Former Palm Bay Deputy City Manager Dave Isnardi has been arrested on charges of racketeering, conspiracy to commit extortion and conspiracy to possess controlled substances, including oxycodone.

Isnardi is the husband of Brevard County Commission Chair Kristine Isnardi.

Dave Isnardi is being represented at his initial appearance by Bryan Lober, an attorney who also is the County Commission vice chair. Lober said he told the Isnardis not to comment on the case to the media, and he noted that being accused of something is not the same as being guilty.

A second man, Jose Aguiar, a former candidate for the Palm Bay City Council, also was arrested Friday morning and charged with racketeering and conspiracy to commit racketeering. In 1997 in Massachusetts, Aguiar was convicted of conspiracy to sell cocaine and was sentenced to three years and one month in federal prison.

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All told, Isnardi is charged with two first-degree felonies, which each carry potential penalties of 30 years in prison; and three third-degree felonies, each of which carry a potential five-year prison sentence.

The two are being held without bail until they can appear before a judge, now scheduled for Saturday morning.

The arrest warrants for the two show that the FBI and Florida Department of Law Enforcement have been investigating allegations of corruption and undue influence on city officials in Palm Bay since at least 2015. The warrants draw heavily from secret recordings made by a confidential source working with investigators.

The arrest warrants for the two paint a picture of a city government embroiled in scandal, as Aguiar attempted to influence Palm Bay city officials. Though not arrested or charged, the warrants allege that City Councilman Jeff Bailey had an addiction to oxycodone and that former Councilman Tres Holton regularly had sex with prostitutes and used cocaine. It also alleges that Holton had obtained prostitutes for Mayor William Capote while the men were in Tallahassee. Capote denied the allegations.

The arrest warrants allege Isnardi and Aguiar were plotting to use a hidden camera to record Holton and Bailey having sex with prostitutes at “the Clubhouse,” a Canova Street home then owned by Aguiar, where Holton, Bailey and other Palm Bay officials hung out. They then planned to use those recordings to blackmail Holton and Bailey into voting the way Aguiar wanted on various issues including rezoning a property that Aguiar owned to allow him to open a scrap metal business that Isnardi would be a partner in.

It isn't clear from the arrest documents whether the two ever did set up a camera or make any recordings.

“Is this a joke?” Holton said, when contacted by FLORIDA TODAY and told the allegations against him in the arrest warrants. “You’re going to have to call me back,” Holton said, not responding further to questions.

Bailey could not be immediately reached for comment.

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The warrants also say that Isnardi and Aguiar plotted to plant drugs in Bailey’s car and arrange for a Brevard County sheriff’s deputy to perform a traffic stop on Bailey and to discover the drugs. The warrants also state that former City Manager Gregg Lynk was aware of the plot to set up Bailey, but didn’t want to know the details or participate in the effort.

Lynk could not be reached immediately for comment. He was fired in November after the City Council voted to remove him by a 3-2 vote. Bailey introduced that measure and Capote voted in favor of the firing along with newly elected Councilman Kenny Johnson.

The warrants also indicate that Aguiar had previously supplied Bailey with drugs and that he also offered Bailey money to make a down payment on a house, which Bailey declined.

During a subsequent interview with investigators, Bailey admitted that Aguiar offered him a house and that he received $300 in cash from Aguiar, according to arrest documents. Bailey didn’t report Aguiar’s donation, which he held onto until turning it over to the FBI during the interview.

In a subsequent interview with the FBI, set up by Isnardi's then-attorney, John Murphy, Isnardi admitted to participating in discussions about trying to record Holton and Bailey in compromising positions, according to the arrest documents.

But he denied there was an actual plot to plant drugs in Bailey's car. He did admit, though, that he contacted Brevard County Sheriff's Office Agent Jason West about the possibility that there were drugs in Bailey's car and noted that Bailey "was doing drugs anyway."

In a subsequent interview with law enforcement, West acknowledged that Isnardi had contacted him a year earlier. West said he wasn't sure but thought Isnardi provided some information about drug activity involving members of the Warlock Motorcycle Club and that he told Isnardi that he would pass it on to the BCSO drug unit.

The arrest affidavit also said that Isnardi had told another Palm Bay official that Bailey was dealing drugs near a school and that the official passed the info to the Palm Bay police.

Ultimately, Isnardi claimed the plot was only "guys talking s---, drinking beers and smoking cigars," according to the arrest documents.

The arrest documents show that Aguiar was angry about how Bailey was voting during council meetings and was determined to drive him from office.

"I’m going to kick his ass, he ain’t winning again,” Aguiar was quoted as saying during one recorded conversation. “I don’t know if I should just approach him and grab him by the throat and tell him how it is, or we should, or I should just avoid him…set this m-----f----- up or something?”

Capote said he was surprised to learn from FLORIDA TODAY that his name was mentioned in the arrest warrant as being connected with prostitutes.

He said those allegations are untrue.

“I don’t know who would tell someone that,” Capote said. “That’s profound. This is all new to me. That accusation has no validity.”

Capote said he has been in Tallahassee in the past on city business, meeting with state legislators and other state officials, but he did not hang out with Holton while he was there.

Capote says people may have been trying to taint him for political reasons. Capote said he was never interviewed by investigators, and that he has no reason to secure a lawyer in this matter.

Lober, the county commissioner representing Isnardi, said, "Dave hasn’t been convicted of anything in relation to these years-old hyper-political allegations. Given the number of individuals allegedly involved and the complexity of the allegations, this is not a case which is likely to be resolved quickly. I have no doubt that the facts will become increasingly clear in the coming months.”

Palm Bay City Councilman Kenny Johnson, who took office in November, said he hoped the city’s growth would not be “stunted” by any fallout form the arrests or what the arrest warrants alleged about other city officials.

“Being that this is prior to me getting in, I really don’t have much of a statement,” Johnson said. “I’ll let the justice system focus on what they have to do, and I’ll just focus on the city. … All the allegations surprised me.”

His fellow Councilman Brian Anderson had little to say. “At this point, I’m just waiting for all the facts to come in.”

Anderson declined to comment on what the potential political fallout might be in the city from the other allegations against current city officials. “It’s too early for any of that.”

Contributing: Jim Waymer, Dave Berman

Contact McCarthy at 321-752-5018

or jmccarthy@floridatoday.com.