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BACK CHANNELS THROUGH BAY WATERS.

IS CARGILL "CLICKING ITS HEELS TOGETHER" OFF TO OZ IN LATIN AMERICA? 

As Clinton prepares to distribute $1.3 billion in "aid" to Colombia, the ole' war industrialists prepare to feather their coffers.  

The San Francisco Examiner reports Cargill stands to receive up to $300 million in combined Federal and State tax dollars for 19,000 acres of salt flats in the San Jose area of San Francisco Bay. (Click to read)

But the tab doesn't stop at $300 million (about $15,800 per acre). Another $200 million ($10,500 per acre) would be required to clean up of this "toxic" dump. Yes, man creates toxics of natural products when it "over concentrates" them, as in the case of the salt flats. And oil, and gas, and sulphur, etc.  

A recent example of damage caused by wine came to light with the Kornell wine warehouse fire this past June in Napa County. Though heavily diluted by water, the natural acids in the wine that spewed from exploding bottles were strong enough to kill grapevines in adjoining vineyards. In an article by Robert Salladay and Jane Kay of "The San Francisco Examiner" (Click to read), Cargill admits "(it) is scaling back its operation to concentrate on finer grained salt used in drugs instead of food. As a result, 19,000 acres of valuable land is up for sale...." 

One might question the term "valuable." Cargill is faced with the typical problems of a  "discontinued operation." The seller is responsible under the laws of the State of California to pay the cost of toxic clean-up. And salt kills, no doubt about it. Cargill's flats are a disaster. Why are S.F. Mayor Willie Brown and U.S. Senator Diane Feinstein so eager to spend our tax dollars to enrich Cargill? It can well-afford to handle the normal costs associated with discontinued operations and toxics clean-up. In a similar fashion, Cargill decided to abandon its North Bay salt flats in Sonoma - Napa Counties. The area totaled 9,850 acres and sold to conservation  interests at $10,000,000, or only $1,015 per acre. And to boot, just this past January Mary Fricker of "The Press Democrat" announced that a lawsuit brought in the U.S. District Court against Cargill for "overcharging" was unsealed (Click to read.

SUDDENLY CARGILL'S FLATS ARE PRICELESS Why the sudden increase in the price per acre in six years? From $1,015 per acre in the North Bay to $15,800 per acre in the South Bay? That's a whopping multiplier of 15 x. And the timing? When Cargill is being pressed through litigation to not only abandon its sale price of $1,015, but cough up the money needed to clean up the North Bay land? The "play" contemplated by Senator Feinstein and entourage would obviously negate the argument of the plaintiffs in the recently filed Federal action concerning the North Bay properties.  It would spare Cargill "loose change" in the extant litigation. Double entrendre. Bay Area residents, be reminded that Buttes Gas & Oil operated the Gambonini quicksilver mine in Marin County and killed off Tomales Bay. Did Buttes successor Reunion Industries suffer the consequences?  

It was reported as "devoid of assets" to foot clean-up costs (while now scott free to sell off prime country properties in Napa for $17 million to developers). So, the Gambonini toxic dump is being cleaned up with Federal Super Fund monies. But is Cargill devoid of assets to handle its own messes? Hardly, not with $46 billion in annual revenues. 

ANOTHER SPOOK CONNECTION? What's the rush? What's the inside deal here? Why the sudden rip-off, sudden urgency to push this deal through? During World War II, companies such as Kaiser and Cargill were indistinguishable from the Federal government. Their income was pure government, Kaiser from ship and war machinery construction, Cargill from ship-building (Minneapolis) and commodities contracts. Since that time they have served the government through their intricate "spook" channels, with layers of their companies and personnel (such as Bush fund-raiser Gene Trefethen of Kaiser, then Trefethen Winery) stepping to the forefront to provide private channels to aid the Contra cause. Ollie North knew who he could rely on in the "private" sector. Ollie did a good job of protecting these assets -- remember Fern Hall, remember the document shredding episode about which Ollie also testified? Somehow all of his notes and records about private contributors were shredded. (Ref: Peter Dale Scott's "Cocaine Politics," and Joseph Persico's "Casey"). 

It doesn't take much of a brain to realize that Cargill was involved in monkey business during Iran-Contra.  At least one of their operations in California surfaced in state records.  Cargill Marine and Terminal was created strategically in 1985, while there was a dry-up in funds to the Contras due to the Boland Act. Click to see it was subsequently "surrendered." Cargill Marine and Terminal probably ducked for cover into the U.S. Federal bankruptcy system when the fuel hit the fan about Ollie's "Triad" and "enterprises" in 1987-88. As to all that "bunk" about Cargill having been around since the Gold Rush - the fact is that Cargill acquired the salt flats from Leslie Salt in 1978. It was Isaac Friedlander who amassed a fortune cornering wheat and sailing vessels in San Francisco, only to die in 1878, one year after losing his Gold Rush fortune. 

BUT THIS CONTEMPLATED LARGESSE is indeed CARGILL'S GOLD RUSH. Cargill was in the Midwest and stayed in the Midwest, non-existent during California's Gold Rush. It narrowly avoided bankruptcy in 1909 when its founder died. The wars of the 20th century brought wealth and expansion on global scales. Cargill expanded during the Depression.  But World War II was Cargill's Gold Rush. Wars are good for grain companies like Cargill. They admit their business, which competes in the international theater, is a "highly competitive, narrow margin business." Enter a war, however, and the profits zoom to astronomical levels under government contracts. (Ref: Dan Morgan's "Merchants of Grain).  

In 1979 Dan Morgan wrote: "Colombia is a good example of what is happening in dozens of other countries. The UN's Food and Agriculture Organizations says that this Latin American country has the capability to be a major exporter of food." So instead, what did the government of Colombia do?  They adopted a domestic policy that hurts the poor and helps Cargill.  

In 1977, President Alfonso Lopez Michelsen was forced to announce that foodstuffs, as well as some manufactured goods, would have to be imported in order to combat growing shortages and prevent speculators.  

Failing to subsidize or stimulate local markets caused a downward spiral for Colombia and major gains for Cargill. Is Cargill going to take the profits of these rip-off salt flat sales to spread them about now in war profiteering in Latin America? You can help stop the Cargill sham by forwarding this information to every Senator you can think of in California and in Washington, D.C. Go to http://www.senate.gov  select "senators" and start rolling this through their email systems.  

Right now Senator John Kerry of Massachusetts is crafting "important environmental laws." And he also sits on the U.S. Senate Select Committee on Intelligence.   

Don't forget to saturate Sacramento and the State Senate Appropriations Committee following Willie Brown's capers. 

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Runway clouds salt pond purchase

Robert Salladay © 2000
OF THE EXAMINER STAFF
San Francisco Examiner 8/23/00

Mayor criticizes environmentalists who oppose bill

SACRAMENTO - For the first time since leaving the Legislature five years ago, Mayor Willie Brown traveled to the Capitol to testify on a bill, but his appearance did nothing to resolve a dispute between environmentalists and San Francisco International Airport.

Although Brown got his bill passed Tuesday, the former Assembly speaker left complaining that environmentalists were "being real stupid" in opposing his plan for the government to buy salt ponds in the South Bay.

Brown believes buying and restoring 19,000 acres of Cargill Inc. land for migratory birds would be the perfect antidote for the damage caused when the San Francisco airport expansion fills in more than 1,000 acres of Bay for a new runway.

"It just happened to come before us, the salt flats on Cargill's property," said Brown, not mentioning that federal officials have been looking at buying the land for two years. "The Bay watchers took me up in an airplane and showed me all the places and the spots, and it is an enormous potential undertaking."

But Cargill said it wouldn't sell the land, near Newark and San Jose, if the deal came under conditions approved Tuesday by the Senate Natural Resources Committee. The bill, supported by Brown and written by Assemblywoman Carole Migden, D-San Francisco, now heads to the Senate Appropriations Committee.

Cargill believes the measure is vague and could mean a five-year wait before it is paid for the marshland it has owned since the Gold Rush. The land is home to 70 species of shorebirds and migratory fowl, and is estimated to be worth $300 million.

As the Migden bill is written, Cargill and environmentalists believe the purchase can happen only when SFO is ready to pay to restore the area.

But that money - up to $200 million - most likely won't be available for years, if ever, after environmental reviews are completed on the expansion.

Cargill said it might be forced to start simply selling the land piecemeal rather than wait for the airport environmental reviews and the state to cut a check. It would rather just sell the land to the state

and federal government now and have the state worry about restoring the land later.

Wants to be paid soon

"If in reality what this means is a significant delay, then yes, that's a problem," said Cargill spokeswoman Lori Johnson, who attended the hearing Tuesday. "Our interest is: If we are going to do this acquisition, we need to do it in a timely manner."

But Migden refused Tuesday to take out language that environmentalists and Cargill believe would kill the sale. The measure continues to say the Cargill sale cannot go through until money to restore the property is found.

So far, the only public agency with money to restore the property is, in fact, the airport.

Migden did make one amendment Tuesday: she removed $150 million from the bill, sending the issue instead to the Senate Appropriations Committee, where lawmakers will haggle over how much to spend on the Cargill purchase.

In Washington, U.S. Sen. Dianne Feinstein is pursuing another $150 million for Cargill, but only if the Legislature and Gov. Davis approve California's half by the end of next week, the final day of the 1999-2000 legislative session.

Both Migden and Brown acknowledged their first interest was to get the airport expansion approved. But they said the Cargill land should be set aside until a fickle Congress was ready and able to spend its half.

At worst, the state and federal governments will have purchased valuable land and preserved it. At best, the airport also will have a place to spend its $200 million and restore the land.

'A golden opportunity'

"When I was presented with this airport runway project, I knew it presented a golden opportunity for magnificent mitigation," Brown said. "Everybody already knows the airport has budgeted $200 million for mitigation and would like it spent on a project that will be forever. This potential restoration project will be forever."

But Davis Lewis, executive director of the preservation group Save the Bay, said the airport saw an opportunity to take credit for

saving the Cargill wetlands before the property slipped from its grip. So the airport, he said, is trying to step in before federal wildlife officials purchase the land and claim credit.

This also is the central worry among environmentalists about the Migden bill: If the state buys the Cargill land, it adds pressure to approve the airport expansion. The state will have spent $150 million on a piece of property in exchange for the runway expansion, even before it has gone through environmental review.

"The airport is trying to get a PR win here. They want to be able to claim: 'We delivered the salt ponds, now we're owed the runway,' " Lewis said. "That's why they are doing this now. The whole thing came about because wildlife agencies wanted to purchase it."

Lewis said the airport should wait until the environmental review was finished, and then look for a way to spend its $200 million on restoring property elsewhere.

"The airport should want the ponds to be purchased," Lewis said. "There is going to be plenty of need for their restoration funds if and when their project is approved."

After the hearing, Brown rushed away, but did say the airport was a critical asset and that environmentalists were making a mistake.

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Senate panel votes to buy salt ponds
By Robert Salladay ©
OF THE SAN FRANCISCO EXAMINER STAFF
  8/23/00, San Francisco Examiner

SACRAMENTO - For the first time since leaving the Legislature five years ago, Mayor Willie Brown traveled to the Capitol to testify on a bill, but his appearance did nothing to resolve a dispute between environmentalists and San Francisco International Airport.

Although Brown got his bill passed Tuesday, the former Assembly speaker left complaining that environmentalists were "being real stupid" in opposing his plan for the government to buy salt ponds in the South Bay.

Brown believes buying and restoring 19,000 acres of Cargill Inc. land for migratory birds would be the perfect antidote for the damage caused when the San Francisco airport expansion fills in more than 1,000 acres of Bay for a new runway.

"It just happened to come before us, the salt flats on Cargill's property," said Brown, not mentioning that federal officials have been looking at buying the land for two years. "The Bay watchers took me up in an airplane and showed me all the places and the spots, and it is an enormous potential undertaking."

But Cargill said it wouldn't sell the land, near Newark and San Jose, if the deal came under conditions approved Tuesday by the Senate Natural Resources Committee. The bill, supported by Brown and written by Assemblywoman Carole Migden, D-San Francisco, now heads to the Senate Appropriations Committee.

Cargill believes the measure is vague and could mean a five-year wait before it is paid for the marshland it has owned since the Gold Rush. The land is home to 70 species of shorebirds and migratory fowl, and is estimated to be worth $300 million.

As the Migden bill is written, Cargill and environmentalists believe the purchase can happen only when SFO is ready to pay to restore the area.

But that money - up to $200 million - most likely won't be available for years, if ever, after environmental reviews are completed on the expansion.

Cargill said it might be forced to start simply selling the land piecemeal rather than wait for the airport environmental reviews and the state to cut a check. It would rather just sell the land to the state and federal government now and have the state worry about restoring the land later.

"If in reality what this means is a significant delay, then yes, that's a problem," said Cargill spokeswoman Lori Johnson, who attended the hearing Tuesday. "Our interest is: If we are going to do this acquisition, we need to do it in a timely manner."

But Migden refused Tuesday to take out language that environmentalists and Cargill believe would kill the sale. The measure continues to say the Cargill sale cannot go through until money to restore the property is found.

So far, the only public agency with money to restore the property is, in fact, the airport.

Migden did make one amendment Tuesday: she removed $150 million from the bill, sending the issue instead to the Senate Appropriations Committee, where lawmakers will haggle over how much to spend on the Cargill purchase.

In Washington, U.S. Sen. Dianne Feinstein is pursuing another $150 million for Cargill, but only if the Legislature and Gov. Davis approve California's half by the end of next week, the final day of the 1999-2000 legislative session.

Both Migden and Brown acknowledged their first interest was to get the airport expansion approved. But they said the Cargill land should be set aside until a fickle Congress was ready and able to spend its half.

At worst, the state and federal governments will have purchased valuable land and preserved it. At best, the airport also will have a place to spend its $200 million and restore the land.

"When I was presented with this airport runway project, I knew it presented a golden opportunity for magnificent mitigation," Brown said. "Everybody already knows the airport has budgeted $200 million for mitigation and would like it spent on a project that will be forever. This potential restoration project will be forever."

But Davis Lewis, executive director of the preservation group Save the Bay, said the airport saw an opportunity to take credit for saving the Cargill wetlands before the property slipped from its grip. So the airport, he said, is trying to step in before federal wildlife officials purchase the land and claim credit.

This also is the central worry among environmentalists about the Migden bill: If the state buys the Cargill land, it adds pressure to approve the airport expansion. The state will have spent $150 million on a piece of property in exchange for the runway expansion, even before it has gone through environmental review.

"The airport is trying to get a PR win here. They want to be able to claim: "We delivered the salt ponds, now we're owed the runway,' " Lewis said. "That's why they are doing this now. The whole thing came about because wildlife agencies wanted to purchase it."

Lewis said the airport should wait until the environmental review was finished, and then look for a way to spend its $200 million on restoring property elsewhere.

"The airport should want the ponds to be purchased," Lewis said. "There is going to be plenty of need for their restoration funds if and when their project is approved."

After the hearing, Brown rushed away, but did say the airport was a critical asset and that environmentalists were making a mistake.

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SALT SHAKER -HEALDSBURG MAN SUES OVER WETLANDS PRICE

January 9, 2000 © 2000 The Santa Rosa Press Democrat
By Mary Fricker © 2000 Staff Writer  | 

A debate over how to value environmental land purchased for preservation has focused on the North Bay, where a lawsuit accuses Cargill Inc., the nation's largest private company, of overcharging state and federal agencies at least $10 million for salt evaporation ponds officials hoped to restore to tidal wetlands.

The lawsuit, brought by a Healdsburg man critical of the acquisition, has received national attention after a federal judge unsealed the case documents and claims last month. The suit accuses Cargill of using a ``bogus and fraudulent'' appraisal method to justify a $10 million price tag for 9,850 acres of abandoned salt ponds, levees and sloughs at the north edge of San Pablo Bay between the Napa River and Sonoma Creek.

The complaint in U.S. District Court in Oakland argues that the property actually had a ``negative fair market value'' because of the cost of cleaning up after the salt operations.

Cargill, a Minnetonka, Minn., company that trades and processes foodstuffs and commodities, has extensive salt-making operations on the San Francisco and San Pablo bays. With 82,000 employees worldwide and offices in 59 countries, it had $46 billion in sales last year.

The lawsuit was filed by Healdsburg resident John Hansen, a carpenter and former volunteer game warden who has taken up a crusade to police what governments pay for private land in order to preserve it.

``This was a sweetheart deal, substantially swept into being by the prowess of Cargill's political weight,'' said Hansen, who founded the small nonprofit Integrity in Natural Resources, which analyzes the economic, scientific and other data used in conservation agreements. Cargill argues, however, that the sale was sought by environmental groups and government agencies and the price paid for the land was substantially below its market value.

Hansen, who is represented by Novato attorney Daniel R. Bartley, filed his complaint in 1998 under the False Claims Act, which lets private citizens sue on behalf of the government. It was sealed and remained confidential while the U.S. Department of Justice and the state Attorney General's Office decided whether to join Hansen in the case. They decided not to intervene and the complaint was unsealed.

Hansen's view

Hansen's view is that taxpayers should not pay more for conservation land than a private person would pay, unless the reasons are clearly disclosed. The view has been backed publicly by leading professional appraisal organizations and the Department of Justice.

``In filing this action, I'm trying to make sure the limited dollars spent for conservation lands for the public are really for the public, not dollars to fill corporate coffers,'' Hansen said.

But others believe some conservation land is worth more to the public than to a private person and should be valued at a higher price.

In the Cargill matter, Hansen claims Cargill knowingly used an appraisal that assigned an inflated value to the property. He also is suing Cargill's appraiser, Craig D. Hungerford, and his company Real Estate Dynamics Inc. of Madison, Wis.

On Thursday, Hungerford declined to comment because he had not seen the lawsuit, but Cargill spokeswoman Lori Johnson defended Cargill's sale and pointed out that the transaction was reviewed and approved by several government agencies.

`Bargain-basement price'

``One thousand dollars an acre for this property was a steal. It was a bargain-basement price recognized by everyone,'' Johnson said. ``All of the agencies involved still say this is one of the best deals for the state of California in California history.''

She said several environmental groups and government agencies had begged the company to sell the property so it could be returned to its historic condition as tidal marsh.

``If wetlands are believed to be so valuable, you are not going to be able to accomplish public goals unless there's a method for incentivizing a landowner to sell you their property,'' Johnson said.

Will Travis, a state official responsible for the negotiations with Cargill in the early 1990s, said he views the acquisition -- which is the largest wetlands acquisition and restoration project in the history of California -- as a major accomplishment.

``Of all the things I've done in my professional career, getting that land acquired so it could be re stored is at the top of the list,'' Travis said. ``I'm extraordinarily proud of it.''

In his complaint, Hansen accuses Cargill, Real Estate Dynamics and Hungerford of making a series of false claims to justify an inflated sales price and of conspiring to defraud the government. He estimates damages at $10 million plus cleanup costs.

The complaint asks the judge to determine the actual market value of the site and to order the defendants to pay the United States and the state of California three times the amount they have been damaged, plus fines, and to pay Hansen ``the maximum amount allowed`` -- which is 25 to 50 percent of any recovery, Bartley said -- plus attorneys' fees and costs.

Drawing attention

Hansen's case has drawn the attention of natural resource experts across the country, particularly appraisers, because it tackles the thorny issue of how to value environmental land, especially when it has social value but little or no economic value.

With more than $1 billion a year now being allocated nationwide to acquire conservation land, much of it coming from taxpayers, the stakes have risen on how the issue is resolved.

Bartley said the case could set a precedent that could have implications for land purchases across the country.

Closer to home, it could impact a half-dozen wetlands transactions around the Bay Area as well as San Francisco Airport's efforts to expand its runways into the San Francisco Bay. For the airport's plans to move ahead, some have proposed it could mitigate the environmental damage to the Bay by buying and restoring Cargill's 29,000 acres of salt ponds in the South Bay.

The first hearing in the Hansen case is set for April 7 in U.S. District Court in San Francisco.

When the story began

The Cargill salt pond story began in April 1988 when the Shell Oil Co.'s refinery in Martinez spilled about 400,000 gallons of crude oil into San Francisco Bay.

To settle claims brought by 15 federal, state and local agencies, Shell agreed to pay $10.8 million into a trust fund to be used to restore and acquire natural resources. A trustee committee of six public agencies was formed to spend the money, with Travis as chairman, and in 1992 it approached Cargill with an offer to buy the North Bay salt ponds.

Cargill, which had harvested salt at the site since 1959, was selling the salt to a Dow Chemical Co. chlorine plant in Pittsburg, but that plant closed in 1990 and Cargill had been unable to find another customer.

At first, the trustee committee said it would select and hire an appraiser, but Cargill objected and eventually selected Hungerford as the appraiser and paid for his work. He established a value of $34.8 million, or $3,533 per acre.

Cargill said it would accept $10 million and would apply to the IRS for a tax deduction based on a $24 million charitable donation. A deal was struck, even though in 1991 state officials had criticized and rejected a similar appraisal of Cargill property in the South Bay, by the same appraiser and using the same appraisal methods.

In 1994, the trustee committee paid Cargill $6.5 million for the site, state agencies paid $2.75 million and $750,000 came from a national conservation grant. Cargill also reduced its taxes by an undisclosed amount.

The Hungerford appraisal is at the heart of Hansen's lawsuit.

His complaint's central concern is that the appraisal claims to establish market value but it is based mainly on what government agencies and nonprofits have sometimes paid to acquire conservation land, such as wetlands.

This type of appraisal, often called a ``public interest value'' appraisal, is different from a conventional appraisal, which is based on what private parties would pay to acquire the land for economic purposes.

Public interest value

A public interest value appraisal usually arrives at a higher value than a conventional appraisal.

Public interest value appraisals are a hotly debated topic in the appraisal industry today, with the discussion centered mainly on whether public interest value is essentially the same as market value.

Market value

Market value is what a willing buyer would pay a willing seller to acquire property for its ``highest and best use'' when the parties are operating freely in a competitive and open market for their own self interest.

Hungerford has been a leading proponent of the public interest value concept, arguing in professional publications that if individuals or organizations pay money to acquire and preserve environmentally significant real estate, that establishes a market value.

The Department of Justice and leading U.S. appraisal associations, including the 19,000-member Chicago-based Appraisal Institute, have concluded that public interest value appraisals do not establish market value and on public land purchases that require market-value appraisals, public interest values cannot be used. The institute spent 2-1/2 years studying the issue.

However, the state Department of Real Estate Appraisers, California's licensing agency for property appraisers, approved of Hungerford's methods in the Cargill appraisal.

In Sonoma County, the county's open space district recently discussed appraisals based on public interest values, but it has no plans to permit their use, according to general manager Steve Sharp.

Hansen's complaint alleges that the Cargill property actually had a negative value because of the cost of cleaning up the salt ponds. In order to restore the ponds to tidal wetlands, the salted waters will have to be diluted and carefully discharged into the Bay over many years to avoid environmental damage.

Studies under way

Studies are under way to analyze restoration possibilities, and government officials recently estimated the cost of restoring some of the ponds to tidal habitat at $6.5 million.

Hungerford's analysis allocated $1 million for cleanup.

Currently, the state Department of Fish & Game, which is managing the property -- with its 7,300 acres of salt ponds and 52 miles of levees -- does not have the funds for restoration, and only one of the 12 ponds has thus far been restored.

PHOTO: b&w by John Burgess/Press Democrat
MAP: b&w by Press Democrat Graphic: Former Cargill Inc, salt ponds John Hansen has sued the Cargill Co. and its appraisers after state Fish and Game purchased 10,000 acres of land in southern Sonoma and Napa counties for $10 million. Hansen claims the land is worthless.

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Logo
Disclaimer: The information displayed here is current as of "Aug 19, 2000" and is updated weekly. It is not a complete or certified record of the Corporation.

Corporation
CARGILL MARINE AND TERMINAL, INC.
Number: C1268364 Date Filed: 2/5/1985 Status: surrender
Jurisdiction: DELAWARE
Mailing Address
15407 MC GINTY RD WEST
MINNETONKA, MN 55343
Agent for Service of Process
C T CORPORATION SYSTEM
800 SO FIGUEROA ST
LOS ANGELES, CA 90017

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