Democratic Sentinel, Volume 21, Number 46, Rensselaer, Jasper County, 12 November 1897 — GREAT ROAD IS SOLD [ARTICLE]

GREAT ROAD IS SOLD

UNION PACIFIC DISPOSED OF AT AUCTION. The Reorganization Committee at Omaha, Neb., Makes the Only Bid for the Property—Full Amount Received Is $57,3«4,932.7G. Ronds Brought About One-Third. The Union Pacific Railroad was sold in Omaha at auction Monday. The sale was forced by the United States, holder of a second mortgage. In order to protect stock and bondholders, the reorganization committee hid in the property, real and personal - that is to say, track, rolling stock and bonds. For the railroad proper the committee paid $39,883,281.57; for the bonds, $13,945,250.99. There were no other bids. The price obtained is sufficient to pay the government in full. Mastery in Chancery W. D. Cornish of St. Paul conducted the sale, and it is said his fee will be the largest ever given an auctioneer, as the Union Pacific is the most valuable property ever sold at auction. The idea of uniting the Atlantic and Pacific coasts by a system of railways took shape in a hill that passed the UnitedStates Senate June 20, 1802, by a vote of 25 to 5. This was the actual stnrting of the Union Pacific. The House passed the bill by a vote of 104 to 21, and four days later President Lincoln made it a law by ntHxing his signature. A charter for $100,000,000 was given the corporation and a land grant of 20,000,000 acres attached. The company was formally chartered July 2, 1802, with authority to construct a railway front Omaha to the eastern boundary of the State of California. The act incorporating the company provided for a government subsidy equal to SIO,OOO per mile for that portion of the line between the Missouri River and the base of the Rocky mountains: $48,000 per mile for a distance of 150 miles through the mountain range; $32,000 per mile for the distance intermediate between the Rocky and Sierra Nevada ranges, and $48,000 per mile for a distance of 150 miles through the Sierra Nevada. , The company had also a land grant equaling 12,800 acres to the mite. “The original act provided that the government subsidy should bo a first mortgage on the road, but by amendment it was made a second mortgage, the company being authorized to issue its own bonds to an amount equal to the government subsidy as a first mortgage on the line. The whole available capital of the road that was ultimately to cost $50,000,000 was only $218,000. The government had offered in subsidies more than the cost of the construction of the road, and Oakes Arnes, of Easton, Mass., who was interested in the building of the road, formed a corporation which became known as “The Credit Mobilier of America,” which was to receive all the profits of the constructors aud divide them among the stockholders in the Credit Mobilier. The profits were enormous, amounting to $43,929,328. Under the Antes contract alo-ne and within one year dividends were paid amounting to 549 per cent, on the- capital stock. The matter was investigated by Congress and the expulsion of Ames from the House of Representatives, of which he was then a member, was recommended. It was, however, never carried out. The first eleven miles of the road were completed Sept. 25, 18C5, and the road was completed to its junction with the Central Pacific at Promontory Point, Utah, May ID, 1809. The meeting of the two rondawAflks duly celebrated. Gov. Leland California, president of tbe'CenffnilTncifio, was present, n« whs Vtce President Durant of (lie Union Pacific. Ties were laid for the rails and when they met the last spike, which was of gold, was driven. Telegraph wires were connected, so that each blow of the silver sledge was reported instantly in all the large cities from the Atlantic to the Pacific.