site, which is adjacent to the main Taksim Square, have been included in the Istanbul municipality's strategic agenda for 2015-2016.
The total budget for the project, named "The Urban Reconstruction of Taksim Square and the Taksim Barracks," is set at 12 million lira ($5.4 million, 4.3 million euros), private Dogan news agency said.
The municipality, controlled by the ruling Justice and Development Party (AKP), confirmed the plan but said that it would be subject to a court ruling and would then be put to a referendum.
"But even if the court rules in favour of the redevelopment, there will be a referendum in any case."
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The plan includes the construction of a replica of the barracks -- known as the Topcu Kislasi in Turkish -- which was built in the early 19th century during the reign of Ottoman Sultan Selim III.
The barracks, seen as an assertion of the Ottoman Empire's might and its Islamic heritage, were demolished in 1940 by the secular government of the time on the advice of French urban planner Henri Prost.
Eight people died and thousands were injured in the ensuing violence as police launched a brutal crackdown, frequently employing tear gas and water cannon.
In a bid to end the protests, President Recep Tayyip Erdogan, who was then prime minister, agreed to halt the park's redevelopment and offered to hold a referendum.
A court later overturned a judgement allowing the redevelopment of the park because of a lack of public consultation.
Yesterday night bulldozers began digging to erect a bus stop just outside the Gezi Park but workers had to stop following an angry reaction from activists.
By today, the space had been well-covered with grass.
Erdogan's government is frequently criticised for its ambitious construction plans that include a third airport in Istanbul and a third bridge across the Bosphorus.
He has also come under fire over a new 1,000-room presidential palace in Ankara that is costing Turkey more than USD 600 million.