December 22, 2014

Water

Niagara Bottling's Fall

Lake County economic developers lured the company in, then spit it out.

Cynthia Barnett | 3/1/2008

Running low: Lake County Commission Chairman Welton Cadwell — with Commissioner Elaine Renick — says he and colleagues were stumped by how oblivious economic developers were to the water crisis. [Photo: Jeffrey Camp]

Bitter aftertaste

Timing may have hurt Niagara as much as anything. The commission voted on the company’s incentives just as Florida newspapers were reporting on how Atlanta was months from running out of water as Lake Lanier was drying up. Meanwhile, bottled water, still one of the fastest-growing segments of the U.S. beverage industry with average sales increases of 10% a year for the past decade, has begun to lose some appeal. Americans worry increasingly about bottlers siphoning off water resources and about the energy and pollution involved in making the plastic bottles. (This month, Niagara, which makes its own bottles, launches a new bottle 20% lighter than any other on the market.)

» “The idea of having a company mine our water resources and ship them out of the county when we are asking people to conserve and pay for alternative sources is just ridiculous,” says Lake County Commissioner Elaine Renick.

Hess also must share some of the blame. Relying on what he viewed as guarantees from managers within local government, he closed on Niagara’s property before anything was put to vote. “He knows how government works, and I think he should take some responsibility for buying the building before he knew he had the support,” says Renick.

Hess says some commissioners apologized before the incentives vote, telling him, “Yes, you’re about to get the shaft, but we’re not willing to take one for the team.” The county commissioners, he says, “appear to be good people, and it would be one thing if they were playing games with their own money. But they’re playing games with my money, and that’s very frustrating.”

Hess feels even more bitter about the city of Groveland, which he says also welcomed him in the beginning. While the industrial park is outside city limits, Niagara originally hoped to buy up to 500,000 gallons of water a day from Groveland, a prospect that Hess claims thrilled local officials. But the town changed its tune after the St. Johns River Water Management District laid down the law — Groveland’s own permit is for less than 300,000 gallons of groundwater a day, and the water district is making the town and other local governments cooperate in planning for alternative sources.

Despite the withdrawal of county incentives and Groveland’s rejection of Niagara’s request for a sewer connection, the company is still trying to build its plant. It’s steaming ahead with its request to the water management district for the 500,000-gallon permit. Both the county and the city have vowed to fight the request; they have succeeded in having the permit bumped up from staff review to consideration by the full water management district board.

Hess, furious that a two-year courtship has turned into combat, has hired a water-law expert, Tampa’s Edward de la Parte Jr., and a PR firm that specializes in water issues, Environmental PR Group. He’s also engaged hydrogeological experts who he hopes will prove that Niagara has as much right to a permit as any business. He estimates that Niagara executives are spending “several hundreds of thousands more dollars” than they expected when they chose Lake County over their second-favorite site in Texas. “It’s a million-dollar-plus loss,” Hess says. “The plant would have been up and running by March.”

In addition to raising a few questions about how valuable the economic incentive package really was to the company, the case puts water managers in a tough spot. Niagara can easily prove the first two of Florida’s three-part criteria for granting a permit: 1) The daily withdrawals are “reasonable and beneficial,” i.e., they won’t harm the aquifer; 500,000 gallons a day is a proverbial drop in the bucket. 2) Niagara’s withdrawal won’t interfere with existing uses of water.

Opponents will have to hang their argument on the nebulous third part of the test: Whether the use is “consistent with the public interest.” R. Duke Woodson, a Foley & Lardner partner in Orlando whom Groveland has hired to fight the permit, says the case “is not going to rise and fall on the effects on the environment. It’s going to turn on a brand-new argument for Florida — whether bottling water is in the public interest.”

As all the players await their chance to address water managers later this spring, elected officials and economic developers in central Florida are having heart-to-heart talks about exactly what industries Lake County wants. Cadwell, the county commission chairman, admits it isn’t fair to heap all the blame on the EDC: “We had a responsibility to let them know exactly which industries to target,” he says, “and I don’t think we’d done that.”

Cadwell hopes Lake County hasn’t scared any industries away, especially those that are green, high-tech or healthcare related. “I absolutely hate that Mr. Hess had that experience here,” Cadwell says. “But I also want to be very clear about our message: Our natural resources are very important to us. If you bring the right kind of business here, we’ll do anything we can to help you.”

Tags: Politics & Law, Central, Agriculture, Environment, Government/Politics & Law

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