Freeborn County, Minnesota - Chapter 15: Coming of the Railroads, 1911

Freeborn county is crossed by the routes of five railroad com¬ panies, operating seven lines, and cutting into twenty of the twenty-four townships of the county. The Southern Minnesota division of the Chicago, Milwaukee & St. Paul crosses the county from east to west, passing through Moscow, Oakland, Hayward, Albert Lea, Pickerel Lake, Alden and Carlston townships, with stations at Oakland, Hayward, Albert Lea, Armstrong and Alden. This company also owns the Duluth, St. Cloud, Glencoe & Mankato road, better known as the Alphabet or St. Clair line, extending from Albert Lea northwest through Albert Lea, a corner of Pick¬ erel Lake, Manchester, a corner of Carlston, and Freeborn town¬ ships, with stations at Albert Lea and Freeborn. The main branch of the Chicago, Rock Island & St. Paul crosses the county from north to south, passing through the townships of Bath, Ban¬ croft, Albert Lea, Freeman and Shell Rock, with stations at Clarks Grove, Albert Lea, Glenville and Gordonsville. This com¬ pany also owns the Germania branch, so-called, extending from Albert Lea westwardly through the townships of Albert Lea, Pickerel Lake and Alden, with stations at Albert Lea and Conger. The Iowa Central has no track in this county, but reaches the county seat by using the Rock Island from Manley Junction, Iowa, to Albert Lea. The Illinois Central reaches Albert Lea over the original Albert Lea & Southern Railroad Company 's track from Lyle, Minn., to Glenville, and from Glenville to Albert Lea over the Rock Island tracks. This line also has a right of way par¬ allel to the Rock Island lines on the east side, from Glenville to Albert Lea. The Illinois Central stations in this county are at London, Myrtle, Glenville and Albert Lea. The Minneapolis &

St. Louis crosses the county from north to south, passing through Hartland, Manchester, Bancroft, Albert Lea and Xunda townthips, with stations at Hartland, Manchester, Albert Lea, Twin

These roads have been built at different times and under vari¬ ous circumstances. The first legislation concerning railways which applies to Freeborn county was introduced in the Minnesota terri¬ torial legislature of 1854 by Joseph Rensliaw Brown. A bill to incorporate the Minnesota & Northwestern Railroad Company, introduced by this pioneer, was passed on the last day of the session and contrary to expectation Gov. MYllis A. Gorman signed it. The route designated was from some point on Lake Superior by way of St. Paul to the Iowa state line in the direction of Dubuque. This route, it will be seen, might be construed as crossing Freeborn county. June 29, 1854, congress passed an act to aid the territory of Minnesota in the constructing of the railroad over practically the route which had been designated for the Minnesota & Northwestern, and granted for the purpose of aiding such a railroad, every alternate section of land, sixsections in width, designated by odd numbers, on both sides of the road. These lands were to be at the disposal ot any future Minnesota legislature. The congressional act provided, how¬ ever. that the road should leave the Iowa state line somewhere between ranges 9 and 17, thus placing it beyond the scope of Freeborn county history.

The Land Grant Roads. By an act approved by the Minne¬ sota territorial legislature May 22, 1857, four railroad corpora¬ tions were granted alternate sections, designated by odd numbers, six miles in width on each side of the roads and their branches, this being in accord with the liberal railroad land grant by con¬ gress. These four railroad corporations, viz., the Minnesota & Pacific Railroad Company (changed to St. Paul & Pacific Railroad Company), the Minneapolis & Cedar A alley Railroad Company, the Transit Railroad Company (changed to mona & St. Peter Railroad Company), and the Root River ^ alley & Southern Minnesota Railroad Company. The companies were to pay 3 per cent of their gross earnings in lieu of taxes and assessments, and the lands granted by congress were to be exempt from all taxation until sold and convey anced by the. companies. The corporations were generally given ten years to construct their respective roads. The financial embarrassments of 1857 retarded the progress of railroad building, and it also became evident that the parties who had obtained the railway charters mentioned had neither the money nor credit to complete these great highways of internal improvements.

1858. The constitution ratified and adopted October 13, 1857, provided, in article 10, section 2, that "no corporations shall be formed under special acts except for municipal purposes''; and it still further provided that "the credit of the state shall never be given nor loaned, in the aid of any individual, association or corporation." Notwithstanding the strong feeling worked up over the talk of getting bonds in the aid of railroads so badly needed in the state, the first act of the legislature, which was approved March 9, 1858, before the state was admitted, was to submit an amendment to the constitution, providing for loaning the state's credit to the four land grant roads to the extent of $1,250,000 each, or $5,000,000 in all, provided $100,000 for every ten miles to be graded, and $100,000 for every ten miles when the cars were running regularly. In return it required the roads to pledge the net income to pay the interest on the bonds, and to convey the first 240 sections of land from the government grant to the state, and to deposit in first mortgage bonds an amount equal to the loan from the state for security. This proposal occasioned much uneasiness among the most prudent of the citizens in the state; and though public meetings were held denouncing the measure, it was, however, upon being submitted to the people, on the ap¬ pointed day of a special election, April 15, 1858, carried by a large majority, there being 25,023 in favor to 6,733 against the amendment. The measure afterward became known as the Five Million Loan Bill. The state bonds were of $1,000 denomination, had twenty-five years to run, with interest at 7 per cent, the rail¬ road companies to pay the interest, and were to be delivered to the incorporators of the companies when ten miles of the i oad as graded and ready for the superstructure. Owing to technicali¬ ties it was extremely difficult to market these bonds. Times were hard and the companies were unable to pay the required interest.

On the assembling of the legislature in 1860 the interest on the state bonds having been defaulted, an amendment to the con¬ stitution was adopted and submitted to the people expunging the section sanctioned and approved by them April 15, 1858, reserving only the state's rights. The electors of the state, at the general election of November 6, 1860, with unanimity, by a vote of 2^,023

Of the subsequent history of the Five Million Dollar Loan Bill the Minnesota Legislative Manual says: "Along with the prosperity of the state, caused so largely by the rapid railroad building, the state pride began to assert itself with more force, and the prominent citizens continued to urge an adjustment of the dishonored railroad bonds. In 1877 a proposition setting aside tin proceeds of 500,000 acres for internal improvement lands in settle¬ ment was by act of the legislature submitted to a vote at a special election called for June 12, and was voted down by the decisive vote of 59,176 against to 17,324 votes for the proposition. This vote was largely owing to the fact that the state at that time had almost an entire new population that had come into the state long after the bonds were issued and had no definite knowledge of the history of the original indebtedness.

In 1881 the legislature enacted a law providing for the adjust¬ ment of these bonds, and designating the judges of the supreme court as a commission to make the settlement. The constitution¬ ality of this law was questioned, a writ of injunction was served, and the final determination of the supreme bench was that the law was unconstitutional, as also the amendment of 1860, pro¬ hibiting any settlement without a vote of the people. This latter act had previously been determined unconstitutional by the Supreme Court of the United States. An extra session of the legislature was called in October of the same year, when the final adjustment was authorized by act of the legislature, on a basis of 50 per cent of the amount nominally due, and, after a careful examination of all the claims presented the bond question was forever set at rest by the issue of adjustment bonds to the amount of $4,282,000 to parties entitled to receive them. For the pay¬ ment of these bonds the proposition of setting aside the proceeds of the 500,000 acres of internal improvement lands was again sub¬ mitted at the general election in 1881, and by a vote of 82.435 votes in favor and 24,526 votes against, the action of the legis¬ lature was ratified and the stigma of repudiation removed, which had been fastened upon the state by the popular vote of 1877."

Of the land grant roads, the Root River Valley & Southern Minnesota railroad only, is of immediate concern to Freeborn county. The Root River Valley & Southern Minnesota Railroad was chartered bv the territory of Minnesota March 2, 1855. The act to incorporate was passed on the above date by the territorial legislature, and amended February 27. 1857. The charter granted the privilege of covering almost everything in the southern end of the state, provided the eastern terminus remained at Hokah, viz. : "from the village of Hokah. in the county of Houston, and terri¬ tory of Minnesota, westward by the most feasible and practicable route to some point between the south line of the territory and the point where the township line between 110 and 111 crosses the Minnesota river, thence west by the most direct and practi¬ cable route to the great bend of the Missouri river, with the priv¬ ilege* of a branch starting from Ilokah and running to the west bank of the Mississippi, via Target Lake to Eagle Bluff in AYinona county. Also the privilege of building a branch from some point on the main line east of range 12. west of the fifth principal meridian, and westward through the counties of Mower, Free- born and Faribault, to the west line of the territory ; also the privilege of constructing a ship canal from the main channel of the Mississippi river to Target Lake." May 22, 1857, the terri¬ tory of the road was extended, and all the land grants applicable to its route duly conferred. This was one of the original land grant roads bought in by the state of Minnesota, which later re¬ issued its charter and loaned the credit of the state.

The Southern Minnesota Railroad Company was the name taken by the Root River Valley & Southern Minnesota Railroad, May 23, 1857, the day after the land grant was conferred. The company executed a mortgage, issued bonds and deposited them with the state, receiving therefor $575,000 in state bonds, having at that time graded thirty-seven and one-half miles on its main branch up the Minnesota, and about twenty and one-quarter on its Root river branch. The company defaulted on the payments April 1, 1860, and the governor advertised and sold the property and conveyed the same to the state. The state conferred the property, etc., on divers occasions to various parties during the years 1861 and 1863, but they failed to comply with the conditions. The rights pertaining to the line through the southern tier of counties were conferred upon T. B. Stoddard and associates March 4, 1864, under the name of the Southern Minnesota Railroad Com¬ pany, thus reviving the old title. The company received aid from various municipalities. The road was completed to Rushford in 1867 ; to Lanesboro in 1868 ; from Ramsey to Alden in 1869 ; Lanesboro to Ramsey and from Alden to Winnebago in 1870, making a total of 167 V2 miles. Trains started running to Albert Lea, October 16, 1869. After various litigation the Southern Minnesota Railway Company was organized under chapter 50 of the laws of 1876.

The Southern Minnesota Railway Company was organized March 3, 1877. The Southern Minnesota Railway Extension Com¬ pany was also organized. January 1, 1880, the Southern Minne¬ sota, after receiving a deed from the Extension company, deeded its road from the Mississippi river to Sioux Falls, and the branch from Wells and Mankato, to the Milwaukee & St. Paul Company, the latter issuing bonds and taking possession of the road May 1, 1880.

Minneapolis & St. Louis Railway Company. The original Minneapolis & St. Louis Railway Company was created March 3, 1853, by an act of legislature and named the Minnesota Western Railroad Company. By authority of the legislature, in 1870, it changed its name to the Minneapolis & St. Louis Railway Com¬ pany. The next year, the Minneapolis & Duluth Railroad Com¬ pany was organized by certain stockholders of Minneapolis & St. Louis Railroad Company. The Minnesota & Iowa Southern, and the Fort Dodge & Fort Ridgely Railroad companies were incor¬ porated under the general laws of Iowa; and these companies, April 20. 1881. were consolidated with the Minneapolis and St. Louis Railway Company and the Minneapolis & Duluth Railway Company into one company by the name of the Minneapolis & St. Louis Railway Company. The latter company, on June 25, 1888, went into the hands of a receiver. Its property was sold under a decree of foreclosure, and on October 11, 1894, the Minne¬ apolis & St. Louis Railroad Company was organized, which con¬ sisted of the Minnesota lines. In order to preserve the corporate rights in the several states, the Iowa lines were conveyed to a committee, who, on January 18, 1895, organized a corporation known as the Minneapolis & St. Louis Railroad & Telegraph Com¬ pany of Iowa, which was formerly consolidated with the Minne¬ apolis & St. Louis Railroad Company, February 1, 1895.

The line of the Minneapolis & St. Louis reached Albert Lea from Minneapolis on November 11, 1877, on which day the last spike was driven. The Albert Lea & Fort Dodge line of this road was put in operation on December, 1879. Plans are on foot, at the time this book is going to press, for the consolidation of the Iowa Central and the Minneapolis & St. Louis.

The Burlington, Cedar Rapids & Northern Railway Company reached Albert Lea with a line from Burlington, in September, 1877. and on September 10, three loads of freight were brought into the village, a passenger service being inaugurated at once. The Germania branch was completed to Albert Lea from the south in the fall of 1900. and work at once started toward the north. In 1901, the tracks reached Owatonna and pushed on to Fari¬ bault. Early in 1902 the road was completed to St. Paul. In 1901. the Iowa Central started running into Albert Lea over the Burlington, Cedar Rapids & Northern tracks.

The Chicago, Rock Island & Pacific Railway Company, organ¬ ized under the laws of Illinois and Iowa dates its origin from a special charter granted by the state of Illinois, February 27. 1847, to the Rock Island & La Salle Railroad Company. By purchase, the corporation acquired, June 15, 1903, the Burlington. Cedar Rapids & Northern Railway Company.

Illinois Central Railroad. The Dubuque & Sioux City Rail¬ road, which is operated by the Illinois Central Railroad Company, is a rt'organized company holding its franchises by charter granted by the state of Iowa, with the exception of the Albert Lea & Southern Railroad Company, incorporated September 20, 1899, under the general laws of Minnesota. This road, which extended from the Iowa state line to Glenville Junction, thus crossing Free¬ born county from Lyle westward, was consolidated with the Dubuque & Sioux City Railroad Company, July 1, 1902. The Al- bert Lea & Southern was organized in 1899, those interested being W. A. Morin, AY. E. Todd, B. J. Humphrey, C. AY. Moore and H. B. Litchfield.

The Alphabet Line. In March, 1907, 4 line called the Duluth, St. Cloud, Glencoe & Mankato Railroad was completed from Al¬ bert Lea northwestwardly through Freeborn to Cream. Later it was pushed on to St. Clair. In 1911 the line was sold to the Chicago & Milwaukee company, which company it is supposed was back of the proposition from the beginning. The active manager in the promoting of the road was E. L. Tobie, who spent several years in the county during the time it was projected and built.

Railroad Bonds. In the early days, it was the custom of the railroads to ask bonds of the township through which their lines were to pass. But few such bonds were ever issued in Freeborn county. Albert Lea and Alden issued bonds for the Southern Minnesota; and Hartland, Albert Lea and Shell Rock, $10,000, $15,000 and $10,000, respectively, for the Minneapolis & St. Louis.

The Albert Lea bonds, which were issued to the Minneapolis & St. Louis, were voted by the town, in the seventies, before the incorporation of the city, the object being to provide a bonus for the first line which should reach Albert Lea from Iowa. The Central Railroad of Minnesota, in an endeavor to secure these bonds, started grading from Albert Lea, southward, and the evidence of the grading done can still be seen, near the "big mill" so called, south of the Minneapolis & St. Louis station. The bonds were issued and deposited with the AYisconsin Fire & Alarine Bank, of Milwaukee, in escrow, but as the road never pro¬ gressed beyond a few rods of grading, the bonds were recovered and burned. Interest on these bonds for part of a year was levied against the town to the amount of $632.00, and this money was used to grade Broadway from Clark street to the courthouse.

It is not the intention of this history to discuss the contro¬ versy between the town and city of Albert Lea over the payment of the bonds issued by the town before the incorporation of the city. In 1869, bonds to the amount of $40,000 were given io the Southern Minnesota, by the town of Albert Lea. In 1877, bonds to the amount of $15,000 were given to the Minneapolis & St. Louis, principally by vote of the people living in the village. Five months after this, the city was incorporated, and as no mention of the payment of the bonds was made, the whole bonded indebtedness of $55,000 stood against the town, unknown, how¬ ever, to the voters of the town, until the $15,000 was due. In 1891 the $40,000 Southern Minnesota bonds were refunded, the division being made on the valuation of city and town al that time, the city assuming $32,000, and the town, $8,000. In 1907 the matter of the payment of the $15,000 came up, and the people of the city declared themselves ready to settle the bonds on the rates which had been established for the division of town prop¬ erty and indebtedness in 18 <8, that of 38.55 per cent for the town and 61.45 per cent for the city. The people of the town, how¬ ever, insisted that the division should be made on the 1906 valuation of city and town property, making $12,491.59 from the city, and $2,508.41 from the town, alleging truly that since the incorporation of the city, the city had annexed large tracts of valuable town property, from which it was receiving the taxincome. In answer to this the people of the city alleged that the city had paid more than its share of the interest, the ratio of interest payments having been determined by the ratio of valuation in town and city property levied each year by the county auditor and by him paid. The matter was taken to the legislature, and it was feared would be dragged through the courts, but an agreement was finally reached, which the people of the town still assert was against their will, but which avoided expensive and extended litigation. The old ratio was accepted, and of the $15,000, the city assumed $9,217.50, and the town $5,782.50. Of the interest from the maturity of the bonds to July 15, 1910, the town paid $597.27, the city's total being $10,412.06.