The Formation of the Wailea Milling Company
The first newspaper accounts of plans for the Wailea Mill don’t appear until May of 1919:
Hilo Daily Tribune, Thursday, May 22, 1919
“Plans are underway for erection of a homesteaders mill at Hakalau but nothing definite has yet been announced by the trustees acting for the homesteaders concerned…The site for the mill has already been secured at Wailea.”
This homestead mill wouldn’t have happened were it not for the demand coming directly from the homesteaders, but it needed strong advocacy and a dogged search for capital to get it off the ground.
There was much to get right: Assemble a management that homesteaders could trust and a deal they could trust. Acquire a good mill site. Give the homesteaders a good deal. Fend off public criticisms from a sugar industry threatened by this idea. Find serious capital for an unproven venture--sugar mill, fluming system, other assorted costs.
Hilo Daily Tribune, Thursday, May 22, 1919
“Plans are underway for erection of a homesteaders mill at Hakalau but nothing definite has yet been announced by the trustees acting for the homesteaders concerned…The site for the mill has already been secured at Wailea.”
This homestead mill wouldn’t have happened were it not for the demand coming directly from the homesteaders, but it needed strong advocacy and a dogged search for capital to get it off the ground.
There was much to get right: Assemble a management that homesteaders could trust and a deal they could trust. Acquire a good mill site. Give the homesteaders a good deal. Fend off public criticisms from a sugar industry threatened by this idea. Find serious capital for an unproven venture--sugar mill, fluming system, other assorted costs.
Political Support and a Strong Board of Directors
Like homesteading itself, the idea of a homestead-run mill was consistent with prevailing “American values” and government officials were encouraging.
The quality of the Board of Directors was essential to its success. Three directors, in particular, provided strong advocacy as well as political ties:
The quality of the Board of Directors was essential to its success. Three directors, in particular, provided strong advocacy as well as political ties:
August S. Costa, President and Manager, Wailea Milling Company, 1919-1944. Photos from Men of Hawaii, 1921 (above) and 1935 (below)
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August S. Costa, President and Manager, 1919-1944 Strong-willed, well- informed and committed. He immigrated with his family from the Azores at age 10 and stated that he’d left school at age “thirteen and a half.” But his propensity for self- education is evident. At age 20, he was a printer at Hilo’s Portuguese newspaper (Setta Publishing Co.). By 25 he was assistant editor, and editor by age 27. He was about 31 years old when he became seriously involved in the Wailea Mill project (1919). By this time, he was a Hilo IRS tax collector with a home in Wainaku, though he’d also had a homestead in Wailea since 1909. Until this time, his advocacy for homesteaders was not apparent by newspaper accounts, but he did have a close relationship with Director A. M. Cabrinah who did have such a public history (see next). His financial investment was 500 shares (par value: $20/share). When criticisms from C. Brewer and Hakalau Plantation were circulated publicly in this period right before the Company was on solid ground, Mr. Costa demonstrated that he’d done his homework and was, as president, quite willing to make a strong rebuttal on numerous points. |
A. M. Cabrinha, Director, Wailea Milling Company. Photo from Men of Hawaii, 1921
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A. M. Cabrinha, Director He was a County of Hawaii Supervisor who had, for several years, been engaged in homestead mill plans for Laupahoehoe and Waiakea. About 39 years old in 1919, he had immigrated to Honomu from Portugal with his family at age 3,”left the plantation at 16 to go into a grocery business for himself”, and became manager of a merchandising company in Hilo “with extensive business throughout the island”. He had no cane land in Hakalau but was a strong and involved supporter for a homesteader mill at Wailea. He purchased 100 shares (par value of $20/share). He had been a “prominent member of the Waiakea Homestead Association,” first as a trustee, then president and manager of the first homesteader-run Kaiwiki Milling Co (above Wainaku), which had been in existence for 3 years. (It went bankrupt in 1923, likely because of the mortgage it had taken out to finance the building of the mill. Importantly, this was something Wailea did not do.) Like Costa, he was ready with well-informed counterarguments to criticisms from Hakalau Plantation and C. Brewer. Source: Hawaii Tribune Herald, Monday, September 17, 1956 |
James W. Russell, Director, Wailea Milling Company. Photo from Men of Hawaii, 1921
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James W Russell, Director He was a Hilo lawyer and Senator “deeply interested in settling the people on the land”. Among other things, he introduced a controversial bill to set the price of cane for homesteaders and to place homesteader cane milling “under control of the Public Utilities Commission.” It got considerable support and discussion, but did not pass. He collaborated with Cabrinha on this and other homestead matters. “As to homesteading, I have always been in favor of it and have studied the matter earnestly.”(Source: Hilo Daily Tribune, Saturday, August 31, 1918) |
Other Board Members Were Advocates for Japanese Homesteaders
In the early period of homesteading on this coast, the Portuguese predominated. But by 1919, the Japanese were present in large numbers and eager to become more self-reliant. Fortunately, there were two more leaders on the Board who represented their interests:
Honolulu Star Bulletin, April 20, 1920, accessed via Newspapers.com
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Tatsuji Kawachi, Vice President, age 49, was mentioned briefly in the newspaper when concerns were raised that he and August Costa went to Japan in April 1920 to seek investors for the mill. Apparently, this was not successful but it is notable that, when the members of the Board of Directors was announced in mid-1919, he had purchased 7,500 shares in the Company, a very large sum and very much larger than shares purchased by the other members. |
H.H. Miyazawa, Secretary of the Federation of Japanese Labor of Hawaii. Photo from Nippu Jiji, March 25, 1915, accessed through the Hoover Institution Library and Archives.
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H. H. Miyazawa, Director Secretary of the Federation of Japanese Labor of Hawaii, age 39, an activist for Japanese laborers. About 58% of the homesteaders entering into agreements with Wailea Mill Co. were Japanese. Though things were slowly changing, mistrust remained about their loyalty to America. He strongly denied this charge of disloyalty and, it appears, was on the Board to support these men. |
Wailea Mill versus C. Brewer and Hakalau Plantation
Newspaper coverage in mid-1919 show how the case was made for the Wailea Mill. Editorials were supportive. In July, Director Russell and President Costa criticized the offer C. Brewer was making to the homesteaders to continue contracting with Hakalau Plantation. In August, Director Cabrinah and President Costa responded to a critique of the Wailea Mill venture posed in a widely circulated letter from C. Brewer.
Hawaii Tribune Herald, Thursday, July 24, 1919
Director Russell:
“The bonus or profit sharing plan proposed by Brewer Plantations is very misleading indeed”, said Senator Russell. “It strikes me as a plan to deceive the planter into the belief that the contract offered was a better one than the Brewer Plantations had ever given before, whereas a fair analysis of the bonus provisions of the contract will disclose that it is not as good as the last contract wherein the planter received $1.20 [for every cent that sugar brings per pound].”
Hawaii Tribune Herald, Thursday, August 7, 1919
An editorial:
“The attack being made by Brewer & Company on the Wailea Milling Company is only to be expected…
Wailea Milling Company will be the forerunner of many mills of the same sort in Hawaii…The days of the grasping corporations is about over and independent farmers are going to take the place of the coolies who have in the past been given a mere pittance for their labor…”
Hawaii Herald, Friday, August 8, 1919
August Costa, regarding the affect the C. Brewer letter had address to the homesteaders:
“Not one Wailea homesteader has made any complaint regarding the contract signed with the Wailea Milling Co. not one homesteader has asked to be released from his contract.”
C. Brewer had a number of criticisms. The “mortgage” was perhaps the most important one and most easily refuted by Costa:
“The Wailea Milling Company will have no debt to pay on the factory and there will be no mortgage on the mill as claimed by Brewer and Company. There is no truth in such a statement for all cost will be subscribed for.”
Hawaii Tribune Herald, Friday, August 8, 1919
Cabrinha replied to the questions posed in the C. Brewer letter, often in depth. Cabrinha’s replies revealed a depth of knowledge that would have been comforting to the homesteaders. And his sometimes defiant language showed a strong advocacy for homesteaders eager to end their dependency on a company they didn’t trust. One example:
“Question [C. Brewer]: Do you realize that while you authorized your trustees to sign an agreement binding you to for 10 years, you signed an agreement for 20 years?”
“Answer [Cabrinah]: This is a deliberate falsehood. The agreement was for 20 years and not ten.”
Hilo Daily Tribune, Thursday, August 21, 1919
In this article, John M. Ross, Hakalau Plantation Manager, replies to Cabrinha’s answer. It ends a series of articles that had laid out the basic claims and counter-claims about the merits of the Wailea mill for the homesteaders. Whatever the arguments and misunderstandings, too numerous to mention here, C. Brewer and Hakalau Plantation intended their points as a public warning to the homesteaders.
Hawaii Tribune Herald, Thursday, July 24, 1919
Director Russell:
“The bonus or profit sharing plan proposed by Brewer Plantations is very misleading indeed”, said Senator Russell. “It strikes me as a plan to deceive the planter into the belief that the contract offered was a better one than the Brewer Plantations had ever given before, whereas a fair analysis of the bonus provisions of the contract will disclose that it is not as good as the last contract wherein the planter received $1.20 [for every cent that sugar brings per pound].”
Hawaii Tribune Herald, Thursday, August 7, 1919
An editorial:
“The attack being made by Brewer & Company on the Wailea Milling Company is only to be expected…
Wailea Milling Company will be the forerunner of many mills of the same sort in Hawaii…The days of the grasping corporations is about over and independent farmers are going to take the place of the coolies who have in the past been given a mere pittance for their labor…”
Hawaii Herald, Friday, August 8, 1919
August Costa, regarding the affect the C. Brewer letter had address to the homesteaders:
“Not one Wailea homesteader has made any complaint regarding the contract signed with the Wailea Milling Co. not one homesteader has asked to be released from his contract.”
C. Brewer had a number of criticisms. The “mortgage” was perhaps the most important one and most easily refuted by Costa:
“The Wailea Milling Company will have no debt to pay on the factory and there will be no mortgage on the mill as claimed by Brewer and Company. There is no truth in such a statement for all cost will be subscribed for.”
Hawaii Tribune Herald, Friday, August 8, 1919
Cabrinha replied to the questions posed in the C. Brewer letter, often in depth. Cabrinha’s replies revealed a depth of knowledge that would have been comforting to the homesteaders. And his sometimes defiant language showed a strong advocacy for homesteaders eager to end their dependency on a company they didn’t trust. One example:
“Question [C. Brewer]: Do you realize that while you authorized your trustees to sign an agreement binding you to for 10 years, you signed an agreement for 20 years?”
“Answer [Cabrinah]: This is a deliberate falsehood. The agreement was for 20 years and not ten.”
Hilo Daily Tribune, Thursday, August 21, 1919
In this article, John M. Ross, Hakalau Plantation Manager, replies to Cabrinha’s answer. It ends a series of articles that had laid out the basic claims and counter-claims about the merits of the Wailea mill for the homesteaders. Whatever the arguments and misunderstandings, too numerous to mention here, C. Brewer and Hakalau Plantation intended their points as a public warning to the homesteaders.
Needed: A Good Location for the Mill
The Honolulu Advertiser, Wednesday, August 13, 1919
A viable mill operation required a mill site situated for fluming the harvested cane as well as for transporting the raw sugar after milling. Fortunately, a piece of land right beside the railroad and makai of much of the homestead land was made available by the Territory for purchase.
“Hakalau homesteaders won out over C. Brewer and Co. and another opponent in a spirited controversy over land exchange in which the homesteaders desired to acquire a tract of 17 acres for a mill site for the Wailea mill.”
A viable mill operation required a mill site situated for fluming the harvested cane as well as for transporting the raw sugar after milling. Fortunately, a piece of land right beside the railroad and makai of much of the homestead land was made available by the Territory for purchase.
“Hakalau homesteaders won out over C. Brewer and Co. and another opponent in a spirited controversy over land exchange in which the homesteaders desired to acquire a tract of 17 acres for a mill site for the Wailea mill.”
Plat Map 754 of August 1919 showing the Territorial land that would be come the site for the Wailea Mill and the Wailea Mill Camp
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A good location for the Wailea Milling Company: adjacent to the railroad, the flume leads into the mill. Wailea Mill Camp was built above the mill. Photo courtesy of the Lyman Museum.
Financing the Mill was a Challenge
The homesteaders had signed agreements by mid-1919, but it wasn’t until mid-1920 that the Board finally found the capital sufficient to sign a contract with Hilo Iron works to build the mill.
Honolulu Star Bulletin, Monday, June 16, 1919
They enlisted their financial partner in securing the capital needed in mid-1919:
“The homesteaders of Wailea, Hawaii have enlisted the cooperation of the Security Trust Company of Hilo in their efforts to acquire a sugar mill of their own…”
Hilo Daily Tribune, Saturday, April 17, 1920
By April 1920, financing had still not materialized and the Board was reaching out for potential investors. Controversy ensued when President Costa and Vice-President Kawachi made a trip to Japan.
Hawaii Herald, Friday, July 30, 1920
Finally, in July 1920, with capital in hand, Costa announced the contract with Hilo Iron Works to build the mill.
“[Costa] returned recently from an extended trip to Japan where we sought to finance the Wailea mill scheme. The unsettled conditions of finances in Japan at the time of his visit, however, determined Costa to return…. Apparently, the money has now been found in Hilo...Discussing the general situation, Mr. Costa admitted that there was some truth in the rumors that some difficulty had been encountered in financing the project, …We are glad that the thing has been financed in this manner, for the future profits of the company will be widely spread and the community on this island will benefit.”
Also included in this achievement was the fact that the two members of the Board of Directors not yet mentioned both worked for Security Trust and the People’s Bank of Hilo, the source of much of this capital. They were H. A. Truslow and S. Kagimoto.
Operational in 1921
The mill was built by Hilo Iron Works and became operational in June of 1921.
Hawaii Tribune Herald, Saturday, July 30, 1921
“The Wailea Milling Company is running more than capacity, according to reports. This mill has ground more than 200 tons of sugar since it opened a short time ago.”
Honolulu Star Bulletin, Monday, June 16, 1919
They enlisted their financial partner in securing the capital needed in mid-1919:
“The homesteaders of Wailea, Hawaii have enlisted the cooperation of the Security Trust Company of Hilo in their efforts to acquire a sugar mill of their own…”
Hilo Daily Tribune, Saturday, April 17, 1920
By April 1920, financing had still not materialized and the Board was reaching out for potential investors. Controversy ensued when President Costa and Vice-President Kawachi made a trip to Japan.
Hawaii Herald, Friday, July 30, 1920
Finally, in July 1920, with capital in hand, Costa announced the contract with Hilo Iron Works to build the mill.
“[Costa] returned recently from an extended trip to Japan where we sought to finance the Wailea mill scheme. The unsettled conditions of finances in Japan at the time of his visit, however, determined Costa to return…. Apparently, the money has now been found in Hilo...Discussing the general situation, Mr. Costa admitted that there was some truth in the rumors that some difficulty had been encountered in financing the project, …We are glad that the thing has been financed in this manner, for the future profits of the company will be widely spread and the community on this island will benefit.”
Also included in this achievement was the fact that the two members of the Board of Directors not yet mentioned both worked for Security Trust and the People’s Bank of Hilo, the source of much of this capital. They were H. A. Truslow and S. Kagimoto.
Operational in 1921
The mill was built by Hilo Iron Works and became operational in June of 1921.
Hawaii Tribune Herald, Saturday, July 30, 1921
“The Wailea Milling Company is running more than capacity, according to reports. This mill has ground more than 200 tons of sugar since it opened a short time ago.”