Knoxville weekly chronicle. [volume] (Knoxville, Tenn.) 1870-1875, 1870-06-08
ILLEGAL BONDS.
How Aid was Granted 10 the Tennessee
and Pacific and Mineral Home
Railroads.
Is the state Responsible for the Debtf
Important Report from the Joint judiciary
Committee.

There was tremendous stir in financial
circles yesterday, with regard to the bill
reported by Mr.. Cooper, of Bedford, from
| the Joint Judiciary Committee, throwing
out a large amount of bonds issued 10 the
| Tennessee and Pacific and Mineral Home
roads. The considerations upon which the
bill is based are clearly shown in the fol-
| lowing report:
| Mr., SPEAKER: The Joint Judiciary
| Committee of the Senate and House of Re
representatives., to whom was referred the re-
port of the Select Committee on Railroads,
in regard to the aid furnished by the State
of Tennessee to the Tennessee and Pacific
Railroad Company, and what legislation,
| if any, should be had in relation thereto,
| have had the same under consideration,
and instructed me to report to the Senate,
and through the Senate to the Gen
eral Assembly, the accompanying bill,
declaring that the eight hundred and
| eighty-five bonds issued by the Governor
of the State of Tennessee to George Ma
| ney, in aid of the Tennessee and Pacific
Railroad Company, on the I'd day of Octo-
| Der, 1863, on the 9Th day of October, 1853,
on the 9th d..t of October, 1863, and on
the eth day of December, 1869, were lille
gally issued, and prohibiting the Comp
troller of the Treasury, and the Treasurer
of the State, from voluntarily paying said
bonds, or the coupons clipped from them,
or even receiving them in payment OF any
| debts due and owing the State of Tennessee
| in any way.
The committees have carefully examined
all the statutes of the State, enacting sys-
TEN of internal Improvements, and grant
| ing aid to railroad companies organized
under them, as well as the act of Decem-
| Der l. 1867, entitled, can act to amend the
| internal improvement laws of the State,
passed February 1lth, 1852 under which
| the Executive Department informs us the
| bonds were issued to the Tennessee Pacific
| Railroad Company, with an earnest desire
| TO ascertain, if possible, the authority under
which the Executive Department acted
| in issuing the large number of bonds to
| the President of said road.
They are compelled, however, by Il sense
! of their responsibilities as legislators, and
| their duties to their constituents, to state,
| that from the testimony of the President
| of the road, and the examination of which
| they have given to the statutes, the bonds
| so issued were illegally issued, without any
authority of law, in direct conflict with the
| express provisions of the act under which
the additional aid was granted to the rail
| road company.
The Committee state that, by the 9th sec
| ton of the act of December, 1867, there
was granted to the Tennessee and Pacific
Railroad Company, "the additional sum OF
| five thousand dollars per mile, Subject
strictions imposed by the internal improve
ment act of February, 1852, and by the
18th section of the same act, it was further
provided that these bonds shall be made
In like manner, and under the same re-
strictions imposed by the internal improve
ment laws Of the State"
The Committee find that the Governor
of the State on demand of George Nancy.
caused to be issued to him as President q
the Tennessee and Pacific Railroad Compa-
ny, eight hundred and eighty-five bonds
of one thousand dollars each in aid of said
road, being five thousand dollars per mile
on the entire road of said Company from
Nashville to Knoxville; they find that al
the time when said bonds We're so issued
it was not satisfactorily shown to the Gov
ernor by any evidence known TO the Com.
mittee, that the Tennessee and Pacific
Railroad Company had procured bona fidt
and good solvent subscriptions of capital
stock to an amount sufficient to grade
bridge, and prepare for the iron rails tho
whole extent of the main trunk line pro
posed to be constructed by such company
and that they had, in fact, at the time gra
ded, bridged and fully prepared, thirty
miles of the road at either terminus.
They find that beyond the town of Leba.
non, IA distance of about thirty miles from
Nashville, along said road, there was not
one part of said road graded, and that be
. | yOnu the town OF carthage, distance o.
some sixty miles from Nashville, the line
of said railroad company was not ut the
time even permanently located.
They find that under the general inter
nal improvement laws of the State, and by
the express provisions OF the act of 9TH De
cember, 1867, granting the additional ait
of five thousand dollars per mile to tht
Tennessee and Pacific Railroad Company
the evidence should be produced to thu
Governor, by the evidence of the President
Geo. Nancy, under oath, satisfying hin
that the Tennessee and Pacific Railroad
:. Company, at the time had thirty miles o
the line of said railroad, al one or the 9th
er of its termini, graded bridged and fully
prepared to receive the iron rails, and
also bona fide good and solvent subscrip
tions of capital stock in an amount sufii
cient TO grade bridge and prepare for the
iron rails the whole extent of the mail
line proposed to be constructed, and then
upon such evidence and proof made by
affidavit by the President, bonds to thu
extent of ten thousand dollars per mile 70
the~first thirty miles, and one hundred
thousand dollars for bridges across certain
rivers, and so on each additional section O
ten miles might be issued, and the act o
December I, 1867, only gave additional ai'
of five thousand dollars per mile, but sub
ject 10 the same conditions and restriction
as attached to the ten thousand dollars pc
mile.
Under the facts shown by the Specia
Committee ON Railroads, in their report
n a