The line of road constructed under the charter of this company, as approved in 1852, extends from State line to Paris, a distance of 82 50/100 miles, and was purchased in 1871 by the Louisville and Nashville Railroad Company. As, however, the accounts of the road were kept separate from those of the Louisville and Nashville Railroad until the consolidation of the whole line between Memphis and Louisville, in October, 1872, a brief reference to the early history of this company, prior to its purchase by the present owners, will not be inappropriate. As above stated, the Memphis, Clarksville and Louisville Railroad Company was incorporated in January, 1852, and by subsequent acts of the legislature it became entitled to State aid, in the shape of bonds, to the extent of $10,000 per mile of completed road.
The road was opened through for traffic in 1860, but the material condition of the country, and its resources, were so prejudicially affected by the war that in 1865 the company was unable to pay the interest upon the State bonds, and a receiver was appointed by the State of Tennessee. It may be noted here that shortly after the close of the war the Louisville and Nashville Railroad Company offered to repair and reconstruct the road from Clarksville to Paris, to operate it as part of the through line between Louisville and Memphis, and to apply the net earnings to the redemption of the debt. This proposition, however, was not accepted, and unfortunately a whole year’s business was lost; but in the spring of 1866 the Legislature of Tennessee appropriated $400,000 of bonds to aid in the reconstruction of the road, and an arrangement was entered into whereby the Louisville and Nashville Railroad Company took the bonds, and furnished on that security the requisite funds for carrying on the work.
The financial condition of the Memphis, Clarksville and Louisville Railroad Company in 1867 was far from flattering. Its liabilities had increased to $4,062,653.52, and it was estimated that it would require not less than $500,000 to finish the work of repairs, when the total liabilities would amount to $4,562,653.52, or about $56,000 per mile of road. The liabilities alluded to were as follows:
|Indebtedness and Stock Liabilities at the close of the War, including Interest due State
|Due to Operatives and Supply Agents
|Due United States Government for Rolling Stock and Material
|New Loan from the State of Tennessee
|Interest due State from January, 1866, to June, 1867
The reader will note that the original cost of the road was $2,300,000, or not quite $30,000 per mile for construction and equipment. In February, 1868, the affairs of the Memphis, Clarksville and Louisville Railroad were so embarrassed that the operatives refused to work any longer unless a guarantee were given that they should be paid, and as the State receiver could not give this guarantee work was temporarily suspended, and the through trains between Memphis and Louisville were run via Nashville and McKenzie.
Arrangements were however soon made, whereby the Louisville and Nashville Railroad Company guaranteed payment for labor and supplies, it being understood that if earnings were not sufficient to meet these expenses the Louisville and Nashville Railroad Company should make up the deficit; but if there was any surplus of earnings over expenditures, said surplus was to be paid over to the State receiver. The road was operated under these terms until October, 1871, when final arrangements were made for a purchase of the property from the State of Tennessee, and the cost, including advances made in former years and actual loss in operating between 1868 and 1871, is now charged on the books as $1,599,774.39, not quite $20,000 per mile.
N.B.—As the whole line between Louisville and Memphis is now consolidated, all returns of operations are included under one head. All communications will be addressed to Louisville and Nashville and Great Southern Railroad Company, Louisville, Ky.
SOURCE: Vernon, Edward. American Railroad Manual for the United States And the Dominion. New York: American Railroad Manual Co., 1873.