Their shipping lifeline in doubt, small Neighbor Island businesses face grim future

Updated: Jul. 30, 2020 at 4:53 PM HST
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HONOLULU, Hawaii (HawaiiNewsNow) - As if the pandemic and its financial fallout weren’t enough, Neighbor Island businesses are facing another potential crisis.

The state’s only inter-island barge service, grappling with a dire financial outlook, may start cutting services that the Neighbor Islands depend on as soon as next month.

Small Neighbor Island businesses say drastic changes or even a potential halt to Young Brothers inter-island cargo service could put them out of business.

“Basically everything comes by barge,” said Kevin Misaki, owner of Misaki’s Grocery in Kaunakakai.

The grocery is two years shy of its 100th anniversary, but isn’t sure it can weather the anticipated cargo disruptions.

“In reality if they were to stop, we would have to stop,” Misaki said.

In a letter to the Hawaii Public Utilities Commission on July 24, the president Young Brothers said without immediate financial relief the cargo company would be unable to continue operations after losing funding from its parent company.

The company claims if they aren’t allowed to increase rates to make up for a projected $30 million shortfall ― or if don’t get a government bailout ― they’ll be forced lay off staff and slash services as early as Aug. 17.

“It basically means if you want your freight to the island, prices will increase substantially,” said state Rep. Lynn DeCoite, adding that it’s critical affordable Neighbor Island service continue.

She said she wants to see the cargo company’s tax records before signing off on a bailout.

“Bottom line we need to see everything,” said DeCoite. “I’m not going to approve or support giving a blank check to one company that should have thought about this many years in the making.”

A rate hike is just part of what store owners are worried about.

“Everybody, everybody will be paying more for everything,” said Misaki.

He says on top of that a reduced shipping schedule would make it difficult to keep items in stock and added the company may also stop shipping containers that are only partly full.

That’s a service small stores depend on.

“Most of the islands have to operate that way,” said Misaki. “Small businesses just cannot ship a container of stuff.”

Young Brothers declined an on-camera interview with Hawaii News Now and wouldn’t offer details on what services would be cut.

Company President Jay Ana said issued this statement:

“This is emphatically not the outcome Young Brothers desires. It would be harmful to the people of Hawaii, to Young Brothers’ valued and highly skilled employees, and to Young Brothers’ 120-year legacy of providing water carrier service to the communities of Hawaii. Unfortunately, the economic conditions and financial realities that the company currently faces leave Young Brothers, and many other businesses, in a position where such unwelcome steps may be necessary.”

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