Maui Economy, 6 Months After Wildfire, Is Still Reeling

Maui Economy, 6 Months After Wildfire, Is Still Reeling

Twisted and charred aluminum mixed with shards of glass still lines the floor of the industrial warehouse where Victoria Martocci once operated her scuba diving business. After a wildfire tore through West Maui, all that remained of her 36-foot boat, the Extended Horizons II, were a pair of engines.

That was six months ago, but Ms. Martocci and her husband, Erik Stein, who are weighing whether to rebuild the business, which he started in 1983, said the same questions filled their thoughts. “What will this island look like?” Ms. Martocci asked. “Will things ever be close to being the same?”

In early August, what began as a brush fire burst into the town of Lahaina, a popular tourist destination, all but leveling it, destroying large swaths of West Maui and killing at least 100 people in the nation’s deadliest wildfire in more than a century.

The local economy remains in crisis.

Rebuilding the town, according to some estimates, will cost more than $5 billion and take several years. And tense divisions still remain over whether Lahaina, whose economy long relied almost entirely on tourism, should consider a new way forward.

Debates about the ethics of traveling to decimated tourist destinations played out on social media after an earthquake in Morocco and wildfires in Greece last year. But the situation is particularly dire for Maui.

State and federal officials scrambled last summer to find shelter for thousands of residents who had lost their homes, relocating people to local hotels and short-term rentals where many still live, often sharing a wall with vacationing families whose realities feel far from their own. Other displaced residents live in tents on the beach, and some restaurant owners pivoted to working out of food trucks.

About 600 small businesses — half the number registered in Lahaina before the fires — are still not operational, according to the Hawaii Small Business Development Center.

A recent report from the University of Hawaii Economic Research Organization predicted that statewide visitor spending this year would decline about 5 percent, or $1 billion, from 2023. The decline in tourism is almost completely confined to Maui, according to the report.

Carl Bonham, the organization’s executive director, said the scope and speed of Maui’s recovery remained an open question. It depends, Mr. Bonham said, on several factors, including how fast “displaced residents can be moved from hotels to more permanent housing, the speed of ongoing cleanup work, the extent and duration of support programs.”

In the weeks after the fires, politicians, Hollywood movie stars, local activists and even the state’s tourism authority urged travelers to avoid portions of the devastated island.

“Maui is not the place to have your vacation right now,” the actor Jason Momoa, a native of Hawaii, wrote on Instagram. “Do not convince yourself that your presence is needed on an island that is suffering this deeply.”

Those messages, some here believe, have had a lingering effect on tourism.

A month after the fires, Gov. Josh Green, a Democrat, announced that West Maui communities around Lahaina would officially reopen in October. It was an attempt, he said in an interview, to save the local economy.

“If we weren’t clear and very direct about when we were going to reopen, then the lingering effects of uncertainty would destroy the entire economy on Maui,” Mr. Green said. “People were not coming back.”

Despite the proclamation, the return has been slow. Many business owners have recently received approval for reconstruction loans from the U.S. Small Business Administration. The agency has approved roughly $290 million in loans — about $101 million for businesses and nearly $189 million for homes. The state and several nonprofit groups have also rolled out grant money to help small-business owners.

But life in Lahaina still feels like limbo.

Tanna Swanson, a close friend of Ms. Martocci and Mr. Stein, spends a lot of time at the couple’s house north of Lahaina, doing 2,000-piece puzzles to help pass time and distract herself. She owned the Maui Guest House, a five-bedroom bed-and-breakfast that burned in the fires. It was her home as well.

She has stayed, since then, in a stream of hotels and couch-surfed at friends’ homes, moving eight times. In December, Ms. Swanson, 66, received a Small Business Administration loan for $270,000.

She wouldn’t have received it — the mountains of paperwork and emotional toll of the process had long deterred her, she said — if she had not met in person with a Small Business Administration representative who came to Maui to meet with business owners.

She hopes to see more such direct outreach, she said, to reduce bureaucratic delays.

On a recent afternoon, Ms. Swanson used her visitor’s pass to get into her neighborhood, which the local authorities have blocked off to prevent looting of burned properties.

The desolate swimming pool and a few melted steel address numbers on a concrete wall are all that remain of the bed-and-breakfast, where, since 1988, she had welcomed guests from around the world, who took in ocean views from the top deck.

She looked at the scorched palm trees and thought about her former employees — five at the time of the fires — and how, like her, they had lost their livelihoods overnight.

“My everything — gone in a matter of moments,” she said. “It’s not just me. It’s the whole community, the whole island.”

An hour away, along two-lane roads where a few tourists still pull over to glimpse humpback whales in the waters below, Britney Alejo-Fishell owns Haku Maui.

Her shop in Makawao, a rural stretch of Maui far from Lahaina, sells traditional Hawaiian leis and holds workshops to create them. Much of her business comes from celebrations among tourists, who in the past flocked to the island. That has all but dried up, said Ms. Alejo-Fishell, who said her profits dropped 80 percent last fall after the fires. Since then, she has seen a slight uptick.

Before teaching a lei-making class on a recent morning, she discussed the troubles her family-owned business had faced in recent years. She was forced to shutter her business for a year during the Covid-19 pandemic, and then, only a few months after business began to pick up to prepandemic levels, the fires engulfed West Maui. She has been living off a reduced income and is hesitant to take on government loans.

“The phone started ringing with cancellations of orders, and it’s been ongoing,” she said. “We had survived Covid, but now this is like a second Covid situation all over again.”

A Native Hawaiian, Ms. Alejo-Fishell said the wildfires had affected many acquaintances, including friends who lost loved ones and their homes.

“They are grieving and will be for some time,” she said. But, she added, “tourism is our economy, and we need it to survive.”

Back in Lahaina, the tragedy of Aug. 8 plays on repeat for Ms. Martocci. She had a scuba expedition scheduled for that day but canceled it because of high winds. Hoping to check on the warehouse, she and Mr. Stein rushed down the Honoapiʻilani Highway, which was choked with traffic because of downed power lines and the growing rush of evacuees. The couple turned around, but they spoke on the phone with Ms. Swanson, who told them she had evacuated and seen thick black smoke, which signifies a structural fire, in the direction of their warehouse.

“We didn’t know if it was gone, but we had a feeling,” Ms. Martocci said.

In recent months, she and Mr. Stein have started salvaging their business. They considered whether it made sense to move, but Ms. Martocci had never felt more at peace than in the clear blue waters off Maui.

Recently, they’ve worked with the Small Business Administration and have received a $700,000 loan. But at 64, Mr. Stein is uneasy about taking on the debt he would need to rebuild, especially considering how much uncertainty remains.

He needs a renewed permit with the state’s boating department to run his business, but to get one he needs a boat — and for now, the marine facility they have used for the past 40 years remains partly closed.

“We are in such a holding pattern,” he said. “There is no sense of when it will loosen up.”

Ms. Martocci said she had come to think of their community as a painful Venn diagram, in which everyone knows someone who lost a loved one, a home or a business. Some lost all three.

“The place we all knew and loved is forever changed,” she said. “We just know we have to keep moving forward and find some sense of normalcy.”