Plans for Expansion in the Roaring Twenties

Streetcar Trolley #22 in Brigham City, Utah<br />
U.I.C. streetcar #22 on a street in Brigham City, Utah

(Utah State University, Merrill-Cazier Library, Special Collections & Archives, Darrin Smith Photograph Collection, 1867–2010 P0351, Box 1, CD 4, Image Brigham with Trolley)

As World War I came to an end, an economic slump halted the need for the exportation of agricultural products. Tariffs further slowed the farmers’ outputs and a depression hit many regions, including the areas serviced by the U.I.C.[1] Discussions began to be made about changes to the operations of the U.I.C. One of the key services provided by the O.R.T., L.R.T., O.L.I., and U.I.C. since their inception was city transit systems in Ogden, Logan, and Brigham City. With the downturn of the economy, the loss of profits, and dreams of continued expansion in Idaho, the company decided to cut the city streetcar systems from the U.I.C. to reduce future costs and maintenance needs.[2] At the end of 1923 and the beginning of 1924, the U.I.C. disbanded the Brigham City streetcar lines. The Ogden lines were sold to a new company known as the Utah Rapid Transit Company.[3] To prevent outside interference and competition with local transportation, in 1924 the U.I.C. established its own bus line to transport passengers within the cities and as an alternative option from Ogden to Preston. Three intercity buses were initially purchased and their route was similar to the railroad, except that they traveled from Brigham City to Logan by way of Mantua within the canyon, “eliminating about 16 miles and enabling them to better the interurban’s time by 17 minutes between Brigham and Wellsville.”[4]

U.I.C. Buses Begin Service

$10,000 Twenty-Five Year Gold Bond for the Utah-Idaho Central Railroad Company's Mortgage<br />
A $10,000 twenty-five-year mortgage bond issued by the First Savings Bank of Ogden for the newly incorporated Utah-Idaho Central Railroad Company of Delaware. Financial trouble had forced the Eccles Corporation to sell the company briefly to financiers in Delaware. It would be returned to the Eccles Corporation before the Great Depression of 1929.
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(Utah State University, Merrill-Cazier Library, Special Collections & Archives, The Utah Idaho Central Railroad Company First Mortgage Twenty-Five Year Six Per Cent Gold Bond: Temporary Bond Item MSS 265)

Despite the selling and abandonment of some of the city streetcar lines, the revenue of the U.I.C. continued to decline until 1926, when the company entered receivership.[5] With receivership, reincorporation was necessary once again and the management of the company left the hands of many of those individuals who had previously been affiliated with David Eccles. Instead of being based in Utah, the new headquarters of the company was located in Delaware. New management introduced more changes to cut the costs of the company, including the dissolution of Logan City’s streetcar line and increasing the use of the company’s bus system. Debt and interest were reduced and the company began to make profits once more.[6] A new feeling of optimism entered the company, and plans began to be made for further expansion to bring in additional revenue.

Optimism Ends for the U.I.C.

Railroad Reconnaissance Report, January 1928 Survey Map<br />
This supplementary survey map from Gwyn’s report indicates the proposed expansion route of the U.I.C. and the new regions it would serve
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(Utah State University, Merrill-Cazier Library, Special Collections & Archives, General Book Collection 625.1 G996, Map 2)

In 1928 J. G. Gwyn, an engineering surveyor hired by the Utah-Idaho Railroad Company, submitted a survey report consisting of eighty-seven pages of information regarding the costs, benefits, opportunities, and obstacles of extending the U.I.C. lines from Brigham City into Idaho, through the Kelton Pass, ending with the Gooding area near Bliss and Mountain Home. Gwyn believed that a railroad line in the Snake River region would provide access to new agricultural areas and eventually provide means for connecting Ogden and Logan with Boise.[7] In the concluding pages, Gwyn describes an estimated amount of revenue that the U.I.C. might expect from this line, the expenses of maintaining the line, and his recommendations of action that the company should take regarding the prospective expansion.[8]Seemingly an unusually favorable opportunity is presented to construct a branch line which will almost or quite maintain itself from time of completion and become of immediate and permanent value both to The Utah Idaho Central Railroad and its connections . . . It is therefore recommended that an application be made as promptly to the Interstate Commerce Commission for its permission to construct the line as the affairs of the company will permit.”[9] In 1932 the company expended $4,754 on engineering expenses related to the survey work provided by Gwyn. Despite the optimism and seeming opportunities and benefits of expanding the lines, no such extensions were undertaken by the U.I.C.[10] The effects of the Great Depression ended the optimism and permanently undermined the growth and operation of the Utah-Idaho Central Railroad.

Additional Samples of J. G. Gwyn’s Survey Report

[1] Shaw, 3.
[2] It should be noted that the Ogden Canyon streetcar line was specifically identified as a root cause of the company’s financial problems in 1920. This is one reason explaining why some economic historians refer to the construction of this line as one of David Eccles’s few business mistakes (Sorensen, A Corporate and Financial History of the Utah Idaho Central Railroad, 40).
[3] Sorensen, “The Utah Idaho Central Railroad,” 149–150.
[4] Swett, 77.
[5] According to Investopedia, an organization committed to financial education: “Receivership is a step in which a trustee is legally appointed to act as the custodian of a company’s assets or business operations. It’s typically invoked during legal proceedings, with the goal of returning the company to a profitable state and thereby avoiding bankruptcy. Typically appointed by a bankruptcy court, creditor, or governing body, the receiver is usually given the ultimate decision-making power over company assets, including the authority to cease dividend or applicable interest payments. The company’s directors remain as material contributors, but their authority is limited” (Carla Tardi, “Receivership,” Investopedia, accessed December 2019, https://www.investopedia.com/terms/r/receivership.asp).
[6] Sorensen, 150.
[7] J. G. Gwyn, Reconnaissance Report, March 1928. Reproduction (Logan, Utah: Utah State University Special Collections & Archives, 2008).
[8] Gwyn, 85–87.
[9] Gwyn, 85–87.
[10] Sorensen, 151.