By Amy Silverman
By Olivia LaVecchia
By Monica Alonzo and Stephen Lemons
By Chris Parker
By Michael Lacey
By Weston Phippen
While McCulloch was staking out lots in the desert for sale, Interior Secretary Stuart Udall began looking at the lake, as well. In 1964, the Department of the Interior published a study of the land along the Colorado River. The 400-page document made one thing clear: Usable riverside land was too rare and valuable for private development. It had to be held for public use "in perpetuity."
Udall's study found that most riverside land was just too rough and rocky for camping and launching boats. But one area stood out as a great place for public use to be maintained: the land around newly planned Lake Havasu City, including Pittsburg Point.
McCulloch's salesmen pounced on this policy with feral glee. They promised their bleached prospects, still dizzy from plane rides out of Chicago or Kansas City, that the area fronting the lake would be maintained in its natural state forever "as a federal park." Those early lot buyers remember the promises, and they can produce tattered brochures from their scrapbooks as proof. According to these old tracts, what is now The Island and the land around it was never supposed to be the site of homes.
The U.S. Department of the Interior, as it often does, contracted with Arizona's Land Department to oversee the public use of this important land. The Land Department, in turn, contracted with the Arizona Parks Department to manage the designated parks. The Parks Department allowed McCulloch to work on its behalf as "master concessionaire." That contract, struck in 1965, put the California entrepreneur and his company in charge of this public land, able to subcontract with lessors and get a percentage of the fees paid the feds every year.
With control of Pittsburg Point, McCulloch bought that outdated bridge from the City of London in 1968 and transported it, stone by stone, to Lake Havasu City. The channel was gouged to create The Island. The novelty bridge quickly paid for itself, attracting a new wave of lot buyers and guaranteeing the town's commercial success.
The Island languished for nearly two decades. A few businesses leased land for "approved" uses: a marina, a hotel, a camping facility. McCulloch himself bought 100 acres in The Island's center for future development. Things might have remained quiet to this day if it hadn't been for the Central Arizona Project.
@body:By 1985, CAP was well under way, and the federal government had a problem: It owed Arizona a lot of money for land used to dig the canal to Phoenix and points south. So a deal was cut. The feds offered the Arizona Land Department $100 million worth of federal land in exchange for state land gobbled up by CAP. State officials looked around and found one piece of land they really liked, land purportedly worth more than four-fifths of the deal they finally struck. The real estate they liked so much was The Island, along with other federal lands around Lake Havasu City.
At first, no one noticed much change. The land would be state park instead of federal. But the state Land Trust--proceeds from which subsidize public education, among other government causes--had other plans.
"Our objective," deputy state land commissioner Glendon Collins says, "has always been to get the value of this land out for the trust. It is a major asset and it has potential to create revenue, to ease the burden on Arizona's taxpayers."
But The Island lies inside Lake Havasu City's boundaries. And when Collins and his aides came to town to explain its new status, the townsfolk grew restless.
"We had almost 600 people show up at the high school," James Spezzano, the city's mayor at the time, recalls. "The people from State Land brought two DPS people with them, for protection." A retired labor negotiator, Spezzano worked hard to protect his small city's interests.
"We wanted to prevent the state from developing that land without any input from us," he says. "We wanted to get our foot in the door to try and direct some of those negotiations."
For a man with no cards to play, Spezzano did pretty well. He got state officials to give Lake Havasu City land on The Island already containing their sewage treatment plant, and control of old Site Six.
But the most important part of the "memorandum of understanding" that Spezzano and Land Department officials signed promised there would be no residential development on The Island. Ever.
By this time, McCulloch had long since passed from the scene (when he died in 1977, almost all of the 17,000 lots in his dream town had been sold) and control of his land interests in Lake Havasu City had devolved to MCO Corporation, the Fountain Hills subsidiary of Houston-based conglomerate MAXXAM. And MCO, which still managed The Island as "master concessionaire," had other ideas about building houses.
First MCO sued the state Land Department to establish its continued place in all land decisions affecting The Island and its continued cut of all concession fees--a lawsuit it won in 1990. Second, the company began attempts to develop the 100 acres it got from McCulloch, only to hit the brick wall of Lake Havasu City's government.