- October 7, 2024
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Going forward, should a Palm Coast Council want to consider implementing a franchise fee, the idea will have to first be approved by residents in a referendum vote.
The Palm Coast City Council passed a resolution on June 18 requiring any future City Council to place any potential utility franchise fee up for public vote before that council can begin negotiating a contract. The language in the resolution was changed during the council’s meeting to make the outcome of that vote binding.
City attorney Marcus Duffy said a “binding” referendum vote simply means the council will be bound to follow through with the majority vote. If residents vote no, he said, that’s the end of it; if they were to vote yes, the council could then begin negotiations on a contract.
A non-binding referendum vote would still have allowed a council to move ahead with a contract, regardless of the public’s choice on a referendum
Vice Mayor Ed Danko said residents had a right to decide on whether a franchise fee is ever implemented in the city.
“This doesn't prevent a franchise fee,” Danko said. “This just puts the burden on us to convince the public that it is necessary, and to me, that is just so important.”
This doesn't prevent a franchise fee. This just puts the burden on us to convince the public that it is necessary."
— ED DANKO, Palm Coast vice mayor
The council voted 3-1 approving the resolution, with council member Nick Klufas dissenting and council member Cathy Heighter absent from the meeting. Though he voted in favor, Mayor David Alfin pointed out that the referendum requirement might push away Florida Power & Light in the future. The power company had backed away from a previous fee discussion in 2023 because of a possible referendum vote.
The resolution passed on June 18 was not tied to a particular franchise fee. Instead, the item is 10 months in the making: Vice Mayor Ed Danko first motioned to require a referendum vote for future franchise fees after a FPL franchise fee contract was not approved last August.
Over the summer in 2023, the council was considering a franchise fee contract with FPL that would add a fee of between 0.5% to a maximum of 6% to residents' utility bills. After much heated debate, council member Theresa Carli Pontieri proposed the FPL franchise fee contract go up for a referendum vote during every general election.
Reviewing the July 25, 2023 meeting on Palm Coast's YouTube where it was discussed, former City Manager Denise Bevan told the council “for FPL, [a referendum] is not feasible for them.” Bevan, upon questions from Danko and Pontieri, clarified that FPL specifically took issue with the contract's rate going to the voters.
Klufas said he had concerns about the accuracy of information residents had regarding franchise fees. Using the FPL contract as an example, Klufas said that because the fee is a percentage based on usage, big box stores, businesses and even hospitals would pay much more than a family in a single-family residence would.
We are going to have to figure out a way to fund our priorities."
— THERESA CARLI PONTIERI, Palm Coast City Council member
Combined with a lowering taxes in another area to accommodate the increase on the electric bill, he said, and residents could actually end up paying less.
But he said he felt the information that came out of the previous franchise fee discussion was “misrepresented a lot.” He said he doesn’t feel residents understand how much an electric franchise fee could offset the difference in between residential and commercial taxes.
“I don't trust the communication that happened, and the educational moment that has occurred, to be the most truthful,” Klufas said.
Pontieri said that had faith residents can and would make educated choices for themselves if given the opportunity and information, just as county residents did when they approved the half-cent sales tax for Flagler Schools in 2022.
At the same time, she said, the city needs to find ways to fund its infrastructure projects.
“We need to be very mindful the fact that, yes, while we are entering into this agreement, money doesn't grow on trees," Pontieri said. "So we are going to have to figure out a way to fund our priorities."
