Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1895-12-03
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DEBT THAT GROWS.


made to the debts due the state school
fund by the Galveston. Harrisburg
and San Antonio and the Houston anu
Texas Central. and the further tac'
that these companies had made a mo
ton In the district court at Austin 10
transfer the suits pending to the fed
eral court. The district Judge at Aus
tin yet has the motion under advise
ment. but a statement as to the or
igin OF these suits VIII be timely.
The suits In question were filed by
Attorney General Culberson, December
s, 1894, and were superinduced by the
dcClination or refusal OF either or the
companies named to make furthei
payment on their obligations TO the
state school fund.
Under the provisions OF an act APP
proved August 10. 1856, providing fol
the Investment Of the special school
fund OF the state 10 the bonds of rail
ways chartered by the state. these
loans were made. From March !, 1888
to December H. 1863. the Buffalo Bay
on, Brazos and Colorado Railway com
pany were loaned sums aggregnting
the total OF $4,000. To secure these
loans the railway issued ten year
ment of 2 per cent as sinking fund
and 6 per cent Interest. These bonds
expressly acknowledge lien on the
franchises and property of the rail
way company.
on July Z. 1868. the franchises and
property Of the railway were sold un
der execution. under the provisions OF
Der /. 1860. on July 81. 1870, the leg.
stature authorized the Buffalo Bayou
Brazos and Colorado to re-incorporate
under the title of the Galveston, Har-
rlsburg and San Antonio. the new
company to assume all the debts due
the state by the defunct corporation.
1t is alleged by the Galveston, Har-
rlsburg and san Antonio. that 1t paid
In cash on these obligations the sum
Of $4,000 sinking fund and s32,2lS,75
prior to October s. 1860. 1t Is further
alleged that the company paid Into the
treasury state warrants aggregatinE
s9S,Ol9,25 which at that time. lS63-6i
were passing at par with specie.
The Houston and Texas Central, be.
1859, borrowed sums aggregatinR
$4,000, and the Washington county
railway, afterwards merged into the
Houston and Texas Central, borrowed
$4,000. The conditions and terms un'
der which the loans were made the
two latter roads were the same as
those applicable to the Buffalo Bayou
Brazos and Colorado. II Is alleged by
the Houston and Texas Central thai
prior to August 81. 1860, there was
paid on the sinking fund $4,000 ant
Ag,79l.2l on the interest. During 1865
" there was also paid on said debt
S3S,290 In cash. II is further alleged
hat during this time the Houston and
Texas Central paid into the state treas
the unht ~
gazing Si05,77i.35.
The Washington County railroad al
leges to have paid on June 4, 1860
$500 sinking fund, and 81, 1899. AS on In
terest; and $3l7.SS on interest January
/. 1867 It is further alleged that the
sum OF sl1OeO.2O in state warrants wat
paid into the state treasury on this
Indebtedness by this company In 1864
The further allegation is made In be
half OF the railway companies that all
these warrants turned In by them or
their Indebtedness was promptly can
celled by the state comptroller, and
the bonds OF the state, payable to the
school tund bearing per cent, were
Issued and turned over to the specia
school fund In liquidation OF so much
OF the claims against the railways.
In 1866 the state legislature passed
an oct extending the time OF payment
OF these loans to railways. and in 1915
enacted turther legislation which pro
vlded a method OF avoiding the sale
OF their property for the ron-payment
OF interest on these obligations, Al
this session n special act for the relief
OF the Houston and Texas Central was
also passed over the veto OF Governor
Edmund J. Davis. among the proyls
ions OF this act was the recognition O.,
all payments previously made in state
warrants, which Governor Davis re.
fused IN
In 1870, Comptroller Bledsoe, acting
at the Instance of Governor Davis. liz,
nofed the prior payments made in
state warrants and demanded they
should again nay the amount in gooi
hard coin OF the realm. The railways
did not evince disposition to do this
ana Governor Davis proceeded to take
steps for the foreclosure Of the lien or
the Galveston, Harrisburg and San
Antonio by advertising il for sale
This proceeding had the desired 81.
feet, and from November 1. 1870 II
May !. 1894, the Galveston, Harrisburg
and san Antonio paid on interesI
Central paid ssI5.s56. 81, both com.
panies paying each time under pro.
test. pS
Last year both companies declined
to make further payment, and Attor'
ney General Culberson instituted sui,
LOT the amount claimed to be due by
each company, and for foreclosure o,
the states lien on the property OF bot
companies. The amounts due by each
without credit for the amounts paid In
state warrants, is, Galveston. Harris
burg and San Antonio, sils 500 az.
Houston and Texas Central. sal. 9ss. \,
on Its own account, and $50, e55, 10 on
account OF the Washington County
RAILROAD. with interest at per CENT
from May /. 1879.
The present attorney general In n
supplemental petition filed In the cases
denies payment made in warrants IN
the ground that II was Invalid on o.
count OF the paper being Intended ~
cirsulatc az money contrary to tbs
state and federal constitutions. TN
Introduction OF this phase OF II NJ
encouraged the railways to move 70,
the transfer OF the cases to the fs1'
erai court: The original debt was 10,