The Pacific Northwest Forum
Volume V, Number 3, Pages 2-9
Summer, 1980

Julius Neils: Lumber Baron (1855-1933)

Patricia Neils

Patricia Neils. whose husband is a descendant of Julius Neils. wrote this article while she was in the graduate program in history at the University of Hawaii.

Thomas Lake Logging Camp: Lumberjacks, logs and steam powered logging machine & railroad

Courtesy of the Library of Congress, added in 2009

According to Crows Digest. Julius Neils was "one of the brainiest and most kindly men ever connected with the lumber industry." As editor of one of the most prominent journals for the lumber industry in the Pacific Northwest, this evaluation by C.C. Crow was not without substance.

Julius Neils blazed his trail to success during those years between the Civil War and World War I when America itself was undergoing a monumental transformation. Agriculture, trade, manufacturing, mining, and communications were all experiencing unprecedented growth. Immense resources of gold, silver, and petroleum were being discovered, and railroad construction was stimulating and unifying the economy.

It was an age of great opportunity, when Americans were imbued with an entrepreneurial spirit. Never perhaps did the American people display more vigor, more imagination, or greater confidence in themselves and in the future of their country. Within this milieu Andrew Carnegie, John D. Rockefeller, and J. P. Morgan rose from rags to riches. Although the stories of their success are quite familiar, countless other talented and ambitious individuals attained great success and made major contributions to their country. One such person was Julius Neils, founder of the J. Neils Lumber Company.

Julius Neils was born June 15, 1855 near Treptow at Tribus, Pomerania in eastern Germany. His ancestors had migrated there from Denmark. While growing up in Germany, Julius helped his father in the marketing of butter, ham, and eggs as well as in the care of sheep and geese. He had six brothers and one sister. At the age of 14 he began to prepare for the teaching profession. He also took lessons in piano, organ, and violin.

To spare his sons from the inevitable prospect of service in the German army, Julius' father brought his family to America in 1872. They first settled in Milwaukee, Wisconsin, where other relatives were already residing. After saving enough money from various odd jobs, Julius entered the Teachers' College at Addison, Illinois and graduated in 1876. He then worked as a parochial school teacher at Reedsburg and Hustisford until 1881. During these years he met and married Mary Geiger. His exceptional memory, patience, and ability to impart knowledge to others contributed to his success as a teacher and were later reflected in his business leadership. Although his salary was only $400 a year, he was able to save a large portion of it. So when teaching became too confining, he ventured into another profession.

With his brother August, Julius bought and began managing a hardware store in Spencer, Wisconsin. In this community of German farmers, the Neils' hardware store often accepted logs in trade for merchandise. The logs were then taken to the Thayer mill to be sawed into boards. The lumber thus produced was sold again in the store. From this experience Julius learned the rudiments of the lumber business.

Fire Destroys the Store While the hardware business was well established, a tragedy occurred in 1886. Because of a prolonged drought that summer, a farmer's brush fire got out of control. More than half the town went up in a holocaust of smoke and fire. The mill, the railroad station, the Neils' hardware store, and August

Neils' home were all destroyed. By this time, Julius had four daughters and one son. The eldest daughter, Julia, vividly recalled the fire at Spencer. In her memoirs she explained that because her father's home was on the outskirts of town, it was spared. Thus her family compassionately provided shelter for the many homeless people who came streaming in, carrying whatever belongings they were able to salvage.

Julius and August had an opportunity to start over again when a hardware store went up for sale in Sauk Rapids, Minnesota. The brothers bought the store and moved their families there in 1888. Sauk Rapids was a town of very small population located on the Mississippi River, seventy-five miles north of St. Paul. It soon became clear however that the business could not support two growing families.

Julius therefore sold his interest to his brother and went into the lumber business with a Mr. Buckman and a Mr. Thayer, whom he had known in Spencer. From the beginning of the partnership, Julius looked after the office management and did all the bookkeeping and correspondence. Mr. Thayer meanwhile was in charge of the sawmill and Mr. Buckman did the selling. But shortly thereafter Julius Neils and Mr. Thayer bought out Mr. Buckman. They then began the practice of stamping all their logs with "T cross N" for identification as they floated down the Mississippi River.

The Thayer-Neils partnership continued until 1895, at which time there was a flood which virtually destroyed the mill. Thayer decided he was too old to start over again, so he sold his interest to Neils and moved to Riverside, California. Looking for a new partner, Julius contacted Thomas H. Shevlin, a prestigious and highly successful lumberman from Minneapolis. Their joint operation was from that time on called the J. Neils Lumber Company.

Prosperity - and an Oldsmobile

Compared to all the conveniences of modern times, the life of the Neils family in Sauk Rapids was quite primitive. The five-bedroom house had (4) no indoor plumbing, no running water, no electric lights, no radio, and no telephone. Indoor lighting was provided by means of kerosene lamps and lanterns were used outdoors. A large washtub on the kitchen floor was used for the Saturday evening baths. Water had to be carried by bucket from the outdoor pump. And of course there was the endless task of splitting wood and carrying it into the kitchen. The range was fired every day not only to cook the meals and warm the house but also to bake bread and heat water for laundry, baths, and household cleaning.

The children were sent to the Lutheran Church Parochial School. They learned to read and write in both German and English, and used slate and crayons in lieu of paper and pencils.

Some of these early years in the lumber business were lean ones. There could be no extravagance in food or dress at the Neils home. Some years even Christmas gifts had to be mostly hand-made - a task which Mary Neils very skillfully and lovingly accepted.

After eight years of successful operation in Sauk rapias, timber became scarce and the J. Neils Lumber Company had to re-establish itself elsewhere. By the year 1900 Julius had completed the contruction of a second lumber plant at Cass Lake, Minnesota, where Chippewa Indians still resided.

In fact the area surrounding the town was still their reservation. When Julius relocated his family there he already had eleven children: Julia, Martha, Anna, Ida, Paul, Walter, George, Martin, Marie, Henry, and Gerhard. In September the twelfth child, Marcus, was born. But he died in infancy. Another child, Victor, was born in 1910 but died of diptheria in 1915.

Relocation due to the scarcity of timber was not only disheartening for the family but caused instability for the community as well. The J. Neils Lumber Company was the largest employer in the area and the local economy depended upon it. And unlike the impersonal industrial giants of today, the J. Neils Lumber Company always took pride in its humanistic concern for its employees and donated countless hours and dollars in the construction and maintenance of public utilities and recreational facilities. It also took a leadership role in religious and community activities. With these concerns in mind as well as for conservation and esthetic reasons, the company in later years applied its genius to the development of a "sustained yield" program. Through selective logging the company maximized timber's potential as a renewable resource. Permanence of operation was thus assured.

Meanwhile, life at Cass Lake was prosperous and happy. It was in fact the beginning of a whole new style of life for the Neils family. The new home was not only spacious and beautifully designed, it enjoyed electricity, running water, indoor plumbing, and a basement laundry. So although there were many household chores to be done and although the older children were already learning the lumber business from their father, there was also much more free time. In the summer the family thoroughly enjoyed boating, fishing, and swimming at the lake. In the winter they became skillful at ice skating and sledding. Gerhard even recalls skiing long before modern equipment was available. "My first skiis," he wrote, "were made from barrel staves with a single strap from discarded belting. Later, I got a real nice pair made from birch wood sawed in the J. Neils mill and fashioned in the J. Neils shop."

One of the most exciting events for the Neils family at Cass Lake was the acquisition of a family car. Due to George's incessant and persuasive arguments. the family purchased the biggest car made in the United States. Gerhard recalled that it was, "Priced at $5000 when the dollar was worth $10 and labor was 20 cents an hour." In a time when roads were either nonexistent or adequate only for buggies and carriages, the 1910 Oldsmobile was quite a sensation.

Until the boys were old enough. Martha, nicknamed Max, had to be Julius' right hand man in the business. Later her daughter recalled that Max used to accompany her father on business trips; she drove the team of horses which took her father for inspection trips of the woods, and once fearlessly handled a run-away. She was very athletic, a fast runner and an expert tennis player.

As Paul, Walter, George. Henry, and Gerhard grew older, they also began to learn the techniques of the lumber business. Of course, logging operations were quite different than they are now. For example. transportation of logs did not enjoy the mechanization of recent times. In those days logs were transported principally by floating them on lakes and streams. In the forests. flumes and horses were also used. Similarly, most of the work in the mill was done by hand. Special techniques were devised for the winter season. As Walter explained in his account:

The transportation of logs in our operation was almost entirely by sleighs. These were drawn by four horse teams on roads that were especially prepared for sleigh hauls. We had a "rutter" that cut ruts in the ground or swamps that they crossed. For hauling, these ruts and roads were iced so that we had practically an iced road from the woods down to our log landings, which were as a rule on the ice of the lakes north of Cass Lake. In the early winter we could haul only small loads of logs, as the ice was not heavy enough to carry the larger loads that we hauled when the ice became three feet thick or more. Usually the first loads to come onto the ice were small, and when the teamster came to the edge of the lake, he'd unhitch his horses and hitch them onto the end of the tongue so that if the load did break through the ice, the horses would not go with it. The "Road Monkey" looked after haying the hills. Whenever a load had to come down an incline, the road monkey would run ahead of the load with an armful of hay and throw handfuls of it into the ruts to slow the load as it came down.

In accord with an all-too-familiar pattern, timber began to grow scarce in the Cass Lake area after about six years of prosperous operation. George W. Millet, the timber buyer, was therefore sent to Kalispell, Montana to buy timberlands from homesteaders in Flathead County. By 1911 the J. Neils Lumber Company had enough in the vicinity of Libby, Montana to be interested in the sawmill that was being operated under the name of Dawson Lumber Company. Dawson sold the mill and over 70,000 acres of timberland to J. Neils. In 1914, as Walter explained, other land deals were made in the area and the Libby operation became an exclusive Neils enterprise:

The J. Neils Lumber Company was still owned at that time by the Neils' interest and the Shevlin interests ... The Anaconda Cooper Mining Company owned the timberlands that had been picked up from the Northern Pacific land grant intermingled with ours, and in 1914 we made a trade with them, they taking the timber in the Fisher River area and we taking the timber in the Libby Creek drainage. We also kept the timberlands that we had north of Columbia Falls and east of Kalispell, and also the timber on the Tobacco River around Eureka, Montana ....

In 1914 my father and the Shevlin interests decided to divide up the property between them. The Shevlin group took the Libby mill; we took the Cass Lake mill and all the other property that went with it. We also kept the timber tributary to Columbia Falls and Kalispell and also the timber along the Tobacco River. The war had already started in Europe and as we feared that the United States would be involved, the J. Neils group did not look for any expansion as many of the family group were of military age and, we expected, would be called into the service. A policy of accumulating cash was developed, and after the war was over, the Libby plant was purchased from the Shevlin interests, and has been one of the operations of the J. Neils Lumber Company ever since that time. I came here in January, 1919, as manager of the plant and have been active as manager ever since that time.

The Move to Klickitat After the war, the J. Neils Lumber Company renewed its program of actively purchasing additional timberland. The largest and most significant one after the Libby acquisition was of the mill and timber acres around Klickitat, Washington, in 1922. Information had come to Walter about the financial difficulties of Max Houser, principal stockholder of the Western Pine Lumber Company at Klickitat. They paid $740,000 for all of its assets. This included the railroad and its equipment, logging equipment, sawmill, planing mill, title to the mill property, logs in the woods and at the mill and in the storage yard, title to 1,599 acres of timberland as well as timber rights on thousands of additional acres.

Hugo Schmidt, husband of Marie Neils, was made manager of that operation and Gerhard Neils was made sales manager. Paul stayed at Cass Lake until the closure of that plant in 1923. He then took charge of the Portland office and became general manager of the company on his father's retirement and death in 1933.

Selma, wife of Gerhard recalls that:

When the Neils took over at Klickitat there were only about 30 houses in the town and the plant had to be manned mostly by single men. They had rooms and board in the two large rooming houses across the track from the planer. In 1923 it became necessary to add a boardinghouse with a dining room large enough to seat 150 men, with rooms upstairs for the cook house crew. This was necessary because of considerable turnover of labor and larger crews used in increased production at the sawmill.

In 1924 Walter H. Rathert, employee of J. Neils and later manager of the company, took charge of supervising the rapid growth and development of the townsite of Klickitat.

During the 1920s and 30s numerous advances were made in the logging industry. For example, the automatic stickerlayer and the mechanical lumber stacker were both invented by an employee at Libby, John Knudson. Similarly, Al Becker proved to be a superb machinist and devised variom innovative devices for the company.

While the steam "donkey," clyde skidder, and railroad had been standard transportation equipment, they were replaced in the 1930s by the "cat," the logging truck and the bulldozer. And, in more recent years, the mobile yarding machine and the power saw have been introduced.

Sustained Yield

The most significant development since the company's expansion to Libby and Klickitat, however, has been its new logging policy. This new program of "sustained yield" facilitated a permanence of operation and community stability that was not possible at previous locations operating under different policies. The "sustained yield" program, as explained by grandsons Edward Neils and Mark Schoknect, meant that: timber was grown as fast as it was cut. In the areas of Montana and southern Washington most logging was done on a 'selective' basis so that only mature trees which would not improve much in size or quality in the next 40 years would be felled. This far-sighted policy and a faith in the future provided that timber for the Libby and Klickitat mills would be available indefinitely into the years to come. J. Neils Lumber Company was the first of the large lumber corporations to adopt a 'sustained yield' program.

With the help of Dr. Walter Meyer of Yale University, Julius' third son, George, initiated this program on the company lands at Libby. The Libby lumber company has been operating securely and successfully ever since.

During the 1930s depression the J. Neils Lumber Company, like most industries across the nation, suffered some serious setbacks. Paul Neils has recorded the following: LOSSES

Libby Klickitat

1930 $ 93,233.37 $ I 35,624.33

1931 71,564.04 161,838.30

1932 154,542.19 127,713.88 Despite these losses, however, the company continued to operate for the sake of the community which was so dependent upon it. By 1934 the economy as well as the company was well on the road to recovery.

Although it continued to prosper, in the 1950s Paul Neils felt that the problem of succession in management and problems of diversification of the product were pressing. He acknowledged that operating earnings continued to be substantial, but it was necessary in his opinion to add facilities for pulp or paper production, or to merge with a paper producer. Thus, to the sadness and dismay of many of the younger family members, Paul effected a merger with St. Regis Paper Company on January I, 1957. At the time of the merger, the J. Neils Lumber Company owned 300,000 acres of timber. 200,000 were in the Kootenai country of Lincoln County, Montana, and 100,000 acres were in the Klickitat River drainage area in Southern Washington. Paul then resigned as President of the J. Neils Lumber Company in order to become chairman of the board of directors. He was succeeded to the presidency by Walter Rathert. George resigned as logging manager at Libby, but Walter continued as plant manager until the end of the year. He was then succeeded by his nephew, Alfons Agather (Martha's son). Gerhard continued as sales manager at Klickitat until the end of 1963. Then Edward, Walter's oldest son, was named successor. In recent years Richard, Walter's second son, became vice-president of St. Regis. He held that position until his death in 1979. Edward, meanwhile, remains the only member of the Neils family holding an executive position with St. Regis.

Under the new St. Regis ownership and management, the Libby and Klickitat operations have continued to 'prosper to the present day.

Unfortunately, however, to maximize profits and despite opposition from environmentalists and some members of the Neils' family, the Sustained Yield program has been compromised. Although St. Regis has contributed to various scientific studies and experiments to promote the healthy growth of trees, it has all too often employed landscape defacing, clear-cut methods of logging.

Although the family has not been able to perpetuate the leadership and logging policies developed by the J. Neils Lumber Company, the legacy of Julius Neils continues to thrive. It lives on in the communities of Libby, Montana and Klickitat, Washington, where his civic contributions have been incalculable. It lives on too in its recorded practice of a Sustained Yield Program, which has proven viable where the motivation is high and greed for profits is not exorbitant. c