Florida Supreme Court Everglades Decision and Its Impact on Bonds
Last Thursday, the Florida Supreme Court issued its opinion, finding that the South Florida Water Management District can finance the Everglades land deal using bonds. Rationale? According to the high court (read the opinion here and here), this will serve the good of the public: restoration of the Everglades.
However, the law made here really deals with how bonds can be sold more than how land can be protected or used. In its ruling, the Florida Supreme Court provides precedent that bonds usually used for construction financing, i.e., certificates of partication, can be used for a public purpose. The key fact, of course, is whether or not a public purpose is involved.
The Everglades - US Sugar Controversy
At issue before the Court was a well-known controversy surrounding more than 180,000 acres of land held by U.S. Sugar. Back in 2008, Governor Crist decided that this land should be purchased by Florida as part of the Florida-US restoration deal. In response, a lawsuit was filed by the Sugar Cane Growers Cooperative of Florida, Florida Crystals, and the Miccosukee Indian Tribe -- these plaintiffs seeking judicial relief to stop the sale, arguing it wasn't so much about restoring the Everglades as helping out U.S. Sugar.
Timing is Everything: Land Deal Already Done Before Opinion Came Down
There's a twist here, almost another example of the barn door being closed after the horse is gone: FWMD has already done the deal, buying the land a year ago (October 2009), at least some of it. It took all its cash to do it, but the deal got done. Cost? $197,000,000 for 27,000 acres or thereabouts. A majority of the purchase was for groves in Hendry County; 8,900 acres was purchased by FWMD in the Everglades farming area.
Maybe the case does mean that more land will be bought. However, in future years we may come to recognize the power of this opinion in its financing implications, in deals having nothing to do with the Everglades whatsoever.