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Florida touts $1.7b deal to restore Everglades

State would buy US Sugar Corp., gain key acreage

Email|Print|Single Page| Text size + By Damien Cave and John Holusha
New York Times News Service / June 25, 2008

LOXAHATCHEE, Fla. - The dream of a restored Everglades, with water flowing from Lake Okeechobee to Florida Bay, moved a giant step closer to reality yesterday when the nation's largest sugar cane producer agreed to sell all of its assets to the state and go out of business.

Under the proposed deal, Florida will pay $1.75 billion for US 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 Governor 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 US 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 to be completed over the next few months, may define how long the honeymoon lasts. Previous acquisitions took longer to integrate than initially expected and, because US 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.

The fate of US Sugar'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 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 a 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, Crist emphasized the land's environmental value.

While declining to provide details of how the state arrived at the price of $1.75 billion, he said it was a terrific bargain.

"I can envision no better gift to the Everglades, 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," he said.

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 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.

A new design 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.

Since 1931, US Sugar has farmed the area, using fertilizers that have often released phosphorous into the water. 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.

Those most affected though will be current workers, and they could decide whether the purchase goes through. US 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.

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 yesterday, opinions seemed mixed.

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