The Morristown gazette. [volume] (Morristown, Tenn.) 1867-1920, 1879-01-29

After the 9Th of May, 1861, there
were issued to the Rome & Carthage
turnpike company six per cent.
bonds amounting to $4,000, and to
the Ohio & Mobile railroad company
six per cent. bonds amounting TO
| $172,OOO These bonds were repu-
dated in 1865, bat still the Comp
troller included them 10 the execu.
tion of the Funding Act Of 1866, as
a part of the public debt.
The Agricultural Bureau. a part
of the plank road, and turnpike com.
panies, and two of the railroad com.
panies were then in default, The
whole amount of the bonds was ST.
335, 900, bearing an interest of $780,
100. Without estimating the meas
ure of the default, and assuming
that no part of the interest was paid
by the principals in the debt, the
whole interest for which the State
then had had to provide was 1885,.
336; and after paying it all the
State still received into the treasury,
annually, over 100000 from its 10
vestments ia excess Of the interest
it bad to pay to public creditors.
But in fact, allof this debt except
$4,000 was the debt of the two de-
linquent railroad companies, end as
other roads with equal debt aud less
business facilities continued to pay
| theif interest. it is obvious the de-
linqnency wss Rqt partial and tenn,
porary.
The debt recited comprehends the
entire liability Of the State existing
at the tims, both primary and Sec
ondary, except contingent liabili-
ty as endorse upon the bonds of
certain railroad companies amount
ing to s2,2O7,0OQ.
1t appears, therefore, that when
the war began, the public debt was
not only no burden upon the tax
payers, but, on the contrary, the in
yestments made by the State con-
tributed largely to alleviate the bur-
den of taxation for the ordinary pur-
poses Of government,
The credit of the State had been |
so cautiously extended to the rail-
road companies that the possibility |
of loss was remote, The internal
Improvement act of 1872, with it's
subsequent amendments, not only
provided abundant indemnity for the
State, if faithfully adhered to, but it
made the preparation Of fraud upon
the State impossible. The cost of
the railroads Of the State wss esti-
mated 10 be from $4,000 to
$27 900 per mile. The law limited
the amount for which the State could
become surety for the company to
about $1,000 per mile for all pur-
poses. with a lien upon the whole
property and its psufruct for its in
demnity. Nor was aid in any case
to be extended until the road was so I
far completed as to insure its com
pletion by the application of the
amount guaranteed by the State,
and to the end that the road when
completed, should be of Such value
as to afford unquestionab!e indemni-
ty to the State and protection to the
taxpayers. the sale of bond under
its par value was expressly prolbi
ted, and the &ctual application Of
the whole procseds of the bonds to
the sole purpose prescribed by law
was directly enjoyed. By a
provision of the Law the power to
issue bonds, With WHICH the Cover
nor was clothed, was made condi- |
tional, and those conditions were:
/. That there was stock subscrib.
ed sufficient 10 amount and sOlvency |
to grade and bridge the whole road.
4. That q given number Of miles
were completed.
8. That there was no other lien
upon the road.
4. That the bonds were to be ex.
clusively applied to the purposes |
prescribed,
5. That the bonds were not 10 bs
sold for less than their par value.
The law prescribed that all of
these precedent conditions should
be made to appear to the Governor
by the affidavits of certain officers OF
the company, by resolution of the
Board of Directors and by the afida-
Wits OF an Engineer aud Comruis.
sioner, each appointed by the State.
When all of these conditions we're
shown to exist in the mode prescrib. .
81 by law, then, and not till then,
did the Governor have power to is
sue the bonds. To protect the tax
payers against fraud and negligence,
the original Act prescribed that its
limitations and conditions should be
notice to all.
The geographical position of Ten
nessee made her soil the theaier OF