Published: Aug 31, 2010 8:38 PM EDT
Updated: Aug 31, 2010 5:38 PM EDT

FORT LAUDERDALE, Fla. (AP) - The South Florida Water Management District should not have to finish an Everglades restoration reservoir shelved by its land deal with U.S. Sugar Corp., according to a report to a federal judge filed Monday.

If U.S. District Judge Federico Moreno accepts that recommendation it would remove a key legal hurdle to the district's proposed $197 million deal to buy 26,800 acres from U.S. Sugar. The land would be used to help restore water flows to the Everglades.

Moreno in March determined that the district's 2008 decision to stop construction on the massive reservoir in western Palm Beach County threatened to derail Everglades restoration in pursuit of a land deal with the sugar giant pushed by Gov. Charlie Crist.

The judge in March appointed a special master to coordinate how to proceed with getting the reservoir and Everglades restoration back on track.

Special Master John Barkett now has recommended that the district be relieved of its obligation to build the Everglades Agricultural Area Reservoir which already cost taxpayers nearly $280 million.

Barkett echoed the district's argument that the chance to buy U.S. Sugar land offers better restoration opportunities for the Everglades than finishing the 16,700-acre reservoir west of U.S. 27.

"The availability of the U.S. Sugar land is another changed circumstance that cannot be ignored in seeking to achieve Everglades restoration," Barkett wrote in his recommendation to the judge.

Instead of proceeding with the costly reservoir, the district wants to turn it into a stormwater treatment area that could help filter pollutants out of water headed to the Everglades.

 "Given limited resources, the district has seized a rare opportunity to acquire lands in a cost-effective way, enabling us in the coming years to implement proven water-treatment projects," the district said in a statement released Tuesday praising Barkett's recommendation.

The district on Oct. 11 plans to close on the latest scaled-down version of a land deal with U.S. Sugar. Crist for two years has pushed to buy U.S. Sugar land that could be used to build reservoirs and treatment areas intended to replenish the Everglades and provide backup for South Florida drinking water supplies.

Barkett pointed out in his recommendation that Moreno in March called for restarting reservoir construction "in absence of an agreement" to change Everglades restoration guidelines. Barkett contends that the district and federal and state officials are working on a new agreement.

Barkett called for a series of hearings starting Oct. 25 to try to resolve the differences between backers of the U.S. Sugar deal and the Miccosukee Tribe, which wants the reservoir built.

The tribe and U.S. Sugar competitor Florida Crystals have been waging a legal battle against the land deal, arguing it costs taxpayers too much, unfairly enriches U.S. Sugar and takes money away from other needed Everglades projects, such as the reservoir.

A decision from the Florida Supreme Court on the tribe and Florida Crystals' challenge to the deal is pending.

Environmental groups have supported the deal as a historic chance to buy strategically located farmland that was long off limits to Everglades restoration.