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Theresa Pontieri led the way in pushing for a smaller plan, which will cost less but comes with risks.
The Palm Coast City Council voted on a compromise, on March 18: In order to save about $7-$9 per month on the utility bill for an average household by October 2028, the council will delay $140 million of utility infrastructure improvements, which could noticeably impact residents.
The infrastructure improvements that remain will still cost a total of $512 million, and bills will still go up for residents by an amount of $23-$28 per month over time.
“The projects we are including are necessary” to satisfy the Florida Department of Environmental Protection, Vice Mayor Theresa Pontieri said. “So I say, ‘This is what we have to do.’ We cannot say, ‘We don’t want any increases.’”
Pontieri was the driving force in asking for a reduced funding option, saying she didn't want the residents to pay for improvements that she felt developers should have paid for. She voted against the full plan on March 4.
Although the increased rates will burden local residents, fixing the wastewater treatment issues is necessary to enable the city to attract jobs and reduce tax burden on the residents, she said.
“We are on the brink of securing some really great economic development projects,” Pontieri said. “We need to keep the healthy growth moving forward. … We need to stop being a net exporter of workers.”
Mayor Mike Norris acknowledged that there was really no option but to pay for improvements; he voted in favor of the full plan on March 4. “We have to do it,” he said again on March 18.
But, Norris fulfilled his promise to vote against the utilities plan increase this time, since no moratorium was approved earlier in the meeting. Pontieri and City Councilmen Ty Miller and Charles Gambaro also voted for the plan, which passed 3-1.
FUNDING AND RATES
The $512 million of improvements will be funded by the following breakdown: 57% by bonds, 23% by developers’ impact fees, 15% by residents’ utility bills, and 5% by grants and other loans.
Impact fees, which can only be used to expand infrastructure capacity — not repair the 50-year-old existing infrastructure — were raised by the City Council to the maximum allowed by the state about 18 months ago. Other building fees are also being increased.
A second bond could be sought to complete the $140 million.
The approved schedule of rate increases is as follows: two 8% increases (one on April 1, 2025, and again on Oct. 1, 2025), followed by three 4% increases on Oct. 1, 2026; Oct. 1, 2027; and Oct. 1, 2028.
A home that uses 2,500 gallons per month currently pays about $73 per month, and on Oct. 1, 2028, the bill will be about $96. By comparison, if all the improvements were to be undertaken, the bill for that household on Oct. 1, 2028, would be higher — about $103. Therefore, the approved plan saves that household about $7 monthly.
For a home that uses 4,000 gallons per month, the rates would increase from $91 today to about $119 on Oct. 1, 2028, with the plan that was approved. The fully funded utility plan would have risen the rates for that home to more than $128, so the vote saved that household more than $9.
Raising the rates in any way was unpopular among many residents.
“Y’all are robbing the elderly people,” said resident and business owner Jeremy Davis. “I’m going to ask for accountability.”
Kaleigh Rickard, who also owns a business in town, had a different perspective: “I am in favor of a utility rate increase.” She criticized Norris for “merely mentioning a moratorium.”
“It lives forever on the internet,” she said. The community needs to attract commercial and industrial jobs, and “the commercial sector is watching the headlines, and they’re going in a different direction. … We have work to do to bring this community to somewhere people will actually want to come to.”
THE RISKS
Delaying some of the recommended projects comes with significant risks: higher future costs, more stormwater intrusion through leaky pipes, more potential sewer overflows into city streets, and lower drinking water quality.
It’s possible, depending on the rate of growth, that the the city will satisfy the DEP’s current decree in the short term, but then face another decree in the next few years because of the projects that have been cut.
Gambaro asked the city’s Stormwater and Engineering Department director, Carl Cote, to explain the risks in detail.
“So if we get rid of this project,” Gambaro said, for example, “we will continue to send out messages: ‘Don’t flush your toilet.’”
Cote said yes, that was true. Moreover, the city's water will not be improved to advanced treatment methods, which would have been more environmentally friendly.
Gambaro had advocated to fund the full $651,468,130, but, knowing that he was in the minority, he was willing to compromise to make sure that at least the $512 million of projects was not jeopardized.
THE ALLIES
Pontieri pointed out that, although many in the audience were critical of the homebuilding industry — trucks lined the parking areas surrounding City Hall to protest a possible moratorium before the meeting — they also wanted the utilities to be improved.
Next week Pontieri and other members of City Council will be petitioning state legislators for funding help for utilities — and so are the homebuilders.
“It’s not a resident thing, it’s not a builder thing, it’s not staff thing … it’s an us thing,” Pontieri said. “We all need water.”
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