The Richmond palladium. [volume] (Richmond, Ind.) 1855-1875, 1870-08-13
BY C. Burnett, Dep. Aud. of State

The General Assembly A of th e
| commencing on the first Monday
of December, 1885, passed an act
entitled IAN act to provide for q
| General System of Internal I'M
provements. The improven ents
contemplated were, the extension
Of the Wabash and Erie Canal; the
construction of the Central Canal;
the White Water Canal; the Madi-
son and Indianapolis and Lafay cite
Railroad; a McAdamized road from
New Albany to yineennes; Turn
pike from Jeffersonville to Craw-
fordsville the removal of obstruc
tons TO navigation IN the Wabash
river, and works of minor impor-
tance.
For the prosecution Of these
works an appropriation of ten mai5-
lions of dollars was made, the m oney
to be obtained by the sale of bonds
of the State, bearing five per cent.
interest, and falling due in twenty
five years.
After great expense and much
financial tribulat:on, the bonds
were disposed of; q State Board
Of Internal Improven nents was
appointed engineers were era-
ptoyed; and the great work was
pashed vigorously, and the mil
lions Of dollars promptly expend-
ed
Out Of this act, md others rela
ting TO the Wabash and Erie Canal.
and the State Bank, and the pecu-
liar deviations and irregularities Of
Democratic officials, grew the State
debt Of Indiana.
For the benefit of the holders Of
the bonds of the State, the interest
coupons on some were made paya-
bic in London, England, and on
others in Jersey City and New
York and there is evidence that
the interest was paid each half
year until January, 1871, when, as
one of the results of the great
tioancial disaster Of 1887, the
credit OF the State was Frustrated,
and the interest falling due at that
aud subsequent dates remained uf3-
paid.
In 1916 the opportunities of
hoRditolders, and the efforts of
prominent citizens, in official and
private life, directed serious atten-
ton TO the fact that the State was
in debt over twelve miilioLs OF
dollars; that unpaid interest was
accommodating at a fearful rate !,
that the prosp Gritty OF the State
was checked by the burden of a
great debt; that immigration, and
the assistance OF men Of capital,
had almost ceased F.; and that citi-
zens were outspoken in their de.
termination to abandon their prop
erty aad seek homes in other Ststes.
At tue session Of the Legislature,
begun in the winter of 1916. an act
entitled IAN act to provide for the
Funded Debt Of the State of Tndi-
ana" DC, well known as the But
ler Biil'-having been drawn up or
dictated by Charles Butler, the
agent and representative of the
holders of the internal Improve
ment Bonds-was placed upon the
stssute-b book. and in 1917 amended
and completed by supplemental
act.
BY virtue of the provisions Of
these acts, the State agreed to issue
certificates of stock, principal and
interest payable by taxation, one
half Of the principal and one-half
of the unpaid interest o. the In
ternal Improvement Bonds and to
surrender the canal, and large do
nations of land from the General
Government to aid in its construc-
ton, for the other half of principal
and interest.
To accomplish this, certificates
of stock were issued as follows:
Five per cent, certificates of STATE
stock for one half of the principal
of the bonds surrendered, and two
and one half per cent.certifieates Of
State stock for one-half of the un-
paid interest. For the other half
of principal five per cent. certifi-
Gates of Canal stock the same
that the Democratic canal ring
and their coadjutors are now en-
deavoring 10 saddle upon the
State-were issued, and Canal
stocks for the moiety Of unpaid in
terest.
For the payment Of the princi-
pal and interest of the State stock,
the faith OF the State was irrevoca-
bly, pledged, and for the paym ent
of the principal and interest of
the Canal stock, the holders were
to look to the revenue and profits
of the Canal, the State, by stipula-
ted agreement, fully concurred III
by the holders of the original
bonds, being entirely relieved from
all obligations in relation to that
portion Of the principal and in
terest.
The one half of the debt repre-
sented by certificates Of State stock,
as shown by Douglass Mcguire,
Auditor of State, in his report for
the fiscal year ending October 81,
1s47. Doc. journal, 1847, page
Al, was as follows:
One-half of the principal due
January j, 1S47 ........... S., ,532, 500 90
One-half of unpaid interest jan
uary /, ls47 ,............ 1,663,o2O 90
One per cent. of interest, from
January /, lS47, to January
l, 1858. .-.-.......-..... 33l,s5o %
Total. OBSERVATION-DISCLOSURES. 81, ,527, ,470 90
This is, briefly, the origin of the
debt that has hung over the State