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Sunday, July 22, 1990 - Page updated at 12:00 AM

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Cypress - An Island Set Apart -- The State Finds The Best Way To Preserve Pristine Property - Buy It!

CUTLINE: WOODSY RIDGES ON CYPRESS ISLAND RISE HIGH OUT OF THE WATER, OFFERING GREAT VIEWS BUT LITTLE BEACH AREA.

CUTLINE MAP OF SAN JUAN ISLANDS

CUTLINE: BEFORE HE SOLD THE PROPERTY, RAYMOND HANSEN PLANNED TO DEVELOP A LARGE RESORT HERE IN EAGLE HARBOR; NOW KAYAKERS CAMP NEAR OLD CABINS AND HAVE ACCESS TO THE ISLAND'S INTERIOR.

CUTLINE: LEFT - ED HOWARD, RIGHT, WHO HAS LIVED ON THE ISLAND OFF AND ON SINCE 1963, RELAXES AFTER A MORNING OF DIGGING CLAMS WITH HIS BROTHER-IN-LAW, BILL WOODRUFF OF ANACORTES.

CUTLINE: BELOW - ON A TOUR AROUND CYPRESS ISLAND, A STATE ACQUISITION AND POINT OF PRIDE, ARE FROM LEFT: NICK FAHEY, ISLAND RESIDENT; BOB ROSE, A SPECIAL ASSISTANT TO STATE LANDS COMMISSIONER BRIAN BOYLE; BOYLE; DNR ENVIRONMENTAL PLANNER PATRICIA POWELL, AND STATE REP. HELEN SOMMERS, D-SEATTLE.

CUTLINE: LEFT - WITH NO FERRY DOCK OR UTILITIES, CYPRESS MAY REMAIN PRIMARILY AN ISLAND OF STANDING TREES, PUBLIC BEACHES AND TRAILS FOR EXPLORATION.

Buy land,'' the folk wisdom goes. ``They aren't making any more of the stuff.''

After a quarter century of lost opportunities, Washington-state officials appear to be taking this advice to heart.

You can see it at the crown of Cypress Island. What was once contemplated as a water reservoir for a mammoth resort today remains a still lake, cupped in wooded hills and cruised by a hunting bald eagle.

You can see it in a grove of 500- to 800-year-old cedar trees near Nemah, in the southwest corner of Washington.

You can see it from Interstate 5 near Everett, where the Cascade rampart to the east now includes nine miles of wooded ridge line on Pilchuck Mountain protected from logging.

The race is on to protect the best of Washington before it disappears.

The statistics are impressive enough. With little fanfare, state lawmakers have tapped the tax surpluses generated by the past few years of explosive state growth and have earmarked $245 million to protect land from logging and development - not by regulation, but by buying it.

The first acquisitions with that money, plus land transfers by the state Department of Natural Resources, have added more than 46,000 acres of nature preserves and recreation areas in Washington since 1987.

In the assessment of Sen. Dan McDonald, R-Bellevue, growth has both created the alarm necessary to encourage the land acquisitions, and provided the money to pay for them. Growth ``is the reason we have this money,'' says McDonald, one of the architects of the land purchase program. ``We have an opportunity to make a difference in how this place looks when the growth spurt is through.''

Particularly remarkable is a scheme to use $170 million in school construction money twice: once to build schools and again to preserve land.

The double bookkeeping sounds like the card trick of a Mississippi gambler, but it actually involves no sleight of hand.

Instead of cutting old-growth forest to provide state money for school construction, the state is using recent tax surpluses. The trees thus saved from logging are set aside in preserves, and already-logged land equal in value to that set aside is purchased and replanted to maintain the state's total timber base, providing trees for the future.

``It's kind of a double use of taxpayers' money,'' McDonald says.

But numbers don't convey the real value of what is finally, narrowly, being saved. To do that one must visit a place like Cypress Island, that woody, wild-looking isle rearing high above the water to the north of the Anacortes ferry dock.

Cypress is a curiosity when seen from the deck of a ferry rumbling toward Orcas Island or Friday Harbor. Five miles long and three miles wide, it is about as big as Mercer Island but much more rugged, its woodsy ridges rising out of the water with little beach and mounting up to 1,500-foot heights. Lakes dot the folds between its rumpled hills, and the views from its crests are panoramic.

But while the rest of the San Juans swarms with visitors, Cypress seems set apart. It has only 20 or so homes, no public dock, no stores or telephones. Its wintertime population hovers near two, or three.

It is the last major undeveloped island in the archipelago - seemingly as untouched, at casual glance, as when Capt. George Vancouver came ashore in 1792 and apparently confused the island's juniper trees for swamp cypress.

In fact, Cypress is a survivor. Over the past century it has been logged, mined, roaded and has a weed-grown gravel airstrip incongruously carved on a ridge top hundreds of dizzying feet above the water.

In the late 1970s and early 1980s, a Spokane industrialist and inventor named Raymond Hansen - who bought 3,170 acres of the island's 5,500 when the state would not - built the airstrip and proposed a 100-slip marina and 18-hole golf course here.

He wanted to build more than 1,000 homes and condominiums on the island or, in a scaled-back version when his initial proposal drew protest, a 340-unit resort.

An earlier big landowner on the island, Seattle's Sam Emmanuel, once proposed an oil port on the island's south shore, and a nuclear power plant that would use its cooling water to form a waterfall.

What has prevailed over such grandiose plans are the eagles. If you circle the island in a boat or kayak, you may spot the snow-white heads of bald eagles roosting in the shoreside trees. In the island's interior two immature eagles, still brown, sometimes seem to play tag over a wetland.

In the next two years the public will be deciding, through an advisory committee and public hearings, how their newly acquired island should be managed.

How Cypress was saved as a reminder of the wilder San Juans is a good-news story with no shortage of heroes. It is representative of a much broader number of acquisitions that include the slopes of Mount Si near North Bend, the trees of Mount Pilchuck, a one-time Weyerhaeuser site on Woodard Bay near Olympia, meadow land near Chelan, and so on.

``It's a stunning list,'' says Rep. Helen Sommers, D-Seattle, who recently thrashed through chest-high underbrush on Cypress to emerge at a hidden lake surrounded by rugged cliffs and old-growth forest. She chairs the House capital construction committee. ``We've taken the unanticipated revenue (from the state's current boom) and applied it to this one-time purpose.''

Even happier, the acquisitions are just beginning. While there is no sign yet that the development that consumes an average 8,000 acres a year in the Puget Sound basin is slackening, some of the best of the state is being preserved for future generations.

The dream of preserving Cypress Island is not new. Too steep to farm except in a couple of places and its shoreline mostly too rugged for easy cabin development, it has no ferry dock or utilities and only one really protected harbor. It has escaped the development that has taken place on San Juan, Orcas, Shaw, Lopez and Guemes islands.

There is an aquaculture farm and boys' reform school in Secret Harbor and 20 or so mostly summer homes on Strawberry Bay, but most of the island is empty. About 80 percent of it has been logged and is covered with second-growth forest, with three surviving old-growth stands already set aside as special conservation areas.

In the late 1970s, state Lands Commissioner Bert Cole had DNR produce a film touting Cypress as a place the state should acquire and protect.

But Cole's department bungled - intentionally, some observers believe - an opportunity to pick up 143 acres on Cypress Head in 1973 and more than 600 acres of Whitworth College property in 1978. Instead, Raymond Hanson bought up two-thirds of the island and announced plans to develop it.

In 1980, Hanson contributed to Cole's last, losing race as DNR commissioner. And the day he left office, Cole gave Hanson a needed permit to dam and deepen a lake on the island for a resort water supply, despite a written plea from incoming commissioner Brian Boyle that no action be taken.

Hanson, who calls Cole ``a very fine individual,'' is an American success story, a Spokane luminary accustomed to getting what he wants. He invented a device that helps level harvesting combines when they cut rolling wheat in country such as Washington's Palouse, and a gargantuan ditch digger used to build California aqueducts. He has plunged into projects around the world.

But a handful of people with homes on Cypress, led by Nick and George Fahey, were appalled when Hanson began proposing the island's transformation to a mega-resort, turning it from the least to the most heavily developed of the major San Juan islands.

Hanson ultimately dropped his plans, but initially, ``He was the perfect developer enemy,'' recalls Nick Fahey, whose father bought a logged-over 100-acre waterfront homestead for $3 an acre in back taxes in 1929 and has kept it undeveloped. ``He came in and did everything in a rude and arrogant way.''

Hanson feels, however, that arrogance is a term more aptly applied to island dwellers. ``You have a lot of retired people living in Skagit County whose attitude basically is, `I'm the last one in, I don't want anybody else.' They want to close the gate behind them.''

The islanders and their allies in Skagit County, of which Cypress is a part, formed Friends of Cypress Island (which never had more than about 50 dues-paying members, says Fahey) and began challenging Hanson's plans.

The preservation group began picking up some valuable allies. Bob Rose had a master's degree in English and had come to Anacortes in the late 1970s to apprentice as a wood shipwright. He became embroiled in a successful battle to block a clearcut next to Deception Pass State Park, lobbied a bill to add land to the park, and in 1978 became president of a group called Evergreen Islands.

In 1980, he wound up working on Boyle's successful campaign to unseat Cole as land commissioner. After the election he returned to school to study land management, worked for DNR as an intern doing the project planning for Tiger Mountain State Forest near Issaquah, and wound up as a special assistant to Boyle. As such, he has been given an environmentalist's dream: millions of dollars to acquire the most sensitive remaining lands in the state.

Boyle, meanwhile, was interested in broadening the mission of his agency from an emphasis on revenue production through its vast timberlands to resource preservation as well. ``He was light years ahead of his predecessor in terms of environmental awareness,'' consultant Joel Kuperberg says of Boyle, a politician who walks a tightrope between the timber industry and local governments dependent on his agency's trees, and the environmental sentiments of Washington's increasingly urbanized population.

In the late 1980s Kuperberg, a Vashon Island environmental consultant, saw Boyle quoted about Cypress that while he would like to acquire the island, you ``can't acquire the whole world.''

Kuperberg wrote Boyle to suggest that based on his experience acquiring lands for groups such as the Trust for Public Land, if one can't acquire the whole world, an island might just be possible.

The letter worked. Kuperberg was hired to begin courting Raymond Hanson, a process that took two years. Hanson's attorneys had estimated their client had spent $12 million on the airstrip, roads and a dike on the island, and he initially wanted $14 million for the property.

But while Hanson had acquired a necessary development permit from the Skagit County commissioners, he needed additional permits from Boyle, the Army Corps of Engineers, and the state Department of Ecology.

``I pointed out to him he didn't have all the permits,'' Kuperberg says.

``Hanson has got to be on my list as one of the 10 most interesting people I've met in my 63 years,'' the land negotiator recalls. ``He's an inventive genius. He loves to negotiate. He could have done the resort if he wanted to. He could have gotten the permits. What happened was, this is the last large undeveloped island in the San Juans, and Hanson recognized that. He was able to come to grips with the reality that the state did not have unlimited funds.''

Cypress was just one of several sites the state saw slipping away, and in 1987 the Legislature narrowly approved a two-year, 0.06 percent excise tax on the sellers of property - which meant $60 added closing costs on a $100,000 house - to buy just 680 acres on Cypress plus land on Mount Si, Woodard Bay and the Dishman Hills near Spokane.

Talks with Hanson played on, and the possibility arose that instead of giving up just 680 acres, Hanson might part with 3,176 acres. Finally in the spring of 1989, Hanson called Kuperberg, told the consultant to catch a 6 a.m. plane to Spokane, and gave him until 5 p.m. to cut a deal. After that, Hanson was leaving for New Zealand.

The state had about $4.8 million left from the excise tax, and the real-estate lobby was working hard to keep the tax from being extended. Hanson wanted more. At the private, nonprofit Nature Conservancy, Elliott Marks said he had authority to loan the state up to $500,000 more.

Finally the deal was cut: Hanson would sell his holdings for about $5.3 million, keeping only 50 acres and the right to build a single house on it for himself and his wife before he died. The deal was for $900,000 less than the land's appraised value, and millions less than what it was worth as a development.

Hanson says the deal, in which he reserved for 50 years the right to prime beach property north of Eagle Harbor worth $3 million or more, was fair for all parties involved. ``We had all our permits and could have kept going with the project,'' he says, ``but everything you do today is a fight. The county was set to block us at every turn.''

The Spokane magnate sounds bitter over the episode: ``We were just basically forced to sell by the constant hassle. Life's too short to do development, people are getting to be against everything. It doesn't matter what you promise, basically their intention is to slam the door.''

It's been four years since he visited the island, Hanson says, and he isn't sure he'll ever do anything with his property there. ``If I don't, I imagine somebody will, though,'' he says.

Acquiring almost an entire island of Cypress' size was the kind of coup that makes government look good, and lawmakers could have basked in its glow for an election or two.

Instead, with the unerring instinct all state legislatures seem to have for shooting themselves in the foot, the state Senate killed the excise-tax program the same day the Cypress deal was announced, temporarily eliminating money to complete purchases on Mount Si.

The dream of a quarter-century had been realized, but public attention focused not on legislative foresight, but instead on the Senate's decision to bow to the real-estate lobby, which had argued that only a part of the population was paying for a program benefiting all.

Irony was piled on irony. By the spring of this year, public concern about growth was at a fever pitch and lawmakers pushed through a bill allowing local governments to assess a 1 percent real-estate excise tax to acquire open space. Instead of sellers having to pay $60 in added costs on a $100,000 house, buyers may end up paying $1,000 more if local governments adopt the option.

``In the year that came in between (the two tax decisions), people became aware that what we have is fast disappearing,'' says MacDonald, who with other Eastside legislators had fought hard and unsuccessfully to keep the smaller tax in 1989. ``If we want to make sure we want to save that, we have to do so in the not-too-distant future.''

As it turns out, the excise-tax program has been just a small part of what has become an ambitious program of state-land acquisition.

A wildlife and recreation coalition chaired by former Gov. Dan Evans and former congressman Mike Lowry persuaded the Legislature to appropriate $53 million for land acquisition this spring and may return next year seeking more.

Boyle, McDonald, Sommers and others crafted the $170 million program to provide money for school construction and preserve scenic timber land simultaneously.

More than 21,000 acres of DNR land have been transferred to adjacent state parks, and nearly 7,000 acres of old-growth timber and other unique places simply have been set aside as natural-area preserves.

Examples include Columbia Falls in Skamania County, the Bone River wetland in Pacific County and Larkspur Meadows in Chelan County.

The state is also trying to manage some of its forest land with careful, selective-cut logging that leaves some of the trees to preserve popular recreation areas while still getting timber income. Two examples are the 15,000-acre Tiger Mountain State Forest in east King County and the 90,000 acre Capitol Forest southwest of Olympia. Also planned is a new experimental forest near Lake Crescent on the Olympic Peninsula.

All these programs are blurring the distinction between state lands set aside strictly for parks and those set aside for timber production, and changing DNR's reputation from resource exploiter to a more balanced agency.

Just how all these areas should be managed is not sorted out. An advisory committee, for example, is trying to come up with a plan for popular Mount Si, and a similar committee for Cypress Island will be appointed later this year.

A management plan for the island is expected by the end of 1991, says Patricia Powell, the DNR environmental planner spearheading the study.

The possibilities range from flatly discouraging visitor use of the island and keeping it as wild as possible to selectively logging some of the tight second-growth stands to enhance the remaining trees.

Undecided is if Hanson's sky-high airfield should be closed, what should be done with the network of logging roads and future trails, and whether there should be a public dock, more camping, or even a commercial visitor shuttle from Anacortes.

The opportunities on the rugged isle, with its Eagle Cliffs and secret lakes and empty beaches and stunning views, are boundless. Already it is a favorite of kayakers, and in summer its three DNR campgrounds - Cypress Head, Pelican Beach and Strawberry Island - are often full.

It is a rare, reassuring instance of paradise saved.

Decades from now, ``People won't remember how it happened, or why it happened,'' McDonald says. ``They'll just be happy it did happen.''

BILL DIETRICH IS THE ENVIRONMENTAL REPORTER FOR THE SEATTLE TIMES. TOM REESE IS A TIMES STAFF PHOTOGRAPHER.

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Some thoughts on Cypress Island;

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If you have opinions on the future of Cypress Island, you can write Patricia Powell, Environmental Planner, Land & Water Conservation, 234 E. Eighth Ave., EG-11, Olympia, WA, 98504.;

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If you boat to Cypress Island, DNR asks:;

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-- Camping and fires are restricted to the three existing campgrounds. Do not build fires elsewhere - the island can get quite dry in summer and fire danger is extreme.;

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-- About 20 percent of the island remains private property. Observe posted closures.;

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-- Keep to posted roads and trails.;

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-- Pack out your litter.;

Copyright (c) 1990 Seattle Times Company, All Rights Reserved.

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