Mower County transcript. [volume] (Lansing, Minn.) 1868-1915, 1877-02-01
STATE RAILROAD BONDS
A Proposition Made to the Legislature
the Largest Owner of the Bonds.

UOVs L 14AoUuAy . ulCoodSC " CdtCU dl
considerable length the subject Of the
old minnesota State Railroad Bonds,'
and in accordance with his suggestion
the Legislature appointed a joint com.
mittee to consider the question; which
promises to he one Of the leading top
les of the session. MIR. Selah Cham.
berlain, who holds the majority of the
bonds, has appeared before the com.
mittee and submitted the following
proposition:
re the aSneraN boSas Snar'n Of Joint Committee
Coming to your State in 1858, took
q contract from two of your land. grant
railroad companies to grade and pre-
pare for the iron portion of their
roads. performed my engagements,
paid all my bills, and received as my
only compensation the quota of State
bonds which, by the constitution of
the State, had been devoted to the per-
formance of the work which under
took. By these bonds the faith of the
State was pledged to pay the sum of
one thousand dollars for each bond in
twenty-five years from date, with in
terest at seven per cent. per annum,
payable semi-annually.
The companies to whom the bonds
were originally granted, having failed
to complete their roads, forfeited their
charters and the State took posses
sion by foreclosure of the roads, with
all the work which had been done on
them. In consequence OF the failure
of the State to pay any interest on the
bonds, and other causes, they soon
ceased to have any marketable value.
At later period, when the State had
conveyed the railroad properties to
new companies composed of her own
citizens, in trust, to procure the COM
pletiOn of the roads, l was again in
vited to come to the State and under
take the work. I was assured by in.
fluential citizens that as soon as the
people should receive the benefits of
the roads, they would discharge their
obligations upon the bonds. Under
the influence of these considerations,
I organized new company, and, with
means and credit drawn entirely from
abroad, undertook the construction of
one of your leading systems of rail
roads, which has expanded into the
present River, Iowa and Minnesota di.
visions of the Chicago, Milwaukee &
|St. Paul railroad. Meanwhile, the
population of the State has grown
from 100000 in 1858 to about 100000
in 1876, and the assessed valuation OF
it's property from $s32, ,000,0 in 1868
to 1925 100000 in 1875.
I have often appealed to the people
Of the State to redeem their pledge,
and provide for the payment Of their
obligations. Various reasons have
been assigned for neglecting to dc
this ; among them, perhaps, the most
forcible was that the railroad compan
les, or the lands held by them, were
liable for the payment of the bonds
To determine the validity of this sup
position, l instituted suit in the
Circuit Court Of the United States fol
the District Of Minnesota, against two
of the railroad companies, which. latter
having been decided against me, ap
pealed to the Supreme Court of the
United States, where the various
questions at issue were argued by
the most learned and able counsel who
could be procured both from within
and without the State.
As 4 result, the highest judicial tri
bunal in the nation has determined
that the railroad companies hold theil
lands free of any liens in favor Of these
bonds that the bonds are direct and
primary obligation Of the State, an(
that the State, il amenable to the pro
cess of the courts, would be compelled
to pay the bonds, principal and interest
according to their terms and finally
that the Constitution and laws devolvt
upon the Legislature, without submiss
ion to a vote of the people, the duty
of providing for their payment. Mean
| while, amid the Vieissitudes O1
business, I, in common with many OF
the creditors of the State, have becom,
curios)y inconvenienced by my inabili
ty to realize anything upon this large
obligation.
The question is presented whether
I shall wait until the State is ready tt
pay the entire debt, or whether by {
voluntary offer on my part to compro
mise the claim for a portion of thu
amount due, I shall induce the Legis
lature to make an immediate and fina
settlement. In view Of the uncertain
ty Of life, or the disagreeable alterna
tive of leaving to my heirs an unset
tied claim, and of the desirability o1
freeing myself in advancing age from
the anxieties and uncertainties Incl
dent to the situation, have determin
ed to adopt the latter alternative, ant
am now here to make a proposition s<
much less than my legal claim, and sc
manifestly advantageous to the State
that trust shall be met with a cor
responding spirit of compromise OF
the part OF the representative of thu
people.
The bonds bear date December 1st
1858. They are for 81 1000 each, ma
.ure December lst, 1858, and bear ir
terest at seven per cent. per annum
payable semi-annually. The who'll
number issued was 1915. On the Is
day of June, 1877, there will be du,
upon each bond,
81 coupons Of S35 each ...... ...... 81 ,295
Simple interest at Z per cent. upon
coupons since they (coupons) be-
Principal sdi ofc Of bond iunmatured 800. 600
ss,11o 8
will surrender all the bonds l hol'
or control with the coupons, and re
lease the State from all further claim
waiving to the State one.half (1-2) o
the amount of interest thereon, an
will accept new six (6) per cent. thirt,
1907 year bonds, in lieu of the pc
cent. bonds I now hold, and of tn
bonds so issued, will surrender twelv
(l2) per cent. of the entire amount t.
furnish the State with means to pa
interest for two years, or for such 9th
er purposes as the Legislature may de
ltermine, if interest is provided from
other sources. The result of this pro
position will be as follows:
Amount due upon each
old bond June LIST, 1877 $3,1lO
take in new bonds for
each old bond 80. .. 81 ,808 n
Having LETT with the
State on each bond. 246 Is
each % bond ...... ...... loss 4s
~''s'N ~ -- 3,1l0
Total amount con-
Il ceded bY me on