NORTH CAROLINA. 



1. Bonds Issued before the wtr, called "old 



bon<U" $8,872,1)00 00 



InttTftt unpaid on name 8,000,170 00 



Total $11,879,07500 



8. Bonda Imu.-.i -im-,- the war, but under 



acts pa*sel before the war $9,997,000 00 



Interest unpaid on Mine 701,010 UO 



Total $8,088,91000 



3. Bonds Issued duriiiir (he war for Inter- 



nal liiiprovi-inriit purpuflea $1.188,00000 



Iiiti-n-rl unpaid ou vault; 606,590 00 



Total $1,714,690 00 



4. Bonds Issued since the war for funding 



Intel-cat and matured bonds as lor- 



Under funding; act of 1866 $9,472,800 00 



Interest unpaid on same 814,186 00 



Total $8,88688600 



Under funding act of 1868 $1,709,900 00 



Interest unpaid on same 614,904 00 



Total $8,817,804 00 



Total for funding $6,604,140 00 



6. Bonds Issued since the war under or- 

 dinances and acts passed uiuce tlie 



war, not special tax $1,692,046 00 



Interest unpaid on came 677,157 68 



Total $8,199,20253 



6. Bonds commonly called "special tax" $11,407,000 00 

 Interest unpaid on same 8,598,930 00 



Total $14,985,980 00 



Total bonds and interest not spe- 

 cial tax $28,986,918 06 



Total debt, including special tax, 

 bonds, and interest $88,921,848 05 



In calling the attention of the Legislature to 

 the importance of this subject, Governor Brog- 

 den said : 



The people cannot pay the annual interest that ac- 

 crues on the entire debt, in addition to the ordinary 

 expenses of the State government ; and the ques- 

 tion arises as to the best mode and manner of its 

 adjustment. 



Various plans have been suggested in relation to 

 this subject, but in matters of business two or more 

 parties are necessary to a contract, and to give it any 

 validity it must have the assent of both. 



I earnestly recommend to your careful attention 

 and consideration the adjustment of the State debt, 

 because it is filled with the fate of future conse- 

 quences which may ultimately redound to the honor 

 and good name or the shame or humiliation of the 

 State. We have great cause for honest pride in her 

 past history, her present position, and future pros- 

 pects, and may it never pe truly said that her pa- 

 triotic and honest sons quietly submitted to any un- 

 just imputation or stain upon her character for in- 

 tegrity and fidelity. 



The financial question was one of the most 

 important that claimed the attention of the 

 Legislature upon its assembling, and hills re- 

 lating to the State debt were early intro- 

 duced. In the House of Representatives a 

 bill was introduced providing for a new State 

 debt, to be called the consolidated debt, and 

 a tax levy to pay the interest on it and a 

 reserve for a sinking-fund. It then declares 

 all bonds issued under legislation before the 

 war as of equal validity, and also includes the 

 bonds issued under the funding-acts of 1866 and 

 1868, as they were for interest on the first- 

 class or old bonds. It then provides that the 



Treasurer nh all issue the now bond* to the hold- 

 ers of this tirst-clatis or old bond* at 88^ pr 

 cent, on the principal, or, in other word*, (rive 

 one bond for three old OUCH, with the put-duu 

 ins. r.-st attached. All other bonds are ig- 

 non-d. It tlu-n authorizes Uio Nortli Ciiroliim 

 Railroad Company to buy the con.->tni<-tin 

 bonds, so called, and gives that company tliu 

 right to buy the stock of the State for the 

 company, and tarns over all right of the State 

 to representation by proxy or directors in tliu 

 company to the private stockholders, with a 

 proviso that the State may, within ten years, 

 purchase that interest again by paying the 

 cost and six per cent, interest. 



Another section provides for the purchase, 

 by the public Treasurer, of the Western North 

 Carolina Railroad, if the same can be done at 

 the sale, for $800,000, payable in State bonds, 

 with ten years to run, interest guaranteed ; and 

 it provides for the appointment, by the Gov- 

 ernor, of five commissioners, with the concur- 

 rence of the Senate, who shall hold and oper- 

 ate and complete the Western North Carolina 

 Railroad with convicts. 



The interest of the State in the North Caro- 

 lina Railroad is of prime importance to the 

 people. The public faith of the State is pledged 

 for the redemption of the bonds issued to con- 

 struct the road, and that all of the stock held 

 by the State in the company, and any divi- 

 dends or profits arising therefrom, shall be ap- 

 plied to the payment of the interest accruing 

 on such bonds. For several years the divi- 

 dends arising from the State stock have been 

 paid into the public Treasury, and applied to 

 the general expenses of the State government. 

 A suit having been brought in the United States 

 Circuit Court by Anthony Swazey, and other 

 bond-holders, to have the dividends applied to 

 the payment of interest on the construction 

 bonds, a receiver was appointed, in June, 

 1871, to collect the dividends. These divi- 

 dends, as far as received, have been applied to 

 the payment of interest ; but, as they were not 

 sufficient fqr that purpose, application was also 

 made to the same court for a decree for a sale 

 of the State stock to pay past-due interest. A 

 decree was accordingly rendered by the court 

 at the June term, 1874, to the effect that, if 

 the State fails to provide for payment of the 

 interest due up to the 1st day of April, 1875, 

 the stock may be sold. 



If that decree is carried into effect it will 

 thwart and defeat the main purposes of the 

 " act to amend the charter of the North Caro- 

 lina Railroad Company, and for other purposes 

 therein mentioned," ratified the 10th day of 

 February, 1874, commonly called " the consoli- 

 dation bill," providing for a continuous line of 

 railroad from Morehead City, on the Atlantic 

 ocean, through almost the entire length of 

 North Carolina, a distance of more than 500 

 miles, connecting the seaports with the great 

 West and the Mississippi Valley : 440 miles have 

 already been completed, and a large amount of 



