The Palmetto & Roseport Railroad

Early History of the St. Joseph and Western Railroad


The following is reprinted from The Axtell Anchor, Axtell, Kansas on May 29, 1884. It describes the development of the first railroad that came through Axtell.

A charter was approved February 17, 1857, for the building of a railroad from Roseport, opposite St. Joseph to Palmetto, now Marysville, in Marshall County, Kansas. The name of the Company was the Palmetto & Roseport Railroad Company, and the road to be built was intended as an extension of the Hannibal & St. Joseph Railroad.  Governor Stewart, Jeff Thompson, John Corby, John Severance and John R. Boyd, of Missouri, and Frank Marshall, of Kansas were the first Board of Directors.  The work of constructing the road was commenced in the summer of 1859, opposite St. Joseph, and on the 20th of March, 1860, the first bar of railroad iron ever laid in Kansas was placed on this road, and the track was completed to Wathena, five miles west of St. Joseph on the 28th of April, 1860.  The projectors of the road had absolutely nothing certain to build a railroad with, the work of construction being commenced without a dollar in the treasury of the company.

The individuals who organized this Company believed that the magnificent country west from St. Joseph ought to be penetrated by a railroad, and, acting on this idea commenced its construction, trusting that the city of St. Joseph and the counties and individuals on the line of the road would assist in its completion.  Five miles of the road from St. Joseph west, was completed by private subscription and on the 28th of April, 1860, the pony engine, "Albany," was placed on the track and run to Wathena.  The war intervening, nothing farther was done in the construction of this road until 1866.  The charter of the company, however, was kept alive, and on the 17th of April, 1862, the corporate name of the company was changed to the St. Joseph & Denver City Railroad Company, and under the general railroad law of Nebraska, the company obtained the right to maintain a railroad from the border line of Kansas to Ft. Kearney, in Nebraska.

By the terms of an agreement made on the 11th of August, 1866, a corporation organized as the Northern Kansas Railroad Company, was consolidated with the St. Joseph & Denver City Company, and by this consolidation the right to certain lands granted by the general government in an act approved July 23, 1866, was vested in the St. Joseph and Denver City Railroad Company; also this company acquired the title to certain lands by reason of an act of the legislature of Kansas, approved February, 13th, 1865.  Under these two acts the amount of land received was 373,162 acres in Nebraska and 64,672 in Kansas.  The company also received the proceeds of the sale of 125,000 acres of land granted by the general government to the State of Kansas, to aid in the construction of railroads in the state.  The sale of this land amounted to $164,528. The company also obtained subscriptions to its capital stock, payable in city and county bonds as follows: City of St. Joseph, $500,000; Doniphan County, $200,000. Brown County, $100,000; Nemaha County, $125,000; Marshall County, $100,000.  All the above stock was taken and paid for in bonds except the $125,000 subscribed by Nemaha County.  This county refused to take its stock and issue its bonds.  Assuming the lands granted to the company to have been worth three dollars per acre and the county and city bonds to have been worth eighty cents on the dollar and we think this is a low estimate the amount of aid per mile in the construction of the road was $9,600, or certainly more than one-half of the actual cost of the road.

It is not the purpose of this article to discuss what might have been in building the St. Joseph & Western railroad.  It is true of this road as of all the roads in Kansas, that the general government and the people on the lines of the roads, furnished more than one-half of the means necessary to build them; and it is equally true, that the stock issued by the railroad companies in payment of the money advanced is worthless.  A history of the manner of manipulating railroad stock will explain this. The primary object to be accomplished in constructing the St. Joseph & Western railroad as well as all other railroads in Kansas was the development of the country.  That object has been accomplished and Northern Kansas is beyond all question a much greater country than it would have been if no railroad had been constructed through it.

About the close of the war the proposition to go ahead with the construction of the railroad west from St. Joseph was actively agitated, and in the summer of 1867 negotiations were made with capitalists in St. Joseph, to borrow $100,00 to complete the road from St. Joseph to Troy, in Doniphan County, or a distance of fifteen miles.  To secure the payment of this $100,000, a first mortgage was given on all the assets the company would come in possession of on the completion of this fifteen miles of road.  Col. Severance agreed to complete and did complete this fifteen miles of road for the $100,000.  The completion of the first division, fifteen miles, gave the company this much of completed road that could be used in the construction of more road, besides giving it the possession of a part of St. Joseph and Doniphan County bonds that were to be issued on the completion of the first division of the road.

Having completed the first division of the road and secured the land grants and city and county subscriptions before mentioned, the company was able to negotiate a mortgage on its franchise and all the property it possessed with parties in New York, for the completion of the whole road.  First mortgage bond on the road were negotiated by Tanner & Co. and Donald, Lawson & Co., brokers, in New York, and with money realized from the sale of those bonds, the road was completed from Troy in Doniphan County to Hastings, in Nebraska, about two hundred and sixteen miles. The whole road through to Ft. Kearney might have been completed in this way, but it was found that Donald, Lawson & Co., and Tanner & Co., were not only brokers for the sale of the securities of the company, but they were also the contractors, in fact, for the construction of the road, and parties who were buying these first mortgage bonds found they were getting a mortgage on property that had cost and was costing entirely too much money.  Donald, Lawson & Co., and Tanner & Co., were paid for building the road more than double the actual cost of the work, and when it became clear to the parties who were paying the money, arrangements were made as soon as possible, for the foreclosure of the mortgage, and the sale of the road.  The sale of the road on mortgage, of course, wiped out the original stock.  The road went into the hands of Gould & Co., who completed the road, making Grand Island the terminus instead of Kearney, and changed its name from St. Joseph & Denver City Railroad, to St. Joseph & Western Railroad.

The local management of the St. Joseph & Western Railroad will compare favorably with that of any road in the west, but this road like all other roads in Kansas, was built that the public might be benefited.  Large donations were made by the people to accomplish this object, and the people have the right to regulate by law the manner of running these railroads, and the representatives of the people will fail in their duty if they do not see to it that this is done.

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