Saint Paul and Pacific Railroad
Encyclopedia
The Saint Paul and Pacific Railroad (also known as the St. Paul & Pacific Railroad and the SP&P) was a shortline railroad
in the state
of Minnesota
in the United States
which existed from 1857 to 1879. Founded as the Minnesota and Pacific Railroad, it was the state's first active railroad. It went bankrupt, and the state changed its name to the Saint Paul and Pacific Railroad. The SP&P went bankrupt as well. It was taken over by James Jerome Hill and others, who used the railroad as the basis for building the Great Northern Railway.
issued a charter to the Minnesota and Pacific Railroad to build a standard gauge railway from Stillwater
in the east to St. Paul in the west. From St. Paul, the main line would extend to Breckenridge
in the west (the state's border with the Dakota Territory), while a branch line would extend to St. Cloud
, Crow Wing, and St. Vincent
. As the state's first active railroad(though not necessarily the state's first railroad), the Minnesota and Pacific received a grant of 2460000 acres (995,527.6 ha) of land from the territorial legislature. This was the seventh largest land grant of the 75 given to railroads nationwide between 1850 and 1871.
Construction began in the autumn of 1856, and in 1857 the state backed a $5 million bond issue to support the new rail system. But speculators manipulated the nascent railroad's profits, overcharged it for supplies, and sold off some of its assets. It went bankrupt in 1860, and the new state legislature purchased all of its assets for a mere $1,000.
finally opened. Egbert E. Litchfield bought most of the road's stock, and while the branch line reached Sauk Rapids
by 1867 (financed mostly by bonds sold in The Netherlands) little was accomplished on the main line. Only 210 miles (338 km) of track had been laid as of 1865. The railroad built almost no more track between 1867 and 1871. Nonetheless, it heavily promoted the construction of towns every eight miles along its length, and was the leading railroad helping to "colonize" Minnesota.
In December 1870, the Northern Pacific Railway
purchased the SP&P. But the Northern Pacific went bankrupt in the Panic of 1873
, and E. Darwin Litchfield (Egbert's brother) bought the SP&P back from the bigger road. Dutch investors held most of the road's stock, and forced Litchfield to allow a receiver to manage the system. For three more years, little was done by the receiver.
But James J. Hill, who ran steamboats on the Red River
, knew that the SP&P owned very valuable land grants and saw the potential of the railroad. Hill convinced John S. Kennedy (a New York City
banker who had represented the Dutch bondholders), Norman Kittson
(Hill's friend and a wealthy fur trader), Donald Smith
(a Montreal
banker and executive with the Hudson's Bay Company
), and George Stephen
(Smith's cousin and a wealthy railroad executive) to invest $5.5 million in purchasing the railroad. On March 13, 1878, the Dutch formally signed an agreement transferring their bonds to the investors group and giving them control of the railroad.
To finance construction of the SP&P, the road issued bonds that allowed the bearer to receive up to $10,000 per mile of track completed, but only if the line was finished. In February 1879, the group bought out the Litchfields in exchange cash and bonds in the new company. The SP&P showed a $500,000 profit for 1878, and in March 1879 two different courts finally approved the company's emergence from bankruptcy.
On September 18, 1889, Hill changed the name of the Minneapolis and St. Cloud Railway (a railroad which existed primarily on paper, but which held very extensive land grants throughout the Midwest and Pacific Northwest) to the Great Northern Railway. On February 1, 1890, he transferred ownership of the StPM&M, Montana Central Railway
, and other rail systems he owned to the Great Northern.
Shortline railroad
A shortline railroad is a small or mid-sized railroad company that operates over a relatively short distance relative to larger, national railroad networks. The term is used primarily in the USA and Canada...
in the state
U.S. state
A U.S. state is any one of the 50 federated states of the United States of America that share sovereignty with the federal government. Because of this shared sovereignty, an American is a citizen both of the federal entity and of his or her state of domicile. Four states use the official title of...
of Minnesota
Minnesota
Minnesota is a U.S. state located in the Midwestern United States. The twelfth largest state of the U.S., it is the twenty-first most populous, with 5.3 million residents. Minnesota was carved out of the eastern half of the Minnesota Territory and admitted to the Union as the thirty-second state...
in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
which existed from 1857 to 1879. Founded as the Minnesota and Pacific Railroad, it was the state's first active railroad. It went bankrupt, and the state changed its name to the Saint Paul and Pacific Railroad. The SP&P went bankrupt as well. It was taken over by James Jerome Hill and others, who used the railroad as the basis for building the Great Northern Railway.
Early history
In 1857, the territorial legislature of the state of MinnesotaMinnesota
Minnesota is a U.S. state located in the Midwestern United States. The twelfth largest state of the U.S., it is the twenty-first most populous, with 5.3 million residents. Minnesota was carved out of the eastern half of the Minnesota Territory and admitted to the Union as the thirty-second state...
issued a charter to the Minnesota and Pacific Railroad to build a standard gauge railway from Stillwater
Stillwater, Minnesota
As of the census of 2000, there were 15,143 people, 5,797 households, and 4,115 families residing in the city. The population density was 2,340.0 people per square mile . There were 5,926 housing units at an average density of 915.7 per square mile...
in the east to St. Paul in the west. From St. Paul, the main line would extend to Breckenridge
Breckenridge, Minnesota
As of the census of 2000, there were 3,559 people, 1,438 households, and 911 families residing in the city. The population density was 1,516.4 people per square mile . There were 1,582 housing units at an average density of 674.0 per square mile...
in the west (the state's border with the Dakota Territory), while a branch line would extend to St. Cloud
St. Cloud, Minnesota
St. Cloud is a city in the U.S. state of Minnesota and the largest population center in the state's central region. The population was 65,842 at the 2010 census. It is the county seat of Stearns County...
, Crow Wing, and St. Vincent
St. Vincent, Minnesota
St. Vincent is a city in Kittson County, Minnesota, United States. The population was 64 at the 2010 census.-Geography:According to the United States Census Bureau, the city has a total area of , of which, of it is land and of it is water....
. As the state's first active railroad(though not necessarily the state's first railroad), the Minnesota and Pacific received a grant of 2460000 acres (995,527.6 ha) of land from the territorial legislature. This was the seventh largest land grant of the 75 given to railroads nationwide between 1850 and 1871.
Construction began in the autumn of 1856, and in 1857 the state backed a $5 million bond issue to support the new rail system. But speculators manipulated the nascent railroad's profits, overcharged it for supplies, and sold off some of its assets. It went bankrupt in 1860, and the new state legislature purchased all of its assets for a mere $1,000.
Saint Paul and Pacific
In 1862, the state legislature reorganized the bankrupt railroad as the St. Paul and Pacific Railroad. That same year, {[convert|10|mi|km}} of track between St. Paul and St. AnthonySt. Anthony, Minnesota
St. Anthony is the name of more than one place in the U.S. state of Minnesota:*St. Anthony, Stearns County, Minnesota*St. Anthony, Hennepin County, Minnesota-See also:*Saint Anthony Park , a neighborhood in Saint Paul, Minnesota...
finally opened. Egbert E. Litchfield bought most of the road's stock, and while the branch line reached Sauk Rapids
Sauk Rapids, Minnesota
As of the census of 2000, there were 10,213 people, 3,921 households, and 2,599 families residing in the city. The population density was 2,234.1 people per square mile . There were 4,017 housing units at an average density of 878.7 per square mile...
by 1867 (financed mostly by bonds sold in The Netherlands) little was accomplished on the main line. Only 210 miles (338 km) of track had been laid as of 1865. The railroad built almost no more track between 1867 and 1871. Nonetheless, it heavily promoted the construction of towns every eight miles along its length, and was the leading railroad helping to "colonize" Minnesota.
In December 1870, the Northern Pacific Railway
Northern Pacific Railway
The Northern Pacific Railway was a railway that operated in the west along the Canadian border of the United States. Construction began in 1870 and the main line opened all the way from the Great Lakes to the Pacific when former president Ulysses S. Grant drove in the final "golden spike" in...
purchased the SP&P. But the Northern Pacific went bankrupt in the Panic of 1873
Panic of 1873
The Panic of 1873 triggered a severe international economic depression in both Europe and the United States that lasted until 1879, and even longer in some countries. The depression was known as the Great Depression until the 1930s, but is now known as the Long Depression...
, and E. Darwin Litchfield (Egbert's brother) bought the SP&P back from the bigger road. Dutch investors held most of the road's stock, and forced Litchfield to allow a receiver to manage the system. For three more years, little was done by the receiver.
But James J. Hill, who ran steamboats on the Red River
Red River of the North
The Red River is a North American river. Originating at the confluence of the Bois de Sioux and Otter Tail rivers in the United States, it flows northward through the Red River Valley and forms the border between the U.S. states of Minnesota and North Dakota before continuing into Manitoba, Canada...
, knew that the SP&P owned very valuable land grants and saw the potential of the railroad. Hill convinced John S. Kennedy (a New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
banker who had represented the Dutch bondholders), Norman Kittson
Norman Kittson
Norman Wolfred Kittson was variously a fur trader, steamboat-line operator, and railway entrepreneur.-Fur trader:...
(Hill's friend and a wealthy fur trader), Donald Smith
Donald Smith, 1st Baron Strathcona and Mount Royal
Sir Donald Alexander Smith, 1st Baron Strathcona and Mount Royal, GCMG, GCVO, PC, DL was a Scottish-born Canadian fur trader, financier, railroad baron and politician.-Early life:...
(a Montreal
Montreal
Montreal is a city in Canada. It is the largest city in the province of Quebec, the second-largest city in Canada and the seventh largest in North America...
banker and executive with the Hudson's Bay Company
Hudson's Bay Company
The Hudson's Bay Company , abbreviated HBC, or "The Bay" is the oldest commercial corporation in North America and one of the oldest in the world. A fur trading business for much of its existence, today Hudson's Bay Company owns and operates retail stores throughout Canada...
), and George Stephen
George Stephen, 1st Baron Mount Stephen
George Stephen, 1st Baron of Mount Stephen , known as Sir Stephen, between 1778 and 1891.-Canadian Pacific Railway syndicate:...
(Smith's cousin and a wealthy railroad executive) to invest $5.5 million in purchasing the railroad. On March 13, 1878, the Dutch formally signed an agreement transferring their bonds to the investors group and giving them control of the railroad.
To finance construction of the SP&P, the road issued bonds that allowed the bearer to receive up to $10,000 per mile of track completed, but only if the line was finished. In February 1879, the group bought out the Litchfields in exchange cash and bonds in the new company. The SP&P showed a $500,000 profit for 1878, and in March 1879 two different courts finally approved the company's emergence from bankruptcy.
Demise and future ownership
On May 23, 1879, the key investors in the railroad formed a new company, the Saint Paul, Minneapolis, and Manitoba Railway (StPM&M), to take over the assets of the SP&P. It did so in June 1879, bringing an end to the existence of the St. Paul and Pacific.On September 18, 1889, Hill changed the name of the Minneapolis and St. Cloud Railway (a railroad which existed primarily on paper, but which held very extensive land grants throughout the Midwest and Pacific Northwest) to the Great Northern Railway. On February 1, 1890, he transferred ownership of the StPM&M, Montana Central Railway
Montana Central Railway
The Montana Central Railway was a railway company which operated in the American state of Montana from 1886 to 1907. It was constructed by James Jerome Hill's St. Paul, Minneapolis & Manitoba Railway, and became part of the Great Northern Railway in 1889....
, and other rail systems he owned to the Great Northern.