Poor, Poor Pat Neal

Last week, Manatee County Commissioners held their first public hearing on moving forward with collecting 100% of impact fees from developers, who have been receiving steep discounts for over a decade and a half. In response, they got an unusually brisk dressing down from billionaire developer Pat Neal.

Neal, a former Florida Senator, whose privately held, family-owned business recently constructed its 25,000th home, has long been an opponent of impact fees, arguing that they are a tax on homebuyers. As everyone who is not in the business of building and selling new construction has long pointed out, houses sell for whatever the market will bear.

When interest rates decrease, prices tend to rise, as the same monthly payment now covers a larger amount of principal. When interest rates increase, however, prices rarely drop at the same scale. Home sellers test the market and only reduce sale prices if lower demand warrants it.

A development is often built with combined parcels of land that were not purchased simultaneously. A home on a lot that was acquired for significantly less than one down the road, obviously, does not come at a discount, because … say it with me … homes sell for what the market will bear. The lower the builder’s total cost, the greater their profit.

When you buy a new home, you do see a line item for the impact fees being “passed on to the customer.” However, the price point is determined by the total cost buyers can and will bring to the table in that market. Does anyone believe that if there were no impact fees at all, builders would discount the homes by that amount rather than keep collecting the price that the market has borne, pocketing the rest as additional profits? It would seem much more likely that they are looking out for their own bottom line, rather than helping families struggling to afford homes.

Impact fees are a tool to enable communities to ensure that development at least comes close to paying for itself. However, deep-pocketed developers have been doing a great job of convincing Republicans in Tallahassee to pass anti-small-government legislation that impedes communities from collecting adequate fees to cover new infrastructure necessitated by growth.

When determining impact fees, the county must commission a study using the latest and best data to determine the amount at which they should be set. However, the county has not collected full impact fees since 2005. Beginning in 2009, Manatee County began steeply discounting impact fees, under the misguided notion that it would keep people in the building trades working through the downturn that followed the subprime crisis, which led to the Great Recession.

Year after year, local governments dragged their feet in terms of updating or commissioning new studies, and developers got hooked on the padded profits that resulted, spending heavily to elect county commissioners who would keep the gravy train rolling. Before the matter was taken up in earnest, developers successfully pushed a half-cent infrastructure sales tax in 2018, the revenues of which would have to be considered in future studies or updates. As a result, when the board voted to finally collect even 90% of the impact fees that year, it was misleading, because the 10% discount was being further subsidized by all of us through the sales tax.

The next time around, developer-friendly board members and bureaucrats would run a similar shell game. They were aided by developer stooges in the Florida legislature, who amended the statute in 2021 to severely hinder communities from collecting fees at an appropriate rate. The statute prescribes that the most that a board can increase impact fees through the normal process is by 50 percent, and it must do so in four equal annual increases. Increases of more than 12.5% but less than 25% must be phased in equally over a period of two years. What’s more, once you raise impact fees, you are locked in without the ability to raise them again for the next four years.

The last board, which developer-loyal commissioners dominated, declined to utilize updates to its outdated study and voted 6-1 (Commissioner George Kruse dissenting) to incrementally collect “100 percent” of an old study, which amounted to 44 cents on every dollar the consulting firm that did both the study and its update had determined was needed to pay for the infrastructure to support new growth. Despite the fact that the firm is literally undefeated when defending the results of its studies in court, commissioners feigned fear of legal challenges when explaining their fealty to the development community—the same one that had padded their campaign coffers.

The decision not to raise impact fees to the full amount prescribed by the updated study, which took place just ahead of the August 2024 primary, faced immense public backlash and was a major factor in the landslide victories enjoyed by Kruse and other grassroots candidates who, against long odds, managed to flip the board despite record spending from developers. The new board is attempting to move forward with its commitment to follow the required process to collect 100% of the fees. At its first public hearing, Neal not-so-subtly warned that they would likely face legal challenges.

Neal was featured in a glowing profile in Forbes magazine this month. Despite having covered Neal on various stories over my 15 years at TBT, I learned many new details about the man, who the magazine estimates to be worth $1.2 billion. For instance, he enjoyed an entrepreneurial childhood that sounds like it comes straight out of a Horatio Alger tale, overcoming ADHD to start a successful small business at the age of 16. His time at Penn’s Wharton School of Business overlapped with President Trump, of whom he says he’s “not a big supporter of.” It also notes that he “spent two summers in the Army reserves to avoid getting drafted into the Vietnam War.”

I had known that Neal had been a Democrat while serving in the Florida legislature, and, over the years, many of his allies have used this to suggest to me that he’s much more liberal than people think. However, according to the profile in Forbes, Neal worked on Richard Nixon’s 1968 presidential campaign and was a “body man” for Republican Arlen Specter while the future U.S. senator served as Philadelphia’s District Attorney. Post Watergate, Neal was said to have seen the Republican brand as a liability and decided to run as a “conservative Democrat,” at a time when Dixiecrats still dominated Democratic politics in the South.

However, what struck me most was a line near the beginning of the piece in which Neal proclaims, “We want the wetlands to be pristine…”

That sentiment seems to be directly contradicted by Neal’s support for the last board’s gutting of Manatee County’s wetland protection policies, which the new board is also in the process of attempting to overturn. Again, the board has encountered the threat of lawsuits related to SB 250, a statute aimed at facilitating the rebuilding of areas affected by hurricanes by restricting local governments from enacting more stringent development rules in the wake of a storm. However, because the statute also applies to new construction, it has, not coincidentally, been a boon for developers.

SB 250 is set to expire on October 1, 2026. However, a last-minute amendment to SB 180, the comprehensive emergency management bill for this session, would extend that prohibition, statewide, for another year. The amendment was put forth by Representative Fiona McFarland (R-Sarasota)—who raised a quarter of a million dollars for her 2024 campaign, largely from development interests and their dark money PACs. It would prohibit counties and municipalities that were listed in the Federal Disaster Declarations for hurricanes Debby, Milton, or Helene from enacting construction moratoriums on redeveloping storm-damaged properties or more "restrictive or burdensome" comprehensive plan amendments, land development regulations or procedures related to development approvals from August 1, 2024 through October 1, 2027.

New (and highly entertaining) reporting this week from Craig Pittman claims that Neal is said to have been the driving force behind the SB 180 amendment. Of course, this doesn’t square with the image Neal presents to Forbes, but he was, after all, a successful politician. These days, he’s a successful political kingmaker, having been instrumental in the ascension of just about every big-time Republican officeholder in Florida, including Gov. Ron DeSantis, who is expected to sign SB 180 into law.

The real reason Neal is likely trying to squeeze every last bit of juice out of his Manatee County holdings is economic. The Forbes article notes that Neal's revenues increased from $613 million in 2022 to $905 million in 2023, and then reached a cool billion in 2024. However, that growth has slowed, and Neal says he expects "the Trump adjustment" to slow building growth as he sits on around 200 spec homes. Neal's gross profit margin is reported to have decreased from approximately 30% in 2023 to 24% today, prompting him to raise prices by 10% to 11% over the past year. He told the magazine he's counting on the Fed lowering interest rates, which would likely boost demand, especially for his lower-end development brand, SimplyDwell. However, if Trump's TACO tariff strategy leads to even more inflation, as many economists predict, the FED would not only lack cause to lower interest rates, it could actually be in a position to raise them.

While Neal told Forbes he plans to eat the $10,000 per-house cost increase he estimates Trump's tariffs will add, rather than pass it on to customers, he took the opposite approach when confronting commissioners on impact fees. Neal thinks all sorts of other pots of money would be far more appropriate to fund infrastructure from. However, as Manatee County saw in last year's budget sessions, the lack of impact fee revenue is resulting in a myriad of infrastructure projects getting canceled or delayed indefinitely.

In the profile, Neal, 76, discusses spending much of his time these days "contemplating his legacy." To be sure, he has an impressive life story and can point to numerous philanthropic endeavors he’s supported throughout the local region. From what I've heard, his product is also significantly better than a home one might purchase from other prominent local builders, such as Medallion Home or D.R. Horton. But as the billionaire continues to tell the community from which he has harvested so much wealth that their concerns about unbridled development, a lack of infrastucture and the destruction of critical environmental resources must take a back seat his bottom line, it is not hard to imagine what most people in Manatee and Sarasota counties will think of the Neal name after he is gone.

Neal told Forbes he sees himself as a "seagull" with "the right to swoop down on any chicken bone.” I think most folks around here would be more likely to see him at this stage of his career as a vulture, one who has scarfed down enough chicken bones to choke a whale. You won, Pat. You made the three-comma club. Congrats. Perhaps it's time to sit back, count your money, and allow the officials this community has elected to decide how to best address an increasingly hostile environment by designing growth policies that are sustainable in the long term. 

Dennis "Mitch" Maley is an editor and columnist for The Bradenton Times and the host of our weekly podcast. With over two decades of experience as a journalist, he has covered Manatee County government since 2010. He is a graduate of Shippensburg University and later served as a Captain in the U.S. Army. Click here for his bio. Mitch is also the author of three novels and a short story collection available here.