U.S. Sugar land deal is fair, economist says

BONITA SPRINGS — Buying out U.S. Sugar and then leasing the land back to the company at $50 an acre is a good deal.

That’s the word from Henry Fishkind, an economist hired by the Everglades Trust to study the proposal. The governing board of the South Florida Water Management District approved the purchase of 182,000 acres for $1.34 billion in December by a 4-3 vote with opponents, including local board member Charles Dauray of Estero, questioning the economics.

Wednesday, Fishkind questioned the assumptions used by appraisers reviewing the deal for the district.

“There are a number of factors I don’t believe the appraisers accounted for,” he said.

Among those is the sheer size of the lease, the relative productivity of the land to be leased and the proximity of the land to infrastructure.

Fishkind said he saw leases of sugar land ranging from $50 to $450 per acre. The proposed lease includes more than 156,000 acres of sugar cane, he said.

“It’s enormous,” he said.

Fishkind said critics should also keep in mind the lease was not negotiated in a vacuum; if the lease price went up, he said, likely so would the purchase price.

Thom Rumberger, chairman of the Everglades Trust, said Fishkind was hired to provide an outside opinion of the lease. The economist’s report was distributed to legislators and water district governing board members.

“To render an opinion outside the government and ourselves,” Rumberger said.

In a statement, however, the Sugar Cane Growers Cooperative of Florida called the trust “a moving force behind the acquisition” and questioned Fishkind’s objectivity.

“An economist hired by those promoting the U.S. Sugar Corp. ‘bailout’ says that $50 per acre is fair,” the statement said. “But the appraisal on which the purchase is based says the land should lease for $200-$220 an acre.”

Co-op spokeswoman Barbara Miedema said the co-op is still waiting for an answer to its offer to lease 15,000 acres of the land for $150 per acre.

Miedema said other co-op members — there are 47 who raise cane on 60,000 acres — would be interested in leasing land as well.

“We have members who wanted to explore it and have a transparent, open process,” she said.

The statement said rather than release a “bought-and-paid-for” economic study, U.S. Sugar should make public all its leases so the public could do its own comparison.

Rumberger pointed out that the leased land could not be restored immediately by the government, and U.S. Sugar would be responsible for maintaining the land using “best management practices.”

“I think the rest of the community will come to the conclusion it’s not outrageous,” he said.

Brad Cornell, spokesman for Audubon of Southwest Florida, said he hasn’t seen the new study and cannot comment on what it says. He said the organization supports the overall purchase package.

“It’s hugely in the public benefit to do all the components of the deal,” he said. “If you look at it by itself some pieces may be problematic, but you have to look at the context.”