Miami Herald: Water managers outline fiscal pain, say U.S. Sugar deal doesn’t help

Mar 11, 2010

The Miami Herald published this article on March 11, 2010.

The massive Everglades land deal was brought into question Wednesday, but the purchase is unlikely to be derailed anytime soon.

They’ve got shrinking income. They’ve got growing expenses for everything from ensuring South Florida’s aging levees are safe to retrofitting coastal floodgates compromised by rising seas.

Then there is “the elephant in the room,” as Jerry Montgomery, vice chair of the South Florida Water Management District governing board, put it. That would be the $536 million deal for 72,500 acres of groves and fields, and an option for 107,000 more — conceived by Crist and championed by environmentalists as key to Everglades restoration.

The board could decide whether to shoot the elephant on Thursday, but, judging by plans for more discussion over the next few months, that seems a long shot. Still, a vote to extend an expiring contract deadline opens a door to kill a deal already downsized twice because of the struggling economy.

The purchase would add about $45 million in annual debt, and force drastic cuts to other programs for an agency projected to be running tens of millions in shortfalls over the next few years.

At the same time, deputy executive director Ken Ammon said the district needs more land to meet pending state and federal water pollution rules.

“Does it meet our mission? The resounding answer was yes,” he said. “Not to say we need all that property, but that is the way it was delivered to us. It was all or nothing.”

The deal has been under siege from rival growers Florida Crystals, the Miccosukee Tribe and some state lawmakers, who contend it will siphon money from existing projects and push back restoration by years or decades.

On Wednesday, Florida Crystals attorneys Joseph Klock and Gabriel Nieto sent a letter contending language in a financial “out” clause the board had inserted had been tweaked to make it harder to escape the deal, opening the door for a potential tax hike or breach-of-contract lawsuit from U.S. Sugar.

The attorneys urged the board to either restore tougher wording or let the March 31 deadline expire for a court to “validate” the bonds the district intends to use to finance the land.

Last year, in a lawsuit brought by Florida Crystals and the tribe, a Palm Beach County Circuit Court judge approved enough bonding capacity to make the first phase of the deal, but rejected a $2.2 billion credit line. The Florida Supreme Court is to hear an appeal April 7.

Board members did not discuss the letter or “out” clause, but district budget managers repeatedly dismissed the notion of raising property-tax rates in Miami-Dade, Broward, Palm Beach and 13 other counties that supply the bulk of its funding.

Plans call for the sugar land to be used for expanding reservoirs and pollution-treatment marshes crucial to supplying the Everglades with adequate water. Opponents say the district can’t afford the land or billions of dollars’ worth of needed projects.

“It’s ironic and a sign of the times,” said board member Charles Dauray. “We’re being asked to do more with less.”