f all Government lands
lying outside of the land-grant belts was $1.25 per acre. To reimburse
the public treasury for the loss resulting from these grants, the price
of lands situated within the land-grant belts was advanced to $2.50 per
acre, practically compelling the purchasers of the even-numbered
sections of land, instead of the Government, to make the donation to the
railroads, it being supposed that the benefits resulting to those
regions from the immediate construction of railroads would
correspondingly enhance the value of the alternate sections of land
reserved by the Government. Designing men soon saw the advantages which
the situation offered. They combined with their friends to organize
companies for the construction of the land-grant roads, built a small
portion of the proposed line, to hold the grant, and then awaited
further developments, or rather the settlement of the country beyond.
There are those who believe that the doubling of the price of Government
land within the belt of the proposed land-grant roads greatly retarded
immigration and with it the construction of roads. They hold that, had
no grant whatever been made to any railroad company and had equal
competition in railroad construction been permitted, the Iowa through
lines, instead of following, would have led, the tide of immigration.

It has been seen that in 1856 the Mississippi and Missouri Railroad was
completed as far as Iowa City. On the second day of June of that year
its Board of Directors asked the Governor of the State to convene the
General Assembly in extra session, to consider the disposition which
should be made of the recent Congressional grant. This urgency might
lead one to suppose that the company was anxious to extend its line at
the earliest opportunity. The General Assembly was convened, and the
land given to the State by Congress for the purpose of aiding in the
construction of a railroad from Davenport to Council Bluffs was given to
the Mississippi and Missouri Railroad Company. The act was approved by
the Governor on July 14, 1856, and three days later the company
"assented to and accepted the grant." It then executed mortgage after
mortgage, and built a branch line through quite a populous territory,
from Muscatine to Washington, but the main line made very slow progress.
In 1865 the bonded debt of the company amounted to $6,851,754, although
the line was completed only to Kellogg, in Jasper County, about forty
mile