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June 28, 2026 · The Sunday Brief No. 006 · Cape Coral, FL
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FREE EDITION
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What's being built · What it means
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$1.14M
Federal CDBG dollars up for distribution to Cape Coral nonprofits and housing programs in FY 26/27.
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47 ac.
The Seven Islands site where mangroves were cleared without federal authorization during invasive species removal.
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$0
Stop-work orders issued by the City of Cape Coral or the Army Corps after the mangrove removal was discovered.
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Lead Story · Seven Islands Development · Northwest Cape Coral
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Mangroves cleared at Seven Islands without federal authorization. The developer says it was a contractor mistake. No stop-work order was issued.
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Work at the Seven Islands site in northwest Cape Coral came under scrutiny this week after neighbors discovered that mangroves along the waterfront had been cleared. The U.S. Army Corps of Engineers confirmed to local media that no mangroves were approved for removal under the project's pending permit application; and neither the Corps nor the City of Cape Coral issued a formal stop-work order.
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Gulf Gateway Resort & Marina LLC, the developer behind the $1 billion mixed-use project, acknowledged the clearing in a statement. The company said a contractor was authorized only to remove invasive exotic species, specifically Australian Pine and Brazilian Pepper, and that the mangrove removal was unintentional. After a representative for the developer visited the site and learned what had happened, the contractor was directed to stop.
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The Army Corps told reporters its permit application for the Seven Islands project is currently in a withdrawn status, pending a design change. That means no active federal authorization was in place for any waterfront disturbance at the time the mangroves were removed. The city told reporters it is not involved in any work stoppage and directed questions to the developer and the Corps.
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Why this matters for the project
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Seven Islands sits on the east side of the North Spreader Canal in northwest Cape Coral. The 47-acre property, made up of seven man-made islands, was sold by the city to Gulf Gateway (a Forest Development entity out of North Palm Beach) in February 2026 following unanimous City Council approval in January. The project calls for up to 995 residential units, a 10-story hotel, a public marina with 39 boat slips, restaurants, retail, and a community center island adjacent to Tropicana Park.
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From the beginning, the developer's stated position was that mangrove preservation was a design priority, not just a regulatory requirement. Forest Development Senior VP Sam Bauer told media in January 2026 that the seawall was moved upland specifically to avoid removing mangroves, and that docks would meander around the mangrove line rather than replace it. The involuntary clearing of mangroves before a federal permit was even in hand cuts against that narrative, and it hands a concrete data point to the project's critics who have argued the environmental commitments would not hold under construction pressure.
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The Corps permit application, now in withdrawn status pending design revisions, covers the seawall, docks, and related waterfront work. No timeline was provided for when a revised application would be resubmitted. Until that application is reactivated and approved, the developer is working with, in their words, "several local and federal agencies on next steps." The current site timeline is described as an ongoing process across all seven islands.
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Project snapshot: Seven Islands / Gulf Gateway Resort & Marina Village
Developer: Forest Development (North Palm Beach) via Gulf Gateway Resort & Marina LLC ·
Site: 47 acres, 606 Old Burnt Store Rd. N., northwest Cape Coral ·
City sale closed: Feb. 11, 2026 ·
Planned: 995 residential units, 10-story hotel, marina, restaurants, retail, community center ·
Federal permit status: Withdrawn, pending design revision ·
Stop-work orders issued: None
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Neighbors who live directly across from the site expressed concern about the exposed shoreline left behind. With no permits in hand and no stop-work order on the books, the immediate question is whether the Corps or DEP will require restoration of the disturbed area as a condition of any future permit approval. That answer will come from the agencies, not the city.
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Sources: WINK News reporting, June 17 and June 23, 2026; Naples Daily News, June 23, 2026; Gulf Gateway developer statement via WINK News. The Digest will continue to monitor Corps permit activity and any agency-required remediation.
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Board Meeting · CDBG Citizens Advisory Board · June 19, 2026
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Cape Coral's federal housing and social services grant cycle opens at $1.14 million. Here is who is in line for the money.
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The CDBG Citizens Advisory Board met on June 19 to hear applicant presentations for the FY 2026-2027 grant cycle. The total allocation is $1,143,460, up 2.93% from last year's $1,110,919. Staff's recommended methodology is to apply that same 2.93% increase uniformly across all funded agencies.
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CDBG stands for Community Development Block Grant, a federal program administered through HUD. Cape Coral's allocation splits three ways: public services (capped at 15% of total, or $171,519), housing and economic development (65%, or $743,249), and administration (20%, or $228,692). That 20% administration slice drew scrutiny from the board at its April 10 meeting; members discussed whether it could be trimmed in future cycles.
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Who is requesting funding
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Eight organizations applied under the public services category, requesting a combined $176,295 against the $171,519 cap. The gap between what was requested and what is available means at least one applicant will be trimmed, or the board will need to adjust individual awards. Staff's recommended awards track just under the cap at $171,519.
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| Agency |
Project |
Requested |
Staff Rec. |
| Abuse Counseling and Treatment |
Shelter & Services, Domestic Violence Victims |
$36,121 |
$36,099 |
| Cape Coral Caring Center |
Public Services |
$24,865 |
$25,594 |
| Cape Coral Parks & Recreation |
Paratransit (Minibus) |
$25,000 |
$20,797 |
| Cape Coral Parks & Recreation |
Child Care Services |
$16,595 |
$16,052 |
| Community Cooperative |
Utility Assistance |
$20,385 |
$20,982 |
| Deaf and Hard of Hearing Center |
Handicapped Services (Deaf) |
$21,750 |
$21,265 |
| Dr. Piper Center for Social Services |
Senior Services |
$20,000 |
$18,629 |
| Sunrise Community of SWFL |
Handicapped Services |
$11,579 |
$12,102 |
| TOTAL PUBLIC SERVICES |
$176,295 |
$171,519 |
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On the housing side, Habitat for Humanity of Lee and Hendry Counties submitted two requests: $170,000 for land acquisition and $530,000 for gap financing. Staff's recommended award for the land acquisition aligns exactly with the request at $170,000; the gap financing recommendation comes in just above the ask at $533,249. Combined with Goodwill Industries of SWFL's $40,000 microenterprise request (fully recommended by staff), the housing and economic development bucket totals $743,249 in staff recommendations.
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The federal funding question hanging over the program
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At the April 10 board meeting, member Glasford raised a flag that is worth tracking: federal CDBG funding may be reduced or eliminated in the next federal budget cycle. The board's housing coordinator, Millie Babic, noted that this is not a new threat; the program has faced proposed cuts in prior years. No letter from HUD had been received regarding the FY26 allocation as of that meeting, and the working assumption is that Cape Coral receives funding consistent with prior years. Congress controls the appropriation, not the city.
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The board also discussed transportation as a barrier for the program's low-income participants. Several of the services funded, including the Caring Center's food access network and the Deaf and Hard of Hearing Center's interpreted appointments, depend on clients being able to reach service sites. The Caring Center's executive director noted at the April meeting that a new partnership with Guiding Grace Family Support Network will allow some residents in the northern parts of the city to access food services closer to home.
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CDBG FY 26/27 timeline
June 19: Applicant presentations and staff funding recommendation presented to the Citizens Advisory Board ·
July 22: City Council consideration ·
Aug. 3: Submission deadline for the Action Plan to HUD
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The Citizens Advisory Board's funding recommendation will be forwarded to City Council on July 22. Council's approval triggers the submission of the Action Plan to HUD by August 3. Based on 20 years of program history reviewed at the June 19 meeting, the board's final award figures have closely tracked staff recommendations in all but a handful of years; the dollar differences when they diverge have been small.
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Sources: CDBG Citizens Advisory Board Meeting Minutes, April 10, 2026; CDBG PY26 Action Plan Presentation, June 19, 2026; City of Cape Coral agenda package.
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July is quiet on the calendar. The questions left open in June do not go away.
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The next regular City Council meeting is July 15. Before that date: HB 803 (the permitting streamlining bill covered in Issue No. 005) took effect July 1; the Lee County Property Appraiser issues certified taxable values in late July; and the CDBG Action Plan goes before Council on July 22 ahead of the August 3 HUD submission deadline.
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On Seven Islands: the Army Corps permit application is in withdrawn status with no resubmission date on record. What happens next on site depends on what the Corps and DEP require as conditions for moving the application forward, and whether any restoration of the cleared mangrove area is ordered. This story is not resolved.
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The FY 2027 budget's $3M structural gap remains unresolved heading into summer. Certified taxable values in late July set the actual math. The millage rate certification and public hearings happen in September before the October 1 budget year start.
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Coming next issue: Hudson Creek. A developer recently closed on a 1,745-acre tract east of Burnt Store Road in what is being described as the largest raw-land deal in Lee County history. The parcel sits directly in the path of the city's northward utilities extension and has implications for growth, infrastructure capacity, and the long-term buildout of the northwest Cape. We are pulling the full picture together for Issue No. 007.
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That is The Sunday Brief No. 006. Two issues back from our regular schedule, and the stories were worth the wait. The Seven Islands situation will be one to track closely all summer; the CDBG calendar moves fast with the August 3 HUD deadline on the horizon. Next week: Hudson Creek, the largest raw-land deal in Lee County history, and what it means for northwest Cape Coral.
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