New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1874-01-06

$i2 500 per mile for each mile OF it's road 10
be built from Vermilionville to Shreveport
and which might be constructed within I'VE
| years from the date of the acceptance OF Tue
act by the company.
The seventh section Of the same act, as an
inducement to the speedy completion OF the
railroad from New Orleans to Houston,
made an absolute donation to the company
of $4,000, 900 in bonds; $75O,OO0 to be Issued
on the completion OF the railroad to Don,
aldsonville, $4,000 on the completion OF
the road to Eermilonville, $75O,0OO on the
| completion of the road to the Sabine river,
and $3.50, 900 on its completion to Houston.
The right to this donation was to be Tor
, feited, unless the road was opened LOT
traffic to the Sabine river in three years
from the date of the acceptance OF the act.
The State has issued to the company
$750.00O Of these subsidy bonds. =.
I BY act No. 95 approved April ~. tS' |. II
was attempted to commute the obligation
! of the State to guarantee for said company
its second mortgage bonds by the absolute
| issue of $2,500.000 of bonds in payment OF a
subscription by the State to 25 .OOO shares OF
the company of 500 each Under this act
$2,50e, 900 of bonds were delivered to the
company ~ the twentSsecond OF APRIL
1871.
There - 40 record in ths auditors OF
Treasurer's ~ other offices of the State
| of the issue of these bonds, nor IS
1 there any receipt from the company
| fOr these bonds on file or evidence that
the conditions of the law under which
| they were issued have been complied with.
PIE SAKE OF eHE ROAD.
l 1t will thus be perceived that The New
I Orleans, Mobile and Texas Railroad Com
| pany has, in subsidies or otherwise received
| aid to the extent of $4,000, 900 as an induce
ment to construct . railroad to Texas. The
company actually agreed to finish the line
from New Orleans tS the Sabine By March
| 5, 1873.
Attekcompieting the Road ~ Donaldson
willie, on the Lafourche, a distance OF about
| seventy miles, and performing some work
on the line from DOnaldsonvile to- Grand
I river, distance Of about twenty miles, the
| company became insOlvenJ, abandoned the
! work, and in June, 1873. was sold under
| judicial proceedings IA the United States
| Circuit Courss This sale, if valid, effectually
destroys any hope Of the State as screditOr
to recover the $3.50 of subsidy bonds,
| which, by the provisions of the act, we're to
| be returned In case che company failed 20
| complete the road to the Sabine river within
the time limited; it also annihilates the in
| extent of $2,5000O0. in case the courts
should a5judge Che $2,5O0,0O0 of bonds
issued under act Of April 20. 1877. to be
valid.
PROCEEDINGS iRsrIrUzE0s
have employed special counsel 60 insti-
tute suit for the purpose of sunuling the
sale made in June, 1878, under the proceed
| ings in the United States Circuit Court.
and TO assert the rights Of the State, as a
creditor, 60 the extent of the $4,000 of
bonds given as subsidy. Under these pro-
ceedings, the road from New Orleans to the
Sabine river has been sequestered, and is
in the hands of a receiver appointed by the
Superior District Court Tor the parish OF
Orleans.
| Notwithstanding these proceedings. {
waa disposed to abandon them, provided,
those who claimed the ownership of the
road from New Orleans to Texas could
give any satisfactory guarantee for its
completion within s reasonable time.
1. in common with what l believe to be
the sentiment Of the community, en-
| tertaine6 doubts of their ability to fulfill
their promises. Nevertheless, with a view
of elciting the the opinions of those inter
ested in the welfare of the State. and OBJ
tanning their advice. l arranged tor an
smicable interview between the present
claimants of the road and a committee of
prominent citizens and merchants of this
city. After several meetings the parties
came TO no agreement-nO satisfactory
guarantee of the completion Of the road to
Texas having been offered.
RECOMMENDATIONS.
SO important do I consider the compile.
ton OF our western connections. would
most willingly abandon all the claims of
the State IN favor of any parties who would
undertake to build the road within y reasou.
able time. and could give o reliable guaran.
tae for the execution of their engagements.
Unless these guarantees are given within
reasonable time. considering the vital i'm
pOrtance of the enterprise. not only to New
Orleans. but to the entire State, recon-
mend that authority be given to purchase
the road on account of the State, and trans.
fer it. on favorable terms. to some new Or.
gan,sation, composed of our own citizens
VI Others, who will undertake to complete
is. The State, as second mortgage creditor.
has a right to purchase the completed por
ton of the road from New Orleans to Don.
jacksonville for the price of $50 500 per mile.
|. is not supposed any purchaser will be
found willing TO bid SIS 900 per mile, the
amount Of the first and second mortgages.
BONDS NOT TO :.E PAID.
I have determined. az I have already
stated, to resist by all lawful means
the payment Of the 2,500,000 of bonds
issued to the railroad company under
act approved twentieth of April, 1871. | do
not regard them as valid obligations OF the
State; the money which has accumulated in
the treasury to meet the interest on these
bonds, will go far to enable the State to pur-
chase the road from here to DonaldsonVille
at the price of So, 500 peg mile. should this
be determined upon.
THE BACKBONE RAILROAD.
By act No. 43. approved December 80,
1869. the New Orleans, Baton Rouge and
Nlcksburg railroad was chartered and the
State authorized to issue second mortgage
bonds to the amount Of $l2,500 per mile.
This company was also authorized to build
branch roads Congress by an act approved
March 3. 1871, entitled an act to incor.
porats the Texas Pacific Railroad Com.
pany. practically recognized this road
as a branch of the Texas Pacific yail-
the road from New Orleans TO Shreveport
via Baton Rouge and Alandria granted
TO this company every alternate section of
public land designated by odd numbers in
a belt of forty miles on each side of the pro-
posed route. This land has been withdrawn
from sale by the general government under
the provisions Of the act. 1t is made a CON
ditiOn in the act that the company shall
complete the road from New Orleans to
Ficksburg within five years from the
passage thereof. BY act of the Legisla-
tuIe No. 100, of 1872 the New Orleans,
Baton Rouge and Vicksburg company
are given more specific right to build
read from New Orleans to Shreveport via
Baton Rouge, and are authorized to issue
first mortgage bonds to an amount not ex-
ceeding $4,000 per mile. This act AFRO
gates the provision of the original charter
granting the Endorsement of the State to
the second mortgage bonds of $l25OO in
case the company issues S3O,O0O per mile of
first mortgage bonds. To avoid all ques-
ton in this regard, ! recommend that
an act be passed repeating 80 much
of the original charter as authorized any
guarantee On the part of the State
to indorse the second mortgage bonds of the