By Anna Merlan
By Roy Edroso
By Carolyn Hughes
By Chuck Strouse
By Albert Samaha
By Anna Merlan
By Steve Weinstein
By Tessa Stuart
Libby Pataki, the governor's wife, is part owner of a canker-ridden parcel of citrus groves in southeast Florida that state and local officials are negotiating to purchase at three times the price the Pataki-tied company paid for it in 2000. Jeb Bush's administration has already cleared the way for the acquisition by giving the parcel a top ranking in the Florida Forever preservation program, even though it does not meet the pristine wetlands standard ordinarily applied to state-financed purchases.
Sources indicate that the Pataki land, which is located along the border of Martin and Palm Beach counties, will go for roughly the same as the $10,113 per acre Florida officials agreed to spend on a neighboring parcel with pristine wetlands. Mrs. Pataki and her partners could collect $14.4 million compared with the $4.4 million they paid for it before the canker was discovered. A bacterial disease that leaves cork-like lesions on fruit and leaves, the canker swept through a reported 150 acres of the groves last fall, forcing the removal of thousands of trees.
An agreed-upon price for the Pataki land will go before a state board on November 14, a week after both governors are presumably reelected, The purchase will be financed as a 50-50 state and local split, with Governor Bush ultimately having to personally approve the voluntary acquisition. Mrs. Pataki's earnings on the sale may well be the largest windfall in the complicated maze of real estate dealings involving the family over the last decade or so. They were over a million dollars in debt when George Pataki took office in 1995.
Though Mrs. Pataki had no income when her husband was elected, she has become a big breadwinner in the family, earning $200,000 in 2001 from a variety of consulting jobs (he reported $204,500). One of the largest is with Premier Heart, a Long Island-based medical technology start-up that has paid her $285,000 since November 1998 to aid in marketing a sophisticated electrocardiogram. The mysterious company, whose Web site once said the marketing strategy was aimed exclusively at developing a network in "five hospitals in the New York metropolitan area," is owned by Richard Hayden, who is also a principal in the Florida company, Old Blue LLC, that bought the groves.
Reached at his Oregon home, Hayden told the Voice that he went to Yale University and Columbia Law School with the governor and has been a friend for decades, but refused to say if it was he who had invited Mrs. Pataki to join Old Blue, a term of affection for Yale. Financial disclosure statements indicate that Mrs. Pataki acquired an 8 percent interest in the company, which was incorporated on December 20, 1999, using Hayden's million-dollar, five-bedroom, four-and-a-half bath house in Ocean Ridge, Florida, as its mailing address. The only other partner is Vanessa Yuan, who lives on West 66th Street in Manhattan and declined to answer any questions. Hayden, who is married to Ying Lee Hayden, refused to say if he was related to Yuan.
Hayden said he and Mrs. Pataki were "passive investors," and were "not really involved" in the ongoing negotiations with Florida officials. Asked if The Stuart/Port St. Lucie Newswas correct in reporting that his firm approached local officials about buying the 1430-acre plot, after canker hit their groves last year, Hayden said, "That's not my understanding." He refused to elaborate. Describing himself simply as an Oregon attorney for 23 years, Hayden refused to say if Premier Heart was "in any way benefiting" from his ties to Pataki, including the recent decision by New York Empire BlueCross BlueShield to cover patients "with diagnostic indications" detected by the company's experimental Cardiotron.
The same day that Old Blue LLC was incorporated in Florida, another company, New Orange LLC, was also formed, including three major local developers: Shannon Ginn, John Bills, and Charles Martyn. The three had long been the principals of Sunrise Citrus Groves Inc., which leased the then thriving orange and grapefruit groves near Cypress Creek. Seven days later, Old Blue and New Orange became partners in Sunrise Boys LLC, which bought the groves on January 3, 2000. The only one of the three Florida partners reached by the Voice, John Bills, rebuffed questions about why they didn't just buy the groves themselves, though he said he was "aware that Rick brought in the governor's wife," a reference to Hayden.
The Sunrise property was bypassed for preservation designation in late 2000, largely because it did not contain pristine wetlands, according to Patrick Hayes, a leader of the Loxahatchee River Coalition. Though Hayes and other environmental leaders there favor the acquisition of the parcel, and its possible use as a storm-water reservoir, he is upset that officials made the purchase of the neighboring wetlands property contingent on closing a deal with the Pataki partners.
"The groves are definitely a secondary consideration," said Hayes. "I don't know why the state chose to make them a linchpin piece and make the very critical acquisition of the wetlands contingent on the groves. I just don't know how this piece got to be such a prominent fixture." Hayes led a 400-mile trip by activists to Tallahassee this spring to push for the Florida Forever ranking, but he says the purchase of the wetlands property is a "life or death" matter for the river, while he doesn't "really care what happens to those groves." The state usually "considers groves a liability," Hayes says, adding that "under normal circumstances, it would not want to buy a wetland disturbed by them." The only explanation state officials offered was that an easement issue affecting the adjoining property necessitated the acquisition of Sunrise, an unlikely argument if Sunrise's owners weren't anxious to sell.