Knoxville daily chronicle. [volume] (Knoxville, Tenn.) 1870-1882, 1879-03-04

&c dASbNS Auhut ny eOlNEnL OF OAuEE InaA
2, underthese acts. Nor IL il their desire q
. .ii0;i - isls.ao "aT upon any UJi
e. poratiOns. But they intend the truth
10 TO be known as far as they are able {,
d discover 1t, aud TO announce II. AID
d. uniting fully the legality OF the pay
ments made by the roads under the
v, latter act, for the purposes of dischRrg.
: log tie statutory lien Of the State. We
e deny that this act, or the act OF 1862
operates as az estoppel against the
! people as TO the outstanding debt.
= AS matter OF fact, all railroads except
8 the Louisville 81 Nashville Railroad
y Company (wb ch paid its indebted
g ness To the State in 1861, 80 far az
Q known TO your committee were in ia
9 vOT Of the act OF 1870.
: The act OF 1869 restricted payment
t to bonds of the same series rs those
issued to the road or roads paying
! This being inconvenient, the railroads
required the further act Of 1870.
. The Legislature OF lS69.7O early In
its session, Instituted an investiga-
ton intO the frauds connected with
the issuance Of the bonds to Tailroa Dis.
That investigation disclosed gross
frauds in the reception, use aud dispos-
al OF bonds by a number OF railroad
companies. The committee that con-
|
determined to submit a separate bill as
to each road that bad fraudulently Oh
tanned bonds declaring the bonds lille
gal and void.
AT, or about this time, movement
looking 10 the reconstruction OF the
: State became very active, and IL was
urged in favor OF the movement that
! the Legislature then in session intended
to repudiate the States obligations and
bonds iScurred and issued under Gov.
| BrownloW's administration and Gov.
| Senter's The danger Of recOnstfucS
| ton be came so alarming that Dorsey
| b. Thomas, the Speaker OF the Senate.
and w. ON. Perkins, Speaker OF the
| House, in their official characters aud
at the request OF a large number OF
people aud Representatives, in con.
nectiOn with others, went to Washing
ton City to prevent the threatened
overthrow OF the existing Sta'e gov
ernment. II is also intimated, n not
proven, in the testimony, a number OF
the holders of Tennessee bOnus were
there in favor OF reconstruction, Civ
ing as "a reason that with the State
under the military control OF the
United States il would be forced To
levy a sufficient tax To meet the Inter
est due them, and to provide for the
payment of the principal Of their
bonds, The Speaker OF the Senate,
while at Washington, made ~ prom.
inenJ in his argument against recon
sAruction that The STATE intended
nothing wrong aud that there va. an
honest determination to restore the
credit % the State; and as fact, he
did This To rebut or neutTaliZe the
strength the movement seemed TO de-
rive from the fear OF the reputation
of these fraudulent bonds.
1t is further in proof that in view of this
threatened reconstruction and the existence
of the act of 1870, and the construction put
upon it by the railroads and the officers OF
the State, further legislative action, then,
towards repudiatiag or rejecting irauda-
lent bonds was paralyzed IL Is further
proven that the act of 1870, WAS either
drawn in New York, or by railroad at
tOrney. 1t is further proven that the act Of
l6G9-7O, chap AZ, sec. ], as fret introduced,
did not have the words legally Issued
before the word bonds and that tho
words legally issued were inserted by
the judiciary Committee TO which the hill
was referred, and that these words were de-
sgnedly inserted for the purpose OF pro-
tect.ng the State from receiving or bcCum-
ing responsible for tho fraudulent bonds
That committee, or "A portion
of it, thought that with these words insert
ed, the act would afford better protection
to the State against fraudulent bonds than
the act of 1869, chap. s. Soc /, for tho
latter act allowed the railroads TO pay their
debt TO the State lin the bonds Of the
State" The proof is IA thCr that these
words legally issued " were inserted not
only 10 protect the State from receiving
fraudulent bonds, but also TO enable tho
State, if she desired, after all dangers Of
reconstruction had passed, u take such
other and affirmative steps to get clear Of
fraudulent bonds rs she dcemcd cXpCdicni.
In view of these facts end in view Of tho
argument hereinbeforo advanced as to tho
funding act Of 1879, we arc OF the opinion
hat this act Of lSG9-70 presents no estoppel.
1t is claimed, however, that tho ante and
bonds were sold and purchased
without distinction. Your committee can
not concur in this assertion. a plain fact
'efutes II OF the fourteen and odd thou
and ante-war railroad bonds, nearly 30
ire still out. OF the thirteen and odd thou
and post.war railroad bonds, only a little
,ver 2. 600 are out. in addition. il Is in
roof that one Newspaper was paid large
um of money by railroad President for
Is vigorous service In depreciatinP tho
,ost- war bonds and at least one other iCad-
ng paper iI the State WIS approached 10
20 engaged in the same work. The value
f this service to the railroads consisted in
his, that if the postwar bonds were de-
PRESSED they could thereby be bought for
ess, and that with them the debts Of
he roads could be paid of ut less cost.
Inc COmmlLLeG Will call tue hkLthkl'A VI
he General Assembly TO one other matter
nd close this report, Under the act Of
lay "a 1866, incorporating the Tennessee
nd Pacific Railroad Company, a number
f turnpike companies in East Tennessee
yere chartered. Several sections of the
ct assigning the stock OF the State, in the
last Tennessee and Georgia railroad,
to S12j, 0O0 as recited in the act
D these turnpike companies, giving TO each
specified amount. in addition over
undred bonds Of the State had been issued
nce the war 10 turnpikes in that section
{ the State. Yet with all this aid, supple
lented by private subscriptions, only
bout 20 miles Of inferior constructed turn
i es can be heard Of in that part Of the
tate Some of the pixies are mile or
lore long. Some less and as your COM
littee learned, a great deal that was done
n them was done by parties paying their
rivate subscriptions in work.
Your committee tried to trace this rail.
pad stock to its present ownership. We
ad before us the Secretary and Treasurer,
r the book keeper of the East Tennessee,
Tirginia and Georgia road. He promptly
Finished US n statement showing when
nd in what amounts to each, etc, stock
ad been assigned TO the turnpike compa-
les. But when the committee propounded
le question to know who owned the stock
lto, he excused himself from answering
ntil tho authorities Of the road could be
,nsulted.
Tbe Choiruap Of tho cnup,ittee Lor,-,