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Florida Buying Big Sugar Tract for Everglades

Damien Cave|The New York Times
Wednesday, 25 Jun 2008 | 1:14 PM ET

The dream of a restored Everglades, with water flowing from Lake Okeechobee to Florida Bay, moved a giant step closer to reality on Tuesday when the nation’s largest sugarcane producer agreed to sell all of its assets to the state and go out of business.

florida, everglades
Keo the Younger
florida, everglades

Under the proposed deal, Florida will pay $1.75 billion for United States Sugar, which would have six years to continue farming before turning over 187,000 acres north of Everglades National Park, along with two sugar refineries, 200 miles of railroad and other assets.

It would be Florida’s biggest land acquisition ever, and the magnitude and location of the purchase left environmentalists and state officials giddy.

Even before Gov. Charlie Crist arrived to make the announcement against a backdrop of water, grass and birds here, dozens of advocates gathered in small groups, gasping with awe, as if at a wedding for a couple they never thought would fall in love. After years of battling with United States Sugar over water and pollution, many of them said that the prospect of a partnership came as a shock.

“It’s so exciting,” said Margaret McPherson, vice president of the Everglades Foundation. “I’m going to do cartwheels.”

The details of the deal, which is scheduled to be completed over the next few months, and does not require legislative approval, may define how long the honeymoon lasts. Previous acquisitions took longer to integrate than initially expected and because United States Sugar’s fields are not all contiguous, complicated land swaps with other businesses may be required.

The purchase will be paid for with bonds and from fees already added to water bills. But if the price goes up or environmental remediation enters the picture, the state could have to renegotiate or find other money.

The fate of the company’s 1,900 workers also remains in question and some former company executives have suggested that the state is overpaying, bailing out a company burdened with debt, a troubled new sugar mill and a lawsuit from former employees who said they were bilked out of retirement money.

Company officials said the deal would amount to $350 a share, after taxes and other obligations were paid, a premium over two previous offers of $293 per share that the company had dismissed as inadequate.

The accusations and concerns, however, did not dampen the mood. Even as workers from the mill in Clewiston tried to get a handle on their futures, and some cried foul, Mr. Crist emphasized the land’s environmental value.

He said the deal was “as monumental as the creation of the nation’s first national park, Yellowstone.” Declining to provide details of how the state arrived at the price of $1.7 billion, he said it was a terrific bargain.

“I can envision no better gift to the Everglades,” he said, “the people of Florida and the people of America — as well as our planet — than to place in public ownership this missing link that represents the key to true restoration.”

The impact on the Everglades could be substantial. The natural flow of water would be restored, and the expanse of about 292 square miles would add about a million acre-feet of water storage. That amount of water — enough to fill about 500,000 Olympic size swimming pools — could soak the southern Everglades during the dry season, protecting wildlife, preventing fires, and allowing for a redrawing of the $8 billion Everglades restoration plan approved in 2000.

It would essentially remove some of the proposed plumbing. Many of the complicated wells and pumps the plan relied on might never have to be built, water officials said, because the water could move naturally down the gradually sloping land.

Kenneth G. Ammon, deputy executive director of the South Florida Water Management District, which would assume control of the land, said it would be a “managed” flow-way, with reservoirs and other engineered mechanisms to control water flow. David G. Guest, a lawyer for Earthjustice Legal Defense Fund, joked that he might have to go to blows to keep the area all natural.

Questions about the fairness of the deal

“This is about putting it back to the way it was in the 1890s,” Mr. Guest said. “What will happen is that if you come back here in 20 years, it will look indistinguishable from the way it looked before the white man arrived.”

The future challenges will probably intersect with the land’s more recent history. Since 1931, United States Sugar has farmed the area, using fertilizers that have often released phosphorous into the water. The legacy of its efforts could prove hidden at first, like pollution found during other environmental cleanup efforts.

The company has long denied that its efforts severely damaged the land, and executives said that the sale would benefit the Everglades, and shareholders.

“It’s dollars and cents and the right thing to do,” said Robert H. Buker Jr., the company’s president, in an interview after the announcement. “If I had to go out I’d rather — all of us would rather it went out to make the state of Florida better.”

The company will face some hurdles. The lawsuit involving former employees will not disappear but will probably include fewer plaintiffs, said Curtis Miner, one of the workers’ lawyers. Some, like Randy Smith, 57, who cashed out last year at $194 a share after 25 years with the company, said Tuesday’s deal only proved that he did not receive his fair share.

“I got ripped off pretty good,” he said.

Those most affected though will be current workers, and they could decide whether the purchase goes through. United States Sugar took its stock off the public market in 1983 to create an employee stock ownership plan, so technically the company is owned by the workers.

Mr. Buker said he expected the workers would approve the deal because of the money they could make. But at a meeting with workers in Clewiston on Tuesday, opinions seemed mixed. Some workers said they were angry they were left out of the loop. As recently as Tuesday morning, bosses told them that rumors of a sale were not true.

They had a lot of questions: Why sell now? What would happen when the state took over? Would the mill still run? Would there be jobs? What would happen to Clewiston, the tiny town that has relied on United States Sugar since the 1930s?

Mr. Buker tried to respond. He said it was a good deal, that wage earners would receive a year’s pay as severance; that salaried workers would get two years. And he said that the company had no choice but to sell because the state had the upper hand, and could have pushed them off the land with laws, rather than with $1.7 billion dollars.

For many — both workers and environmentalists — it was all still hard to believe. “You got to hear it three times,” said Chris Harris, 36, a United States Sugar foreman, after the meeting. “It sinks in but...”

His voice trailed off and he looked away. The company had seemed to be growing, revamping its mill. A new tower went up just last week. At the time, Mr. Crist was being lambasted by environmentalists for abandoning his opposition to drilling offshore for oil and natural gas. At least for some on Tuesday, all was forgiven.

“Offshore drilling is a mouse,” said Mr. Guest, of Earthjustice. “the Everglades is an elephant.”

Reporting was contributed by Yolanne Almanzar from Clewiston, Fla., and Mary Williams Walsh.

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