A proposed interlocal agreement for the new Holiday Isle state park drew extended debate at the Okaloosa Board of County Commissioners’ March 3 meeting, with Destin city officials advocating for their own version of the agreement and two commissioners distancing themselves from the county’s draft.

• The roughly 4-acre waterfront property, adjacent to Destin’s Norriego Point Park, was acquired by the state in December for $83.3 million. Three months after the acquisition closed, the two governments have yet to determine how they will work together.

No formal lease between the state and the county has been executed. No management plan has been submitted.

Two interlocals, two visions

Destin’s version, approved by the city council in January and sent to the county, runs seven pages. It requires both governing bodies to approve any management plan before it is submitted to the state. It calls on the county to coordinate with the city before filing any application with any governmental entity related to the park. And it requires future development to be consistent with Destin’s comprehensive plan and land development code.

The county’s version, drafted by staff and placed on Monday’s consent agenda as Item 21, spans four pages. It calls for the respective staffs of both parties to meet periodically to discuss the development and use of the park, and states that if the parties come to terms, they may enter into a separate development agreement. The county’s version also includes a provision stating the agreement “is not legally enforceable against either Party.”

• A staff memo from Deputy County Administrator Craig Coffey accompanying the county’s version noted that Destin’s interlocal was sent to the county only after the city council had already adopted it — without county input in the drafting. Coffey wrote that the city’s version “raises concerns and therefore, cannot be recommended by staff for adoption.”

Commissioners differ

Commissioner Sherri Cox pulled Item 21 from the consent agenda. During discussion, she said the county’s draft did not represent her position.

“This is not my starting point. These were not my words,” Cox said. “I would not have written this document.”

Cox said she had spoken with Destin’s city manager and acknowledged that Destin’s residents represent a fraction of the county’s population — and an even smaller share of visitors — who would be affected by the park. She said she was uncomfortable making decisions about the property’s future without broader public input and proposed a scientific poll of county residents.

Commissioner Carolyn Ketchel agreed.

• “This is really the first time we’ve really talked about all of this,” Ketchel said. “I agree with Commissioner Cox. This is not my starting point.”

Ketchel, who said she had recently walked the property and found it “jaw dropping,” urged a conservation-focused approach. “We don’t need to concrete everything in our area. Old Florida is disappearing,” she said.

Destin officials make their case

Four Destin representatives addressed commissioners during public comment: Councilman Dewey Destin, Councilwoman Sandy Trammell, Councilman Jim Bagby and Mayor Bobby Wagner. City Attorney Kim Kopp also spoke at length.

Councilman Destin, who has been appointed as the city’s liaison for the negotiations, called for equal partnership. “For an interlocal agreement to be effective, it has to be equal partners,” he said. “It appears the thrust from your side, at least so far, has been much more commercial activity than the city thinks is acceptable.”

Bagby made a similar appeal. “If you offered us the deal we’ve offered you, we would accept it immediately,” he said. “Why? Because it’s a collaborative partnership.”

Trammell presented commissioners with a drawing — originally produced by the previous property owner — showing more than 200 parking spaces, which she said reflected what Commissioner Drew Palmer had described to her. Palmer interjected to clarify that the drawing was the developer’s prior plan, not his proposal, and that he envisions roughly 100 spaces.

Mayor Wagner defended the city’s decision to send the interlocal agreement to the county only after it had been approved by the full city council.

• “We seek council approval first so that the will of our elected body is clear in writing,” Wagner said, adding that the approach was intended to avoid “confusion back and forth or hearsay through staff or an elected body official.”

Wagner said the city sent its interlocal to the county on Jan. 22 with the expectation that the county would respond with red-line edits. Instead, he said, the city received no revisions until the county produced its own competing draft.

“We are ready to collaborate. We welcome the red line direction,” Wagner said. “We keep continuing to ask for red lines repeatedly since January 22nd without any revisions until now.”

The docks question

The existing 53-slip marina on the state property emerged as a major point of contention.

City Attorney Kopp told commissioners the docks were approved under a development order tied to a condominium project that was never built. That order, she said, specifically prohibited non-residential use, commercial use and slip rentals — restrictions she said were emphasized in bold and caps in the original approval.

“The development order – not only does it say “no commercial use,” Kopp said. “It says no non-residential use, no renting of the slips, no intensity and frequency of boats coming and going that is not typical for a residential neighborhood.”

But Kopp also sought to temper the narrative around the city’s position on the docks, noting the city is not demanding they be torn down.

• “I don’t want the city to be portrayed as an extremist,” Kopp said. “Like nothing can be done here and the docks must be torn down because that’s not the city’s position.”

Palmer said the Florida Cabinet approved the acquisition with the expectation that the marina would be operated as a public recreational marina, and that removing it was not something he would support.

“Are we contemplating approaching the state and asking them to tear down the marina? I think my answer is no,” Palmer said. He added that he would not have signed on to the letter committing county funds if the expectation was that the property would generate no revenue, and said the marina could help offset ongoing maintenance costs without relying on general fund dollars or tourism tax revenue.

Palmer seeks direction

Palmer told the board he needed guidance on two central questions before entering negotiations with Destin: whose definition of “conservation” should the county use — the state’s, which includes outdoor-based recreation, or the city’s, which he characterized as more restrictive — and whether the board supports any form of commercial activity on the property, including short-term slip rentals at the marina.

“When I’m talking with the city, we’re saying the same words and meaning different things,” Palmer said. “I need some direction from this board.”

He identified his two non-negotiables: free and sufficient parking for Okaloosa County residents, and keeping the marina operational as a public recreational facility.

Chairman Trey Goodwin offered the most detailed vision of any commissioner, saying he did not want the property to become “a land-based Crab Island” with “blowups and bounce houses” but did not believe generating income and conservation had to be mutually exclusive.

• Goodwin compared the marina slips to RV pad spots at Topsail Hill Preserve State Park, managed jointly with the state. He said he could envision transient day-use slips, modest retail such as a small sundries store, and tight enforcement of rules — but not fuel sales, long-term slip rentals or overnight living.

On parking, Goodwin broke slightly from Palmer, saying his priority was parity between county and city residents rather than necessarily free parking for all county residents.

“If city residents are free, I want county residents for free. If city residents get a discount, give county residents the same discount,” Goodwin said.

Next steps

The board reached consensus to send Palmer and County Attorney Lynn Hoshihara to negotiate with the city’s delegate — Councilman Dewey Destin — and City Attorney Kopp. The board did not adopt either interlocal agreement as a formal starting position.

Goodwin framed the two existing proposals as “bookends” for negotiation, though Cox and Ketchel made clear the county’s draft did not reflect their views.

Bagby, in his final remarks, said the city wants the negotiations conducted in the sunshine. “It ought to be in the sunshine,” he said. “When we’re talking about this parcel and the impact that it has on the citizens of Destin and the citizens of this county, it should be in the sunshine.”

Deputy County Administrator Coffey told commissioners the next procedural step is securing a lease from the state — which has not yet occurred — followed by the development of a management plan that would require a public hearing.

Goodwin acknowledged there is still significant ground to cover.

“This will not be the last discussion,” he said. “Nobody’s ready to start building anything right now.”

Background: 

The state acquired the Holiday Isle property on Dec. 11, 2025, purchasing approximately 3.99 acres from Pointe Mezzanine, LLC and Pointe Resort, LLC for $83.3 million. The sellers had originally planned to build 80 luxury condominiums on the site. Infrastructure including the 53-slip marina, sea walls, road construction and utility connections were completed before the sale. Okaloosa County has pledged a minimum direct investment of $3 million, with an overall contribution exceeding $5 million. No formal lease or management agreement between the county and the state has been finalized.