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With the end of U.S. Sugar, what becomes of Clewiston?

CLEWISTON — The day after U.S. Sugar delivered a seismic shock to this town on the southern edge of Lake Okeechobee, things seemed strangely the same, yet different. Like a close relative had just died and nobody had quite come to grips with the loss.

Robert Coker, the company's senior vice president, was still barreling down the halls of U.S. Sugar's Tara-like headquarters.

Joel Granville, a machine operator at the company's mill, was high-tailing it home on his bike at the end of the afternoon shift.

And Butch Wilson, laid off in October after 32 years at U.S. Sugar, was behind his desk as curator of the Clewiston Museum, a shrine to the town sugar built. But for the second day in a row, Wilson was besieged by reporters, wanting his take on news that his former employer had agreed to sell all its assets to the state of Florida for $1.75-billion.

"We always thought we were privileged to live in a small town, with a company that was so self-sufficient and created such a diversity of jobs,'' said Wilson, 57. "It's just a shock they decided to sell to the environmentalists."

Coker, built like a bulldog with tenacity to match, has been battling for U.S. Sugar's interests on the local, state and federal levels for 26 years. A graduate in political science from Florida State University, he married the daughter of Clewiston's long-time mayor. For years he was known around town as "Mindy's husband." Offered a post as "director of nothing important" at U.S. Sugar at age 23, he felt like he'd died and gone to heaven. "I thought the guys there were at the top of the pole,'' he said.

Now Coker, 49, is at the top of that pole, and he just maneuvered a deal to do away with the whole shebang in about six years. U.S. Sugar's nearly 300 square miles will become the missing link in the state's comprehensive Everglades restoration project.

Coker denied the company caved in to environmentalists, who recently forced U.S. Sugar to stop back-pumping water from its fields into Lake Okeechobee.

"For their level of conviction that we have horns and a tail, we have the same level of conviction that we've done what's right and reasonable,'' he said.

Nor was U.S. Sugar ready to give up on agriculture in South Florida, where it cultivates 187,000 acres in sugar cane and citrus. Coker said the company, which reportedly had revenues of $398-million last year, has been profitable all but one year during his career. And the recently passed federal farm bill, which guarantees domestic sugar growers 85 percent of the U.S. market, should be a boon for all farmers. "There's absolutely a future for agriculture in Florida,'' he said.

So why would one of the nation's largest agribusinesses consider closing up shop?

Coker sidestepped the question, saying it was his "fiduciary responsibility" to bring Gov. Charlie Crist's surprise November buyout offer before U.S. Sugar's directors. The board, which includes relatives of Charles Stewart Mott, who founded the company in 1931, had dismissed another suitor's offer of $575-million in 2005 and again last year. But Coker, who said he never spoke directly to Crist about the deal, had a feeling the state could come up with an acceptable figure.

"When the governor's got something on his mind, he can be pretty specific,'' Coker said. "There are people who may have underestimated him in the past."

After the holidays, U.S. Sugar's employees began intense negotiations with state and South Florida Water Management District officials. Talks were so top-secret, Coker didn't even tell his wife. The sugar people wanted an all-or-nothing deal.

"They couldn't just come in and buy 25,000 acres of citrus groves or sugar cane,'' Coker said of properties which include a sugar refinery, citrus processing plant and a 120-mile railroad. "All the assets are an integral part of our business."

The state still needs to get an appraisal of U.S. Sugar's holdings. And details of a lease-back arrangement, which will keep the company going for at least six years, need to be worked out. Then U.S. Sugar will morph from big boss to tenant farmer. Coker downplayed the transition.

"We're going to continue investing in this business through the last harvest," he said. "We've got to work every day like we're going to be here for the next 20 years."

• • •

Sitting on a worn bench in front of Local 57 of the International Association of Machinists and Aerospace Workers, Tom Owens said he understood the sale was the best option in a no-win situation.

"Robert Buker (U.S. Sugar's president) told us the state made an offer that was close to fair market, and they could have come in and taken our land anyway,'' said Owens, a mill mechanic for 22 years. "The company has been battling this since '94 and the Everglades Forever Act."

Owens said managers started cutting back on capital outlays at the mill about four months ago, but everybody chalked it up to general belt-tightening that had seen union membership sliced in half to 500. Despite the layoffs, workers expected to die or retire at the plant, where wages were double what they could earn elsewhere in town.

"Used to be you couldn't beg, borrow or steal one of these jobs,'' said Owens, 44. "You had to wait until somebody passed away."

Greg Thompson, in his first year as union president after 19 years as a power plant operator, said workers were happy to hear promises there would be no layoffs for six years. And though the union hasn't negotiated severance, Thompson expected it will match the year's salary being offered to non-union hourly employees. Salaried employees will get two years' pay.

Long-time employees will also be able to cash in shares they've accrued in the company. Valued earlier this year at about $200 each, shares will jump to about $350 a share when the transaction closes. But nobody's predicting a boom of sugar-millionaires.

Even many veteran white-collar workers have amassed fewer than 1,000 shares. And a 12-year mill worker had fewer than 150 shares.

"Some people will do fairly well, and they deserve it," Thompson said of the payout. "People are wondering if it's enough for them to pick up and move somewhere else."

• • •

The best scenario, according to Thompson, the union president, would be for another manufacturer — a food processor maybe — to take over U.S. Sugar's state-of-the-art mill and refinery complex the day after the last crop of cane passes through.

At corporate headquarters, Coker spins out a similar fantasy. Maybe the refinery, the largest in the world, could be retooled to turn sorghum or switchgrass into fuel, he said.

"The technology of alternative energy will catch up with the economics," said Coker, admitting U.S. Sugar tried and failed to make a go of ethanol. "I could see this area becoming a major player with its open land and transportation infrastructure."

But that was speculation about a rosy ending on a summer's day when afternoon rain clouds were piling up overhead.

Joel Granville, 31, has worked at the mill, seven days on, two days off, for a dozen years. Pedaling home Wednesday, he paused before the storm.

"I thought U.S. Sugar was too big to be bought," he said. "It was the biggest company that ever was."

Kris Hundley can be reached at [email protected] or (727) 892-2996.

With the end of U.S. Sugar, what becomes of Clewiston? 06/30/08 [Last modified: Tuesday, July 1, 2008 5:09pm]
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