Palm Coast’s City Council went into a budget workshop Tuesday, July 28, 2026, and the temperature rose fast. Staff laid out a spending plan that, in practice, would mean higher taxes. Council members pushed back, then pushed harder. By the end, they tossed all three staff scenarios aside and told the city manager to come back with two fresh versions — one built on the rollback rate, the other on a rollback rate with inflation figured in. Before any of that, the room paused for a moment of silence to remember former Flagler Beach Mayor Alice Baker and former Palm Coast Councilman Bob Cuff, both recently deceased.
Public comment set the tone. Cameron Knorr, who serves on the county-city animal shelter task force, said the group has “languished” since January and pressed leaders to move on a 10-acre offer from an anonymous donor along a main corridor, a gift he said is worth “in the millions of dollars.” Pat Stasio warned against converting code enforcement into a complaint-only operation, saying inspectors should be out in neighborhoods, and when they answer one call, “they’re supposed to do the whole street.” Terry Webb asked what Community Development Districts still owe Palm Coast. John Kaveteris pitched something simple — a quarterly report broken out by council district with project costs, schedules, and where the money comes from.
City Manager staff said they’ve already contacted the anonymous shelter donor and set coordination meetings, including a 3:30 p.m. sit-down that afternoon with the interim county administrator. Vice Mayor Pontieri asked the council to agree that staff can talk money with the county, pointing out the donor wants the shelter finished quickly. Councilman Sullivan kept returning to the same point: Palm Coast residents make up about 80 percent of the county’s ad valorem tax base, so “when the county spends money, 80% of that money comes from the city.” Everyone agreed to keep the discussion going, though they also repeated that roads are still their priority.
Most of the workshop, though, was budget presentations for the city’s proprietary funds. Stormwater Director Carl Cody said his team cut open swale work orders from 654 at the start of the fiscal year down to 225 by early July, added a second trenching crew, and finished several large drainage jobs. Next year, stormwater adds one position to run a new pontoon excavator, bringing the division to 78 employees. He also walked through plans to refresh the city’s LIDAR mapping so the stormwater model is more accurate and staff can spot ditches that are overgrown or never properly documented.
Utilities Director Brian Roche presented a water and wastewater budget based on $92 million in revenue, about 8 to 9 percent above last year, tied to a rate adjustment and continued growth. He described a $590 million capital program spread across multiple years and separated out the buckets: day-to-day operations, debt service, and renewal and replacement (R&R). Roche said the city issued $283 million in bonds, not the $600 million figure that circulates in the public, and with refinancing the total sits around $330 million. The utilities budget brings on 14 positions this year, although several are reclassifications. He also said sludge hauling is getting more expensive, rising from about $105 per ton to $125, as contractors stop renewing at the old prices.
Building Director John Zobler said the building division issued just under 16,000 permits in the last fiscal year, but it’s been sliding for roughly two years. That trend is driving a cut of 2.89 positions, four jobs staying frozen, and an overall budget reduction of 11.2 percent. Public Works Director Matt Mansell covered collection and sanitation, noting more than 47,000 residential trash accounts and about $426,000 in commercial franchise fees collected so far in 2026. IT Director Doug Aikens reviewed the IT enterprise fund, pointing to fiber hookups completed for Fire Stations 22 and 26 and added revenue tied to cell tower leases the council approved.
The real fight arrived with the general fund millage discussion. Staff offered three options, from a rollback rate of 4.1387 mills up to the maximum 4.229 mills. A big chunk of the argument centered on a plan to shift code enforcement to a complaint-based model, a move that would cut 11.5 positions. Staff said that during a one-week pilot, they saw 816 violations that were never written up while only about 91 citizen complaints came in. The city manager urged “extreme caution,” said, “It’s not something I recommend,” and warned that community appearance would take “a definite degradation.” Several members, including Pontieri, Councilman Gambaro, and Councilman Miller, said flatly they don’t want to hollow out code enforcement.
On the Flagler Humane Society contract, Zobler said the group is seeking $300 per animal for a five-day stay, up from $156. Staff suggested a different route — a 10 percent increase in line with past practice — and said the contract this year is expected to land near $190,000. Council members also agreed Zobler should meet with the State Attorney’s Office about tougher enforcement and restitution in animal abuse cases. They cited a recent incident where offenders posted just $50 of a $500 bond and left Florida, leaving Palm Coast with more than $800 in animal care expenses.
The council also took up a request from the Flagler County Sheriff’s Office for nine more deputies under a three-year plan already approved. Sullivan and Pontieri argued for a pause, not a rejection, until voters weigh in during November on a state homestead exemption amendment that could take a noticeable bite out of city revenue. Pontieri summed it up as, “The ask would be hold the line for one year until we know what’s going on.”
Pontieri delivered the most pointed remarks of the day. She said the proposed $72 million general fund budget headed toward a tax increase without what she considered real savings. “In a $72 million general fund budget, we are looking at a tax increase while still not providing any meaningful cost savings,” she said, adding that the state is “clearly telling us, ‘cut government spending.’” In her view, the council was pushed into a bad choice: raise taxes or cut services. “I am ashamed of myself for not pushing back more,” she said, and argued that code enforcement should not have been the first place the efficiency hunt landed.
Mayor Norris said he wants reductions “across the board” to reach at least a full rollback. “People are angry, and they want their taxes reduced,” he told colleagues, adding he won’t support gutting or splitting any one department to get there. Staff explained what’s making this year so tight: taxable values are up only about 4 percent, the first smaller jump after years of double-digit growth, while inflation and the operating costs tied to two new fire stations keep rising. Finance staff said they cut cost-of-living raises and left only a 3 percent merit program in place to reach the proposed rate.
Gambaro pointed out that of roughly $45 million in ad valorem revenue, about $35 million goes to salaries and benefits, and about two-thirds of that is public safety. He and Miller also said Palm Coast’s millage rate sits among the lowest for comparable Florida cities, and unlike many municipalities, Palm Coast doesn’t stack on extra service fees.
After a long back-and-forth, the council agreed staff should return Aug. 25 with two options only: the rollback rate and the rollback rate plus a CPI adjustment. Staff warned the first public hearing comes soon after, making the 25th a hard deadline if the council wants enough time to decide.
In wrap-up comments, resident Jimmy Henge questioned severance, saying a slide showed six pay periods, about three months, compared with a national commercial average of one to two weeks, and suggested that could be an area for savings if layoffs ever happen. Interim Deputy City Manager Kyle Berryhill said severance isn’t a fixed city policy and is handled by the council case by case. Gambaro closed by urging attention to westward expansion, arguing that adding more than 8 million square feet of commercial, non-residential space would broaden a tax base that is now over 90 percent residential, and would help buffer Palm Coast against state preemptions like Amendment 3. Miller also noted the death of Dr. Carly Taj Mayor, co-owner and founder of East Coast Animal Clinic, who died at 38 after battling cancer, with services planned for Saturday, Aug. 1.
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