A cool deal, going once, going twice

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Zellwin Farms General Manager Glenn Rogers knows well this vegetable precooler, a quartet of 10-foot diameter, 50-foot long steel vacuum tubes, plus assorted condensers and pumps.

Rogers bought the precooler's last tube just five years ago and oversaw its installation under the metal roof here at Zellwin Farms, on the north side of Jones Avenue in Zellwood. Last year, his company sold the yellow, basketball court-sized apparatus to the St. Johns River Water Management District for $1.4 million. On the morning of Dec. 3, Rogers bought it back for $35,000 during an auction held on his property.

Dozens of deals were made Dec. 3 at Zellwin Farms. And by this week's end, hundreds more will be struck in a series of auctions to liquidate the machines and tools, buildings and spare parts that 14 large farms used to coax corn and carrots and celery from the former lake bottom.

The auctions are the last phase of the taxpayer-funded, $91 million Lake Apopka buy-out process, designed in theory to stop the pollution of the lake and make way for a restoration. The state agreed to pay the farmers the appraised value of their equipment "in use," an amount many multiples of its market value.

So this week's sales are creating opportunities for savvy buyers with ready cash, and none are more savvy -- or have more cash -- than former owners. They know which items are valuable -- their workers built much of the specialized machinery -- and they know each other's inventory. The farmers have worked cooperatively for years, first in administering the Zellwin Drainage District, more recently in fighting environmental regulations and then in guiding the buyout.

Officials with the St. Johns River Water Management District, which negotiated the buyout, said last year that they expected the equipment auction to recoup only one-third of its $29 million cost. For specialty items the presumed markdown was greater. The district hoped to get back about a quarter-million dollars for the Zellwin precooler.

Told of Rogers' deal, Assistant Apopka City Administrator Jack Douglas says the city told them so. "We told them from the beginning that when they sold the equipment it wasn't going to bring in what they said," Douglas says. "We brought that to their attention early in the process."

In many cases, even those low expectations may have been optimistic. By the end of bidding Monday, about $2 million had been raised, according to auction administrator Ed Underwood. While big-ticket items were going for pennies on the dollar, prices for the vehicles were described by some bidders as high. "It was ugly," says one.

But the returns might have been higher if the district itself had not taken some of the best rolling stock for itself. The water district kept $1.4 million worth of trucks and heavy equipment to help it build the marsh that it hopes will clean the lake. Last week only a half dozen of the 117 remaining pickup trucks and vans appeared to be in decent running shape. The rest were either last decade's offerings or marked with caveats like "bad starter," "won't idle down" and "doesn't run."

"The trucks are junk," says Chuck Edmonds of Chuck's Used Truck Parts, in Ocala.

The money raised in the auctions is slated for economic development in the area where the farms, which employed more than 2,200 people, were located. The auction money will be divided up by the political jurisdictions most affected: Orange County gets 60 percent, Apopka 25 and Lake 15. The buyout legislation also enabled "up to" 20 percent of the resale funds to be used for retraining the farmworkers.

But "it's not going to go to retraining!" says Jeannie Economos, a coordinator with the Farmworker Association, which is aiding in the retraining effort. "By the time they get this 20 percent, what are they going to use it for, and who is going to use it, and who's going to be left?"

Although the county has programs that include child care, gas reimbursement and even a stipend for trainees, many farmworkers are unable to take advantage of the benefits.

Geraldine Matthew, a Farmworker Association outreach worker who concentrates on Seminole County, says she "found a good 18" workers who weren't aware of the retraining. "A lot of them are going to labor pools and getting daily pay jobs," she says.

The labor pools pay poorly, then charge the workers for transportation and lunch: "Three dollars for a dry bologna sandwich," Matthew says. "A lot of the people in Seminole County are going to Lake Okeechobee, picking oranges and being returned each night. It's like a three-hour drive, depending on the condition of the vehicle. ... One guy we know made $43 working [on a recent day]. He said he got in four hours [of work]. But he left the house at 6 a.m. and returned at 10 at night."

Workers are reluctant to take a day off from these kinds of jobs to go to an orientation meeting where they could learn about retraining opportunities, Economos explains: "We say it's better for their future. They say, ‘Well, we have to eat.'"

Told that Zellwin's Rogers repurchased his precooling equipment for one-fortieth what taxpayers had spent, Economos said she was "speechless."

But Underwood says the purchase price at auction is not comparable to the state's cost. "We're talking about two completely different sets of numbers," he says. "We're talking about ‘in-use' numbers."

As chief of the bureau of motor vehicle and watercraft in the Florida Department of Management Services, Underwood oversees about a half dozen state vehicle auctions each year, which raise about $15 million. "There were people there from all over the country," Underwood says. "If $35,000 was the high bid on that, then that's what the item was worth on that day in Apopka."

While more than 1,000 bidders crowded the auction floor, only a handful had the means or desire to bid on heavy items like the precoolers. And they were mostly locals.

To ensure that the government gets a fair price for all the stuff, Underwood's job was to notify as many potential bidders as possible. Underwood said his department spent $175,000 advertising the farm auction in food processors' trade magazines, direct-mail efforts and "all the major farm publications."

Rogers was taciturn about his purchase. "Hopefully we have a use for it," he said. "You have to take into consideration, it's going to be expensive to move it."

Zellwin's new vegetable processing facility is just over the Florida state line in Lake Park, Ga., near Valdosta. It is reportedly three times the capacity of the one that used to be here, yet because of automation it will employ only six people on a full-time basis, and during peak season significantly fewer than the 200 or so who worked the fields here for hourly wages.

The expense of Zellwin's modernization, eased by the windfall from last year's buy-out, is being further boosted by the bargains at the auction. Still, Rogers demurred when asked to assess his good fortune.

Rogers said he has "no idea" what the state paid for his precooler: "We didn't negotiate on a part-by-part basis."

But appraisal records show a part-by-part breakdown. The water district paid Zellwin $33.5 million for the farm based in part on the $14.2 million appraised value of the equipment. Appraiser S.M. Dix valued each item in use and tagged it with an identification number.

In many cases the number corresponds to the buyers' guide that was published by the auctioneer.

Zellwin's precooler setup was item number 624.00 in the appraisal and was tagged as lot 4.00, number 624 in the auction guide.

The lot Rogers bought comes without the "receiving tank," which farmer John Grinnell said is part of the concrete floor. Thanks to Underwood, the ammonia in the device -- similar in function to the freon in an air-conditioner -- will be removed "at the state's expense" so that it can be transported.

Underwood says he has no idea what that process will cost the state.

Rogers says he bought his former precooler for the convenience of fast delivery, as it would take several months to build a new one and, "I need it now."

Like all bidders for the stationary items, Rogers has 30 days to remove his prize. "I'll get mine out," he says, "before the state gets theirs."

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