590 



MINNESOTA. 



ed or rafted on the spring floods to the main 

 boom, a few miles above the city, where 100,- 

 000,000 feet may be stored, anil whence they 

 are taken, when needed, according to the own- 

 ers' murks upon them, to the several mills. 

 AVI i on at full work, the mills on the two sides 

 of the river cut up a million feet a day. 



The whole number of mills and their capacity 

 have more than doubled since 1870, and the 

 population of the city has increased from 18,079 

 to 60,000. 



MINNESOTA. The Legislature, consisting 

 of 29 Republicans, 11 Democrats, and 1 Green- 

 backer in the Senate, and 86 Republicans, 16 

 Democrats, and 4 Greenbackers in the House, 

 assembled at the beginning of the present year 

 and adjourned on the 9th of March. On the 

 19th of January S. J. R. McMillan, Republican, 

 was re-elected United States Senator. The 

 most important act of the session was the one 

 providing for the settlement of the old railroad 

 bonds at fifty cents on the dollar. The history 

 of these bonds was summarily as follows : 



In March, 1857, Congress granted to Minnesota six 

 alternate sections of land per mile to aid the construc- 

 tion of six difi'erent lines of railroad. This grant was 

 divided ainong four different railroad companies. 

 The sanguine expectations excited by this liberal grant 

 were suddenly cut short by the financial crisis of 1857. 

 followed by the general suspension of Western railroad 

 enterprises. In this emergency the railroad compa- 

 nies applied to the Legislature for aid. After a winter 

 of active discussion a constitutional amendment was 

 submitted by the Legislature to the people for a loan 

 of State credit to the several companies. On April 

 15, 1858, the amendment was adopted by a vote of 

 about 35 ? 000 for to 8,000 against. It authorized the 

 bonds of the State to be issued to the four companies 

 (not to exceed $1,250,000 to each company, or $5,000,- 

 000 in all) as construction advanced, at the rate of $10,- 

 000 per mile for each mile of graded road, and $10,000 

 for each mile of completed road. The amendment 

 pledged the faith and credit of the State for the pay- 

 ment of the bonds in the event that the companies 

 should make default in the payment of the interest 

 or principal, and as security tliercfor exacted certain 

 securities from the companies. Among others, first, a 

 conveyance to the State of the first two hundred and 

 forty sections of land to which each road was entitled 

 prior to construction ; and, second, a first mortgage on 

 all the lands, franchises, etc., of the several roads, and 

 to this was added a general penalty of forfeiture. The 

 companies proceeded to grade the roads, and bonds 

 therefor were issued to the amount of $2,275,000, when 

 further construction was suspended. The companies 

 found themselves unable to negotiate the bonds at 

 prices sufficient to enable them to go on with the 

 work. They defaulted in the payment of the interest 

 on the bonds when in 1860 the State, through its 

 then Governor, foreclosed its mortgage on the lands, 

 franchises, road-bed, etc., and took possession of the 

 same. Though the constitutional amendment provided 

 that these securities should be devoted to the payment 

 of the interest and principal of the bonds, the 'Legis- 

 lature proceeded soon after to turn over these lands 

 and franchises to other companies free of all lien. The 

 Legislature of 1860 proposed two constitutional amend- 

 ments which were adopted in November of that year, 

 one of which provided that there should be no further 

 issue of bonds under the loan amendment, and that it 

 should be expunged from the Constitution, reserving 

 > the State all rights, remedies, and forfeitures accru- 

 ing thereunder. The other was an amendment to 

 section 2, Article IX, of the Constitution, in the fol- 

 lowing words: 



" But no law levying a tax or making other provis- 

 ions for the payment of the bonds, denominated Min- 

 nesota State railroad bonds, shall take elll-ct or be in 

 force until such law shall have been submitted to the 

 people and adopted by a majority of the electors vot- 

 ing for the same." 



Immediately following the adoption of these amend- 

 ments, the public attention was engrossed by the Mar 

 for the Union and the Indian war. It was not till 

 1866 that any further action was taken by the Legishit- 

 ure. In that year an act was passed for the appoint- 

 ment of three commissioners to ascertain what the 

 bonds cost the holders, and on what terms they would 

 surrender them to the State. 



At the next session of the Legislature, 1867, an act 

 was passed to provide a sinking fund for the adjust- 

 ment of the bonds, from the proceeds of the internal 

 improvement lands. The minimum price of the lands 

 was fixed at $3 per acre, and they were to be appraised 

 and sold in the same manner as school lands. The 

 act provided that whenever the sinking fund should 

 amount to $20,000, but not oftener than once a year, 

 the State Treasurer should advertise for proposals 

 from the bondholders for the surrender of an amount 

 of bonds hi exchange for said money ; the person of- 

 fering his bonds at least price to be entitled to the 

 money. This act, submitted to the people in Novtm- 

 ber, was rejected. 



In 1870 the Legislature passed an act ostensibly set- 

 ting apart the proceeds of the 500,000 acres of internal 

 improvement lands, but really the lands themselves, 

 for the payment of the bonds. The act required 

 2,000 of the bonds to be deposited with the State Au- 

 ditor on or before the first Wednesday in September 

 with all unpaid coupons attached, with a written 

 contract on the part of the owner agreeing to purchase 

 such lands to trie extent of the bonds so deposited, 

 and hi case of failure to purchase, authorizing the Au- 

 ditor to set apart an amount of lands which, at the 

 minimum price, fixed at $8.75 per acre, would equal 

 the bonds and coupons so deposited. In other words, 

 each bondholder was required to be on hand to select 

 and purchase, for the sum of not less than $8.75 per 

 acre, an amount of lands equal at that price to the 

 amount of his bonds and coupons, or, if he could not 

 dp it himself, to allow the State Auditor to do it for 

 him. 



This proposition was ratified by the people, but 

 when the first Wednesday of September came it was 

 found that less than 2,000 of the 2,275 bonds had been 

 deposited with the State Auditor, and this adjustment 

 fell through. Selah Chamberlain and other bond- 

 holders accepted this proposition and deposited their 

 bonds, but a minority either refused or failed to ac- 

 cept. 



At the next session of the Legislature in 1871 another 

 act was passed to test the validity and provide for the 

 adjustment of the bonds so deposited. Under this act 

 the Governor was empowered to appoint three disin- 

 terested persons learned in the law, either residents or 

 non-resiaents of the State, to constitute a board of 

 commissioners to determine whether the bonds were 

 a legal and equitable obligation of the State, and if so 

 to ascertain and award the amount due upon such 

 bonds upon the basis of the cost of such bonds to the 

 holders thereof, with interest upon the cost at the rate 

 of 7 per cent per annum, and to file their determina- 

 tion with the Governor before July 1, 1871. 



In case the commissioners decided that the bonds 

 were a legal obligation against the State and should 

 award the amount thereof on the basis of the cost to 

 each holder, new bonds were to be issued in lieu 

 thereof at the rate of 2 per cent the first year, 3 per 

 cent the second, 4, 5, and 6 respectively for the sub- 

 sequent three years, and 7 per cent thereafter. The 

 tax on the gross earnings of the railroad companies 

 was set apart to pay the interest and principal of the 

 new bonds. This proposition, the only one ever 

 made by the Legislature for a quasi-judicial determi- 

 nation of the legal validity of the bonds, was rejected 

 by the people. In March,"l878, the Legislature passed 



