Sep 242012

Larry Ellison, the billionaire owner of Oracle, recently bought 98% of the Hawaiian island of Lanai for a reported $600,000,000. One wonders what he plans to do with it. According to the 2011 Assessor’s report on the Lummi Island the market value of taxable properties is close to $300,000,000. For the sake of argument we’ll suggest that the non taxable portion of the island might be worth another $300,000,000. Not too different than the island of Lanai.

If a billionaire could purchase Lummi Island and all its properties what changes might he or she make?

The geography is fixed. The on island infrastructure is not complex—eighteen miles of road, power lines, cable, phone, several water systems, lots of wells, a mix of small lots, larger properties, Trust lands and publicly owned lands. There is a school, a library building, a Grange Hall, a store, a restaurant and an inn. There is a ferry dock, a few boat ramps (none publicly owned), and a couple of natural harbors which are, unfortunately located away from the majority of the population. There is no local government save for a fire district which supports the volunteer fire department.

The longest distance between two points (Migley Pt to Scenic Estates) is a bit less than six miles. Some beaches are accessible at high tide. Many are not. There are a few low spots that have full time beach access (Lane Spit and Legoe Bay, for example). There is no regular bus service or public transportation. Biking is fairly easy for those young enough to pedal although the weather isn’t amenable to bicycle travel year round.

There is no on site power. Electricity arrives via underwater cable but is quite reliable. There is no place to purchase fuel on the island. A few islanders have storage in the hundreds of gallons. Most keep a gas can or two filled for emergencies. There are but a handful of solar/wind powered homes.

Supplies are obtained from the mainlined or via UPS, USPS or Federal Express. It is very difficult for retail business on the island because of the ease of getting to town. The morning ferries usually have a number of service and sales vehicles from the mainland arriving to do contracting or service work. There are a few contractors and some service people working on the island. Some are able to keep busy. Businesses tend to be home based and fill niches in the marketplace.

The island is not self-sufficient in any category except for water and there are many question marks about the water. A few people have added rainwater catchment. The island is dependent on County government for ferry service, road maintenance, law enforcement, on electric company for  power, the garbage company for garbage pickup, etc. Tourism provides a few dollars for a few people, there is some seasonal fishing, home business and telecommuting. The most reliable job is working on the ferry. There is not enough agriculture to provide food for the islanders. It is an import economy.

If a billionaire bought the island lock stock and barrel they would see that it was tethered to the mainland depending on the car ferry like a fetus relies on an umbilical cord. The billionaire would need to decide if this was a good thing or a bad thing.

In Lanai the debate over what Larry Ellison will do continues. Will he preserve or develop?Whatever he does, taking a fresh look at how an island might look in the future isn’t an exercise just limited to billionaires.


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