Key West Commission To Weigh Higgs Beach Transfer Amid Cost Questions, Cable Huts Award and New Fire Services Assessment
Analysis shows slim surplus as critics, residents urge caution over beach park, Commission expected to award three properties to Tropical Shell and Gift.
KEY WEST, Fla. — The Key West City Commission will consider a proposal Wednesday during its April meeting to take ownership of Higgs Beach from Monroe County, with financial projections showing only a narrow long-term surplus as elected officials, residents and a competing developer raise concerns about risk, transparency and long-term costs.
The proposed interlocal agreement would transfer the 16.8-acre beachfront park at 1040 Atlantic Blvd. to the city, consolidating control of one of Key West’s most heavily used public spaces. The City and County have been considering the transfer for years.
A city-backed cost-benefit analysis projects approximately $5.34 million in revenue over five years against about $5.11 million in recurring costs, yielding a net benefit of roughly $223,971 — less than $45,000 annually on average.
Projected operating costs are expected to rise from about $936,810 in 2027 to more than $1.11 million by 2031, driven by staffing, beach cleaning, insurance, utilities and maintenance.
The analysis also identifies nearly $2.9 million in non-recurring capital needs, including $927,884 for Reynolds Street Pier repairs, $704,000 in West Martello Tower improvements and $400,000 for seawall stabilization, along with additional upgrades across the park. That all comes admist the City trying to navigate renovations for the docks at Mallory Square.
Initial funding sources include $500,000 from Monroe County, $834,448 in Tourist Development Council funding, roughly $987,000 in Hurricane Ian insurance proceeds and other grants, but projected revenues rely heavily on tourism-driven funding and lease income.
Commissioner and mayoral candidate Sam Kaufman has urged caution, saying the city should not rush into a deal with uncertain long-term costs.
“This Wednesday, April 1st, the City Commission is expected to vote on taking ownership of Higgs Beach from Monroe County at the 9:00 a.m. session. And no, this is not an April Fools’ joke… even though it sounds like one,” said Kaufman.
“We all love Higgs Beach. This is not about the park. It’s about whether this is a good deal for the people of Key West,” said Kaufman.
“Right now, the County shares the cost of maintaining this park. Under this proposal, the City and ultimately our taxpayers would take on all future costs and risks,” said Kaufman.
“In plain terms: the costs are uncertain, and will likely grow,” said Kaufman.
Kaufman also expressed concern over moves in Tallahassee to reduce or eliminate ad valorem taxes as well as uncertainty of TDC funding.
Public comment submitted ahead of the meeting echoes those concerns.
“I support the idea of the City taking control of Higgs Beach, but I think we need clearer answers before moving forward,” wrote West resident Loretta M. DiTocco.
“This could be a good deal, but only if the long-term costs are clear and manageable. Right now, those details are not fully clear,” DiTocco wrote, raising questions about future repairs, funding contingencies and long-term maintenance obligations.
At the same time, a separate set of high-profile redevelopment proposals tied to Mallory Square is drawing scrutiny of its own.
Commissioners are also scheduled to consider awarding Tropical Shell & Gift, Inc. three related leases for the Historic Hospitality House, 402 Wall St., and the Cable Huts at Mallory Square, consolidating control of multiple city-owned historic properties under a single operator.
According to its proposal, Tropical Shell — a subsidiary of Historic Tours of America and operator of the Key West Aquarium — plans to convert the Hospitality House into an environmental education center focused on marine conservation, with exhibits, classroom space and partnerships with local nonprofits. Other HTA properties include the Conch Train and Old Town Trolleys.
Under the proposed agreements, the company would assume all costs for rehabilitation, operation and maintenance, with no direct financial impact to the city.
Earlier in the process, only two proposals were received for the redevelopment concepts. Although HRG was found responsive to the bid requirements, the Tropical Shell proposal was deemed invalid. Since only two proposals were received, the City reopened the bidding process.
Walsh said commissioners should review both proposals publicly and allow presentations from each applicant before making a final decision.
“The redevelopment of Mallory Square is worth the time and effort,” Walsh wrote in an email to city procurement officials.
Walsh argued that scoring differences among reviewers, particularly on subjective categories such as “vision for Mallory Square,” warranted closer scrutiny. He also contended that Hayes Robertson Group scored higher in that category across reviewers and questioned whether all evaluators were sufficiently familiar with the Mallory Square Master Plan.
He further raised concerns about how financial capacity and experience were evaluated, noting that his group had submitted documentation indicating the project was fully funded.
Walsh did not object to the recommended award for the 402 Wall St. property but argued that the Hospitality House and Cable Huts proposals — which he described as critical to the future of Mallory Square — should be fully vetted in public. If awarded to Tropical Shell, HTA and its subsidiaries will increase their already huge footprint on City property.
The overlapping decisions on Higgs Beach and Mallory Square place the commission at the center of two significant policy questions: whether to assume long-term financial responsibility for a major public park and how to structure redevelopment of some of the city’s most visible historic assets.
The meeting begins Wed., April 1 at 9 a.m. at City Hall, 1300 White St., with additional items scheduled for the evening session, including a proposed fire services special assessment. The meeting will be live-streamed on the City’s website.
Oh, the usual with Mallory Square, though the two big guys are slugging it out. Unfortunate that the Cultural Preservation Society didn’t get involved. But they’re not what they once were anyhow.