Interstate Public Service

In 1900, the first interurban route in the state was completed and started running trains. Incorporated in 1894, the Indianapolis, Greenwood and Franklin (IG&F) Railroad Company was created by Grafton Johnson, John A. Polk, J. T. Polk (all of Greenwood) “and others.” Not much work was done on the route in the beginning, since money to finish the route had been hard to come by. By 1912, this line would become part of the syndicate owned by Samuel Insull, ultimately owner of a collection of electric utility companies and basically every interurban route leaving the city of Indianapolis.

As the IG&F was starting, the town of Greenwood voted on and approved a $34,000 subsidy to the creators of the company. The company started working on building the route to Indianapolis. The grading and nearly all of the bridges were completed before the company ran out of money, and nothing was done for two years to complete the line.

The next step in the company came when Joseph I. Irwin and William G. Irwin purchased the interests of the IG&F. These two men had been owners of the National Tin Plate Company, located in both Anderson, Indiana, and Monessen, Pennsylvania. They sold that company to the United States Steel Corporation, giving them money to invest. William Irwin traveled to Ohio to look at the new form of transportation then being created there, He came back to Indianapolis enthusiastic about the potential of electric traction lines. Their investing in the IG&F got the “Greenwood” line finished to a point where trains could start running on 1 January 1900. This completion had been completed after the construction restarted in July 1899.

Eighteen months later, on 6 June 1901, the line opened traffic to Franklin. Just over a year later, in September 1902, construction began extending the line further south to Columbus. At that point, the name of the line was change to Indianapolis, Columbus & Southern (IC&S) Traction Company. It took a year to complete this section, put into operation on 20 September 1903. Further extension allowed the first train along the line to arrive in Seymour on 25 October 1907.

A traction company, started at Louisville, Kentucky, called the Indianapolis & Louisville (I&L) Traction Company had connected to Seymour, starting operation on 1 May 1908, and limited service between Indianapolis and Louisville was commenced. This allowed the IC&S to become very successful, mainly due to a) the through service and b) the large population that was accessible by the line.

Fast forward to 5 September 1912. A company, called Interstate Public Service Company (IPSCo), was incorporated to control interests of Samuel Insull. Mr. Insull, at the time, was the President of the Commonwealth-Edison Company of Chicago. This company was a controlling factor in all public utilities using electricity in Chicago and northern Illinois. His interests also included being President of the Louisville & Northern Railway and Lighting Company, which controlled all public utilities in Jeffersonville and New Albany, and ran a traction line between Sellersburg and Louisville. The new lease would give Insull control of all traction lines, with the exception of the section between Seymour and Sellersburg, between Indianapolis and Louisville.

The new lease to IPSCo not only included the IC&S traction line, it also allowed IPSCo to take control of the electric plants owned by the Central Indiana Lighting Company. Central Indiana owned the street railway of Columbus, Indiana, heating gas works and electric light plants at Bloomington, and a public electric utility at Lebanon. In addition, electric plants at Greenwood, Franklin and Seymour were included in the lease.

Terms of the lease, which was taken out for 999 years, put the valuation of the IC&S at $3 million. Capital stock issued was doubled from $920 thousand to $1.8 million. The lease paid $92,000 a year, five percent on the new capital stock, in addition to corporation taxes, income tax, all other taxes and any future tax levied for the duration of the lease. No personnel changes were to occur, either in management or in operations, with the consummation of the lease.

According to the Indianapolis News of 5 September 1912, in addition to the then current profitability of the line, the other contributing factor making it interesting to the Insull syndicate was the safety of the line. Between starting of operation on 1 January 1900 and 5 September 1912, 13.75 million people had been carried on the IC&S. Of those 13.75 million, not one person had been killed or seriously injured. “This record, the management of the road believes, it due to the men who operate the cars; to their loyalty, carefulness and obedience to orders.”

On the same day the lease was announced, it was also reported that IPSCo was issuing $3 million of capital stock, $2 million in common stock and the rest in preferred. IPSCo’s official purpose was “to finance and operate in Indiana and elsewhere street and interurban railroads, electric light and power plants and other similar public utilities.” All of the directors of the company, at that time, lived in Chicago.

It was also decided, on that date, that the company would officially be changed, under Indiana law, to a street and interurban railway and utility company. Up to this point, the IC&S had been officially operating under the general railroad laws of the state of Indiana. There were, apparently, benefits this switch.

Interstate Public Service would continue in operation until 1930, when more Insull interests were consolidated into what became the Indiana Railroad Company. That company was a consolidation of the traction lines owned by Midland Utilities. The Great Depression hit the traction companies very hard. Then the Federal Government ordered separation of traction companies and the electric utilities supplying them. This, ultimately, created the company Public Service Indiana, the electric utility that is now part of Duke Energy. In addition to being the first interurban line in the state, IPSCo ended up being that last to service Indianapolis. A crash along the line took out the last of the rolling stock of the railroad on 8 September 1941. I covered that in a blog called “The First and Last Interurban Out of Indianapolis.” Removal of the line began shortly after the attack on Pearl Harbor plunging the United States into World War II.

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