- November 23, 2024
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After months of debate through a consultant, Flagler Beach has granted easement rights to a digital infrastructure company to build a cable landing site in the city for $600,000 upfront.
The site is located at South Sixth Street in the right of way. The agreement is with DC Blox, a digital infrastructure company. A cable landing station is where underwater internet fiber optic cables makes landfall.
The landing site at Flagler Beach would have six cables that would connect to a data center. In March, DC Blox first approached Flagler Beach, presenting the landing site as the first step in a large data center planned for Palm Coast.
Palm Coast Mayor David Alfin confirmed that the data center is planned for Town Center. He said the Flagler Beach easement approval was the final step in the process in beginning the data center.
Alfin said several city employees in Palm Coast have signed Non Disclosure Agreements preventing them from talking about the data center until the project is further along.
Alfin said he has not signed any such agreement, but, in turn, does not know much about what is planned.
What can be confirmed is that DcB Orchid LLC, the parent company to DC Blox, purchased 34 acres of land at 1035 Town Center Blvd from Florida Landmark Communities for $3.3 million. The sale went through in October 2023. The property is located near Royal Palms Parkway and Town Center Boulevard and next to a Florida Power & Light property,
According to its website, DC Blox owns and operates “edge-market data centers,” a regional Southeast network and managing a critical cable landing station — like the one planned for Flagler Beach — in Myrtle Beach, South Carolina.
The undersea cables that connect at the landing site in Flagler Beach would then connect to the data center.
The project — titled Project Orchid in the March 2024 commission meeting packet — will likely attract additional business opportunities for the cities and residents and businesses alike would have access to faster, more reliable internet speeds, according to the meeting documents.
When DC Blox first approached Flagler Beach in March, it originally proposed two locations, at North 11th Street and the South Sixth Street location. There was some consideration on the company’s part of using Veterans Park, but it was quickly vetoed by the commission, according to city meeting documents.
The original financial proposal presented to the Flagler Beach Commission stipulated that DcB would pay $100,000 for each of the first two cables landed in the city, totaling $200,000. The North 11th Street site has since been dropped.
Who pays, and when?
Much of the debate over the last five months of mediation has been over the contingency of the funds.
Flagler Beach’s consultant, Michael Tammaro, valued the South Sixth Street landing site at $1.2 million, which DC Blox agreed to. But Tammaro was recommending that DC Blox pay Flagler Beach $800,000 immediately, with the remaining $400,000 to be determined at a later date.
DC Blox Executive Vice President of Sales Chris Gatch, said the $600,000 upfront for the first three cables, was as high as the company was willing to go. The city would receive $200,000 per cables four, five and six as each is installed. Tammaro argued in his letter to the city that the compensation to the city should not be contingent on the installation of the cables.
Gatch said he did not have authorization to negotiate at the meeting.
“We just reached a point where we felt like we had offered what we could offer,” Gatch said.
Commissioner Jane Mealy said she did not like the idea that the company could feasibly just install a few of the cables, and then leave the city without installing the others.
Attorney Drew Smith said that is the nature of the contingency.
“They absolutely have that right. We don’t control their business,” Smith said.
But, with the negotiated proposal, DC Blox would still pay Flagler Beach $600,000 right away, without installing any of the cables.
Commissioner Rick Belhumeur had concerns about the placement of the site’s grounding beds, which would be placed underground, interfering with city’s future planned projects.
Belhumeur said the beds on DC Blox’s plans are right where the city plans to make installations for the flood mitigation project and where the city could one day need to expand the library or the Wickline Center in the future.
“I won’t vote for this with those grounding beds where you have them. So it’s not just about the money with me,” he said.
The commission approved the DC Blox’s financial proposal presented at the Aug. 27 meeting in a 4-1 vote, with Mealy dissenting, but added the following stipulation: DC Blox must find a way to place the grounding beds within the right of way, as approved by Flagler Beach.
Though the Flagler Beach commission approved it, the DC Blox representatives will need to present the decision to their board for approval. If approved by their board, it could still take over a year to begin construction.
In March, Gatch said that it would take over a year to get the permitting with the U.S. Army Corps of Engineers before it starts its construction. The plan, at the time, was for the construction work to happen over the winter of 2025.
Email sierra@observerlocalnews. com.
