Last November the consultant Palm Coast government had hired to study the city’s utility rates ahead of an increase framed its conclusion in the worst possible way for a council facing criticism almost every time it meets from residents complaining about too much growth. Water and sewer rates would have to increase substantially, the consultant told the council, because of growth: the city’s infrastructure is not keeping up. The consultant, in other words, was giving credence to the critics, who want the city to slow its growth.
The consultant, Eric Grau of Jacksonville-based Stantec, the design and engineering company, was projecting capital needs of $635.7 million between 2024 and 2033, of which $225 million would be needed in the next three years. Even the city’s flush utility doesn’t have that kind of money.
Water and sewer bills would have to go up by 18 percent in three years, though the city could ease the blow by creating a tiered system that would encourage water conservation. Those who used less water would see somewhat smaller bills. And the city would have to sharply increase its utility impact fees, those one-time taxes levied on new homes and businesses to defray the “impact” of development. (See: “Consultant Says Palm Coast Residents Must Pay Cost of Future Growth With Higher Water Bills. Council Recoils.”)
Palm Coast Mayor David Alfin was was ill (nothing to do with the study’s conclusions) so he was not at the council for that discussion. But the idea of a tiered system got support from Council members Theresa Pontieri and Ed Danko. The city administration is also encouraging a tiered system, because it encourages conservation. Such a system is already in place, but additional tiers would limit cost increases at the lower end of the consumption scale.
There was no conclusive agreement at the end of the November workshop, with council members looking for additional models that would reduce the need for sharp rate increases.
Today, the consultant returned, along with Utility Director Mike Flanagan, and this time Alfin was there, too. So was a new rate tier. But the long segment on the revised rate study did not end anymore conclusively or hopefully, probably because the bottom line from the consultant was not much different than it was in November: the city is facing steep utility infrastructure repair and construction costs. Existing rate-payers must assume some of those costs, and any way the consultant slices it, it ends up being around 18 percent over three years.
In fact, the proposal the administration supports would have rates going up 21.5 percent between this coming May and October 2026.
“I am troubled by your presentation,” Alfin told Grau, contesting the method. He noted a 20 percent decrease in single-family permits approved in 2023, compared to 2022, which, to him, tells him that the consultant’s assumptions of growth may not be what they seem. “I’m troubled at the get go with the starting assumption.”
Flanagan trie to put the mayor at ease by describing wastewater capacity issues–shifting capacity from this plant to that plant–as the expansion of a pant from a capacity of 2 million to 4 million takes place. But it wasn’t clear how that answered the mayor’s overall concern. “We had a bust, we had a boom but if you look at the trendline, in my mind, we’re not really far off from the original forecast for our infrastructure needs,” Alfin said, suggesting that perhaps the capital spending projected by the rate study are not as necessary. “I’m not fearing a consequence of not investing at this level, at this moment in time,” he said.
Flanagan’s presentation today included a long segment on the utility department’s accomplishments. The segment was clearly intended to build some support for what the utility does, though the utility faces that unforgiving paradox: residents’ complaints are few, the water quality is high, Palm Coast tends to have a strong record of flood protection. For all that, residents would rebel at yet another rate increase, when, just in 2018, the city increased rates 20.6 percent over the next four years. Last year, the city increased stormwater rates by 75 percent over five years. Stormwater, sewer and water rates all go on the same bill. To residents, those bills are zooming up too fast.
The city has secured about $17 million in grant funding tied to three specific water main extension projects, but that’s a small dent in the $635 million in needs. Operating expenditures for the utility are at $40 million today, but are projected to rise to $70 million a year by 2033. So as Grau told the council in November, even indexing rates to inflation, the city would fall far short of what it would need. Between 2025 and 2033, the city would need to fun $270 million in debt for its capital program. That’s generally financed in part by impact fees.
Rate payers pay two water charges: the fixed, base rate, just to be a customer, plus the charge for the actual amount of water they use. The council has the option of weighing rate increases one one side or the other of those rates, keeping in mind that the two need to be generally balanced. That balance is in place now, Grau said. “We currently have a structure that is very much such that it’ll preserve fiscal stability, revenue stability,” he said.
Grau presented three different scenarios, one of which would reduce fixed charges a little, while increasing volume charges. Under one such scenario, and with conservation in mind, almost two-thirds of customers’ bills would increase but by less than 12.5 percent. The scenario recommended by the city staff, Grau said, would have rates rise 6 percent in May, another 6 percent on Oct. 1, 6 percent on Oct. 1, 2025, and 3.5 percent on Oct. 1, 2026–that’s the 21.5 percent proposal mentioned above.
Again, most of those figures, with small variations had been presented at the November workshop.
“I have some problems with this too,” Danko said, echoing the mayor, before going on another economically challenged anti-Biden rant, which nevertheless appears to be driving his policy approach: “So my feeling is I’m willing to put this off till next year when President Trump is back in office and the price of fuel drops and the cost of everything goes with it. And we’re then maybe looking at a normal cost of living increase. So I would like to see us just tighten our belts for one year and till the political landscape changes.” Or, more less disingenuously, when Danko is not running for a County Commission seat, as he is now, and having to defend a rate increase in Palm Coast.
Council member Nick Klufas, who is also running for a County Commission seat, questioned the consultant about what scenario might have prevented the proposed rate increases. (He was more interested in indexing each year’s increase to inflation or to another index, as long as it generates steady revenue). What he did not mention was that he was the only council member on the dais who was part of the vote approving the 20 percent rate increase in 2018, spread over four years.
Pontieri pointed out that next year’s national political scene won’t make a difference whoever is in office, with inflation lower now, and low enough that it will not match up with the city’s needs for additional revenue, so relying on increases indexed to inflation won’t work. She liked the proposals that put weight on conservation, allowing consumption to play a role in customers’ spending, but she also did not think all the necessary information was in.
So as in November, the consultant was again tasked with drafting an amendment to the study, showing what the consequences would be if certain capital projects were delayed, since they drive a lot of the need for the rate increases through 2028. Pontieri also wants to know whether the rate increases could be split from the recommended impact fess, so that the two would be approved independently.
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jake says
“Palm Coast Council Still Not Thrilled by Proposed Utility Rate Increases Near 18 Percent Over 3 Years”.
Who actually thinks the “Palm Coasts Council” gives a rat’s ass about their constituents?
Michael J Cocchiola says
Do you not remember that council members are taxpayers and utility users, t00?
TR says
Do you not remember the council gave themselves an enormous pay raise for a part time job? They can afford the increases. Some families are really struggling just to make ends meat. Not to mention the city council wouldn’t even have to raise any rates if they would know how to run a business and collect the infrastructure fees from the developers that are suppose to take care of the added homes being built. I’ll bet that if there was a forensic audit and they release the true findings. It would show that the city isn’t doing what they are suppose to do so that the entire population doesn’t have to fit the bill to repair their mishandling of EVERYTHING the city is involved it. JMO
Romuald Flieger says
Why would the Palm Coast government need to hire a outsider to tell that the infrastructure is not up to snuff . It should be a automatic that annually a portion of the annual budget should be allocated to upgrade systems and save monies for the future growth of the town not all of a sudden charge the taxpayers. Where does all the money go now. Where does the impact fees go with all the building going on in town? Again you don’t need a outsider to tell you that your sewage and water infrastructure is not big enough.
Terry Melton says
It is becoming impossible for a retiree to keep up with the never ending outrageous annual increases from palm coast. Their salary costs, the garbage increases, & all this on top of ridiculous property impact fees should make these people look closely at where all this money is going instead of habitually going to the property tax payers for more money. This must stop.
The Sour Kraut says
I know one thing that will help. STOP BUILDING!
Callmeishmael says
I’m no numbers genius, but it appears the proposal does call for a modest increase in water/wastewater impact fees, staggered over four years, for a total increase of $2,725.46 per residential unit. Next year, the first year, would be about $1,000. Is staggering in this manner reasonable? I guess that depends on how soon the city needs the money and how much they are willing to put on the backs of those who already live here in the meantime.
I think Councilwoman Pontieri’s request to review any available data that can segregate infrastructure needs due to current growth trends in this report can be quite insightful.
Oh, and Mr. Danko, eat my grits.
TR says
What the heck did the council expect when they just keep letting developer after developer build and then don’t pay attention to the infrastructure to see if it can handle the large amount of homes they allowed to be built. Not because they allowed all these home to be built the entire city residence of PC have to get an 18% increase to fix a problem that should have been prepared for from the start. I think the best thing anyone can invest in is vasaline because it is starting to hurt by the city council continuing to shove it up the Palm Coast residences butts.
How about getting rid of that ridicules pay raise they gave themselves. The residences of Palm Coast have been telling the council to take care of the infrastructure since the beginning, but did they listen? Nooooooo. Mark my words the next infrastructure problem that the city will have the residence have a major rate increase will be for the roads. Another problem they did nothing about before they allowed all this building growth.
So lets see, since Alfin took over as Mayor, He has given the council a large pay increase. Has increased the trash cost to the residence because of changing companies. Has raised our storm water charge. Now wants to raise the water bill. And as I stated the next will be a tax raise for the roads. Did I forget anything? Alfin and any other realtor has to be voted off the council come Nov. This is all getting way out of hand. Alfin and the council make me sick and after living in Palm Coast for 34 year, I guess it’s time to move and get the heck out of use to be a nice place to live.
The only thing that I’m hoping for, is that in the next year the bottom falls out of the housing market and these developers loose their butts and Alfin does as well.
JimboXYZ says
Where’s Biden’s “Build Back Better” money ? Billions for immigrants, nothing for the growth for infrastructure. I know what I consume as an individual, what I conserve. there’s nothing more to cut back on & go without. And that’s going to still cost 18+ % more over the next 3 years. Sorry.Not Sorry to say it, but the one’s birthing more need to knock it off & go find another hobby. They need to pay for that additional infrastructure, not find a way to share & saddle the burden over the rest of us that didn’t overpopulate & overrun the community. I know when I relocated here, it was a net decrease, +1 in, at least -2 human beings out of Flagler County/City of Palm Coast for consumption & resultant pollution. Own your environmental impact ?
Dennis C Rathsam says
With Biden in the Whtehouse, nothings been built, nothing is better. Senior citezens over 65 should get break on their water bill. We use less water, its a proven fact.We are on fixed incomes, we should pay for what we use! Stop the madness, work with the seniors, if you want to kick us out, dont beat around the bush. Tell us your against us….We will move.
Jim says
Dennis C Rathsam is right!!! It’s Biden’s fault that our water bill is rising! It’s Biden’s fault that prices in Florida are going up and we’re all going to be kicked out! We can all agree that all the Republicans running the state, county and local administrations have absolutely nothing to do with what we poor senior citizens pay for water! And we don’t use as much water – maybe because we sometimes forget to shower – but you get the point. Until I read this comment, I had not realized my water bill doesn’t reflect MY water usage! I’m paying for someone else’s water along with mine! I can’t believe this has been kept secret for so long.
Well, let’s just hope Biden loses to Trump. Then our water bill will go down. Dennis, you should contact the Trump campaign and get them to include that in their adds. The more senior citizens know it’s Biden’s fault their paying a higher water bill, the better Trump’s chances.
Well, that’s all I have. The air is so thin here in Palm Coast, I’m feeling a little faint trying to keep my facts straight. Where’s Kelly Anne Conway when I need her????
Bruno says
I’d get used it if I were you buddy.
Personally, I find it crazy that you’d fly over every local elected official just so you can blame the President of the United States for your high water bill.
But then again, that’s what Fox told you, so it must be true 🤷.
How come you’re not talking to Travis Hutson? Or Paul Renner? Or Gov. Ronny? Theyre party has only been running Florida’s State Government with a supermajority since 1993. Thats like no time at all to fix problems!
Golly, this whacked out world!
The dude says
This city, county, and state are run 100% by your beloved MAGA.
Look to them for the source of the problems, not someone who has literally no say in the decisions we’re being held responsible for.
It’s you. You and your MAGA cohort, that’s the problem.
Michael J Cocchiola says
Umm, Jimbo… Biden’s infrastructure wis not for “immigrants” other than the infrastructure they use as we do.
“This Bipartisan Infrastructure Deal will rebuild America’s roads, bridges and rails, expand access to clean drinking water, ensure every American has access to high-speed internet, tackle the climate crisis, advance environmental justice, and invest in communities that have too often been left behind. The legislation will help ease inflationary pressures and strengthen supply chains by making long overdue improvements for our nation’s ports, airports, rail, and roads. It will drive the creation of good-paying union jobs and grow the economy sustainably and equitably so that everyone gets ahead for decades to come. Combined with the President’s Build Back Framework, it will add on average 1.5 million jobs per year for the next 10 years.”
Shark says
Nothing to do with Biden – It’s the republicans running this town into the ground !!!!
Jim says
JimboXYZ, I feel your rage, buddy! I also thought that when the Bipartisan Infrastructure Deal was passed, any utility needs anywhere in the USA would be covered by that bill! In fact, I also thought it would reduce the costs for all of us retirees. How unfair to us that this is not what’s happening. And, like you, I feel that I conserve where I can (unless it’s inconvenient) and I shouldn’t have to cut back on anything. And how dare those people who are birthing more! They’re costing us money! We need more abortion rights – don’t you agree? That would help improve the utility costs! Of course, it might impact our medical costs but we can complain about that when it happens… Right now it’s utility costs we’re mad about!
And don’t get too concerned about the immigrant issue, DeSantis has implemented great rules that have resulted in many of those terrible people leaving the state for fear of our laws! That’s great isn’t it? Of course, it might result in higher costs for building, renovations and general businesses since they can’t find low pay workers but it’s a small price to pay! You and I can agree to fund the added costs associated with that, right?!!!
Bruno says
The State of Florida is the entity that received close to $6,100,000,000
If you want a piece of that, you have to pretty much ask the Governor.
Palm Coast did ask The State of Florida (which again, is pretty much asking Ron DeSantis), and he said no.
The $100,000,000 budget Palm Coast asked for to upgrade its sewer system was struck down.
Ron was so happy he cut a billion dollars from the budget. Cant you feel the winning?
Tim says
I am a little slow today , but is this all because of growth? I thought that impacted fees was to pay for this stuff . I for one am not happy I have to pay more so new people can move in . I am all for paying to maintain or upgrade what we have but I will not pay more so some contractors can build a new subdivision. And any city or county officials that votes to do so I will do so at his or her own risk ( I will vote them out and tell everyone I can to do the same )
Atwp says
What other increases are coming?
TR says
I’d venture to say, road repairs, new survey for traffic study and then new traffic light timings, then they will add a bend over tax.
Greg says
On a fixed budget and tired of paying high fees for city services. The growth never ends and the quality of life keeps going down. Seems like it not worth living here anymore.
dave says
Rates on EVERYTHING are going up, it’s out of control. And nothing is going to prevent it as more concrete is added and the population keeps on keeping on. The best and only choice you have, as it sure isn’t voting, is to move out of FLA to a state where the fees in whatever city you chose is manageable for your budget. FLA is not slowing down and politicians will come and go, but the people will still move in.
Nephew Of Uncle Sam says
“I am troubled by your presentation,” Alfin told Grau, contesting the method.” Doesn’t like what the professional told him, then the council should double the developer impact fees on houses.
“So my feeling is I’m willing to put this off till next year when President tRump is back in office and the price of fuel drops and the cost of everything goes with it. ” says Danko. Another GOP member trying to kick the can down the road hoping their 91 time indicted rapist Messiah will deliver them from “evil”.
Don Appignani says
With the increase in electric rates, utility bills and homeowners insurance, it’s becoming very difficult for many to make ends meet.
I believe it is time to limit growth in Palm Coast.
Jay Tomm says
They want everyone to move here? They want to be the big little city? Well, we all must pay for that!
Stephen says
Why is our water bill becoming a FPL bill? I am tired of paying such a high water bill. Please do something else Mayor Alfin.
TR says
Yea like leave and crawl in a hole so we don’t ever have to look at that smug smirk he calls a smile.
Michael J Cocchiola says
Umm, Jimbo… Biden’s infrastructure wis not for “immigrants” other than the infrastructure they use as we do.
“This Bipartisan Infrastructure Deal will rebuild America’s roads, bridges and rails, expand access to clean drinking water, ensure every American has access to high-speed internet, tackle the climate crisis, advance environmental justice, and invest in communities that have too often been left behind. The legislation will help ease inflationary pressures and strengthen supply chains by making long overdue improvements for our nation’s ports, airports, rail, and roads. It will drive the creation of good-paying union jobs and grow the economy sustainably and equitably so that everyone gets ahead for decades to come. Combined with the President’s Build Back Framework, it will add on average 1.5 million jobs per year for the next 10 years.”
James says
As I’ve stated elsewhere recently, the ITT “planned” growth to over 200K residential homes in Palm Coast was in my opinion, nonsense. If they had this intention, we would ALREADY HAVE the water treatment capacity which is required for that number of homes, plus a little more excess capacity for underestimated demand fluctuations.
This crisis, if you can call it that, is due to the growth spurt we’ve experienced. And the proposed increase in the water rate on the monthly utility bill is due to this and the projected residential growth rate.
In this regard, it’s my opinion we the existing residents of Palm Coast, are being asked to underwrite the actions of the developers.
I say if Palm Coast is worth further development, let the developers pay the true costs to do so. If a developer can’t do so here, they can move on… it’s supply and demand. Do the job right… build out infrastructure. Raise your price of a new home to reflect this. If no one buys?
Too bad.
Perhaps then things will be valued appropriately, and we’ll all be the better for it.
Just an opinion.
jeffery cortland seib says
Even though it’s an extremely complex issue, we should all lower the volume and look at what we can do together to get this worked out. I think we all can agree that the massive numbers of new residents moving into new homes and apartment complexes is, if the not only reason, is the main reason for these budget shortfalls. No one is against new residents; we welcome the new folks to our city. But maybe we should have some type of orderly manner in which this is done. Every week, every city council meeting, the Planning Department is asking the city council to approve an 850-unit apartment complex or a new development of 450 homes. Perhaps there is a number of new units, whether they are apartments or homes that when we reach that number, that’s all for the year? Maybe we need a consultant’s report on that?
Bruno says
I do believe Palm Coast asked the state of Florida for funding to get us on a sewer system.
DeSantis struck it down.
No money for us.