Palm Beach Post


Fanjuls file legal attack against U.S. Sugar sale

By Tony Doris

December 12, 2008

WEST PALM BEACH Florida Crystals Corp. says the state's proposed buyout
of land for Everglades restoration would give competitor U.S. Sugar a windfall
but fail to advance the ambitious ecological project the public envisions.

Florida Crystals subsidiaries New Hope Sugar Co. and Okeelanta Corp. filed a
motion this week in Palm Beach County Circuit Court to oppose the financing
that would let the South Florida Water Management District buy the 180,000-
acre expanse south of Lake Okeechobee.

U.S. Sugar would get hundreds of millions of taxpayer dollars up front, get to
lease the land back from the state at a low rate and continue to farm it for at
least seven years - and the public would get no benefit, said Gaston Cantens,
vice president of corporate affairs for Florida Crystals.

"There's no flow-way, there is no plan for restoration, there is no project that
is planned," he said.

Florida Crystals, owned by the Fanjul family of Palm Beach, is U.S. Sugar's
major rival in the state's sugar cane market.

Criticism of Florida Crystals and the Fanjuls came swiftly today from U.S. Sugar
and other supporters of the deal.

"They've chosen to go all out in their opposition to Governor Charlie Crist's bold
vision of Everglades restoration," U.S. Sugar Vice President Robert Coker
said. "They've clearly done so on the premise that anything that's good for
U.S. Sugar is bad for the Fanjuls and the heck with everybody else."

Coker added: "It's a relief for them to drop the pretense of any concern about
the public's interests in truly restoring the Everglades."

Florida Crystals also has been working behind the scenes, lobbying legislators
to kill the deal, said Eric Draper, policy director for Audubon of Florida.

"They're acting on behalf of their own financial interest, in hopes that if
they're able to scuttle the deal that they will be able to pick up parts of U.S.
Sugar at a discount," he said. "Florida Crystals has aggressively resisted every
major Everglades restoration project for 20 years."

The water district hopes to borrow up to $2.2 billion to cover the land and
other project costs. It would finance the deal by selling certificates of
participation, which are similar to bonds.

But that public borrowing requires a judge's approval. A bond validation hearing
has been scheduled for Feb. 6.

State officials announced June 24 that they had struck a tentative deal to buy
U.S. Sugar's land, lease part of it back to the company during an economic
transition period, and arrange to swap parts of the land for tracts held by
nearby growers that are better situated for projects to improve the flow of
water toward the Everglades.

The approximately $1.34 billion purchase, a centerpiece of Crist's political
career, has drawn worldwide attention and support from environmentalists
across the country.

But the Florida Crystals court motion says the proposed buyout goes against
the public interest.

"The issuance of these bonds is for an illegal purpose, specifically, use of the
district's taxing power to bail out a private company, allowing that company to
sell its assets to the district and then indefinitely remain on the sold land to
farm and profit from it while the taxpayers support its private purpose," the
motion says.

The supporters "paint a colorful picture of a new 'river of grass' flow way
through the Everglades Agricultural Area," but have presented only "vague
conceptual visions" with no defined plans for the land, according to the motion
by attorneys Joseph Klock Jr. and Juan Carlos Antorcha.

It's not just the big sugar companies butting heads over the deal. Opposition
also has come from former U.S. Attorney Dexter Lehtinen, a longtime legal
representative for the Miccosukee Indian tribe.

Lehtinen sued in August, alleging that the deal was hatched secretly and
would supplant a more timely reservoir creation and water flow restoration plan
that the district was already legally obligated to complete. President Clinton
signed that state-federal restoration plan into law eight years ago Thursday.

Water managers conceded that the reservoir plan was delayed, but they have
defended the U.S. Sugar buyout as one of the most important moves to
protect the Everglades since the creation of Everglades National Park in 1947.

A water district spokesman said today that it will press ahead with its plan.

"The district continues to believe it has the authority to issue certificates of
participation for the public purpose of Everglades restoration and water
resource development projects and is prepared to present its position to the
court in February," spokesman Gabriel Margasak said.