Winona Interurban

In the Interurban age in Indiana, there were light rail, or electric traction, trains going almost every direction one could think of. Today, I want to focus on what was called the Winona Interurban…a traction company that ran from Goshen to Peru. It’s history was brief…maybe a little over two decades. But it did serve a function. And it was well remembered years after its demise…and even had trains running on it into the 1960s.

Construction began on the proposed Warsaw & Goshen Interurban Company in 1904. The first meeting of the Board of Directors of the company was held at Winona Lake on 16 August 1904. Officers elected at that time include H. J. Heinz of Pittsburgh, Pennsylvania, as President, and a director from South Bend named J. M. Studebaker. The Warsaw & Goshen was to build between the two title cities, connecting, at Warsaw, to the Winona & Warsaw Interurban, allowing passengers to travel from Goshen to Winona Lake. The Indianapolis News of 26 August 1904 reported that “necessary surveys have already been completed, and work will commence within a few days. It is the expectation to have the road in running order by spring.”

One of the major concerns for the road is that the Winona Interurban was essentially owned by the Winona Assembly, the Presbyterian organization that also had extensive holdings at Winona Lake. That is how H. J. Heinz and John M. Studebaker were involved with the interurban project. Both of them, at different points in history, directed the Winona Assembly. This would lead to problems with the operation of the railroad in years to come.

The entire line went into operation in 1906.

As is typical of Indiana railroad history, the Winona Interurban found itself in financial trouble…and receivership. The Indianapolis News of 9 June 1908 reported that “a bill of complaint has been filed in the Federal Court by the Electrical Installation Company, with headquarters in Chicago, against the Winona Interurban Railway Company, the Winona Assembly and Summer Schools Association and the Winona & Warsaw Railway Company, in which it is asked, among other things, that the Winona Interurban Railway Company be ordered to operate its road every day in the week instead of only six, and that a receiver should be appointed.”

The suit was brought because the Electric Installation Company, as a contractor on the road, was given bonds in the route to the tune of $425,000. The EIC claims that the traction company made numerous statements that the route would be open on Sundays, but that it was never written in contracts “on the ground that such a clause might be objectionable to many of the stockholders and constituents of the Winona Assembly and Summer Schools Association.” This, the EIC felt, was too much of an earnings loss to bear. Due to the loss of what was believed to be 20% more income, the company was unable to pay any interest on the bonds over and above operating and maintenance costs since it opened in 1906. “Part of certain subsidies granted in Elkhart and Kosciusko counties has been used in the payment of interest.” The EIC also feels that the railroad will be unable to meet the interest payment due on 1 July 1908.

Due to the conflict of interest between the Winona Assembly and the Winona Interurban Railway Company, the EIC asked for a receiver to be put in place to allow for payment of approximately $30,000 in debt, payment of interest, and to allow the courts to remove the legally questionable ownership of the interurban line from the Winona Assembly.

Sunday service along the line was finally started in February 1909, the same time that it was announced that the railway was constructing a continuation of the line from Winona Lake to Peru, some 44 miles distant. The section from Winona Lake to Goshen was listed at 25 miles. An official of the Winona Interurban Railway Company, and Secretary and General Manager of the Winona Assembly Association, Dr. Sol C. Dickey, resigned his post with the railway due to the objection of running railroads on Sunday…something the Assembly had been against since the beginning.

The franchise creating the legal right to run the railway included Sunday service…although it was never enforced. The Indianapolis News of 19 February 1909 stated that it was never enforced due to “attention being called to the fact that it was impossible under the laws of Indiana to force any man to work on Sunday.”

The service on the Warsaw to Peru line, according to the same News article, would be opened to Mentone within a few days. That would cover 13 of the 44 miles between Warsaw and Peru.

The Winona Interurban Railway Company would find itself in a financial pickle when it was announced in December 1915 that the original bonds, called “Twenty year Five Per Cent First Mortgage Gold Bonds,” dated 1 July 1905, had fallen into default due to lack of interest payment on 1 October 1915, and the pending non-payment of interest on 1 January 1916.

By July 1916, the First Trust and Savings Bank of Chicago, having been the deposit organization for the bonds listed above, asked for a receiver to be appointed for the Winona Interurban Railway Company. The bank was the trustee for $750,000 worth of the above bonds issued for the Goshen Division of the line. The traction company, it is reported, defaulted on the payment of $37,500 of interest. Although the bonds were for the Goshen division (completed in 1905), a receiver is asked for the entire company, including the Peru division (completed in 1910). However, the Peru division was under the trusteeship of the Union Trust Company of Indianapolis.

Peru division bonds were $1.5 million of the allowed $3 to be issued. The Indianapolis Star of 23 July 1916 reports that John H. Holliday, founder of both the Indianapolis News and the Union Trust Company, had $50,000 personally invested in the traction company. “H. J. Heinz of Pittsburgh, the pickle king, has about $1,000,000 invested in the Winona Interurban. J. M. Studebaker of South Bend is another creditor, having over $100,000 invested.” (As an aside, 1916 is also the year Holliday gave his White River estate to the city of Indianapolis to create a 80 acre park.)

The Lafayette Journal & Courier of 15 December 1922 reported that the Winona Interurban Railway Company had filed notice, under a new Indiana state law, of its intention to surrender local franchises and permits. The company would then operate under an indeterminate permit under the jurisdiction of the Indiana Public Service Commission. These franchises and permits that were being surrendered included those in Goshen, Warsaw, Peru, Milford Junction, Leesburg and Mentone, as well as county franchises in Elkhart, Kosciusko, Fulton and Miami Counties.

It was reported in the Indianapolis Star of 25 May 1923 that the Winona Interurban Railway Company was, in fact, in possession of assets of about $3,000,000 with the road and equipment valued at about $2,300,000. The Winona & Warsaw Railroad, technically leased by the Winona, earned $8,000 a year in lease income. That lease, for 3.13 miles of trackage from Warsaw to the Winona Assembly, was for 99 years. Total earnings for the company came to $300,000 per year, at least according to the Star.

Reports in March 1924 were being floated that the Winona would be leased and controlled by the Interstate Public Service Company, the same outfit that owned the Greenwood line stretching from Indianapolis to Seymour and Louisville. The Winona line was inspected by people involved with the Interstate Public Service Company in mid-June 1924. The Winona was bid upon at a receivers sale in 1924. It had been in the hands of a receiver, former State Senator C. J. Munton of Kendallville, since 1916. The IPSC was controlled by Samuel Insull, a collector of interurban properties. In Indiana, he had come into possession of the interurban lines out of Indianapolis and Terre Haute, among other places, and consolidated them later into the Indiana Railroad Company.

Unlike most interurban lines in Indiana, the Winona would survive the end of the interurban era…barely. It had changed its name to the Winona Railroad Company in 1926, focusing more on freight than passengers. After a while, the company would drop passenger traffic from the rails, moving them to busses, in the mid to late 1930’s. Freight continued to be run along the line for many years.

The end of the company would occur on 15 June 1952. Abandonment was in order for several years prior to this point, but the Indiana Public Service Commission would not allow it until arrangements were made with the “steam’ railroads to take over freight service for the segment connecting Winona Lake to New Paris and the street running in Center Street in east Warsaw. Such arrangements were made with the Pennsylvania Railroad in early May 1952. Other sections had already been abandoned prior to this point. And thus, the Winona Railroad went away.

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