USA > Iowa > Des Moines County > History of Des Moines County, Iowa, Volume I > Part 53
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After this followed in succession, the Boston & Albany, and the New York Central. In the West, the Wabash & Western, the Illinois Central, the Chicago, Rock Island & Pacific, the Chicago, Burlington & Quincy, and the Burlington & Missouri River Railroad.
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HISTORY OF DES MOINES COUNTY
The history of the Burlington & Missouri River Railroad and its connection with the Chicago, Burlington & Quincy with its branches, are the ones with which the people of Des Moines County are particularly interested.
On the 26th of January, 1852, there was filed in the office of the recorder of leeds of Des Moines County the articles of incorporation of the Burlington & Missouri River Railroad Company. In the articles the following named persons appear as incorporators : J. F. Tallant, Charles Mason, J. J. Child, William Ends- ley, David Rorer, James W. Woods, J. C. Hall, Thomas Sperry, William Sunder- land, P. C. Tiffany, O. McClelland, John Johnson, Lyman Cook, Henry W. Starr, J. P. Sunderland, Alphonso Martin, J. P. Kriechbaum, A. W. Carpenter, Wil- liam F. Coolbaugh, George Frazee, F. J. Peasley, Joseph Fales, J. F. Abrams, Joshua Copp, T. L. Parsons, J. A. Funck, R. S. Adams, John Pierson, C. H. Snelson, Thomas W. Newman, T. D. Crocker, Jarnett Garner, William S. Graff, E. D. Rand, A. D. Green, John G. Foote, Levi Hager, J. C. Stocton, Thomas Hedge, J. M. Swan, J. G. Law, D. Denise, E. H. Ives, J. G. Lawman and J. S. Schramm.
The articles among other things declared that the above named persons have associated themselves for the construction of a railroad from Burlington to the Missouri River.
The second article gave the company the name, "Burlington & Missouri River Railroad Company."
The third fixed the life of the company at fifty years.
Another article made provision for a board of directors to consist of nine persons, and provided the board could hold its meetings at any place they might select outside of Burlington.
The seventh article limited the capital stock to $3,000,000, and the indebted- ness should not exceed at any time two million dollars.
The twelfth article authorized the board of directors to make any arrange- ment with the State of Iowa for the purpose of securing the benefit of any lands which may be given by the State of Iowa for the "construction of the road herein contemplated." To construct the contemplated road was a big undertaking for those men in a small western town in a state at the time only six years old.
Between Burlington and the Missouri River at this time existed a vast extent of prairie land, the most fertile of any in the Mississippi Valley, which the Gov- ernment owned, and if it could be induced to part with its title to a portion of the same along the line of the contemplated road, the project seemed perfectly feasible.
The old Greek proverb, "The beginning is half of the whole," these incor- porators believed to be true, and they determined to begin. To do this they determined to get the people of the towns and counties along the line of the contemplated road interested in its construction. From what was then said, every town along the line of road would become a metropolis, and every county through which it ran an Eden. Log cabins would give way to stately mansions, corn dodgers, pumpkin pies, brown sugar and Orleans molasses to white loaves of bread, "raisin pies," loaf sugar and "dewdrop" molasses. The cob pipe be sup- planted by the meerschaum, the coonskin cap by a woollen hat, the yellow walnut colored trousers and wampuses made by wives and daughters to a tailor-made
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suit, cut and fitted in accordance with the fashion of the day. The people of the towns would revel in all that wealth could supply.
Dazzled by such visions which would have full fruition, when the railroad had been built they were willing to bank on the future by loading themselves down with a debt of taxation in order to build the railroad.
In so far as it concerned Burlington and Des Moines County, and the Bur- lington & Missouri River Railroad, no complaint can be made, for the people got all for which they contracted, and while their imagination may have been overwrought, that was no fault of the company, and if they lost out in not acquir- ing an interest in the road, it was not the road's fault, but that of the stupid blockheads comprising the City Council of Burlington, and the board of super- visors of the county.
The people of the city and county were not opposed to carrying out the con- tracts for which they had voted, but these officials, in some way, either through the action of the state courts, or by bad advice, were made to believe that after having received the benefits for that which they had contracted, undertook to repudiate the obligation of both city and county.
The act, entitled "An act to incorporate and establish the City of Burlington," approved June 10, 1845, among other things, provided in section 27, "That where in the opinion of the city council, it is expedient to borrow money for any public purpose, the question shall be submitted to the citizens of Burlington, the nature and object of the loan shall be stated, and a day fixed for the electors of the said city to express their wishes; the notice shall be given as in cases of an election ; the loan shall not be made unless two-thirds of all the votes polled at such election shall be given in the affirmative."
In chronological order we here set out the substance of certain proceedings of the City Council of Burlington to aid in the construction of the B. & M. R. R. R.
The city council passed an ordinance June 15, 1855, which provided "That a loan of $75,000 be made by the city at a rate of interest not exceeding 8 per cent per annum, payable semi-annually; the proceeds of same to be invested in the stock of the Burlington & Missouri River Railroad Company." The ques- tion whether said loan should be made was submitted to the electors as provided by the city's charter, when it appeared that more than two-thirds of the electors had voted in the affirmative.
It was further provided in the ordinance that the mayor be authorized to con- tract for said loan, and that the bonds of the city be issued when the contract shall have been made, and by the terms of the ordinance the solemin faith of the city was pledged for the full payment of the bonds.
The city council passed an ordinance June 27, 1856, which among other things recited "That the council on the 19th of May, 1856, had adopted a resolution authorizing the mayor to call an election and to submit the question whether or not the city issue and lend to the Burlington & Missouri River Railroad Company $75,000 in the bonds of the city bearing interest at the rate of 10 per cent per annum."
The question was submitted to the electors at an election held on the 2d day of June, 1856, by which the council was authorized to make the loan.
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It was provided in the question submitted to the electors "That the bonds to be issued and delivered to the company, be secured by the first mortgage bonds of the company."
In the first instance the bonds to be delivered to the company was for the stock of the company, and in the second to be secured by first mortgage on the road of the company. In one case the city was to be a stockholder; in the other, a bond- holder.
The city council on the 26th of April, 1858, passed an ordinance in which was submitted to the electors: "Shall the City of Burlington take stock in the Bur- lington & Missouri River Railroad for the $75,000 indebtedness of said company to said city ?" An election was held in pursuance to law, in which 880 votes were cast in favor of the proposition and 67 against it.
By this action the city ceased to be a bondholder, if one at any time, and became a stockholder in the company.
Thereupon a contract was made between the city and the company, in accord- ance with which, among other things, it provided, (5) "Said railroad company further covenants and agrees to and with said City of Burlington, to issue to said city certificates of stock in said company to the amount of $75,000 in full pay- ment of $75,000 which said railroad company now owes said city, etc. The stock to be issued by said company, and received in payment for said indebtedness by said city as of date of the ordinance aforesaid, beginning the 29th day of April, 1858."
EDWARD L. BAKER, President of Burlington & Missouri River Railroad Co. J. P. WIGHTMAN, Mayor of the City of Burlington.
So far as I am able to discover from the records, at this time the city had issued its bonds in the amount of $75,000 and had delivered the same to the company to be by it sold on the market, and the company had delivered to the city an equivalent amount of its stock.
Matters were then in fairly good shape, and the work of construction going on.
Herewith is submitted a report of Hon. J. C. Hall to the stockholders of the company :
REPORT
"To the Stockholders of the Burlington & Missouri River Railroad Company : Our company completed its organization as a body corporate and became an efficient company on the 25th day of November, 1853. The object and purpose of the company was to construct a railroad from the City of Burlington on the Mississippi River, to some eligible point on the Missouri River, near the mouth of Platte, or Nebraska River, passing centrally through the second tier of counties north of the south line of the State of Iowa-a distance of about two hundred and eighty miles.
"It is believed that no road west of the Mississippi River, when considered with reference to geographical position, apparent and prospective connections, salubrity, fertility and beauty of climate, soil and country, can produce so prom- ising a future as this road. It cannot be denied but that this road passes over as
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favorable a country, as far as grade and heavy work are concerned, as any other road that can be found in the State of Iowa, and it can be constructed with less expense than any road passing from east to west across the state.
"At the time this road was projected, our people were anticipating an early connection by railroad with the City of Chicago, also by the Peoria & Oquawka Road and extensions a connection east with Peoria, Logansport, and in this direction with the cities of Pittsburgh, Philadelphia and New York.
"By this route our road to the eastern cities would be greatly shortened, and, as it is believed, the danger from interruption by snow in the winter greatly diminished .. Indeed, upon the completion of these roads, our facilities and east- ern connections could not be surpassed.
"By examining the map of the country, it will be seen that with the road now finished and running east of Logansport, Ind., and the completion of the eastern extension of the Peoria & Oquawka Road, from Peoria to Logansport, the Peoria & Oquawka Road, between Peoria, Burlington, and our road from Burlington to the Missouri River near the mouth of the Platte, that they form almost a direct air line from New York, Philadelphia, Pittsburgh, Logansport, Peoria, Burling- ton, Ottumwa, to the Missouri River at the mouth of the Platte, whose valley extends far westward, in the same parallel of latitude, and draining the eastern slope of the Rocky Mountains. It is believed that no more direct route can be found than this for any road, however specious names may be assumed. It will be a great central air line road from Philadelphia to the Missouri River, and when a road shall extend west, up the valley of the Platte, toward the Pacific Ocean, it will be but a continuation of this great central aventie.
"Should the time come when a railroad could be constructed westward from the Missouri River to the Pacific Ocean, on or near the forty-second parallel of latitude, our road must be a great link in that connection east of the Missouri. It is on the proper parallel,-the shortest line from the valley of the Platte to the Atlantic cities. It has a geographical position that must make it all that its friends can hope or wish.
"That the valley of the Platte or Nebraska River is the proper place for a road west to the Pacific, if ever that great project shall be accomplished on this parallel of latitude, no one can doubt. This route has been somewhat examined west of Fort Ridge, which is situated on a tributary of Green River, by Lieut. E. G. Beckwith, but east of that point no explorations have been made with a direct reference to the construction of a railroad. Much information, however, can be gathered from the examinations and reports made by Lieut. G. K. Warren, Colonel Fremont and Captain Stansberry.
"By the route designated, on the forty-second parallel, the eastern terminus may be fixed at the mouth of Platte River, either on the north or south side of the river, as a survey and examination of the country may prove most practicable. It will ascend the Platte and pass through the Black Hills, or eastern chain of the Rocky Mountains, either by the North Fork and its tributary, the Sweet Water, or the South Fork and its tributary, the Lodge Pole Creek. By the former, it will enter into the great elevated table land in which the head waters of the Platte and the great elevated table land in which the head waters of the Platte and Colorado are found, by the South Pass, with a gradual ascent from the first gorge of the Black Hills, about thirty miles above Fort Laramie, to the Vol. 1-29
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summit of the pass, a distance of near three hundred miles. By the second route, or Lodge I'ole tributary of the Platte, the same difference of elevation can be overcome by the Cheyenne Pass, thus entering the Laramie Plains, which form the eastern part of the great plateau in which the Sweet Water and Colorado have their source, above referred to. Captain Stansberry says of the Cheyenne Pass, that 'his examination fully demonstrated the existence of a route through the Black Hills, not only practicable, but free from any obstructions involving in their removal great or unusual expenditures.' From the Cheyenne Pass the country can be easily crossed. The route best known is between the waters of the North Fork of the Platte, and the Green River by Bridger's Pass. I refer particularly to this route from the positive preference given to it by Captain Stans- berry, who has examined both routes. From Fort Bridger west, the line ascends the divide between the waters of Green River and those of the Great Salt Lake, by the valley of Black Fork or one of its tributaries. The summit is a broad ter- race at the foot of the Ninta Mountains, thence over an undulating country sepa- rating the Ninta and Bear River mountains, crossing the head of Bear Creek, and entering the valley of White Clay Creek at its head, follows that creek to Weber River. Great Salt Lake can be gained from that point by valley of the Humboldt, which is followed for about one hundred and ninety miles. From Humboldt River to the foot of the Sierra Nevada, the best route is by Noble's Pass road till we reach the Madalin Pass of the Sierra Nevada, on the west shore of Mud Lake. From Mud Lake we ascend by the valley of Smoky Creek, and thence to Round Valley on the Sacramento River.
"I particularize this route for the purpose of calling attention to the direct- ness of the line from east to west across the continent.
"Much speculation has arisen of late years in relation to several lines of con- templated railways that may be constructed from the waters of the Mississippi to the Pacific coast. The examinations that have been made thus far are necessarily imperfect, but from the best information that can be obtained, we may be encour- aged in the opinion that with the vast advantages of country and population which our great central line has east of the Missouri, that when any line is con- structed west of the Missouri, the one indicated above, between the thirty- ninth and fortieth parallel of latitude, will certainly be the one adopted.
"The first purpose of our company after the organization was to construct the road from the City of Burlington to the Des Moines River at Ottumwa, a dis- tance of seventy-five miles. To this end, stock was taken to the amount of $592,100, which has been increased to $667,100, which is the present capital stock of the company.
"In 1854 most of the grading, ditching and tieing of this part of the road was placed under contract, and between forty and fifty thousand dollars expended at different points on the road. Owing to a severe pressure in the money market, in the latter part of 1854, and first months of 1855, the company found it im- practicable to carry on the work, and it was consequently suspended, and the laborers dispersed.
"In the summer of 1855, it was thought advisable to change the policy of the company in relation to the construction of the work, and in the place of continu- ing by small contracts, to let the entire road to contractors, to be delivered to the company in complete running order. Following this policy, on the 15th day of
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August, a contract was executed with Clark, Hendrie & Co., a responsible and wealthy firm, to construct the road and deliver it to the company on the ist of June, 1857, from Burlington to Skunk River, a distance of thirty-five miles, at a price of $22,500.
"This company has energetically entered upon the execution of that contract. The grade and ties are now ready for the iron to Mount Pleasant, a distance of twenty-eight miles, and the iron is laid and track constructed about half of the distance. We can confidently expect that the road will be open to Mount Pleasant by the Ist of June next.
"There has been a great anxiety felt by the citizens of Jefferson and Wapello counties for an early construction of the road west of Skunk River, through those counties, but with the present state of finances it has not been practicable to make any contract for that purpose. A proposition has been made to those coun- ties to increase their stock $100,000 each, and a contract agreed upon to construct the road to Ottumwa, upon the condition that those counties subscribe the stock. This, however, has not yet been done, and the matter yet remains open. The distance from the west terminus of the road to be constructed by Clark, Hendrie & Co. to Ottumwa is about forty miles. After meeting our contract with Clark, Hendrie & Co. we have only about two hundred and forty thousand dollars of stock with which to construct the road west. This is too small a basis to invite responsible contractors to undertake the work, and it is believed that it will be difficult, if not entirely impracticable, to progress further without an increase of stock in Jefferson and Wapello counties.
"Good faith to the stockholders of Wapello County requires that the company shall so manage the aggregate means as to secure the construction of the road to Ottumwa at as carly a day as possible, and it would be unjust to them to expend the entire stock applicable to the road in Jefferson County, without ensuring the construction of the road through that county.
"Under all the circumstances I think I can congratulate the company upon the success of the enterprise so far, and predict an auspicious future.
"All of which is respectfully submitted. "J. C. HALL."
After the bonds had been sold and stock delivered to the city, and the com- pany had almost completed the construction of the road, some of the taxpayers got it into their heads the city had no authority under the law to create an indebt- edness for a private purpose, contending that such was solely the purpose of a railway company. Instead of seeking to enjoin the issuance of the bonds, they waited until the bonds had been sold and the work almost completed. The ques- tion arose in the case of Elisha Chamberlain et al. vs. the City of Burlington, 19 lowa 395, which was a suit in equity to restrain the city from levying a tax of one-fourth of I per cent upon the real and personal property of complainants for the purpose of paying interest due on certain bonds issued and delivered to the Burlington & Missouri River Railroad Company. Complainants set forth a copy of one of the bonds, which is as follows :
"1856. TIIE CITY OF BURLINGTON, IOWA 1856
"Bond No. 50. One thousand dollars, issued by the City of Burlington under ordinance No. 44: 'To authorize a loan of city bonds, to the amount of seventy- five thousand dollars, to the Burlington & Missouri River Railroad Company.'
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"Twenty years after date the City of Burlington, in the State of Iowa, promises to pay to bearer, at the office of E. W. Clark, Dodge & Co., in the City of New York, $1,000 for value received, without defalcation, with interest at the rate of 8 per cent per annum, payable semi-annually at the same place, on the first days of August and February in each year, upon presentations of the coupons severally hereto annexed, until payment is well and truly made of the said principal sum of $1,000. In witness whereof, and in pursuance of ordi- nance No. 44 of said city, entitled 'an ordinance to authorize a loan of city bonds to the amount of seventy-five thousand dollars to the Burlington & Mis- souri River Railroad Company,' the mayor of said city hereto sets his hand and causes the corporate seal of said city to be affixed, and the recorder of said city countersigns the same at the city aforesaid this ist day of August, A, D. 1856. "J. L. CORSE, Mayor.
"D. J. SALES, Recorder."
(There are forty coupons attached.)
Complainants answered that said tax was illegal and not authorized by the charter of the city, or the laws of lowa, etc.
The city, defendant, demurred to the petition because the same, with exhibits, does not set forth sufficient facts to constitute a cause of action, and shows no reason why the relief asked should be granted. The District Court overruled the demurrer, and the defendant electing to stand thereon, judgment was granted as prayed in the petition.
The case went to the Supreme Court of the state, which sustained the ruling of the lower court. So far, Chamberlain and his kickers had won; but this was just the beginning of trouble. The Federal courts had to be dealt with. As touching the power of a county to issue its bonds, and become a stockholder, arose in Dubuque County v. The Dubuque & Pacific Railroad Company, 4 Green I. The court held such power existed. The same question arose in Clapp v. Cedar County, 5 Iowa, 15, where the holding in the Dubuque case was sustained. Other cases of the Supreme Court held the power existed. With the decisions of the highest court of the state sustaining the existence of such power, it was an incentive to railroad building, and many such projects were started. Counties and cities voted aid in their construction, the bonds sold, but in some cases the railroad did not materialize.
The bonds had passed into the hands of innocent purchasers for value, who brought stiit to recover both principal and interest as they became due. The Supreme Court by its decisions had placed the seal of legality on such trans- actions, and thereby induced investment in these bonds. When counties and cities failed to get the roads for which they voted aid, then it was the court undertook to go behind its former holdings, or in a vain attempt to declare the constitutional question had not been raised in their former decisions. However, the Iowa Supreme Court in no case was unanimous in sustaining the power, Justice Wright in every case dissenting. The majority opinion was not filed until four years from the time of its rendition.
In McClure v. Owen, 26 Iowa 243, the court held that the state constitution confers no power upon the Legislature to authorize counties to become stock-
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holders in railroad corporations, nor to borrow money upon their bonds for the purpose of the payment of such stock, and such bonds were void.
In the McClun case it was contended the decisions of the Supreme Court of Iowa on the question arising under the construction of the constitution of the state, or of a law of Iowa, was paramount, and under well authenticated decisions of the Supreme Court of the United States it was bound to follow the decisions of the highest tribunal of the state.
The case of Rogers v. Burlington, 3 Wallace, U. S. 654-67, affirmed the validity of the city bonds, which Chamberlain had attacked.
One Rodgers brought an action in assumpsit in the United States Circuit Court to recover interest due as shown by certain coupons annexed to the bonds issued by the City of Burlington to aid in the construction of the B. & M. R. R. R. The declaration contained many counts.
The defendant city interposed a demurrer to the declaration :
2 "That the bonds showed on their face that they were not issued for any municipal purpose, but as a loan from the city to the railroad company.
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