There’s no question that water and sewer rates in Palm Coast are among the most expensive in the state. That was true even before the City Council this week approved the sharpest and fastest rate increase in the city’s 25-year history.
Before the increase, the typical house using 4,000 gallons a month paid $91 a month before taxes. The average for public utilities in the state was $68 when last surveyed in 2022. It’s gone up since, but not anywhere near Palm Coast’s rate. Now we have another increase that’ll push those rates by more than a third.
So there’s no argument there. Our rates suck and are going to get suckier. But to hear some of the public outcry, you’d think the increase was due to mismanagement, incompetence, corruption and City Council inaction over the years. None of it is true. There may have been a few missed steps and a miscalculation about how much growth we would or we would not get before Covid “changed the world,” as one council member put it. (Palm Coast’s population grew by 17,000 between 2020 and 2024.)
But aside from a colossal error by the City Council in 2003, none of it would have made a substantial difference, because when Palm Coast bought Florida Water that year for $83 million, it inherited a system near ruin. The $83 million price was insane. It was 232 percent more than Florida Water had paid for when it acquired the plant from ITT’s Palm Coast Utility Corporation just four years earlier. We still owe $60 million.
If there was an original sin, that was it–along with the dubious claim by the council in 2003 that owning the utility would allow Palm Coast to control its own fate. In fairness, the city was also moving preemptively to prevent a coalition of Panhandle cities from owning Palm Coast’s utility and turning into their cash cow. So even the council’s decision at the time was not without its own justifying context.
Still, all it’s done is shift a rickety utility and its ricketier infrastructure onto ratepayers’ back. ITT was not an honorable company then (only its $400,000 bribe to Nixon’s 1972 Republican National Convention saved it from an antitrust case). The infrastructure it left Palm Coast has not been honorable since. The city has been paying the price.
But it’s not as if leaving the utility in private hands would have improved matters. Chances are the rates would have been higher still. In fact, this week’s rate increase is the highest in the city’s history, but not in the utility’s. Thirty years ago Palm Coast Utility Corp. filed for a 34 percent increase, likely because it could see what a ruin it had on its hands. The Public Service Commission stopped it. The utility sued and won, and could’ve imposed any rate hike it wished. By then Florida Water had bought the wormy potato.
What were ratepayers paying at the time? An average of $40 for water and sewer, using 4,000 gallons a month. Adjust that for inflation, and you’re at $78 a month–not that much different from what we’re paying now. The council has been increasing rates in three-to-five-year increments ever since 2003, each time with the Cheshire-smirking lie that it would be the last necessary big increase, each time not increasing them enough. The increases barely broke even with ITT’s crappy legacy. In a counterintuitive way, this week’s rate increase is closer to reality than any before it, though the council repeated its predecessors’ mistakes: it shied off the bolder approach it initially voted for. That rattling sound you hear is parts of the can the council still kicked down the road.
The city’s $615 million dollar spending plan may have been overly ambitious and indebting the city with nearly half a billion dollars more should give anyone pause: an economic downturn robbing the city of new residents will have meant yet another huge rate increase to satiate bond holders. But the package wasn’t unreasonable, given the skeletons in the ground. In the event, scaling spending back to $512 million and a smaller bond issue of just under $300 million was a pragmatic compromise, since the alternative would have been like the city defaulting on its own utility, with catastrophic consequences.
Calls for a moratorium are not illogical. Trucks impersonating icons outside City Hall aside, there’s nothing sacred about construction, just as there’s nothing sacred in any city policy. In Oliver Wendell Holmes’s famous phrase, “the life of the law has not been logic; it has been experience.” Substitute the words “ordinance,” “development” or “moratorium” for the word “law,” and we begin to dispense with dogmas in favor of the reality on the ground.
Something is amiss when you talk of a sewer plant overcapacity and under a state order to get in compliance while buildings keep going up. Slow-walking some development should have been one of the options, and judging from the dearth of new developments in the past year, that may be just what’s going on.
As things stand, an outright moratorium would do more harm than good to a local economy still too dependent on construction. Until the economy diversifies, the city will remain in unhealthy codependency with growth–which does not pay for itself, hence the perpetual ponzi chase after more growth–the way petrostates are disproportionately reliant on their fossil fuels. It’s also rich for any of us to scream and yell for a moratorium while bitching about unaffordable housing–and crucifying most apartment building projects on bogus claims of potential crime or lowered property value. Apartment buildings are the most efficient way to reduce sprawl, improve affordability, diversify our workforce and demographics and create the sort of urban density without which no mass of subdivisions can call itself a city. But that’s another story.
In any case this continuing glimmer of a housing glut will cause its own correction. As the numbers the Flagler County Association of Realtors released this week show, home sales are not where they were two years ago. It takes five times longer to get to a sale contract. The local supply of houses continues to climb steadily: Flagler County had an inventory of 250 houses three years ago. It’s now approaching 1,500. Property values are also not rising as fast.
But whatever correction is under way will be temporary. ITT in 1974 saw Palm Coast as a future city of 600,000. The ocean will claim Palm Coast before that happens. In the meantime, we might see a county of 150,000 to 175,000 by midcentury, with most of that in the city.
Too much? “Obviously” seems too ready, too pat an answer: who’s to apply the same arbitrary judgment on, say, the American population, which has doubled since a campaigning John Kennedy told a Jacksonville crowd how “a rising tide lifts your boats”?
It is also impossible to justify a moratorium regarding the remaining 7,500 vacant lots in the old ITT section of Palm Coast. That’s where the bulk of construction is concentrated. I live on one of those lots. So do most of you. We all got our dream house. Yes, my heart breaks every time another lot’s trees go down. But it’s all in-fill development and I have no moral standing to deny that future homeowner or renter a chance to live there while I’m perfectly happy to live in my block of concrete and lumber where trees also used to be. Those new homes have every right to go up.
As for those utility rates, I just give ITT a special message every time I flush the toilet.
Pierre Tristam is the editor of FlaglerLive. A version of this piece airs on WNZF.
Gene Perez says
This well thought out and well written column lays out the dilemma in a clear and understandable way. It also correctly identifies the error in 2003 that made this series of painful water rate hikes inevitable.
It isn’t clear to me that the recent approval by the City Council is sufficient to fix the problem in the near term. The costs could be higher. For example, the clay pipes originally installed all leak and all must be replaced. It isn’t just the retrofitting of the wasterwater treatment plants that must be accomplished. There are other needs as well and all cost money.
Will the problem self correct? Perhaps, but it will take more time and more money for that to happen.
Critical Eye says
Great article! Thank you!!
Dennis C Rathsam says
One of your best!
Plan ahead says
The city knew what they were buying (over paying for) but did it anyway. Then approved enough construction to overwhelm any current system with no foresight to know they were sinking.
Just maybe being a “cash cow” for others would have been cheaper in the long run
Pogo says
@P.T.
A masterpiece and nothing but the truth.
Lev Goodman says
The way I underwent it is that those skimmers remove the floating waste and pump it to where it gets processed into diarrhea. From there, it’s drained into shallow pools where it dries up and the remaining waste is shoveled away.
brucestone says
Disagree they were pushing for put up fast homes to be built
we need a pass for people over 65 and on a fixincome
pass should be for two years why our other city rates much cheaper
JimboXYZ says
ITT didn’t fail Palm Coast, the growth of the masses failed it. 1980, Flagler County had 10.9K for population, that’s 1/10 of the +/-102K there is today for the City of Palm Coast alone. If the pdf linked is accurate, Flagler County has 155.1K for a population for 2024. When did we go over capacity to force this ? Under Alfin. Beyond it’s inception to become an established community, there has never been this many new residential construction projects. Let’s not blame ITT for what Alfin did to us here. ITT seems to have overbuilt for capacity. And then the one’s that demanded that Palm Coast become something that it was never intended to become ruined it. And that’s why the moratorium has to happen, the approved will exceed capacity of this $ 1/2 billion funding and in a few years bend over & grab your ankles again because they’ll need another STF to catch up, Norris has already told us that by going after a moratorium. And Norris is the only one coming clean on it in March 2025. The rest of them are staying the course of Alfin. It’s just as bad as the dimwits that are fighting Trump II after the Biden era. If we were at or under capacity before Biden, Alfin era growth was never going to pay for this, especially getting nothing in the form of a state grant for STF’s. And after 4 years of Biden/Aflin era nonsense about growth that wasn’t ever going to be funded ? I mean we all saw the list. The STF projects existing upgrades & repairs got zero funding, even the Westward of US-1 Expansion was so grossly underfunded. The money was never there and every employee sat in a meeting and not one of them came up with how this was going to ever be paid for without risking a majority of every retirees reserve to get it done. Retired means retired, they have a fixed income to live on. Even if they could go back to work, the retiree won’t get paid for what the real cost of living & going rate is. Wanna know who is to blame, look at the duplexes that are over utilized. Those are 2/2’s if there are 3, 4 or more cars parked in the driveway & swales, maybe even in the streets, those folks are over utilizing the fresh water & sewage system. It’s simple math really 2 bedrooms, how many was that duplex designed for occupancy ? Not 4 full grown adults showering & flushing.
https://edr.state.fl.us/Content/population-demographics/data/Pop_0401_c.pdf
Greg says
Sad. Our house will be listed for sale Monday, and we are getting out of this insane city. I just hope it sells.
JimboXYZ says
“The city’s $615 million dollar spending plan may have been overly ambitious and indebting the city with nearly half a billion dollars more should give anyone pause: an economic downturn robbing the city of new residents will have meant yet another huge rate increase to satiate bond holders. But the package wasn’t unreasonable, given the skeletons in the ground. In the event, scaling spending back to $512 million and a smaller bond issue of just under $300 million was a pragmatic compromise, since the alternative would have been like the city defaulting on its own utility, with catastrophic consequences.”
The article has a history lesson, but let’s live in the present ? Anyone else find it odd that the 2003 Utility lesson happened under W Bush, a period of property flipping & inflation, that happened to ruin this nation for a bailout economy ? Tell me with a straight face that real estate industry for property flips aren’t happening anywhere in FL. By 2008, that Bush prosperity became the bailout economy of Bush => Obama. And Biden was there as VPOTUS for that mess. The article touches on affordable housing, the housing under W Bush was equally as unaffordable for it’s time, compared to Biden unaffordable, the Bush flipping prosperity economy, housing was a bargain at any point 2001-2008. It was such a mess back in 2003, that the STF’s weren’t over capacity, the State wasn’t fining & litigating to force a new STF that a state grant wouldn’t fund a penny of, much more fund upgrades for the existing STF’s. Enough on the Utilities history though of Palm Coast from it’s founding year to the Jeb Bush/Rick Scott eras .
One has to ask the question about the $ 615 million vs the $ 512 million difference as the “pragmatic compromise, that $ 103 million difference is 20% of the $ 512 million. Where did they find $ 103 million to come up with the “pragmatic compromise”. I wanna hear that explanation of being out to lunch on an amount is, what the difference in capacity was between the $ 615 million option and the approved $ 512 million ? Only because we all like to hear a good story ? About getting something of a marketing concept of a discount, when the starting MSRP was an unrealistic number to start with ? Retailers online are constantly advertising 20, 30. 50, 70 & even 90% off a magical number. Call me skeptical, I think the $ 512 million still is a bloated figure, has a lot of fat to trim off to get to a real number ? It’s like that pork picnic that has a thick layer of skin & fat that nobody eats that part of the pork picnic. It’s not unusual for/unlike a contractor to fudge numbers. Golden Rule of sales, always leave the customer feeling like you did something for them, even if it’s just the illusion of doing something for them ?
Nunya Biznus says
Great article. I do believe the current city administration is doing their best to make applesauce out of the bag of road apples they have been handed with the utility infrastructure. Having spent 16 years working for one of the largest POTW in the Northeast, I am amazed at the lack of upgrades and accountability to industries here in Palm Coast. There is no surcharge program, no pretreatment, no FOG testing. It is not sustainable for the small plants to handle future industrial growth that would be the economic diversification needed.
Residents here also need to understand the meaning of the Consent Decree issued by FDEP. Palm Coast has no choice but to upgrade the plant capacity as Plant 1 has exceeded their permited GPD for more than a year.
Greg says
I always wondered why i got bacteria infections since moving to palm coast. Literally the water supply has sewage in it! The whole town is sitting in a sewage and swamp!
t.o. Doug says
This is very enlightening, but still doesn’t excuse overdeveloping, not charging reasonable impact fees until last year, or sticking with (and paying for) pep tanks as residential building exploded.
JimboXYZ says
Connecting dots here, the Utilities hike, how related is it to the Alfin era grants that were grossly underfunded & then cut by the State ? The list is provided in the FlaglerLive link below:
https://flaglerlive.com/desantis-vetoes-palm-coast/
Hmmmmm, the grant wants/requests were $ 496 million, $ 151.13 million was the initial underfunding across the board, $ 46.52 million was vetoed. That means the grants covered $ 104.61 million was what Flagler County got as a whole.
The pragmatic solution is $ 512 million. The Utility increase will essentially cost more in borrowing debt than the State Grants requests were supposed to be as fully funded for the county ? Flagler Beach is going after a utilities hike ? The beach thing, they want a tax/fee and whatever else the local government(s) can create a funding source from existing citizens. The numbers are bouncing around all over the place.
https://flaglerlive.com/palm-coast-leans-bond/
Get a good watch of DOGE interview (linked below), do we need a DOGE for Palm Coast & Flagler County. The numbers add up way too conveniently. This has a lot less to do with the ITT utility that was built +/-60 years ago. It has more to do with the last 4 years of Biden & Alfin, even what DeSantis had to work with for Grant money whether there was State funding sources, perhaps included some Federal funding that sifted it’s way down to the State & eventually divied up among all State of FL local county & city governments.
Adam Friedland says
What ever happened to the new treatment plant they were building next to the Wawa on A1A?
celia pugliese says
Jimbo: this is one of the problems “always throwing the blame to whoever is not the cause of the blame”. Whether you blaming Biden and everyone else blaming ITT. The root of the problem started in the very late 90’s when Palm Coast was still unincorporated under the foot of Flagler County and the FCBOCC decided with ist chair Jim Darby not to exercise “the first right of refusal rights” to buy the ITT utility serving Palm Coast and instead let it go to Florida Water when Palm Coast was then the largest unincoporated community in the county served by the utility! The county let it go for 25 millions if so as I heard then was less…while I attended our only government meetings then the FCBOC Commissioners. I told them do not let our utility go to Florida Water buy it, help us as the Wall Street investirs backed little counties Milton in the panhandle 3 years later were after it as great investment! Because Palm Coast already started the referendum to incoporate in 1999 given the disastrous county government exercised over us. But NO, FCBOCC with chair Darby said would not fight the big tkt lawyers of Forida Water that “wanted our utility” . Why the hell do you all think included Pierre, that didn’t live here in the 90’s, Florida Water and Wall Street backed Panhandle towns and others wanted so0 deperately buy our utility and were fighting nail an tooth for it? Because was a good investment then in 1999 and 2003. What should have been investigated is why in onlky 4 years later Florida Water sold it back to us PC for 83 gounging usure millions! We had to pay for it or Wall Street would have owned it and if so ….now we will be paying 500 a month in water! The water company was fine until fell on the hands of the Netts administration. The Mayor of “we have no debt” and made sure we had a great cash cow utility reserve funds that were incorrectly used to build a city hall defeated in referendum to buy land and costly widening infrastructure in South OKR and Boulder Rock Dr to benefit town center 5 millions then for its CRA those tens of millions spent 20 years ago in non intended utility projects are the hundreds of millions needed today. Our utility is broke right? And I attended a city meeting at end of 2024 were the council and Mayor approved and extension of the utility infrastructure south of Rte 100 in OKR for new development costing 10.5 million and a 13 acre drainage pond in north Palm Coast to replace the giant 279 acres of our Matanzas Golf Course sponge allowed to be sold in foreclosure for 200,000 only in early 2000’s and now plugged by development. Just digging that 13 acres pond costs 10.5 millions to the utility to drain the L section and adds value to any current or “incoming new development” there. Insufficient impact fees for 25 years and every 10 millions used here or there from our fees to pay non intended uses, like expand our current installation to serve unfunded growth other than repair, improve and expand “existing infrastructure” is what brought to the current utility situation by subsequent Palm Coast first elected government and their administrators since we incorporated. Why ya’ll think that those sounding the alarm like Mr. Flanagan and Ms. Reese were forced to leave the stage, after alerting or trying to alert us the rate payers and council about the current situation…? Utility Director (does not mean he financially runs ) and for many years Mr. Flanagan in February 2024 (in I meeting I attended) told us, the increase was given to growth: https://www.observerlocalnews.com/news/2024/feb/14/city-council-members-question-necessity-of-proposed-utility-rate-hike/. I would add unsustained growth or = rate payers paying for it! This is not the fault of ITT…lets stop beating the dead horse and instead place the blame were due, in special interest using our utility as cash cow manipulated by past County and current Palm Coast elected and administrators. Mayor Norris is straight to the point questioning the main 3 administrators most of them on their seats for decades to tell us why was allowed our utility to get to this point. Those telling our utility directors ‘what they want ” while benefitting developers and other interest, instead of “what is needed” so we rate payers do not have to get gouged.
MITCH says
The city has had 25 Years to fix what they took responsibility for from ITT. Roads / Utilities infrastructure and yet we are being pushed to the limit now when inflation has materials and labor the highest in our history. That is poor management that has harmed families for 25 years. IRRESPOBSIBLE!!!
JimboXYZ says
Line Item # 2 of the list, Flagler County Beach Restoration/Coastal Stabilization Project, amazing the State Grants of $ 496 million includes the first effort to restore & stabilize the beach. I sthat included in the $ 512 million currently approved ? Yet here we are in 2025 debating tax increases, whether those are property taxes or local sales taxes of 1/2 cent, whether there’s going to0 be additional for relatively exclusive tourism taxation line item for 18 miles of beaches. I’m thinking there’s something in those numbers that are a contingency reserve for the Flagler Pier for future pier wash aways ? I just see the water bill being jacked to pay for all of this growth, that doesn’t include the new STF or repaving a single road. Where are those projects ? Is that going to be in the next round of jacking the cost of living for Alfin’s Vision/Imagine of 2050 as the legacy of fiscally irresponsible, the growth that never pays for itself ? And going thru that 44 page document, this is nothing, but new & existing STF’s for a proposal. How messed up are the models & spreadsheets that when the State Grants were being sought after, that the numbers for asks/needs were so grossly & materially understated & even worse, the Grants simply were a lobby effort for funding “the experts” SWAG at any estimate that wasn’t even close to be any encouragement to approve a Vision/Imagine of 2050 ? Just me, but I think they knew the Grant numbers were smoke & mirrors to get the commit, wouldn’t stand up to a 3-5 year plan even. I mean any of the options in the proposal indicate that there would be additional bond need in the event any of the proposals is insufficient funds. Heed the warning, they’ll be coming back for more money, there won’t be any rollback for a give back for beating their estimate(s), that much is certain from future water rates eventually being tied to the CPI for inflation. Anyone still think Biden-Harris is worth defensing for ever having happened to America ?
https://flaglerlive.com/desantis-vetoes-palm-coast/
The dude says
“The Bush Prosperity”…
O Jimbo, you’ve truly outdone yourself with that one…
“This sucker could go down”….
Let’s review the country’s situation as the last two GOP morons left the office of POTUS shall we?
W – gas was like $1.75 because the recession him and Turdblossom caused was so deep, nobody could afford to buy it. (Probably because they were all losing thier houses to foreclosure)
The orange stain – We couldn’t even buy toilet paper or paper towels, and we were stockpiling ammo when he left office last time.
Yep, those were the good old days…
HAHAHAHAHAHA
THIS, my friends, this is why this place will only get shittier, not better. Folks like Jimbo who are challenged when it comes to historical facts. This mindset prevails far too much here to allow anything to get better.
bill says
Greed, Greed. and more Greed. Keep on building the crappy homes with carpenters and other trades that received their training on line. Its was a good thing that i was renting here when they build my house. The mistakes were disgrac3eful, 10 workers and only one spoke english. one year later and the builder moved to the west coast and declared bankruptcy