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essential to the success of the campaign against these base attacks upon the public health.

I fully approve the recommendation of the President of the Board of Health that an appropriation be made for the salary of a purchasing agent for the Board. In all probability a competent man in such a position would save many times his salary.

In the financial report of the Queen's Hospital it appears that the reduction of income of that institution, on account of the loss of real estate through an adverse decision in the construction of the will of Dr. Rooke, and the cessation of the passenger tax, amounts to $49,335.38 for the biennial period. In view of this loss on income and of the important work the Queen's Hospital is doing, I have recommended an appropriation equal to double the amount of the old one, on condition of free treatment of Government patients and the maintenance of a free ward for the poor of all nationalities.

The necessity of a hospital for incurables has long been apparent. Such cases are very properly not received at the Queen's Hospital. The matter became so urgent during last year that several public-spirited ladies and gentlemen went to work and organized such a hospital and have conducted it with the assistance of funds contributed for the purpose. This institution was temporarily located at the beach near Kakaako and is doing a splendid work. The Council of State appropriated $5,000 for its support and $25,000 toward its endowment---the latter appropriation being conditioned on the raising of a fund of $100,000 for the same purpose by private subscription. A considerable amount of money has been raised for the construction of hospital buildings for such a hospital and for its maintenance, but as yet no beginning of the work has been made. I strongly recommend the appropriation of $9,600 toward the maintenance of the present hospital.

You will find by the report of the Superintendent of Public Instruction that the public schools are in a prosperous condition. For some years there has been a rapid increase of pupils beyond the capacity of the school houses of the country even with the considerable additions that have already been made. School accommodations are still unequal to the demand. The large appropriations recommended for this purpose are for the most part very

necessary.

The Government has recently adopted the plan of building school houses of large size, with walls of fire-proof materials. This plan was carried into effect in the construction of the Princess Kaiulani School and the Kaahumanu School in Honolulu. An appropration of $75,000 is recommended for rebuilding the Royal School. The main building in the Royal School

premises was found to be unsafe last year and was taken down. At present a part of the pupils are accommodated in the remaining buildings and the rest in the Aala Warehouse, which has been fitted up temporarily for that purpose. This arrangement is very unsatisfactory. The Aala Warehouse is a cheap, rough building with unsuitable surroundings. The separation of the school into two divisions at such a distance apart is unfavorable to its administration.

It is proposed to put up a large building of fire-proof materials of sufficient size to accommodate seven hundred pupils. The historic fame of this school and its honorable and successful record justify the proposition of giving the new building such an architectural character as will make it a worthy monument to the famous Aliis who were its first pupils and to its later graduates as well.

I call your attention to the plan of the Superintendent of Public Instruction, as set forth in his report, to move the Reformiatory School at Waialee, in the District of Koolauloa, and to designate it as the Industrial School for Boys. I emphatically approve of this project. The piece of land suggested for this purpose contains over seven hundred acres and lies partly on the foothills and partly between them and the sea. The location is most healthy, with fresh trade winds from the ocean. The place offers opportunities for a variety of farming work, including stock raising and the cultivation of field crops and taro. There is fishing and sea bathing. An industrial school located on this land would have an environment most favorable to the education of boys in many industrial lines, and to a good development of the character and the body.

The boys in the Reformatory School are taught, outside of book learning, carpentry, harness making, tin work and sewing only. There is little opportunity for teaching them agriculture.

If this plan is carried out, it is proposed to use the Reformatory School premises for an industrial school for girls, which is much needed.

Such changes in the laws as are necessary to effectuate these projects should be enacted.

There is a small number of children scattered over the Territory who are ineligible for admission into the public schools on account of their inability to pass the required medical examinations. Some provision should be made for the education of these children. As the number is small in any one locality, it may be impracticable to provide instruction for them at their homes. There does not seem to be any insurmountable objection to legislation that would gather them at some place or places, according to their numbers, and provide them with instruction and careful

medical attendance as well as food, clothing and lodging. Such a plan would be in their own and public interest. The matter is most important; the Government cannot leave these children to grow up in ignorance and neglect without deserving the severest

censure.

The report of the Superintendent of Public Instruction contains interesting information in regard to the development of manual training in the schools. This feature of public instruction is worthy of hearty support.

Your attention is invited to the proposition of the Superin-. tendent of Public Instruction that the Department be relieved of the work of furnishing school books to school children. I have grave doubts of the advantage of such a change. The question to be considered is how pupils, particularly those in out-of-the-way districts, would be affected by it, rather than the convenience of the clerical force of the Department.

The suggestion of this report favoring the establishment of school libraries is admirable, and should have legislative assistance. With a moderate appropriation for this purpose at each session, such libraries would grow steadily and soon become in each district a most favorable influence toward taste in reading, a knowledge of the English language and growth in personal character.

Congress has conferred on the Legislature authority to create counties and town and city municipalities within the Territory and to provide for the government thereof.

This is an enterprise requiring for its success a high degree of patriotism and civic intelligence. Careful study of local conditions and the experience of other communities in the creation and administration of municipal corporations are necessary to safeguard the country against costly mistakes. Many problems will arise in the consideration of such legislation that are difficult of solution, calling for sincere deliberation.

There are important questions to be weighed by you in the consideration of this subject. Should such local governments be established in communities that do not ask for them? Should the whole area of the Territory be occupied by such governments, or should experiments be made in one or two localities before going further? What will be the approximate burden of the aggregate taxation of the city or county and the Territory on the tax payer? How will the small proprietor be affected by such combined taxation, and by the probable greater stringency of municipal regulations? These questions are better answered before than after the character of such corporations is finally settled.

Probably the most satisfactory method of conferring such privileges is by means of a general statute, stating the conditions

precedent to the establishment of such governments, and the principles and limitations to be recognized in their organization, under which any community within the conditions may proceed to acquire corporate existence whenever it shall so desire.

Should the Legislature find itself unable, at this session, to agree upon satisfactory legislation in this matter, it would doubtless facilitate the progress of the work in the future if it should make provision for the appointment and adequate pay of a commission of several persons to prepare a general scheme for both county and city government, and report to the next regular session of the Legislature.

The Executive is in correspondence with the Bureau of Forestry of the Federal Government in regard to the temporary services of an expert forester to examine the forests of the Territory and advise the Government on questions pertaining to their preservation, the need of reforesting and the extent to which deforesting may be safely permitted. The Bureau favors sending one of its own skilled foresters as soon as one can be spared. The Territory will, however, be required to pay his expenses and a reasonable salary. An item has been placed in the Estimates for this

purpose.

The plan of the Department of Agriculture at Washington to establish an agricultural experiment station here is one of great importance to the Territory. Such a station conducted by trained men will be of inestimable value to our agricultural population in testing the capabilities of various plants producing food, fibre and other valuable products in our climate and soils, and in introducing scientific methods of cultivation. The small farmer will be especially benefited by such experiments, and it is to the prosperity of the small farmer that much of our social and political advancement will depend. Our own Department of Agriculture and Forestry will work with such a station in promoting the development of our agricultural resources.

A considerable appropriation is recommended for roads and harbor improvements. Roads are a necessary condition of commercial and agricultural growth. Much progress has been made in this direction during the past four years. A highway for wheeled vehicles has been nearly completed around the Island of Hawaii. It should be finished in the coming period. The increase in the number of homestead settlements requires many new roads; the growth of Honolulu and Hilo demands new streets of the best quality.

The increase of our commerce calls for more wharves and come harbor enlargement. The Territory must carry on this work antil such time as it may be taken up by the Federal Govern

nent.

The Territorial Act requires the Legislature at its first regular session after the census enumeration shall be ascertained to reapportion the membership in the Senate and House of Representatives among the Senatorial and Representative districts on the basis of the population of citizens of the Territory in each of said districts. The Executive is in correspondence with the Director of the Census in the matter of such information and is assured that it will be furnished as soon as it is ascertained. Upon the receipt of such information by the Executive, it will be promptly sent to the Legislature.

Previous to the going into effect of the Territorial Act, the Post Office Inspector in charge at Honolulu directed the country postmasters of these Islands to forward the Hawaiian postage stamps in their possession on the 14th day of June to the Post Office Department in Washington, which direction was generally followed. These stamps in every case were owned by such postmasters, it having been the practice in the postal bureau under the Republic of Hawaii to require the postmasters outside of Ilonolulu to purchase the stamps required by them for the business of their respective post offices, and to sell them to customers on their own account. A number of these postmasters requested the Washington Department to return either the stamps or their value in money or American stamps. Such requests were refused, and the applicants were referred to the Territorial Government. As but two or three of these claims have been sent to me, I would recommend the Legislature to notify such postmasters to send ir sworn statements of the amount of their losses in this matter, and thereupon to place an item in the appropriation bill for their pay

ment.

Under the appropriation of the Council of State for the expenses of a Hawaiian exhibit at the Paris Exposition, Mr. William G. Irwin, of Honolulu, was appointed a Commissioner to take charge of the enterprise, and later Mr. Alfred Houle, formerly Hawaiian Consul General at Paris, was appointed Assistant Commissioner. The prevalence of the bubonic plague in Honolulu last winter seriously interfered with the preparation of articles for exhibition and, through the quarantine regulations, delayed and well nigh defeated the undertaking. From these causes the installation of the exhibit was barely in time to receive the inspection of the jury on awards.

In spite of these drawbacks, the articles displayed, especially those illustrative of educational work in the public and Kameiameha school, attracted interest. The Department of Public Instruction received a grand prize for primary instruction; the Kamehameha schools received a gold medal for manual training work, and the Hawaiian Planters' Association was awarded a

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