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DUBUQUE AND SIOUX CITY RAILROAD
DUBUQUE AND SIOUX CITY RAILROAD. The Dubuque and Sioux City Railroad was incorporated on August 1, 1860 after Morris K. Jesup forced the DUBUQUE AND PACIFIC RAILROAD into receivership. (1) Jesup held many of the railroad's defaulted bonds and wanted to put the line on a firm financial basis. Jesup controlled the company for twenty-seven years and held the presidency from 1866 to 1887.
The railroad reached Cedar Falls, Iowa in 1861 where the celebration included the placing of a cedar lei or crown around the balloon stack of the locomotive. (2) The construction was made possible by pledging the company's most valuable land in the Des Moines River valley for two dollars an acre. (3) The CIVIL WAR ended all further construction except for a feeder line called the Cedar Falls and Minnesota Railroad. This line had been incorporated on April 16, 1858 by Platt SMITH and others who were also involved with the Dubuque and Sioux City Railroad.
In 1863 the Dubuque and Sioux City constructed Dubuque's first major passenger railroad station. Located at Iowa and Jones STREETS, the 32' by 275' passenger shelter on the west side of the tracks contained passenger and baggage rooms, ticket office and two additional offices. Located on either side of the entrance to the passenger room were rose windows. Freight and passenger cars were stored in the south end. (4) The company also sold 107,000 acres along the Des Moines River in November 1863. (5)
The railroad's freight depot by 1864 was too small to handle the volume of business. A contractor was hired to build an addition 250 feet long, forty feet wider, and ten feet higher on the southern end of the present building. Work was to start during early March. (6)
On April 16, 1866 the first train reached Iowa Falls from Dubuque. (7) A large crowd of people met the train at its arrival and a three-day celebration was held with a special excursion train running between the two cities. Both the Dubuque Herald and Dubuque Times carried stories of the celebration including evening entertainment, dinner and dancing were held at Sayer's Hall. The following day the excursion returned to Dubuque where another grand celebration was held. (8)
Despite the celebration, the fact remained that the Dubuque and Sioux City was only half way across the state. Other lines were making much greater progress. Concerned that the ILLINOIS CENTRAL RAILROAD would lose interest in the Dubuque and Sioux City line, Platt Smith suggested to John Douglas, the first president of the Illinois Central, a way of increasing their joint traffic in livestock to Chicago.
We can increase the cattle and hog business at this point very materially I believe by building some large stock yards at South Dubuque where our road strikes the river and have a flat boat arranged expressly for the transportation of stock to Dunleith (later called East Dubuque). (9)
On October 1, 1867 the Illinois Central leased the Dubuque and Sioux City for twenty years. The lease included the 143-mile line west of Iowa Falls and the 15-mile branch north to Waverly. (10) At that time, Platt Smith was instrumental in forming the IOWA FALLS & SIOUX CITY RAILROAD acquiring the franchise, right-of-way, and land grants belonging to the Dubuque and Sioux City west of Iowa Falls to Sioux City. (11)
The corporate history of the Dubuque and Sioux City involved 10 predecessor companies. The property of the Dubuque and Sioux City was operated by the Illinois Central continuously since October 1, 1867, with the exception of the period between October 1, 1887, and March 15, 1888. (12)
The Dubuque and Pacific Rail Road Company. Incorporated under general laws of Iowa, May 19, 1853. Sold at foreclosure to the Dubuque and Sioux City, August 21, 1860.
Iowa Falls and Sioux City Railroad Company. Incorporated under general laws of Iowa, October 1, 1867. Conveyed to the Dubuque and Sioux City, October 23, 1888.
Cedar Rapids & Chicago Railroad Company. Incorporated under general laws of Iowa, September 24, 1886. Conveyed to the Dubuque and Sioux City, October 27, 1888.
Cherokee & Dakota Railroad Company. Incorporated under general laws of Iowa, July 15, 1887. Conveyed to the Dubuque and Sioux City, October 29, 1888.
CEDAR FALLS AND MINNESOTA RAILROAD. Incorporated under general laws of Iowa, August 20, 1858. Sold at foreclosure June 1, 1896. Acquired by the Dubuque and Sioux City, June 15, 1896.
Fort Dodge and Omaha Railroad Company. Incorporated under general laws of Iowa, September 14, 1898. Conveyed to the Dubuque and Sioux City, June 22, 1900.
Stacyville Railroad Company. Incorporated under general laws of Iowa, October 14, 1897. Conveyed to the Dubuque and Sioux City, April 6, 1903.
Albert Lea and Southern Railroad Company. Incorporated under general laws of Minnesota, September 23, 1899. Conveyed to the Dubuque and Sioux City, April 20, 1908.
Cedar Falls & New Hartford Railroad Company. Incorporated under general laws of Iowa, January 6, 1903. Conveyed to the Dubuque and Sioux City, June 30, 1904.
Cedar Falls and North Eastern Rail Road Company. Incorporated under general laws of Iowa, August 30, 1904. Conveyed to the Dubuque and Sioux City, May 4, 1905.
The recorded mileage of the Dubuque and Sioux City amounted to 760.98 miles, which was acquired partly by construction, partly by purchase, and partly through reorganization. The inventoried mileage was 760.902.
Lawsuits followed and litigation lasted for months with those holding stock in the Dubuque and Sioux City demanding purchase of their shares at par which was well above their current value. In the end, the stockholders were given $80.00 per share, and the Dubuque and Sioux City Railroad disappeared into the Illinois Central. (13)
The story of the Dubuque & Sioux City Rail Road bonds is fascinating from a philatelic point of view. Two denominations of bonds, $500 and $1000, were printed by Henry Seibert & Brothers in 1867. They were then forwarded to the American Phototype Company for imprinting. The bonds were initially imprinted with 50¢ and $1.00 stamps, the rate that would accompany mortgage bonds. But that was not the case. These were almost a simple promise to pay with no pledge of the property and rolling stock of the company pledged as collateral for the bonds.
These were what today would be called junk bonds, or nearly so. The Dubuque & Sioux City Rail Road pledged to set aside $18,000 per year in two installments in a sinking fund. These were also convertible into stock of the same rail road. The advantage for the investor was that if the company was financially successful and the stock of the company appreciated in value, these bonds could be used to purchase an ownership share of the company.
At what point it was discovered that these bonds were improperly stamped is not known. The fact that they are dated May 1, 1867 suggests that they may have been imprinted by the American Phototype Company before it was required that all new imprinting work had to be approved by the Bureau of Internal Revenue in Washington (April 15, 1867). Unsecured debt was to be taxed as a promissory note, i.e., at the rate of 5¢ per $100 of face value. Thus they should have been taxed at 25¢ and 50¢ respectively.
The agreement that they could be converted at any time into stock of the company required an additional tax of 5¢. The $500 bond thus was imprinted with a 25¢ stamp and a 5¢ stamp in green obliterating the original 50¢ orange imprinted stamp; similarly the $1000 bond was imprinted with 50¢ and 5¢ stamps in green obliterating the underlying $1.00 imprint.
The Dubuque & Sioux City Rail Road bonds are the only ones known that show evidence that an error in imprinting had been caught and subsequently corrected. They are the only examples of the higher denominations that were printed in green. The $500 bonds are quite scarce; only 6 copies having been recorded in collections. (14)
1. Silag, Bill. "The Dubuque and Pacific Railroad," Iowa Heritage Illustrated, Summer and Fall 2002, p.117
2. Stover, John F. History of the Illinois Central. New York: Macmillan Publishing Company, Inc. 1975, p. 131
3. "Iowa and the Illinois Central," Illinois Central Magazine, November 1927, p. 5
4. Meyer, Jeffrey J. "Inter-century Railroad Stations," Julien's Journal, February 2012, p. 50
5. "The Great Land Sale," Dubuque Democratic Herald, November 10, 1863, p. 4. Online: https://news.google.com/newspapers?nid=A36e8EsbUSoC&dat=18631110&printsec=frontpage&hl=en
6. "Addition to the Freight Depot," Dubuque Democratic Herald, March 1, 1864, p. 4. Online: https://news.google.com/newspapers?nid=A36e8EsbUSoC&dat=18640301&printsec=frontpage&hl=en
7. "Iowa and the Illinois Central."
8. A National Register of Historic Places Travel Itinerary, "Iowa Falls, Iowa--Railroad Era, 1866-1909. http://www.iafalls.com/historic/railroad_era.html
9. Stover, p. 132
10. Stover, p. 133
11. Silag, Bill.
12. Wikimedia: WikiProject Trains. Online: http://en.wikipedia.org/wiki/Wikipedia:WikiProject_Trains/ICC_valuations/Dubuque_and_Sioux_City_Railroad
13. Donovan, Frank P. Jr. Iowa Railroads. Iowa City: University of Iowa Press, 2000, p. 104-109, 112-114
14. Lesher, Ron. "Greatest Revenues, X," Online: https://www.americanstampdealer.com/SubMenu/Greatest_Revenues_X.aspx?id=372