Treasure island

The Lasqueti Mint isn’t guarded by motion-sensing alarms, thıck cement walls or menacing guards. It’s not even hooked up to hydro or accessible by road. Instead it’s in the middle of nowhere on Lasqueti Island, an off-the-grid Strait of Georgia rock near Texada Island, accessible by passenger ferry only from Vancouver Island.

Its security system is what also makes it a refuge for U.S. draft dodgers, pot growers and escapists:
isolation. It is here, in this unlikely location, that Tolling Jennings and Ray Lipovsky are literally minting money.

“What we originally wanted to do was get precious metals into the hands of people in the Gulf Islands to support the economy and to get precious metals back into the currency,” Jennings explains. “Since then it’s taken on a life of its own, and it has been more successful than we could have hoped.”

Coins pressed at this remote B.C. mint are used every day to buy goods and services on Lasqueti, Gabriola and Salt Spring islands. Numismatists (coin collectors) who own Lasqueti Mint proofs – coins only meant for collecting – are seeing the value of their collections grow by up to 500 per cent. And in an industry first, the Lasqueti Mint is sourcing gold directly from Yukon mines, adding value to placer mining. Jennings, not your textbook entrepreneur, admits almost reluctantly that commercial minting has turned out to be a viable business. “But that was never the point,” he stresses. “It was always a labour of love.”

Of the 350 people who call Lasqueti home, about one in seven is an accomplished ultimate-Frisbee player. Back in 1996, Jennings, who was coaching a couple of the teams, took a bag of old coins to Lipovsky, an island jeweller, in the hopes of selling them to raise money for team travel. Talk turned from ultimate to coins to currencies. “We were on the same page with a lot of things,” Jennings says, including the lunacy of the unbacked paper-money system of the Western world.

Jennings explains it like this: governments such as Canada’s have stopped backing currency with precious metals, removing the currency’s ability to store value. “The only promise they give is that they can print more,” Jennings says. And governments do, diluting the money supply and driving up inflation. Since 1900, Jennings says, the real value of the Canadian dollar has fallen more than 90 per cent. Eventually, the theory goes, with nothing

of tangible value backing them, inflation will render government-issued currencies worthless. “To hedge against this inflation, you need something that will hold value: land or precious metals,” says Jennings. “Land is expensive. Everyone can afford to buy metals.”

Lipovsky had a drop hammer used for pressing imprints into metal, so he and Jennings decided to help Gulf Island residents prepare for currency Armageddon by getting some precious-metal coins into circulation. “It was a total hoot, but we didn’t have a clue what we were doing,” Jennings recalls.
They bought some raw metal, cut it to size and weight, and then loaded the drop hammer – basically a 23-kilogram weight dropped guillotine-style onto a die that imprints the coin. The first coin went flying across the room.

Eventually, Jennings and Lipovsky got the process under control and set up shop in a secret spot, powering it with wind and solar energy. The first run of $20 pure-silver Lasqueti coins was minted in 1997 and sold locally to raise money for a trip to the ultimate nationals. “We had no idea how they would be accepted,” Jennings remembers. He needn’t have worried; the run sold out in a couple of weeks. At the nationals, the Lasqueti teams used the coins for the pre-game toss. The organizers of the ultimate worlds were so impressed with the pieces, they commissioned some to give away as awards. It was the mint’s first contract sale.

Business ticked along, and soon Jennings and Lipovsky were printing coins for use as local currency. In Canada anyone can mint metal bullion, as long as it meets a few criteria; for instance, it can’t have the Queen’s face on it. Best of all, such currency is tax exempt. “When you tell that to people around here, their eyes light up,” Jennings says. The currency is bought into a local market and then used to buy goods and services. The idea is nothing new. Local currencies are used all over the world to encourage economic development. The Lasqueti Mint took it one step further by hiring local artists to design the coins, making them collectable works of art.

The Salt Spring Island dollar, or $$, is another local currency. It was started six years ago and is now dispensed at all three island financial institutions, accepted at almost every business on the island and used as a model all over the world. “When you have Salt Spring dollars in your wallet, this is where you spend it,” explains Bob McGin, one of the currency’s founders. “I know where the profits go when I spend my money locally.”

Every month $1,000 to $2,000 worth of Salt Spring dollars and coins pressed at the Lasqueti Mint move through the financial system, while even more are bartered back and forth. Salt Spring dollars are tied to the Canadian dollar, and banks treat them like cheques, withdrawing money from the Salt Spring-dollar account into the depositor’s account and vice versa. Proofs of the coins and bills are also sold by the mint, and profits are re­invested in low-interest loans for farmers or donated, McGin says.

Officials at the central bank of Brazil were so impressed with the Salt Spring-dollar system that they came to the island to learn about it last year. Senior adviser Marden Marques Soares and
coordinator Marusa Vasconcelos Freire, both visiting Vancouver for an economic conference on behalf of the Banco Central do Brasil, met with McGin and other Salt Spring-dollar reps because they were interested in developing community currencies coordinated with the central bank. It’s not the first time Salt Spring has garnered international attention for its currency. “The general consensus is that we’re the closest to what everyone is striving for,” McGin says.

Collectors have capitalized on the Lasqueti Mint’s growing reputation and climbing precious-metal prices. Every issue includes proofs, which the mint sells at a premium. A collector recently sold his collection for $5,000, profiting $3,800 on his initial investment over 10 years of collecting. One rare $40 Lasqueti coin sold for $500.

“The neat thing about these coins is the story behind them: it’s these two guys from the ’60s making them in this shack in the woods,” says Lynn Balmer, a Vancouver-based eBay seller specializing in coins. “The coins are unique and are a higher quality than you can find virtually anywhere.”

The mint has also been lucky. The day after its marijuana-bud coin was minted, the federal government decriminalized the possession of pot. “People bought the coin for the bud alone,” Balmer says. And now the mint’s quality craftsmanship and original artwork are catching up to them, he says. Demand is increasing from all over the world.

The mint’s latest product will only stoke the fire. Since they started their operation, Jennings and Lipovsky have been searching for conflict-free gold. Usually, after refining, gold from all over the world is dumped together, so tracing the origin of any piece is impossible. So the duo went straight to Ross Mining Ltd., a Yukon placer miner. Mammoth Tusk Gold Inc., a Whitehorse-based middleman, is keeping track of the gold from the environmental-award-winning Klondike mine to the mint, where the one-ounce coins are pressed with a mammoth on one side and an 1890s-style prospector on the other. The first run, 250 coins selling for $1,650 each, is expected to sell out and is raising eyebrows.

“The placer mining community is really excited about the idea,” Jennings says. “It’s a way for them to add value to their product. Many of them are saying, ‘Why didn’t we think of this before?’” There’s even talk of branding all pure Yukon placer-mined gold as Mammoth Tusk Gold and marketing it in a similar way as Canadian diamond miners have done, by pointing out that it’s conflict-free and environmentally friendly.

The new coin fits with the mint’s altruistic identity, but its success isn’t changing life on Lasqueti. “The bottom line has never been important to us,” Jennings says. “It’s mostly been about magic. Then to now, it has been one synergistic happening after another.”