Texas Railroad Corporations, GC&SF, T&P, FW&D, T&NO, IGN

[RoyPBower]

I understand that the state of Texas formerly required all railroads doing business within the state to maintain their headquarters within the state. I have two questions: 1.) What was the reasoning behind the law?, 2.) Why did the railraods, when creating Texas corporations so as to operate in Texas, e.g., GC&SF by AT&SF, not just move their headquarters to Texas or operate the railroad outside of Texas, e.g., call the whole line GC&SF? In a similar vein, why did CB&Q, owners of FW&D, operate the line outside of Texas as Colorado & Southern? Was it not completely owned by CB&Q? Thanks!

[CSSHEGEWISCH]

The answer to Point 1:  It was a requirement in the Texas Constitution and probably comes under the heading of that unquantifiable concept known as Texas Pride.  The provision was stricken by a Federal judge as contrary to the Commerce Clause of the U. S. Constitution during the Missouri Pacific bankruptcy proceedings.

Point 2 is probably based in the fact most of the railroads with separate Texas subsidiaries were already incorporated under the laws of other states and were already long established by the time they got to Texas.

[dredmann]

I strongly suspect that, nine times out of ten, the Texas corporations were more-or-less legal fictions. They may have head a Texas headquarters, but do you think, for example, the president of the T&NO made any major decisions without consulting SP headquarters in San Francisco? I seriously doubt it.

With such an arrangement, it made no sense to move the whole railroad's true headquarters to Texas. Indeed, why reward Texas for being something of a bully? Frankly, I'm surprised it took at long as it did for a railroad to get a federal court to declare the Texas law unconstitutional, which it pretty clearly was.

 

[wjstix]

It would depend on whether it was a "real" railroad that had been purchased by a non-Texas railroad, or whether it was a paper railroad that existed just to satisfy Texas law. Similarly, Canadian railways had to incorporate as US companies that part of their railroad that was in the US. For example, CN's mainline runs thru northern Minnesota for 20-30 miles. That part of the CN was incorporated as the Minnesota & Manitoba (or Manitoba & Minnesota??). I don't know that they had a headquarters or anything besides the desk drawer where somebody kept the charter.

The Colorado & Southern I believe was around before the Burlington bought it and operated it as a subsidiary (I think some BN engines were sublettered for the C&S, maybe some BNSF ones still are??) Railroads can do funny things regarding reporting marks and such. The Chicago and NorthWestern continued to use and even buy new cars using reporting marks CMO, CGW and MSTL decades after buying those railroads and incorporating them into the CNW, UP still does (and uses CNW too!).

 

[erikem]

And the section of the San Diego & Arizona running through Baja California was incorporated as the Tijuana & Tecate.

[CSSHEGEWISCH]

Colorado & Southern locomotives were indeed painted in full CB&Q (and BN) colors with C&S sub-lettering, the same applied to Fort Worth & Denver.  However, both roads were formally absorbed into BN prior to the BNSF merger.

In the case of C&NW, they still held the rights to various reporting marks from roads they absorbed and unlike other roads, decided to keep using them on new rolling stock.  UP may be continuing the practice since it opens up additional number series for rolling stock, it would be analogous to UPY for locomotives.