RAILROAD HISTORY

 

Railroads

      The railroad history of Henry County is one fraught with many mistakes and errors as well as a partial success which has cost the people many hundreds of thousands of dollars. It was a costly experiment but might have been far less so, had reason assumed control after the die had been cast, and Henry County had placed her credit in a manner it could not be withdrawn. The great benefit which has been received from what was known as the Missouri, Kansas & Texas, now that division of the Missouri Pacific railway, is certainly beyond count. Had the Tebo & Neosho branch, or that part running to Osceola, been allowed to have been completed, there is not a particle of doubt that ere this it would have paid its investment, notwithstanding the stealings which were supposed to have been going on.

      Those bonds have already been partly paid; the remainder will be, and yet no road. The trade that would have come to Clinton from the south, the opening of the coal veins and the increased value of real estate would have redeemed the bonds. Experience is a dear teacher, but its lessons are numbered. Notwithstanding the faults and the mistakes of the past, Henry County must have another railroad within her border, and that road must enter her territory at the northwest and find its southern outlet in the direction of Osceola, in St. Clair County. Kansas City, which has become the metropolis of the Missouri Valley, lies but about seventy-five miles from the county seat of Henry County. That city has become the second cattle and hog market in the country, and it is there that the farmers and business men will secure the best returns for their products, and at the same time find a purchasing emporium for all their wants. When that opening comes Henry County, already far advanced, will take a more rapid stride toward the head of the column of agricultural counties in the state.

 

The First Start

      The first railroad project which drew the attention of the people was called the Pacific Railroad, and Henry County was called to subscribe $10,000 of the stock. This was done by a vote of the people at the August election, 1851. It rested in that way for twelve months and probably lapsed, when the following is found of record:

 

$50,000 Pacific Railroad Subscription

      The following order appears of record at what was termed a call term" of the county court, held on the 25th day of August 1852, the people having voted at the August election in its favor. It reads:

      "Under the direction of a majority of the people of this county, it is ordered by the court that $50,000 worth of stock be subscribed to the Pacific Railroad on the part of the county, provided: That said road is located on the route surveyed on the dividing of the Missouri and Osage Rivers, known as Kirkwood Survey, passing by the high point of Tebo, or through the county. The county bonds for which stock to be issued whenever the railroad is under contract to the county line, or north of it, and upon the further condition that the legislature of this state hereafter legalizes the action of this court."

      The matter seems to have rested there until the February term of the county court, February 18th, 1853, when the following order was made:

      "Ordered that the order made at the adjourned term of the court, held the 25th day of August, 1852, under the direction of the majority of the people of this county, authorizing said court to subscribe $50,000 worth of stock to the Pacific Railroad, be, and the same is, hereby amended, so as to dispense with the condition of passing the high point of Tebo, or this county, but to run the Kirkwood survey through Johnson County on the ridge route. And it is further ordered that James M. Gatewood be appointed special agent to subscribe stock to the above amount in said railroad, for and in behalf of the county."

      William Wall, Joseph Davis and Asa C. Marvin were appointed agents to attend the meeting of the directors of the Pacific Railroad, and vote its stock. At the term of court, February 1854, $1,100 were paid over, being, as the order reads, "10 percent of the subscription." The money was borrowed from the road and canal fund. A few days after, at the same term, the court ordered a warrant for $800 to be drawn in favor of Joseph Davis, the money to be paid on the call made by the Pacific Railroad Company, as above stated.

 

Borrowing Money

      A portion of the money to pay the call was borrowed of William M. Hall, who received the county's obligation for $500, and had turned over to him $914 of swamp land bonds. The balance to make up the payment, $2,760, was borrowed of the road and canal fund. This was in February, and at the May term of the court, 1854, Asa C. Marvin, financial agent of the county in railway matters, brought in the receipt of George R. Smith, the agent of the Pacific Railway Company, for $5,000, being the amount of the first call of ten percent on the stock subscribed. Nothing of moment transpired until the February term, 1857, when an order was made restraining the sheriff from further collection of the tax levied for the purpose of paying interest and calls on stock taken by the county in the Pacific Railroad Company. The tax was the same as the state levy at the time, and the sheriff was ordered to pay back to parties already paid, and await a suit. J. Davis objected to paying the tax, and got out an injunction restraining the sheriff from collecting. Hence, the above order, which was to last until the suit was decided.

      The court in May, 1857, appointed Robert Allen commissioner, with full power to act, for Henry County, to vote stock, pay moneys, etc., he to give a bond in the sum of $20,000 for the faithful discharge of his duties.

      At the October term, 1858, the court ordered Robert Allen, commissioner, who had the county affairs in his hands, to turn over what money he had collected by taxation into the county treasury, and at the same time suit was ordered to commence against him and his sureties, for the funds collected for the Pacific Railroad, and for its return into the treasury, as above.

      At the November term, 1858, the late sheriff, Dewitt C. Stone, reported in his hands funds arising from the railroad tax of $1,765.95. This sum the court ordered to be deposited in the county treasury.

Stopping Payment

      This, it seems, was not done, so at the April term, 1859, suit was ordered against Stone and his security, for moneys collected by him on a levy for subscription to the railroad company. Alexis Walmsley was appointed attorney to prosecute the case. This order seemed to get Mr. Stone and he came into court and entered into an agreement to pay over said money if the court would stand between him and a suit by the railroad company. This the court agreed to do, provided the costs and penalties did not exceed the amount to be paid over, to wit: $1,725.80; the money to be paid in by April 22, 1859. The suit was held in abeyance until the above date, in case of his failure to pay over the money. The amount of $1,765.92 was paid into the treasury, as reported by Royal L. Burge, treasurer, at the May term, 1859.

      The next item in this railroad matter, of record, was an order to pay Russell Hicks $460, attorney fees, in a case in the circuit court of the Pacific Railroad Company against Henry County. This was in 1861.

      June 12, 1863, the treasurer was ordered to invest all the railroad funds in the treasury in county warrants, the latter to be held with the clerk of the county court, to be held for the use and benefit of the railroad tax fund. This seems to be the ending of the Pacific Railway Company matter so far as it was of any importance to the people.

      There was a correspondence opened with the company early in 1866 to ascertain upon what terms they would transfer the stock held by the county, to the Tebo & Neosho Railroad Company. What the correspondence amounted to is not of record, but in August, 1866, an order was made for an election to test the feelings of the people to subscribe $150,000 to the Tebo & Neosho Railroad Company, the election to be held September 26 of that year. The question was carried and $150,000 was subscribed to the stock of said Tebo & Neosho Railroad Company.

 

$150,000 T. & N

      As a large portion of the people of Henry County are not acquainted with all the facts in the railway controversy, it will be perhaps best to give a plain statement, as the people have in the past years been considerably exercised over the acts of a few reckless persons, and are still paying the penalty in the shape of annual taxes to the gross amount of hundreds of thousands of dollars, the value of which they have not received one cent.

      When the vote was carried subscribing $150,000 to the new candidate for public favor, the president of the company came forward and made a few suggestions to the county court. The first was to issue to his company one bond to the amount of the entire subscription, and then coupon bonds of $1,000 each with interest at seven percent per annum, payable in New York, and the interest to be paid semiannually on the 1st of July and January, and to date from January 1, 1867. "That upon the return of the single bond 150 bonds may be issued instead thereof."

      It may be supposed that the 150 single bonds were not issued for the building of the railroad, that was consummated by the issue of the one bond of $150,000. That bond was redeemed by the issue of the 150 separate $1,000 bonds with coupons attached. This rather strengthened the legality and further secured the final payment of the bonds.

      These suggestions, as above noted, were made in the form of resolutions passed by the Tebo & Neosho Railroad Company, and presented to the county court by its then president, Thomas L. Wilson.

 

The Subscription

      The county court in session January 5, 1867, complied with these requests, in the following order, made of record and recorded on pages 474 and 475, book E. It reads:

      "In response to said resolutions and in compliance with the vote of the county at a special election held on the 26th day of September, 1866, it is considered and ordered by the court: That the county of Henry, in the state of Missouri, take and subscribe to the capital stock of the Tebo & Neosho railroad company, fifteen hundred shares of one hundred dollars each, amounting to the sum of one hundred and fifty thousand dollars, and that Royal L. Burge, be, and he is hereby appointed the agent of said county, to subscribe said shares to the capital stock of said company, with full power and authority to represent said county and transact all business of the same pertaining to said stock. It is further ordered that a single bond of said county for the sum of one hundred and fifty thousand dollars, bearing date on the first day of January, 1867, payable ten years after date, with interest at the rate of seven percentum per annum, payable semi-annually, and both principal and interest payable in the city of New York, be issued and delivered to said company for its immediate use; and it is further ordered that upon the return of said bond to said county, that one hundred and fifty bonds of said county for one thousand dollars each, payable ten years after date, bearing seven percent interest per annum, with suitable coupons attached, be issued in lieu of said bond, and delivered to said company in payment of the subscription aforesaid."

      "It is ordered by the court that Peter A. Ladue be requested to prepare a form for said bond with coupons attached, and ascertain the expense of lithographing the same, and report to the court at the next February term thereof."

      The bonds were contracted for and received, and were to be, when issued, signed by the president of the county court, and countersigned by the county clerk. The first of the single series of bonds, ten in number, numbered from one to ten - were signed and turned over to the county treasurer, July 17, 1867, "as part of stock subscription to the Tebo & Neosho Railroad Company, by Henry County." The bonds were then continued to be issued, and placed in the hands of Royal L. Burge, until the number of 107 had been issued, when the court ordered the remainder at a called term of the court, held October 8, 1868, to be turned over to the treasurer of the railroad company, the number being from 108 to 150, inclusive, in full for subscription to the Tebo & Neosho Railroad Company on the part of Henry County.

      After the death of Royal L. Burge, which occurred October 19. 1868, R. C. McBeth was made railroad attorney for the county, in the Pacific Railroad suit.

 

$250,000 Added

      In May, 1869, the county court met and subscribed $250,000 to the Tebo & Neosho Railroad Company in coupon bonds of $1,000 each, with interest, and upon certain conditions therein expressed, and levied a tax of 40 cents on the $100 to pay interest on the railroad bonds for the year 1869 The principal conditions were, that the road should run diagonally across the county in the direction of Fort Scott, and $150,000 of the bonds should not be handed over until the road was completed to Clinton, and the cars running thereon. The other $100,000 was to be delivered, it is supposed, when called for, as no mention was made in the order of retaining but the $150,000. These bonds, principal and interest, were payable at the Park Bank, in New York City, the bonds drawing ten percent interest, the interest payable semi-annually. The bonds were dated June 1, 1869, with the understanding, that when the $150,000 were delivered, that the coupons should be cut off to date of delivery.

      William Jennings, one of the members of the county court, was made county agent to subscribe the stock to said railroad, which was done under date of May 5th, 1869. The tax levy of 40 cents on the $100 valuation made to meet the interest on bond subscribed, produced the sum of $20,949.78, of which $15,280.06 was returned collected, besides the collector's commission and $4,879.59 delinquent.

      However, on the 1st day of January, 1870, the railroad company wished to secure the first $100,000, which, it seems, the court had reserved the right to deliver at its own option. To effect this the friends of the road obligated themselves to the county in the sum of $100,000, which obligation or bond was signed by Asa C. Marvin, Richard H. Milton and Cyrus Newkirk, conditioned, that if the railroad was completed to Clinton by the 1st day of November, 1870, it should be (the bond) null and void, the company to be allowed extra time for all unavoidable delay. This is what secured to the people of Henry County the present road, first known as the Missouri, Kansas & Texas Railroad, (M.K.&T) now the M.K.&T. division of the Missouri Pacific Railroad. It has been an immense advantage to the people, to the advancement of the material prosperity of Henry County, and could the Kansas City road have been completed. Henry County today would had a much larger population, and her wealth would have been increased many hundreds of thousands of dollars.

      There is no one thing that would give so much new life, and develop the rich resources which now lie barren of results in Henry County, as a direct railroad to Kansas City. That road may go by the way of Harrisonville, or still more direct, by the way of Holden, and then an independent line from there, or strike the Chicago & Alton near the eastern border of Jackson County, and within its limits. The people then would have a market the equal of St. Louis, and 150 miles nearer. The road must be built if the people of Henry County would not have their county, rich in agricultural and mineral wealth, lie stagnant, while all around them is energy and enterprise. Delay is folly, if all that go to make a people prosperous, and the county advance in material wealth, is an object to be sought.

      At the August term of the county court, 1870. it was decided to deliver to the company above mentioned, the remaining bonds, $150,000 and the presiding justice and the clerk were ordered to sign the same and deliver them to the proper officer of the railroad company, first cutting off the July coupons, which was done and the bonds delivered.

      With this action closed the official history of the county with the Missouri, Kansas & Texas, or Tebo & Neosho Railroad Company, so far as that road was concerned, only excepting the important part of paying the bonds subscribed to the road, which had ten years to run, and the legal proceedings attached thereto.

      The next railroad matter claiming the attention of the writer of this history, was called a branch of the Tebo & Neosho Railroad.

 

Clinton & Memphis Railroad

      Notwithstanding that the tax or levy for railroad purposes had been raised from forty cents on the $100 valuation in 1869 to seventy cents in 1870, the projectors of the above road petitioned the county court for a subscription of $150,000 upon a petition of the names of sundry voters of the county, without the formality of an election, or a two-third vote of the people, as was made on the other road. The court, however, subscribed the $150,000 upon certain conditions and restrictions, the road to run in the direction of or to Osceola in St. Clair County and in the general direction of Memphis, and no bonds to be delivered until a contract was let which was of a kind to warrant its full performance in doing the grading and the masonry on the proposed line to the south line of the county. This proposition for subscription was made at the August term of the county court and was carried by two of the three judges, one dissenting. The same parties also requested the court to subscribe $50,000 to the

 

Clinton & Kansas City Railroad

      or to the Clinton & Kansas City Branch of the Tebo & Neosho Railroad. This subscription was also made by the same two judges, one dissenting and whose protest is here given. The conditions of this last subscription was that the money was to be used within Henry County in the general direction of Kansas City, either through Cass County or through Johnson County. Hon. Joseph Hillegas, associate justice, was made the county agent, and subscribed the above bonds as he had the $150,000 previous to the Clinton & Memphis Branch.

 

The Protest

      The Hon. William Jennings, presiding justice of the court, entered his protest to both subscriptions in the following words, recorded on folios 357 and 358, Book F, county court records:

      "First. The court is prohibited by the seventeenth section of chapter 63, of the general statutes of Missouri, from taking the stock it subscribed, or to lend its credit to said proposed railroad, without having first ordered an election at which two-thirds of the qualified voters of Henry County should give their assent to said subscription. There having been no such election the subscription is illegal and void.

      Second. Because there is no legal corporation organized under any law of this state by the name of the Clinton & Memphis Branch of the Tebo & Neosho Railroad; nor any lawfully organized corporation by the name of the Clinton & Kansas City Branch of the Tebo & Neosho Railroad.

      Third. Because the county court has no right to do indirectly, what she is prohibited from doing directly by the statutes before cited, namely to vote money and aid to a railroad organized since the adoption of the new constitution of Missouri, without the preliminary step of an election at which two-thirds of the qualified voters of the county should vote in favor of the subscription.

      Fourth. Because by the order of the county court of last term the subscription was agreed to be voted by the majority of the court, upon a petition of a majority of the tax-payers of Henry County, and there has been no legal or sufficient evidence produced to the court that said majority have so petitioned.

      Fifth. Because in view of the burdensome taxation already imposed on the citizens of Henry County, I consider this new tax ruinous in its tendencies and inexpedient at this time."

WILLIAM JENNINGS, President

August 4, 1870

 

      Notwithstanding this protest the subscription stood, and on November 7, 1870, the court ordered to be delivered the $150,000 in bonds to the "Committee of construction" of the Clinton & Memphis branch of the Tebo & Neosho Railroad Company. The next August, being August 15,1871, the $50,000 in bonds subscribed to the Clinton & Kansas City branch of the Tebo & Neosho Railroad were also signed and turned over to the "chairman" of construction committee of that road, the company having, as before stated in the order, "fulfilled the conditions prescribed and therefore entitled to the bonds." This order was made under the protest of Jarred Stephenson, associate justice, for he said the reason "because said subscription was made in violation of law and the wishes and interests of the taxpaying citizens of Henry County." Yet Mr. Stephenson was one of the justices who made the subscription to the road, over the protest of the presiding justice, Judge William Jennings.       At this same term of the court an order was passed, Justice Jarred Stephenson again protesting, appointing John S. Kimbrough, the agent of the county of Henry, in all matters pertaining to the two branches, heretofore spoken of, the Tebo & Neosho Railroad. The appointment was more especially made to act upon a petition of the transfer, by sale or lease of said branches, or of said stock, to any other corporation or railroad company." He was fully empowered to act as his judgment might dictate, the only proviso of the court being that Henry County should hold stock to the same amount in any company or corporation said stock should be transferred, he was to cast the vote of Henry County and to hold his position with full power until his appointment was revoked by the county court. To this action Judge Stephenson as above remarked entered his protest in the words following:

 

Another Protest

      "To the above action of Judges Munson and Hillegas in appointing an agent to cast the vote of Henry County, I enter my protest, for the following reasons:

      First - Because the said Clinton & Kansas City branch, and Clinton & Memphis branch of the Tebo & Neosho Railroad have no existence in law, and any subscription of stock to said branch roads by the County of Henry for the construction of said branch roads is void.

      Second - Because the pretended subscription made by the county court to aid in the construction of said branch roads was made in violation of law and against the interests and wish of the tax paying citizens of this county.

      Third - Because the bonds of said Henry County, issued in payment of said subscription to said branch roads are illegal and utterly void."

JARRED STEPHENSON

August 15th, 1871

 

      A new company had been formed or organized under the name of the Kansas City, Memphis & Mobile Railroad Company, and this company (so called) wished to get the franchise, bonds, etc., of the branch roads aforesaid, and the appointment of Mr. Kimbrough as agent of Henry County was the first step to secure said object.

      On the 31st day of August, 1871, the stockholders of the Clinton & Memphis branch, and of the Clinton & Kansas City branch of the Tebo & Neosho Railroad, held a meeting in Clinton, in which Mr. Kimbrough made his appearance, and he then and there voted the sale of the branches to the said (so called) Kansas City, Memphis & Mobile Railroad Company, and stated in his report that a majority of said stockholders so voted, and that the condition of this sale was that Henry County should have 2,000 shares of $100 each in the new company in place of the shares in said branches of an equal amount.

      The county court accepted the report of its agent, and also accepted the certificate for 2,000 shares in the new company, at the meeting of the county court held November 6, 1871. Mr. Kimbrough also presented his account for services rendered as above, and received a Henry County warrant for the sum of $31.31, in full of demands. The first six months interest on all the bonds subscribed to the branch roads were cut off and destroyed. They amounted to $10,000.

      Matters for a while seemed to have drifted along. The tax levy of 1871, for railroad purposes, was placed at 90 cents on the $100 valuation of the county assessment, but was divided, 64 cents going to the Missouri, Kansas & Texas, and 36 cents for the branch roads. This was done, as an injunction suit had been commenced against the payment of the interest on the bonds issued to the branches. Nothing of importance transpired outside of the legal contest. Work toward Osceola had been commenced, and was finally, so far as grading, and the culverts put in finished.

      On the 26th of May, 1874, there being some doubt as to the disposition of the $50,000 in bonds delivered to the construction committee of the Clinton & Kansas City Branch, and there being no work done, the county court was asked to investigate, and if possible find out what disposition has been made of those bonds. The court approved of the suggestion and appointed W. W. Gatewood, then county attorney, and Messrs. Parks and Gantt, to assist him in trying, "if practicable," to discover the whereabouts of the missing $50,000. They were issued expressly for the work to be done within Henry County, in the direction of Kansas City, either by the way of Cass County or Johnson County, and for no other purpose. They had been issued over three years and no work done. If the gentlemen made any report, it was not put upon the records.

      The same year, 1874, the Missouri, Kansas & Texas commenced suit against Henry County for excessive valuation, by an injunction for assessment purposes, and J. B. Gantt was appointed attorney by the county to defend it. The valuation for 1873, was $592,739, and that of 1874, which had been handed in by the railroad company, at a much lower valuation, the county court refused to accept, and placed its assessment at $592,640. This the railroad company objected to, and hence the suit. This road, we believe, is now bonded at a cost of some $40,000 per mile, and this tax is but a trifle over one-third of what the company claims it to have cost. No doubt the road and its equipment cost over one million of dollars, and fifty percent of its real value was not exorbitant taxation, especially when $400,000 was given the company outright by the people. The assessment for 1875, was $653,832.45, and about the same for 1876. In 1877, the county assessed on this same Missouri, Kansas & Texas road, $533,501.15 valuation, and the different townships. on a valuation of $564,008.51, but in 1878, came down to the sum of $449,168.76, as the total assessed valuation of the railroad property of this corporation within the county. The company opposed taxation, but was willing to receive interest on the bonds, even if suits had to be brought to compel the one and reject the other.

      The old Pacific bonds, of which but part had been issued, the court ordered no taxes to be collected, and those that had paid taxes into the treasury for the interest redemption of the bonds, and held certificates, to come forward and get their money back. The interest fund had been loaned, and the treasurer was ordered to call it in and pay, after adding 40 percent, to those who had paid taxes and subscription previous to 1860. This order was made in April 1875, and renewed July 1877.

      In the meantime the Missouri, Kansas & Texas had passed into the hands of a receiver, and the $400,000 subscribed to the capital stock by Henry County seemed to have "gone where the woodbine twineth," but if there was death as regards the stock, there was life in the taxation yet left on the property, and that increase of the taxable wealth of the county was where the people were destined to get their money back, if ever. The subscription may have been considered costly, but where the people, as in this case, got the road, there was not so much lost, but much may be gained in the end. The people of Missouri have not and never will lose anything by the building of railroads. It is only where bonds and money have been given, scoundrels have gotten away with it, and the roads expected having proved but a "d-d barren ideality," that the people have had cause to complain.

 

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