Swapping Water for Jobs
Bottling is easier in Florida than in many other states.
Madison is one of 33 "first-magnitude springs" in Florida, a designation for springs that discharge at least 100 cubic feet every second, or about 65 million gallons a day. Florida has more first-magnitude springs than anywhere else in the world. That fact, along with the growing market for bottled water in the Eastern U.S., brought a multinational corporation to the tiny nearby town of Lee.
Lee is one of the last places in Florida where you can drive for miles on graded dirt roads and see few signs of life other than the occasional chicken. But today in these woods, not far from trailers with no trespassing signs like the one that says "BAD ASS DOGS," sits Nestle Waters North America's newest plant -- one of the most advanced bottling facilities in the U.S.
The plant, also a Southeastern distribution center for more than a dozen Nestle water products, from the French Perrier to the Italian S. Pellegrino, produced 26 million cases of bottled water in 2005. As the facility expands to 646,000 square feet this year, Nestle's investment here will top $110 million.
HIGH TECH: One of the most advanced bottling plants in the U.S. is nestled in rural Madison County, where Nestle cranks out more than 3,000 bottles a minute. For most of the year, the plant operates 24 hours a day, seven days a week.
Nestle has operated in Florida since 1989, when it bought the family-owned Zephyrhills water bottling plant in Pasco County and began bottling spring water from nearby Crystal Springs. In the late 1990s, consumer demand sent the company searching for a new bottling and distribution site somewhere between Allentown, Pa., and Zephyrhills. The flow, water quality and location convenient to Interstates 10 and 75 sold the company on Madison Blue.
Many in the community welcomed the prospect of up to 250 jobs and an increased tax base. But environmentalists worried Nestle's 1.4 million-gallon-a-day maximum withdrawal could deplete water supply in the region. Even some supporters of the plant complained about the $1.3-million highway improvement grant offered up by the state to a corporation with annual revenue of $66 billion.
Many also ask why Nestle and other bottlers should get their raw material -- water, which by law belongs to the state -- for free. One economist compares it to a food company that makes berry jam and gets the berries at no charge. Others believe that government should receive royalties, such as those paid by oil companies, for allowing water bottlers to extract the planet's most important resource.
Nestle and other officials counter that theirs is a value-added product that relies on water to a lesser extent than competitors such as soft-drink companies or beer makers. Company executives say it takes 1.3 gallons of water to produce one gallon of Nestle spring water, compared with three gallons to make a gallon of soda, 42 gallons to make a gallon of beer and 5.4 gallons to make a board foot of lumber.
"We pay a great deal for this water," says Meg Andronaco, Nestle natural resource manager for the Southeastern U.S. "It costs millions and millions of dollars just to develop the spring and go through the permitting process."
Water bottlers in fact use a minuscule amount of water compared to other Florida industries. The state's farmers, for example, suck up 3.92 billion gallons of water a day. Florida's spring-water bottlers hold permits to use a little more than 10 million gallons a day.
But the issue could grow more sensitive as Florida government and consumers face enormous water-infrastructure bills in the coming decades to create new water supplies -- like desal plants -- as the most populated areas run out of groundwater. There's little question that everyone in Florida eventually will have to pay more for water -- bottlers included. Last year, state Sen. Paula Dockery's work group studying ways to fund new supply considered lifting the sales-tax exemption on bottles of water, which would have raised an estimated $50 million a year for the state. Major help from the industry in the wake of hurricanes helped the powerful beverage lobby convince lawmakers not to take up the idea.
A Maine group is pushing a 20-cents-a-gallon tax on bottlers in that state, home to Nestle's Poland Spring Bottling Co. And in Michigan, the industry is so controversial that Democratic Gov. Jennifer Granholm last year put a moratorium on new or expanded bottled-water operations until the Legislature enacts a water withdrawal law.
To be sure, the industry is a classic case of NIMBY, or not-in-my-back-yard, in Florida. The Wakulla County Commission recently nixed a water-bottling plant two miles from Wakulla Springs, even though the Northwest Florida Water Management District had permitted pumping there.
Handing over resources in exchange for economic development has been a part of Florida's heritage since the Legislature traded swampland for railroad lines in the 1800s. Madison County Commissioner Roy Ellis, who represents the town of Lee, argues that's the only way rural counties can have a chance to grow and prosper. "They've been a very good neighbor, and they've kept every promise and they've filled every job they said they'd fill," Ellis says of Nestle. Meanwhile, he says, the company has invested so much in its Madison operation that there's no way it will deplete Madison Blue. "They have an interest in taking good care of it."