Palm Bay, FL â The Palm Bay City Council will meet this Thursday, December 4, 2025, to vote on a series of high-stakes financial items that could reshape the cityâs infrastructure and public safety landscape.
The evening begins at 5:30 PM with a Special Council Meeting to discuss legal strategy regarding a recent court judgment. Immediately following, the Council will convene for the Regular Meeting at 6:00 PM, where the agenda is dominated by immediate spending demands: over $2.1 million in largely unbudgeted utility costs and a strategic $1.7 million renovation to facilitate the expansion of the Police Department.
5:30 PM Special Meeting: The $1.1 Million âAqua Propertyâ Judgment
The Council will hold a private Attorney-Client Session to discuss the recent summary judgment in the case of Aqua Property v. Bayfront Community Redevelopment Agency (BCRA) and City of Palm Bay.
On November 12, 2025, the Circuit Court ruled against the City, awarding the plaintiff $1,095,088 in damages related to unpaid tax increment financing (TIF) rebates. The litigation stems from a 2019 incentive agreement where the developer (Northshore/Investments LLC) was promised tax rebates for constructing a mixed-use project. The City withheld these payments, citing the developerâs failure to post a required construction bond or build the commercial portion of the project.
Why Was the City Sued? (The âTIFâ Explanation)
Tax Increment Financing (TIF) is a tool cities use to encourage development. When a developer improves a property, its value goes up, and so do the property taxes. In a TIF agreement, the city agrees to ârebateâ a portion of that new tax revenue back to the developer to help cover construction costs.
In this case, the City of Palm Bay entered into a TIF agreement with Northshore (later assigned to Aqua Property) to build a large mixed-use project. The residential portion (apartments) was completed, generating new tax revenue. However, the developer never built the commercial portion (shops/restaurants) and failed to post a required construction bond guaranteeing that second phase. Because the full project wasnât delivered as promised, the City withheld the tax rebates. The developer sued, arguing they were entitled to the rebates for the completed apartments regardless of the commercial phaseâs status. The court agreed with the developer.
Financial âSafety Netâ Revealed
While the million-dollar judgment appears to be a significant blow, City financial records indicate the payout was anticipated. In September 2025, when dispersing the BCRAâs unexpended funds for Fiscal Year 2024, the City explicitly held back $1,136,239 specifically âuntil litigation is settled.â
Judgment Amount: $1,095,088 (plus interest/costs).
Funds Reserved: $1,136,239.
This strategic holdback suggests the City can likely satisfy the judgment using these restricted funds rather than dipping into the General Fund or affecting current operating budgets. Note: The final bill for the City could be higher, as the court has not yet determined the amount of pre-judgment interest and attorney fees the City may be required to pay.
6:00 PM Regular Meeting: Operational Spending & Strategy
With the legal liability likely ring-fenced, the Councilâs attention will turn to the Regular Agenda, which focuses on significant operational expenditures.
Utilities Department Faces $2.1 Million âSpending Shockwaveâ
The Consent Agendaâitems typically approved in a single vote without debateâcontains a cluster of appropriations for the Utilities Department totaling over $2.1 million. These requests draw from the Utilities Operating and Undesignated Fund Balances, signaling significant pressure on the departmentâs reserves.
A key item is the South Regional Water Treatment Plant (SRWTP) expansion. Staff is requesting an additional $500,000 to cover a budget deficit for the project (Project 23WS20), which aims to increase capacity from 6 to 8 million gallons per day.
Original Budget (2023): $3.6 Million.
Current Status: With this new request, the known funding for the project has swelled to approximately $4.2 million.
Why the Increase? City documents state the deficit was âinadvertently overlookedâ during recent staffing transitions. This comes on the heels of a similar appropriation for a new well in October, establishing a pattern of rising costs for this critical infrastructure project.
In addition to the plant expansion, the department is seeking $850,000 for biosolids disposal and $800,000 for meter servicesâa budget line item that was reportedly omitted during the shift of meter purchases to the Operating Fund.
$1.7 Million Renovation to Unlock Police Department Expansion
A major procurement item for the evening is the approval of a $1,384,199 Guaranteed Maximum Price (GMP) contract with Scorpio Construction for the build-out of the third floor of City Hall Building E.
While the construction cost is significant, the projectâs total price tag is approximately $1.72 million when factoring in design, furniture, and IT costs. This exceeds the $1.5 million estimate presented at the July 2025 budget workshop.
Strategic Impact:
The renovation is a strategic domino effect for public safety. By moving the Finance and Procurement Departments into the new third-floor space, the City will free up the entirety of Building B for the Palm Bay Police Department. This move is intended to address acute space shortages for law enforcement without the massive expense of constructing a new police headquarters from scratch. The project is being funded through ARPA interest funds, repurposing federal dollars for long-term municipal needs.
Economic Development: $4.5 Million for âPhoenix Business Parkâ
The Council will also consider applying for a $3.5 million Florida Job Growth Grant to expand wastewater capacity for the proposed âPhoenix Business Parkâ in the cityâs southwest. This project, which requires a $1 million local match from utility connection fees, represents a major infrastructure push designed to attract industrial jobs and economic development to the area.
Community & Quality of Life
Beyond the ledger, the agenda includes items with direct impact on residentsâ daily lives:
Construction Noise: A proposed ordinance would revise the cityâs noise code to change the definition of âweekendâ and adjust permitted construction work hours, a response to ongoing resident concerns about development noise.
Budget Planning: The Council is set to schedule a Budget Workshop for January 14, 2026, kicking off the planning cycle for the Fiscal Year 2026-2027 budgetâa process that will likely be heavily influenced by the financial commitments made at this meeting.
State Mandate: Streamlining Approval for Group Homes and Sober Living Facilities
The City is required to adopt a new ordinance that removes public hearings and City Council review for group housing that serves people with disabilities. This includes Certified Recovery Residences (Sober Homes), drug treatment facilities, group homes for mental health patients, and transitional living facilities. The new law mandates an administrative, staff-level approval process to avoid federal discrimination lawsuits, effectively transferring control of site-specific approvals away from the City Council and the voting public.
In a recent âCoffee with the City Managerâ event, City Manager Morton confirmed this mandate curtails the local process, similar to religious land use institutions. He stated he has asked the City Attorney to clarify the Cityâs remaining authority and explore ways to incorporate community discussion, though he acknowledged the law restricts using public feedback as a basis for these land-use decisions.
The Regular City Council Meeting begins at 6:00 PM on Thursday, December 4, 2025, in the City Hall Council Chambers.
