USA > Missouri > Macon County > General history of Macon County, Missouri > Part 24
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The Macon County Court subscribed $175,000 to the stock of the road on April 2, 1867, without submitting the matter to a vote of the people. In the fall of that year the Supreme Court of the State, by peremptory writ of mandamus, compelled the County Court to issue bonds in payment of the subscription.
At that time the County Judges were A. C. Atterberry, James R. Alderman and W. D. Roberts.
From articles in the local papers of that date the first subscription seems to have been popular. The people were anxious for railroads. and it was thought the new project would prove an important auxiliary in building up the county. At a largely attended mass-meeting at Macon, presided over by General F. A. Jones, these resolutions were adopted :
"Resolved, That we have heard with feelings of great pleasure of the decision of the Supreme Court of Missouri ordering a peremp- tory mandamus to the County Court of Macon comity to issue the amount of stock subscribed to the Missouri and Mississippi Railroad in the bonds of said county.
"Resolved, That laying aside all points of difference, we heartily
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co-operate and unite in all legitimate measures for the early com- pletion of said road and urge upon the citizens of the counties North, East and South of Macon, interested in the Missouri and Mississippi Railroad, to earnestly press the subject upon the attention of the officers of their respective counties and the community generally." (From the Macon Argus, reporting a meeting held October 25, 1867.)
Editorially the Argus said :
"The railroad meeting at the Court Ilouse last Friday night was a spontaneous outpouring of the people to testify their gratification at the successful culmination of the suit establishing the legality of the subscription to the Missouri and Mississippi Railroad. No sooner had the telegraph announced the decision than the news spread over town like fire upon a prairie, and a meeting was called at once to give expres- sion to the feelings of the people. All seemed to partake in the general rejoicing, believing that the success of the road would add universally to the wealth and prosperity of both city and county. John W. Henry's speech was full of telling points and reached chords that vibrated the audience like an electric shock."
It is stated by a party who seems to have been in touch with the early operations of the road that the first appropriation was only expected to be used in bridging, the purchase of ties and grading. It was hoped by then some capitalists would be found to take hold of the enterprise, lay the steel, equip the road with rolling stock, erect stations, etc. The right-of-way and the work done upon it would be offered as security for the future investment. But wages and material were high, and the first subscription by the counties proved inadequate to build the roadbed. Some work had been done northeast of Macon, and the roadbed constructed from Salisbury to Glasgow.
A call was made on the Macon County Court for a second appropri- ation of $175,000. This came in the shape of a motion filed with the court in February, 1870, by Judge James A. Clark, then attorney for the road. Judges Alderman and Roberts were still on the county bench. Judge C. P. Hess was the new member, who succeeded Judge Atterberry.
In a statement published in The Macon Republican of October 28, 1892, when he was the Republican nominee for Judge of the Second Judicial Cirenit, Judge Hess stated that he strongly opposed this second issue of bonds from the first, but when he saw they were going to be issued over his objection, he named important conditions contin- gent upon his favoring the issue, the conditions being a pledge for the faithful use of the money and that the shops be located at Macon, and
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that the line should pass through Macon within 400 yards of the depots of the Hannibal and St. Joe, and the North Missouri roads.
The second subscription was not popular. Meetings in protest were held all over the county. Suits were instituted to stop the issue of bonds. At the same time there were those insisting on the County Court that the second subscription was absolutely necessary, else the amount contributed in the other subscription would be lost in the col- lapse of the road. The second subscription was made May 2, 1870, amid considerable excitement.
The opponents of the issue declared the first money had not been honestly used in construction work, and that the second subscription would likewise fail of its purpose.
It was not long before the road landed in hard lines again. The bonds were scattered, being bought up by investors in many of the large cities. Still the supply of money was inadequate. Contractors filed liens and attached everything they could find. At one time a consignment of steel was shipped to Macon, in care of Major Glaze, the treasurer, with instructions not to let it leave his possession without the money. During his temporary absence from the city some of the track builders seized the steel and laid it on the ties north of town. For a very short time the Missouri and Mississippi railroad actually pos- sessed a piece of track. But when Major Glaze returned, he made them tear up the track and place it back in his possession until paid for. Part of the steel was eventually used in laying the Wabash track from Salisbury to Glasgow.
Some agents of the railroad company, in a determined effort to raise funds, went to London and opened negotiations with some finan- cial men there, with fair prospects of success, it is said, when a notice appeared in the London Times to the effect that investors in M. and M. securities would buy a law-suit. This closed the money boxes of London. Afterwards a man by the name of Vandewater, a contractor of Pana, Illinois, and some St. Louis men came up to look over the situation. These parties made an attempt to handle the property, and, it is said, had arranged with Brayton Ives, a railroad builder of New York, to raise the funds for the steel and rolling stock. One of the syndicate was connected with a rolling mill where rails were made. The bankers of New York were about to elose a deal for advancing the necessary money when a telegram came to Ives from Missouri stating there was imminent danger of suits all along the line. So Ives stood from under and passed from the stage as a figure in M. and M. history.
Major Lewis, president of the road, Judge Clark, Mr. Tisdale of
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Clark county, and a stockholder from Knox county, made a final effort, and attempted to lay some steel, but the rolling mill people demanded the cash, and the work stopped. That seems to have been the last attempt at construction. It is said that many of the men who had taken active hold of the enterprise at the start lost nearly all their fortune. The road was dead, but the bonds still lived.
From the beginning of the suits to recover on these bonds the county's sentiment was strongly against a settlement. The people had received nothing; in equity they should be required to give nothing. That was the argument here.
The bondholders kept their judgment alive and added up their interest. There were those who said quietly that the debt was col- lectible, but it was not popular to make such a statement in public.
That was the situation when Gen. John B. Henderson of Wash- ington, T. K. Skinker, Gen. James M. Lewis, St. Louis, S. A. Saunders, Springfield, Illinois, and Daniel R. Kinder, Litehfield, Illinois, all attor- neys representing M. and M. bondholders, visited Macon in November, 1894, and began to take soundings regarding a compromise of the debt, at that time amounting to $1,100,000. They petitioned the County Court (Judges W. II. Terrell, Gran Goodson and Hammond Ward) to order an election on a proposition to settle at fifty-nine and three quarters, payable in new five per cent bonds of Macon county.
The names of 215 resident tax-payers were signed to the petition. In a statement isued by the County Court it stated that in accordance with the law it would be required to order an election, but "we do most emphatically oppose the adoption of said proposition, for the reason we believe the rate named in said proposition to be entirely too high and unjustifiable under the circumstances."
The election was ordered for December 15, 1894. The County Court advised the people to "vote an emphatic 'No,' on the proposition."
There was not much of a campaign. It was clearly apparent, even to the bondholders' attorneys, that the proposition would be defeated. The vote against the proposition was 5,020; in favor of it, 67. Most of those signing the petition for an election did not vote, or voted against the compromise.
In 1904 Mr. Theodore Gary, after the expenditure of considerable time and means, presented a plan by which it was hoped, and claimed, that all of the indebtedness on the M. and M. bonds could be settled for eighteen cents on the dollar. At that time the total debt was a little over $1,600,000. It was figured that at eighteen cents on the dollar it
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could be settled for $300,000, or $50,000 less than the original subserip- tion by the Macon County Court to the M. & M. bonds. Mr. Gary, in his usual careful manner, began a systematie campaign. He suc- eeeded in interesting a large number of men of affairs in all the town- ships, and a committee of fifty was appointed to work up interest in the project of compromising and settling the debt. In May there was a meeting of the committee and citizens in the rooms of the Maeon Com- mercial Club. This meeting was attended by General John B. Hen- derson of Washington and Arthur C. Huidekoper of Meadville, Pennsyl- vania, two large holders of the M. & M. indebtedness. Both General Henderson and Mr. Huidekoper stated at that meeting that they would accept eighteen eents on the dollar in settlement of their holdings. There was a vote of the committee, all of whom went on record as unanimously favoring the proposition.
Mr. R. G. Mitchell, attorney for the county, stated at the meeting that the amount in judgment at that time was $1,109,131.53. Interest due on the judgment up to the first of August, 1904, $401,099.51. Small warrants, $86,686.86. Court costs, $4,283.42. Total indebtedness np to August 1, 1904, $1,601,201.32.
Both General Henderson and Mr. Huidekoper addressed the meeting.
Mr. Gary stated that in 1901 he personally saw nearly all of the bondholders, and that he only met two who would not aeept the eom- promise. Since then he understood one of these men who held about $22,000 was willing to come in. Mr. Gary stated that no very consider- able amount would stay out of the compromise.
Mr. A. W. Gilstrap said that Mr. Gary had been aeting as the official agent of Macon county in this matter and had doubtless been put to a great deal of trouble and expense. He wanted to know whether Mr. Gary would have a elaim on Macon county for the trouble he had been to and whether he would be paid by the other side of the house.
To this Mr. Gary replied that he never expected to ask Macon connty to pay him a eent commission. He supposed that the creditors would pay him something, not in any case more than five per eent would he ask for.
Mr. Gary went on to state that he was willing for the committee to know everything that he had done, and said all the correspondenee he had was subjeet to investigation at any time; that he had no elaim whatever against Macon county.
Mr. Gilstrap said that "Certainly, we have no fault to find with that."
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In its issue reporting the meeting the Macon Republican presented the following as the complete list of the committee of fifty: John Scovern, J. H. Wright, A. W. Gilstrap, D. B. Moore, Lon Hayner, J. J. Davis, J. G. VanCleve, J. P. Kem, W. G. Walker, E. L. English, Edward B. Clements, Macon; Robert H. Kern, New Cambria; B. E. Moody, Excello; John A. Niekell, Niekleton; F. W. Allen, Callao; John F. Coulter, Excello; Jefferson Morrow, Callao; W. S. Watson, Hf. W. Doneghy, Macon; J. T. Doneghy, La Plata ; E. D. Allen, Callao; James D. Miles, Atlanta; Frederick Sandner, C. D. Sharp, Capt. Ben Eli Guthrie, Harry M. Rubey, Ben Franklin, John T. Gellhaus, Thomas Bibby, Aleck Leathers, C. S. Tuley, Macon; A. J. Brown, Anabel; Judge John Williams, Excello; W. E. Floyd, Axtell; H. W. Graves, New Cambria ; W. E. Murlin, Bevier : E. J. Jones, New Cambria; W. O. Clarkson, Callao; F. W. Blees, Macon; A. S. Ray, La Plata; J. B. Goodding, La Plata ; Aneil Milam, Macon ; Gran Goodson. New Cambria ; Jolin Jones, New Cambria ; George Wisdom, Macon.
In a letter to the Macon Republican the following week Harry M. Rubey stated that his name had been erroneously placed upon the com- mittee list, and that he was not a member of it. He said, however, that he was in favor of compromising the debt at eighteen cents on the dollar, "if it can be effected in the right way, and I will do all I can to accomplish it as a private citizen who is interested, because I am a proeprty owner and taxpayer, and because I think it's to the best interest of the county."
There was a meeting of the committee of fifty and citizens of Macon county in the Circuit Court room on November 21, 1904. This was the opening gun of the campaign on the compromise issue. The meeting was called to order by J. J. Davis, chairman. R. G. Mitchell acted as secretary.
Mr. Gary presented his plan of compromise as follows:
"In the event the compromise is voted by the citizens of Macon county, a committee who will be owners of $100,000 par of the registered warrants now registered against the county, being the first of such warrants registered, will not cancel these warrents, but will give an option to the county to purchase them at eighteen cents on the dollar whenever the remaining outstanding debt comes in at the same price, depositing said warrants with a copy of the option and agreement with a trustee to be named by the court, with an understanding with the county that the M. & M. fund of one-twentieth of 1 per cent shall con- tinue to be levied until the outstanding indebtedness is settled to the satisfaction of the county, and that all of the M. & M. fund shall be
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applied to the payment of interest at par on the warrants deposited with the trustee. The trustee to be instructed to pay the owners of the $100,000 warrants 6 per cent on the $18,000 until principal of $18,000 and six per cent interest is paid ; the county agreeing not to issue any more small warrants or to lend assistance to taxes being paid in M. & M. warrants. Trustees to be authorized to collect the interest, first pay the interest on the $18,000 and to deposit balance in the county treasury, all sums collected as interest on the par value of the warrants over and above the amount necessary to pay the interest on uncan- celled warrants under this agreement at 18 cents on the dollar. Then continue to run the county's finances as it has been done heretofore in all matters except in the matter of the M. & M. fund, which will be collected and paid into the treasury in cash and drawn out on the reg- istered warrants. This plan permits the county to continue to levy the one-twentieth of 1 per cent and provides its absorption as interest on the warrants. The interest on warrants being more than the income from the M. & M. fund makes an effectual bar to anyone except the holders of these registered warrants from drawing anything from this fund.
"The advantages of proceeding with a compromise seem to me to be, without a single exception, all in favor of the county. In the first place, if we are able to prevent the creditors from receiving any- thing at all on a million and a half dollar debt, we can continue to do so on $150,000, provided we absorb the M. & M. fund, and this plan fully provides for that. In the event new litigation is brought and is successful, the county would not be liable for any amount except the $150,000, while now, if the creditors are successful in any new action, they would have a claim against us in excess of $1,500,000.
"It is thought as soon as those standing out for a higher rate learn they are successfully barred, they would come in and accept the com- promise. I. am told by a man who has probably had more to do with compromises than any other man living, in some eighty-odd compro- mises, in no instance but one was all the debt brought in when compro- mise was first voted, and in that instance they paid 85 cents, and in no instance have any of the creditors who stood out been able to get more than the compromise price.
"In adopting this plan, there would be no new point to litigate. The ground has been threshed over. We would not change our plan of handling the business; we would continue to levy one-twentieth of 1 per cent and the general fund is all taken up by general expenses. This should be continued until such a time as we could settle the outstanding
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debt at the compromise price of 18 cents on the dollar, with interest to December 31, 1904. By taking up $1,450,000 of the debt, the remainder would not be worth one cent more than it is now, provided the one-twen- tieth of 1 per cent is absorbed, because a debt against Macon county for $1,500,000 with power to enforce collection is just as good as one for $150,000. The county is perfectly good for either amount. The impres- sion has gotten out that to cancel a part of the debt enhances the value of the balance. This would be true if the $5,000 derived from the spe- cial M. & M. tax is available; if not, then it is not true. It would not be true because all the special tax would be absorbed.
"In view of all the facts, I recommend that we submit the proposi- tion to a vote, because I fear that this very favorable settlement can never be obtained again for a majority of these judgments standing against Macon county. The facts seem not to be realized, as straight judgment of hundreds of thousands of dollars lying against a perfectly solvent county, one that is amply able to pay dollar for dollar if a plan should be discovered by the creditors to enforce settlement. Suppose this was an individual matter, what would you do? Let us treat this at close range. At least, let us use our influence for rational conservative action. I am so well acquainted with the facts and the private opinion of some of our local attorneys, some of them are now present, that I want to earnestly urge careful consideration. I am now talking to you as a citizen interested only, as you are, in the best interests of the county, because, so far, not a creditor has agreed to pay me one cent and I pledge yon my word and honor I don't know that they will ever agree to do so. It's all I could do to get them to agree to the 18 cents.
"I leave the whole matter in the hands of the committee. What- ever they do, I shall cheerfully abide by, but my last word is to be careful. Don't turn this chance to cancel over 90 per cent of this judg- ment debt at 18 cents on the dollar down without submitting it to a vote, unless you feel like you will be in a position to defend your action. For my part I want to go on record here and now in favor of submitting and working for a compromise for as much of the debt as we can get in at the price, and fight the balance until we can get it at the compromise price."
The paper read by Mr. Gary was discussed freely.
Mr. Gary was asked: "Suppose the judgments were held by fellows who don't come in?"
To this Mr. Gary replied: "It is judgments we are buying. We have contracted with these men to come in."
Mr. Gary stated that 90 per cent of the debt was in the contract.
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Major B. R. Dysart, R. G. Mitchell, Ben Franklin and others spoke in favor of Mr. Gary's plan. A motion was made and unanimously adopted to present the petition to the County Court asking for an order of election on the compromise proposition as set out.
There were 502 signers to this petition.
The petition was presented to the County Court the following Monday. As representatives of the petitioners were Web M. Rubey, B. R. Dysart, R. G. Mitchell, Ben Franklin, W. S. Watson, Dr. E. B. Clements, A. W. Gilstrap, John Scovern, J. B. Goodding, W. E. Floyd, Theodore Gary, E. MeKee, Major S. G. Broek, Dr. F. W. Allen, A. S. Ray, Judge J. J. Davis, J. H. Wright and others.
Opposing the proposed submission to a vote of the people were James Sparrow, Ben F. Stone and N. M. Moody.
An election was ordered for Friday, December 30, 1904.
A campaign in the interest of the compromise was swiftly begun. Meetings were held in Macon nearly every week and speakers were sent out over the county. The Macon papers and most of those in the towns of the county favored the compromise. The Macon papers reported all the meetings at the county seat in full, hiring a special stenographer for the purpose.
Circuit Judge Shelton spoke at Macon, La Plata and other places, urging the citizens to vote for the compromise in the interest of their property. There was a counter-campaign by those opposing the eom- promise on the Gary plan. They held meetings here and all over the county in the same manner as did those favoring the compromise. Among the leaders who opposed the compromise were Fred L. Thomp- son, county school superintendent ; James W. White, R. S. Matthews, N. M. Moody, Joseph Park, Dr. T. J. Norris, P. M. Gross, Paul Burton, county clerk, and Dr. C. W. Reagan. These gentlemen insisted that they were not opposed to a settlement of the debt, but that they did not think Mr. Gary's plan was in all respects what it should be.
In a letter to the Macon papers Mr. Moody voiced his sentiment of the opposition in this language:
"One very important point for the voter to take into consideration is whether or not he is in favor of settling a part of this debt and leav- ing unsettled as much as $160,000 to $170,000 of said debt. I honestly believe that to settle a part of this debt, as proposed, will have the effect of making that part of the debt unsettled more valuable."
The following, prepared by one of the leaders opposing a com- promise. embodies the main points of his side of the controversy :
"Those who opposed the compromise of the M. & M. railroad debt
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at 18 cents confidently believed that, inasmuch as the bondholders had litigated the county for more than thirty years and had failed, they had in that time certainly exhausted every legal means to which they could resort, and that therefore they could not force the payment of their claims.
"They had been taught that the county could legally pay all its necessary current expenses before it could be required to apply any of the county revenue on the payment of the M. & M. debt.
"They believed that the county could never be compelled to levy and collect more than 55 cents on the hundred dollars for all pur- poses, including county expenses and the payment of the bonded debt, whether that debt was in the shape of bonds, judgments or warrants, that being provided for by the statutes.
"They also believed that the county revenue would not increase more rapidly than the growth of county expenditures and, consequently, there would be nothing left to apply on the debt.
"A great many believed that a considerable portion of the debt would not come into the compromise and that to compromise a portion of the debt would be bad policy, for the part of the debt that remained unsettled would be greatly enhanced in valne and would force the county to make the same levies and continue the same tactics that had been resorted to for years.
"Quite a few, doubtless, thought that, inasmuch as the bond-holder was offering to settle at 18 cents, it was good proof that he had aban- doned all hope of ever being able to force the payment of his claim.
"It is a fact that cannot be disputed that the legal procedure being pursued by the bondholders at the time of this publication could have been resorted to at any time since the bond litigation begun, with the same effect as now. It therefore follows that all have been deceived as to our legal status in the matter of the M. & M. bonded debt."
The balance remaining out was one of the main points in the con- troversy. It was answered again and again by the advocates of the compromise by stating that practically all of the debt would come in, and that the balance could be so handled that the holders would not realize any more than those who came in. Other contentions of those urging a settlement will be treated under the legal subdivision. Among the more prominent advocates and workers in the interest of the com- promise were E. McKee, Ben Eli Guthrie, Major B. R. Dysart, R. G. Mitchell, Ben Franklin, R. A. Guthrie and all the member of the com- mittee of fifty. The vote was cast Friday, December 30, 1904, with the following result :
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