Palm Coast Council Approves $2.5 Million Purchase of Temporary Buildings to Resolve Utility Office Crisis

It wasn’t a crisis the Palm Coast City Council expected, and the administration did its best to downplay it: four weeks ago, unbeknown to the public at large, most of the 100-odd employees who work in the city utility’s administrative complex at 2 Utility Drive in the Woodlands had to evacuate the premises. They were dispersed throughout city facilities.

The building is leaky, its plumbing and air conditioning systems are failing, pests are infiltrating, its already drab interiors are aging out, and it’s got a few more issues. All this comes as the city is ramping up several hundred million dollars’ worth of utility improvements.

On Tuesday, the City Council unanimously approved a $2.5 million plan to buy modular buildings and a trailer to replace the uninhabitable space, which will be leveled. The council did so after a difficult discussion about Utility Director Brian Roche’s original proposal: a $1.5 million plan to lease the temporary buildings.

“If you’re going to pay this amount of money I think it’s worth it to pay a little bit more and have something the city owns,” Pontieri said. Leasing was “not being business smart.” She and Council member Ty Miller had been surprised by the suddenness of the problem.

“I just wish we would have identified this as a potential problem before now,” Council member Ty Miller said. He felt the request was “coming out of left field.”

The city–and the City Council in particular–has weathered significant public criticism over enacting the largest utility rate increase in the city’s history last year to fund what will be the largest capital improvement plan in the utility’s history–a plan exceeding $600 million largely funded by debt. The council had no choice: the city’s infrastructure has been decaying and the utility is under a state consent order. The council thought all its hardest decisions were behind it. The Utility Drive problem is easily manageable, but candidates are likely to exploit it in an election year.

The money is drawn from the utility fund, which is autonomous of the general fund. In other words, ratepayers’ money rather than property tax dollars are funding the project.

Mayor Mike Norris suggested tabling the issue for further study. City Manager Michael McGlothlin, signaling his advocacy for employees and his eyes on the colossal capital projects ahead, wasn’t comfortable with a delay. “We’ve got a ticking clock on hundreds of millions of dollars that needs to be kicked off, and we need to get these people positioned,” McGlothlin said. “So I would just encourage–I love the discussion–I would just encourage us to get to a decision quickly so we can go ahead and pull this.”

“It’s an important facility because it serves as the hub for the utilities operations, the administration and inventory and warehousing,” Roche said. The difficulties have been “disruptive to the workforce.”

The plan is to level the administrative building on the west side of the complex and replace it with two hurricane-3-rated modular buildings, plus a triple-wide construction trailer for primary locker rooms and restrooms and a small break area for the field force. The complex would be about 10,000 square feet, a bit smaller than the current facility. The space would be needed for three or four years, Roche said.

That’s assuming the Maintenance Operations Center the city has been planning and building for years is done in five years. “I don’t see the MOC being done in five years. I just don’t, based on what I’ve seen,” Pontieri said. “I know, if we use more money towards this, it takes away money that actually goes into the MOC, right? So it’s kind of a catch-22.”

“If we do think that we’re going to need for five or six more years, then that would probably be an economic payback,” Roche said.

Leasing would have cost $1.5 million upfront and a recurring $175,000 a year.

Pontieri and Miller are also interested in the potential to repurpose the temporary buildings for an animal shelter in the future. The buildings could also be sold again, the land rezoned and sold at a premium, to the extent that industrial land adjacent to a sewer plant can fetch premium dollars.

The building at 2 Utility Drive is a year older than Fire Station 22, the station the council just approved redesigning as a museum and cultural center. There are no plans to monumentalize anything on Utility Drive.

A city-issued release noted that “Once the Maintenance Operations Complex is complete and Utility staff relocate, the 2 Utility Drive property will become available for potential redevelopment.” It added: “Located in a prime area within an industrial park, the property is currently zoned Public and Semi-Public (PSP) for government use but could be rezoned in the future to allow private business or industrial development. This could create an opportunity for the City to market the property and generate future revenue while supporting economic growth.”