The builder of a 315-unit multi-family housing project in Riviera Beach has filed suit against the city's water utility, alleging that it is improperly charging new, vastly higher water and wastewater impact fees instead of the fees that were in place when the developer submitted its plans.
Riviera Beach is undergoing a rapid and broad redevelopment aimed at upgrading the city's aging facilities and transforming itself from a city with as much blight as bling to a place teeming with high-end housing and commercial offerings. The lawsuit, filed on Sept. 18 by 7920 Riviera Beach Holdings LLC in Palm Beach County Circuit Court, is another sign that the substantially higher water, wastewater and building impact fees the city is relying upon in its redevelopment is giving
would-be developers pause.
In May, the city postponed a final vote to raise residential and commercial project fees by more than 500% in some instances after the proposed hike raised concerns from the Gold Coast Builders Association, the trade group for developers in Palm Beach and northern Broward counties.
The board of Riviera Beach's Utility Special District, which oversees its water and wastewater systems, approved new water and wastewater impact fees in February 2025 that were a combined 157% higher than they had been before. The fees, paid up front by developers and imposed to mitigate the impact of development, had not been raised since 2019. They went into effect on June 1, 2025.
Riviera Beach Holdings' lawsuit states that the developer submitted all of the permits for its project at 7880 N. Military Trail by April 24, 2025. The utility district, however, is imposing the new water and wastewater impact fees, the lawsuit states. Those fees would cost the developer $2.6 million and raise the project's cost by $1.6 million, according to the lawsuit.
Riviera Beach did not respond to a request for comment on the suit, which quotes a city official telling the developer that "[u]tility impact fees are determined based on the date of payment, not the date a permit process number was issued."
Riviera Beach Holdings disputed that contention, saying it is in conflict with state law in the area, the Florida Impact Fee Act.
A section of that law states: "Unless the result is to reduce the total mitigation costs or impact fees imposed on an applicant, new or increased impact fees may not apply to current or pending permit applications submitted before the effective date of a new or increased impact fee."
Even in the face of a reminder about the law, the city's utility district would not relent, according to the lawsuit.
"Defendants then denied the applicability of the Florida Impact Fee Act and later issued a new set of invoices (the “Revised Invoices”)," the lawsuit states. "The Revised Invoices relabeled the Impact Fees as 'Water Capital Charge' and'Waste Water Capital Charge' (the 'Capital Charges') and further detailed the other charges, including 'Water Deposit,' 'Sewer Deposit,' 'Trash Deposit,' 'Meter Connection' charges, and 'Sewer Inspection Fees.'"
The lawsuit says Riviera Beach Holdings challenged the description of the new fees.
"After plaintiff explained in detail why the Capital Charges in the Revised Invoices were invalid, Defendants asserted, through counsel, that the Capital Charges are not impact fees subject to Chapter 163 but instead 'water and sewer connection fees' excluded from the (Florida Impact Fee) Act," the suit states.
The utility district claimed it "mistakenly used the word 'impact fee,'" in passing its resolution laying out the new fees, according to the suit.
District documents repeatedly referred to the fees as impact fees, and that's how the fees were described by the district's chief financial officer, Randy Sherman, during the Feb. 19, 2025 meeting when the board approved the increases.
Those increases — a 4% hike in the wastewater impact fee and a gargantuan 289.7% water impact fee hike — puts Riviera Beach's water and wastewater impact fees far higher than those charged elsewhere in Palm Beach County, according to a impact fee study Sherman referenced in his presentation to the utility's board.
The Riviera Beach Utility Special District's combined water and wastewater impact fees rose from a combined cost of $3,940 per unit to $10,126 per unit.
That new combined fee is higher than the roughly $2,000 Delray Beach charges developers, higher than the roughly $4,000 Boynton Beach and West Palm Beach charges, and it's higher than the $5,000 charged by Palm Beach County and the $6,000 charged by Wellington and Jupiter.
In conceding that the new impact fee "will far exceed other utilities," Sherman explained that it was needed to help the city pay for a proposed new water treatment facility, which will cost an estimated $400 million.
State law requires large impact fees to be phased in over time unless there are "extraordinary circumstances."
Sherman said the need for the water treatment facility represented such circumstances, and city council members, who also serve as the utility's board, approved the plan to impose the big increases immediately rather than phasing them in over time.
City officials also claimed extraordinary circumstances exist for the huge residential and commercial fee increases they planned to impose before developers asked them to reconsider.
Wayne Washington is a journalist covering education and Riviera Beach development for The Palm Beach Post. You can reach him at wwashington@pbpost.com. Help support our work; subscribe today.
This article originally appeared on Palm Beach Post: Developer sues city, says water fees violates Florida law
