The weekly herald. [volume] (Cleveland, Tenn.) 1876-1888, 1881-03-11
GOVERNORS MESSAGE.


b. . NHH' HHAANA HAH- EH'f# zoo $3.50
y Of well considered aud wise lcgislaliO
0 TO regard to the whole matter.
IRON the report OF the Comptroller
% appears that the total amount OF bond
heretofore issued by the State il so,
lS9, 3lG.GG. The amount now outstand
ing as a liability against the state /
So, 2gG, 800. 10 this may be added
contingent liability of $4,000 on ace
/, court OF bonds issued which have ncy
or been presented for registration OF
renewal, aud which are supposed Il
have been lost or destroyed. The tOta.
Interest now due Oh the debt outstand-
ing Is FL, 1886, $50, which sum being all
ded to amount Of outstanding bOdds
known or believed to be In existence.
makes a total liability of S2J, 5i2, $50.
In consequence OF the agitation which
has prevailed ia Tennessee for the past
few years in regard to the proper adj
justment Of this debt, and the widely
variant views which have been adyOca-
ted in reference thereto, it is perhaps
proper that | should briefly review the
history Of its creation.
The first bonds of the State Issued
were dated January J., 1873, and
amounted to $500, 600; they constituted
a basis for the establishment of the I'm
ion Bank. Subsequently, bonds were
Issued in payment OF subscription made
by the State for stock in certain turn
pike companies. Also to the bank of
Tennessee, 1900, 600: for building the
capitol, $3.50. 900: for agricultural but
reaU, $50, 600; for the purchase of the
Hermitage property, SIS, 600.
In our financial reports these items
Of Indebtedness have been known a.
1.-THE State debt proper in COmtraGiS-
tinctiOn from the debt created under
the general internal Improvement law
Of 1851 and 1852, and acts ~amcHdatory
and subsequent thereto, which has
been known as "lhe railroad debt" OF
the State. The only reason for this
distinction, it is believed, is found in
the fact that on account of the bond
known as "railrOad bonds" tie State
had indemnity. while on account of
those kNOWn rs the estate debt proper
1t had none. They were all alike the
bonds 0 fthc state. Under the general
act of 1873, the distinction be-
tween the TWO classes of bonds WAS no
preserved, and it is believed
there is now no means Of aSCertaining
to which class amy one Of the funding
bonds issued under that act belongs.
Under the general internal improve
ment act Of 1851 and 1852, alsl acts
l]mendatOry thereto, the State provided
for Il loan of its credit to certain rail-
road companies and the issuance of the
bonds of the State TO said specified com
to'thc amount of $4,000 per
nile for the purpose Of ironing and
,quipping said roads, together with
such specific amounts, for building GER
-aimsbridgcs, rs were directed by said
lcts.
These acts provided that these bomda
be issued aud delivered to the
abroad companies of certain c0ndi-
ions precedent and reserved to the
the right, by its officers, to deter
nine when these conditions precedent
lad been complied with.
And although the evidences Of such
compliance may have been lost, we
must presume they were furnished to
governors before the issuance Of the
or else that Our own houOred
gents acted corruptly and in violation ,
# law in their issuance, and ! take it
or granted no well Informed mar will a.,
or one moment maintain the latter :
proposition. :
The constitution of 1891, ratified by !
,ur fathers, declared ga well regulated ,
yStem of internal improvements. is cal :
to develop the resources OF the
,tate, and to promote the happiness and ,
prosperity Of the people, ltherefore it
.ught to be encouraged by tue general {
sSembly." =
1t WAS under this plain mandate Of =
ur own Constitution the various acts :
eferred to were passed and the bond y
ssucd. At the time OF the passage of :
hcsc acts and the issuance Of these ,
.Onds, il is believed no intelligent man y
anywhere questioned the liability Of !
he State on account Of such bonds. ,
7pon their face they5Srecitcd that the e
tate acknowledged to owe, and pom n
sed to pay to the holder the sum Of ST. !
90, with interest thereon, and for the :,
e]rfOrmancG thereof, according to the ,
erms, the faith and credit of the State .
iere pledged. Alone for the purpose +
f imdemuifying the State against loss y
II account of these bOuds, loaned to /
he various railroad companies, the acts =
uthOriziug their Issuance provided r
hey should constitute Il first lien upon I
he roadbed, iron, rolling stock, and :
of the company. -
The companies receiving these bonds s
'ere required to pay into the treasury Y
f the State, fifteen days in advance of I,
he days upon which interest became o
ne, an amount sufficient to meet the b
lme, or to produce satisfactory evil t.
ence that the same had been provided
)r. They were also required, after s.
ne lapse Of a certain time, to pay into l.
he treasury a certain per Centagel on s.
ne amount Of the bonds issued for their |
eneiit, rs a sinking fund for the pay fl
rent of the bonds at maturity. u
In case of the failure of any of the i
Dmpauies to provide for the payment S
f interest as reQired ,ethe State reserv- h
the power, and it was made the duty y
the Governor tostakC possession Of ),
Ich dcfaulting roads and run them V
ntil the net earnings were sufficient a
, meet the unpaid interest. And the o
tate also reserved the right to further Il
rotecti It's interests by such legislation V
) might become necessary or apprOpri- e,
IT,. Il
| make these references for the pur- g,
ose of showing that the State clearly u
,cognizcd its liability on account Of "
lch bonds as might be issued in ac- a
)rdancc with the provisions Of these VI
It's, and carefully sought to idemnify :.
self against loss. a.
These several acts authorizing the is u
Of the bonds of the State for in :
.rnal improvement purposes, met with 81
lc hearty approval Of, and were In fact =,
,mandcd by u vast majority Of the u
,ople of Tennessee. The great want ~
|, Il. ...u.In. IL ll.nI lin,n ,nnL nnAnnl- VI