Last Updated: 6:53 p.m.
The Palm Coast City Council is set to abandon the unpopular franchise fee it proposed adding to electric bills only last week. City Council member Theresa Pontieri said today she will withdraw the motion that she’d made on July 18. The reason, according to the city manager: Florida Power and Light won’t accept the city’s terms.
Pontieri had made the motion that won a 3-2 vote to add the franchise fee to FPL. The motion was conditional. The rate, which could be set anywhere between 0.5 and 6 percent, was to be guided by a referendum at the next election in 2024. Meanwhile, the rate would be set at 0.5 percent, resulting in a negligible addition to power bills.
The referendum was to be non-binding. It was intended to give the public a voice in influencing the rate-setting. But it was not clear whether such a referendum could in any way be part of an agreement between the city and FPL.
“We have been coordinating with FP&L on the franchise fee and being able to further refined the point I think requested by city council on a referendum,” City Manager Denise Bevan told the coun cil at the end of a workshop today, “and from FP&L, that is not feasible for them.” Bevan did not give details. “Basically it came down to having the item come to the voters,” Bevan said. “That was a concern that they did not want to see as an outcome.” They being FPL.
“So essentially what you’re saying city manager is that FPL would not agree to allow the rate to be a referendum,” Pontieri said.
“Well said,” Bevan said.
It was a surprising turn of events. In essence–at least by the city’s interpretation–FPL could veto the city’s plans.
Palm Coast Mayor David Alfin this evening was leaving the door open for an option to revive some form of new revenue stream, possibly the franchise fee under a different form. “This is a most important tool for the city’s tool box and future fiscal sustainability,” he said.
The city attempted to initiate a franchise fee in 2012, and again in 2018, both times provoking a huge blowback from residents. The proposal did so again this time, even though all but 12 percent of local governments have either a franchise fee or a utility tax (or both), including Bunnell and Flagler Beach, and depend on those sources of revenue for general government operations.
For Palm Coast, the set back will be more serious than in 2012 or 2018. This time the elimination of a potential franchise fee follows a vote, also last week, to return the city’s overall tax rate to rollback, reducing by 60 percent the projected increased revenue the administration was basing its budget on, had the council kept the tax rate flat. The city will still get some additional revenue next year thanks to a surge in new homes and commercial construction. But rollback means at least $2.8 million in projected additional revenue will be eliminated, requiring substantial budget cuts.
Mayor David Alfin had hoped to pair the rolled back tax rate with the new franchise fee. But the tactic backfired when Council member Ed Danko, who is running for a County Commission seat in 2024, used the occasion to campaign as an anti-tax absolutist: he voted against the rolled-back rate while anticipating that the approach was only intended to open the door to the new fee.
The city now finds itself at rollback, a decision it cannot reverse, and no fee, since Pontieri, the swing vote on the fee proposal, is making it clear she will not accept a fee absent a referendum, “because,” she said, “I think we all said up here that if the rate could not be a referendum, that we would not vote for it to be put in place.” She added: “I’m fine with withdrawing the motion based on the consensus that we would only move forward with this if it could be a referendum.”
The failed fee will doubly hurt the city, considering why it had been discussed in the first place: to make up a growing deficit in the city’s streets budget, which is looking at $52 million in needs over the next five years, much of it unfunded. Revenue from the franchise fee was to go exclusively to the streets fund. Now, that’s gone, too.
The County Commission is looking for support from the cities to approve an additional half-penny in the sales tax, which would raise the sales tax to 7.5 percent in the county and its cities. But that proposal, though it would generate close to $5 million for Palm Coast, is also going into strong headwinds.
Today’s meeting was attended only by Alfin, Pontieri and Danko. The city attorney was absent, since it was intended as a workshop focusing on proprietary funds, so were Council members Nick Klufas and Cathy Heighter. Alfin suggested to wait until the next meeting to get consensus to withdraw the motion that Pontieri had made. Alfin suggested waiting until next week’s meeting when Pontieri could formally withdraw her motion. The proposal had passed on first reading only, and would have needed a majority next week to go in effect. That majority now seems out of reach.
“It’s not on the table anymore,” Alfin said this morning.
Danko, for his part, wanted to make sure that the item would not “come back and revisit us again.”
Council members had only generally proposed cuts to make up for the lost revenue, so that discussion is ahead, unless the administration pre-empts council members with proposals of its own.
HayRide says
Finally some GOOD news
Romuald Flieger says
Hi there, what were the terms with FPL in detail. Did it have to do with the lease of the light poles in the city.
Denali says
My days of doing “stupid drugs” ended over 50 years ago. Looks like the city fathers and mother have found one of my old stashes. First you try to resurrect a fee which has been kicked to the curb several times by previous administrations and the citizenry; then you roll back the property tax levy counting on the new fee to offset the reduced taxes. Talk about counting your chickens before they hatch! How could anyone who walks among us as a supposedly rational person be so naive to not have the utility in your corner?
The words escape me to describe these actions and the new low reached by this administration. However, short-sighted, ignorant and feeble-minded might be good for starters. Now you morons know how it feels to have the rug pulled out from under your feet. This administration will go down as the ones who sent Palm Coast into bankruptcy.
Of course the fix to all this is right in front of them and FPL showed them the way – are the smart enough to read between the lines?
jeffery c. seib says
This is a farce. Any and every time city staff attempts to push through the city council tax (or fee) increases that gets shot down then they immediately turn up the pressure with doom and gloom rhetoric. We all have to have a budget that is realistic and achievable. Country, state, county, city, and family. I hope everyone knows by now, that with all the new homes and businesses springing up in Palm Coast we are having a budget crisis so we can finally put to rest the big lie that new growth pays for itself. We end up footing the bill for all the new things going in all over. Let’s see if they can truly run our city by reducing the budget while at the same time continuing at the same rate or better all the services like road repairs, stormwater, parks, all the things we current residents need. City departments that do not contribute to our essential needs could be cut back without residents even noticing. The Planning and Community Development Departments are two of probably many more. Let’s hope they can make this work.
Do you know getha...... says
It’s pretty simple get a City Manager that cab manage the City Staff to do their job and manage their budgets.
Cut some of the upper management positions and cut their pay. Also, the City Council should take a pay cut to help the budget.
Budge in a cola for all employees to keeps things in check.
Only do essential repairs.
Lease the golf carts for two years this would conserve cash. Like 300k.
I could go on but Flaglerlive only has so much writting space……
Google It says
Kudos Pontieri – she got the rollback knowing FPL wouldn’t allow a referendum. She played the other two against the other two to get a rollback. Otherwise, they would never had agreed to a rollback. She played it well. Wake up people, she knows what she’s doing. Stop getting upset, she’s smarter than you think.
jeffery c. seib says
She’s not as bright as you say. I don’t think she knew about that or anything. Other than Alfin she is the biggest tax and/or fee spender on the city council right now. Since the recent garbage fee and stormwater fee increases which, she enthusiastically supported and voted for are way more out of our pockets than this would have been you may not have been paying as close attention to all this. But let’s give her a chance, her biggest chance. Let’s see if she can fund the essential services that we the present Palm Coast require in road repairs and stormwater and cut funds from the less essential city departments even temporarily so this city can function as best as possible.
Jimbo99 says
Yep, where are the impact fees that are supposed to have been collected to pay for all of this. Those apartments, the new residential & commercial land development. They just flattened another lot on the backside of me. I hear the bulldozers & dump trucks hauling away dead trees. 5 days of it. Apparently “Saving the Planet” & global warming was a lie too. It all starts with Biden and rolls downhill.
Marcus Aurelius Jr.... says
You’re wrong on the Councilwoman Pontieri.
She is the only one offering solutions because the inept City Staff won’t do their jobs.
Watch how good the staff gets about balancing that budget when they realize there will be no fee or tax increases to pay for it. Pontieri is actually pretty slick.
Ed says
Huh, Republicans do get it right, at least sometimes.
Flattened tax says
The deadline to submit the tentative millage rate is the first week of August. The council can still backtrack and use the flat millage rate.
Tjmelton says
Does this mean the taxpayers do not have to pay for the cops’ new Harleys & Mustangs? Or is there just going to be ANOTHER property tax or other mysterious taxpayers increase to somehow survive in beautiful palm coast, swayle costs & garbage costs notwithstanding.
Skibum says
Again, as said by others as well as myself, the city should put this burden on the developers who are building homes in Palm Coast faster than we can count. With all of the new construction, they can certainly absorb or pass on additional fees to the city that will be needed for street maintenance and other infrastructure costs. These companies who are building all of these new homes should either agree to the additional fees to help make up for the 2.8 million shortfall in the city’s budget, or the city should put a hold on approving new permits for housing developments. Either way, it will be a win for the city and current residents.
TR says
Glad that FPL saw the writing on the wall with what this was. It was a way for the city council to stick it to the residence again. They have stuck their extra fees up my butt so many times that I can’t even bend over anymore because it’s straight.
Maybe the council should go after the owners of the undeveloped lots to pay the storm water fee and bring in the 5M + dollars a year. They also maybe should cut their pay 85%. But the the impact fees from every home that has been or is going to be built within the next 5 years should be way more that enough to fix the roads. What I see it as is a council that doesn’t know how to manage the revenue that comes in. We need to get these idiots out and TRY and find people that have common sense and the ability to do for the residence of PC. If that means having growth at a slower pace then so be it. The other thing they need to not be is greedy.
Celia Pugliese says
By law the impact fees can only be used for building new roads of infrastructure needed for the approved growth projects and even with that by law we still have to fund like almost 30 percent of it as the fees can’t cover the 100 percent cost of it. Still the impact fees in this county are cities are too low.
I believe the city could charge a fee to the over 7 thousand vacant lots for having to maintain grass cutting, litter gathering and hurricane debris clearing after storms on those many lots the normal cost could bring from over 2 to 4 millions a year to be assigned after all to those roads maintenance. But I know the city “stake holders” aka “developers and their accolades” been always opposing it and unfortunately successfully given who we elect for council! I think they do it based on unincorporated (country-agricultural) tracks of vacant lands…but in incorporated areas “cities” this should not apply as we homesteaded are responsible to maintain our right of ways, then vacant lot owners should be as well and not us paying for city public works crews maintaining for free to vacant land owners.
Tom M says
Have FPL mange the city of PC utility bills which now exceed my monthly FPL bills.
John Stove says
Good…now do your damn jobs and find other ways of fixing the streets by eliminating or reducing non-essential core services.
The Sour Kraut says
Retirees are being priced out of Palm Coast. Anyone wonder why there is strong opposition to new fees/taxes? We all have to live within our means. The city should too.
Tony says
The use of water and electricity is a human need and should not have these “franchise fees”. Stop the backdoor taxes. Stop voting Republican.
Jack Howell says
As a former City of Palm Coast councilman, this is a time when we need to practice fiscal restraint. I think that the City Manager needs to impose a 10% cut across the board for all departments. Sure the Department heads will bitch and moan but the city will survive! By the way, I wonder if the city has any COVID monies left? If so, then use these funds for infrastructure needs as well! We don’t need any waste or slash pad debacles.
Jimbo99 says
Covid money ran out a long time ago, the Splash Pad, the Pickleball courts, that money would have gone a long way towards repaving roads before Biden Inflation. Everyone believed Biden was going to “Build Back Better”, as Joe Mullins once said, in 2021, the money is running out with consequences. Every day I read yet another news piece on Global Warming, yet Palm Coast is a top 20 grower under the Biden-Harris fiasco. Acres of trees destroyed for lies of Biden Prosperity. Those trees are no longer able to offset the population growth, the science of pollution & more population. What’s sad is that the borders are leaking millions. I lived in Miami, FL when the Bush prosperity crashed. It wasn’t pretty, construction projects remained incomplete. I wonder how many projects in Flagler County, Cities that comprise it, will be started & abandoned as incomplete ? Flagler Beach just hired Fernandina Beach’s former City Manager, set to start in August 2023. He’ll head into that new position without a pier that will be demolished & rebuilt more expensively than what Federal commitment for money was made nearly 6-7 years ago.
I guess the budget cuts, those Government employees will have to go work at a new construction retail development ?
jeffery c. seib says
Former councilman Howell, I remember your time on the council as one of practicing fiscal restraint with taxpayers’ money. We sure could use that approach now. I like the across-the-board department cuts, but some departments have had huge staff pay increases that are, in my opinion, totally unjustified. I would hate to have our city going to pot while big buck salaried employees are sitting on their arrears. It may be a time to hold off on any spending on anything that is not required for the utilization of the current residents of this city.
Shark says
Start with the utility department and finish with code enforcement. Two departments that need a close look at !!!!
jeffery c. seib says
Whenever residents show up in numbers at city council meetings to express an opposite or different viewpoint on an issue then city staff generated council position the council will usually defer any voting until a later date. This happened with the Green Lion situation when the council chamber was standing room only and everyone was in favor of keeping the place at the golf course. The Palm Coast public was reassured then their voices were being heard. As time went by, less folks attended council meetings until the council returned to the issue when only the Green Lion owners were present, and then kicked them out. Last week the public was again at the meeting in numbers to express their opposition to any new taxes or ‘franchise fees’ on the FPL bill. Again, the council deferred any action. Tomorrow night, August 1, 2023, at 6pm, the council has on the agenda to return to the franchise fee issue, probably assuming less residents will be present, and they will ram it through. I hope the public will be present in sufficient numbers again to tell them that we are not giving in on more and more taxes and fees.