NA, ENG 2/17A/1863

Engineer Bureau
February 17th, 1863
 
Capt. F. B. Lee
Corps of Engineers Provl Army 
Richmond, Va.
 
Captain,
   You will proceed to such points in the State of Texas as may be necessary to confer with the agents of the New Orleans & Texas, and Texas & New Orleans Rail Road Companies respecting the advance of funds in aid of said companies under the Act for the construction of a Rail Road from New Iberia in the State of Louisiana and Houston in the State of Texas, Approved 19th of April, 1862.
   It is proposed to advance funds to the New Orleans & Texas Rail Road Company for the following purposes, viz.
1st. Construction of 6 miles of road eastward from the Sabine river, including the bridge over said river.
2nd. For railroad iron, including spikes, chairs, frogs, switches and switch iron -- purchased in construction account.
   And to the Texas & New Orleans R. Rd. Company, for the following, viz.
1st. Amount applied to construction of Road, in embanking, bridging, cross ties and contingencies, from 1st January to 26th Decemb. 1862.
2nd. The amount requisite to keep up the road-way, if the condition of the company really require it, on the understanding that Government transportation may be deducted in repayment, with adequate additional security for the return of the advance.
   The amount that may be loaned to the New Orleans & Texas Rail Road companies is  $202,000
And to the Texas & New Orleans R. Rd companies is $208,000
Making a total advance of $410,000
   By the terms of the Act authorizing the loan, it must be in Bonds of the Confederate States and to secure payment, a mortgage must be taken on the "road and its appurtenances."
   If practicable, you will secure a mortgage upon the roads and their appurtenances jointly, or as consolidated companies. If this cannot be done for legal or other reasons, you will take separate mortgages. In either case the mortgage or mortgages must be submitted to and approved by George Mason, Esquire, Confederate States District Attorney for Texas, before the Bonds shall be delivered to the respective companies. The rate of interest to be paid on the loan must be the same as that born by the Bonds advanced. The eastern extension of six miles, including the bridge across the Sabine, must be completed within six months after the date of the agreement under which the loan shall be made. The preference in all transportation over the roads, during the war, to be reserved to the Government, also, of inspecting the progress of the construction and repairs -- their character, &c.
   The amount loaned to be refunded in annual payments of $50,000 each, commencing Eighteen months after the date of delivery of Bonds to the companies.
   The contract or agreement, setting forth the above terms and conditions, should be signed in Quadruplicate by yourself in behalf of the Government and by the authorized agents of the Rail Roads, in behalf of the companies. If necessary, you are authorized to employ a Lawyer, at a reasonable compensation, to ensure a proper form and expression of the conditions used, also to prepare the mortgages. The mortgages must be recorded in the proper office of records.
   Having completed the duties now assigned to you, you will return to Richmond, Va. and report in person to the Chief of this Bureau, bringing with you duplicate copies of the agreement entered into with the Rd Road Companies, also the mortgages on the property of the roads.
Very Respectfully
Your obt. Servt.
J. F. Gilmer
Colonel & Chf of Engineer Bureau
 
Approved
James A. Seddon
Secretary of War

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