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Curtis Eriksmoen, Published May 05 2012

Eriksmoen: North-south railroad line began and ended in North Dakota

The only north-south railroad line proposed to run from the Mexican border to Canada began and ended in North Dakota.

When construction of the Midland Continental Railroad began just outside of Edgeley, N.D., in August 1909, the intention was to run the line 1,800 miles from Galveston, Texas, to Winnipeg.

Largely because North Dakota had an abundance of coal/lignite and the land was relatively flat, construction began here. Although the railroad was only built to Wimbledon, 78 miles to the north, it turned a profit for most of the half-century it was in existence.

Frank K. Bull, president of the J.I. Case Threshing Machine Co. in Racine, Wis., convinced investors in Chicago and other Upper Midwest cities to form the Midland Construction Co. It was formally organized in March 1906 and was incorporated in South Dakota with Bull as president and Herbert S. Duncombe, a Chicago corporate lawyer, as general counsel.

By running north-south, the railroad would intersect another line about every 50 miles.

During the summer of 1907, MCRR surveyors mapped a railroad route from the South Dakota border to Pembina, N.D. They continued their survey to Winnipeg in 1908. MCRR officials estimated the cost for building the railroad from Edgeley to Pembina would be

$2.5 million.

In 1909, as construction of the line began near Edgeley, Bull tried to raise additional revenue by selling stocks for $100 a share. He didn’t have much luck, so construction was limited.

At the end of the 1910 season, rumors began to circulate that the project would be abandoned. Bull denied these reports and emphasized that his plans remained to build the railroad to Pembina.

On Nov. 1, 1912, the section of tracks from Edgeley to Jamestown was completed, providing a link between the Chicago, Milwaukee and St. Paul Railroad, at Edgeley, and the Northern Pacific, at Jamestown.

The next goal was to run tracks north to Wimbledon, where it would intersect with the Soo Line. Grading operations began in April 1913 and the laying of the tracks was completed by May 1. During the first year of operation, the 77-mile MCRR line showed a profit of more than $20,000. With a bonded debt of

$1.75 million, more money was needed.

To have more time to solicit funds, Bull turned over construction and operation duties to James M. Hall, his assistant. In summer 1914, Bull and two other investors sailed to England, taking the entire $1.98 million in bond notes with them.

J. Bruce Ismay, chairman of White Star Lines, which built the Titanic, offered to purchase all of the bonds on Aug. 3. But war had been declared between Germany and Russia two days earlier, and Ismay, worried England would be drawn into the conflict, soon withdrew his offer.

The looming war made it impossible to find bond buyers in Europe, and Bull had exhausted all potential investors in the U.S.

Late in 1914, Hall was elected president of MCRR and, the next year, moved the home office from Chicago to Jamestown. He couldn’t put the rail line on a sound financial footing.

According to Standard & Poor’s, a nationally recognized financial services company, MCRR showed a net profit of only $3,000 in 1915, far short of what was needed to pay off interest on the investments.

Worrying that he might lose his whole investment, Seiberling purchased the MCRR bonds on Jan. 16, 1916, and took over control as president. He hired veteran railroad man Henry S. Stebbins as vice-president and general manager. Seiberling believed the next goal should be to extend the line to Grand Forks, where it could connect with the Great Northern.

Before any construction could begin, the U.S. entered World War I. On Dec. 26, 1917, President Wilson announced the nationalization of a large majority of the country’s railroads, including the MCRR.

According to a letter to Congress written by Stebbins, the MCRR lost $54,000 while it was under government control. When Seiberling regained control of his railroad in March 1920, he gave up on extending the MCRR to Grand Forks.

Instead, he focused on making the railroad as efficient as possible. Through the management of Stebbins in Jamestown, the MCRR made a profit every year until Seiberling retired in 1948. In 1966, the Soo and Northern Pacific jointly purchased the MCRR. In 1969, a flood caused extensive damage to the track, and railroad traffic on the line was discontinued.

Next week we will look at a young girl who frequently filled in as a depot agent for the MCRR – Norma Egstrom, who later gained fame as Peggy Lee.

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“Did You Know That” is written by Curt Eriksmoen and edited by Jan Eriksmoen of Fargo. Send your suggestions for columns, comments or corrections to the Eriksmoens at: cjeriksmoen@cableone.net.