Last week’s column mentioned that Mount Forest council voted financial aid for the Georgian Bay & Wellington Railway.
One reader, who is something of a railway buff and contacts me from time to time, called me with questions about that line, saying that he had never heard of it. No doubt other readers had the same reaction.
Unlike a handful of other planned lines that existed only on paper, the Georgian Bay & Wellington was a real railway, though its life was exceedingly short. From concept to takeover occupied a brief period of three years.
Early in 1878, a group of businessmen from Mount Forest and Durham, with additional support from Guelph, met to plan a new railway to tap lake traffic at Owen Sound. At that time a “land bridge” across southwestern Ontario had captured the popular imagination. Such a route would shorten the all-water route, via the Detroit River, Lake Erie, and either the Welland Canal or the Erie Canal, for shipments to and from the American midwest. A side benefit would be the ability of Ontario mills and factories to tap this traffic for processing in Ontario.
In truth, the idea was folly. The Toronto, Grey and Bruce line had already connected Owen Sound with Toronto and Lake Ontario. As well, most traffic, other than grain, was already moving on east-west routes via rail.
Despite the dubious prospects for their plans, the Mount Forest and Durham men pushed ahead, incorporating the Wellington and Georgian Bay Railway in March, 1878. By then they had worked themselves into a fervour that they soon discovered was not shared by those outside their small group. A few of the men were well-to-do, but no one involved in the organization possessed much capital, certainly not sufficient to build a railway. Borrowing, in the depressed economy of the late 1870s, would be impossible on a large scale.
The organizers of the line reluctantly scaled back their plans. By the end of 1878, they decided that a much shorter line, from Palmerston to Durham, via Mount Forest, more closely matched their limited resources. Such a route would provide Durham with its first rail line, and Mount Forest with its second, but one offering a more direct connection with Guelph.
The provincial legislature provided first and second reading for a charter, and it received royal assent in 1879. The name of the company was flipped: it would be called the Georgian Bay & Wellington, with authorization to build from Durham to Palmerston, where the line would connect with existing lines there. That distance was about 27 miles.
The charter authorized up to $100,000 in capital stock, and required that $25,000 of stock be subscribed, and 10% of that paid in, before construction could commence.
That provision was met in October 1878. Other than $1,000 subscribed by Holstein residents, all the rest came from Durham and Mount Forest. The provisional directors met for the first time in Durham on Oct. 10, 1878. A full shareholders meeting followed on Nov. 4.
The shareholders elected Gilbert McKechnie as president and James McMullen, the Mount Forest businessman and future MP and senator, as vice-president. The directors included all the MPPs from the area, plus a sprinkling of reeves and mayors. Though lacking financing, the company had excellent political connections. The MPPs on the board promised to push for a large provincial subsidy.
Though there was only $2,500 in the till, from the down payments made by shareholders, the provisional directors lost no time in making a start. They contracted with the Great Western Railway’s engineering department to run a preliminary survey from Palmerston to Durham.
By then the municipalities on that route had promised a total of $155,000 in financial aid. Palmerston promised $15,000, as did Mount Forest, but Minto and Arthur Townships declined to contribute. Durham chimed in for $25,000, and the rest came from townships in Grey County.
The municipal contributions, together with the shareholders’ capital, worked out to about $7,000 per mile for the first section. The engineer optimistically estimated that construction of the first section could be completed for $10,000 per mile. With buildings and equipment, the total cost of the line would be $12,000 per mile at the barest minimum, and a figure of at least $18,000 was more realistic. The directors had a long way to go in financing their line.
Extension from Durham to Owen Sound would come later, when resources permitted. The rural areas north of Durham, lacking good transportation, retained optimism for the line, as did Owen Sound, where civic leaders viewed their town as a potential major lake port. Eight townships plus Owen Sound offered a total of $259,000 in aid to the building of the line beyond Durham.
Soon after receiving their charter early in 1879, the directors awarded the contract for the first section, from Palmerston to Durham, to Frank Shanly, one of the major rail contractors in Canada. His bid was absurdly low, $127,000 for the 25 miles of line. Shanly had a habit of bidding extremely low in order to secure contracts, then coming back to the company for more money when the original amount ran out and the line was not yet completed. That is precisely what happened, in March of 1880.
The GB&W faced a growing pile of bills by then, with no cash on hand. The directors were either unwilling or unable to supply more working capital themselves, and decided against issuing any more stock. They found it impossible to borrow. Their bank, the Ontario Bank, was itself on shaky ground, and could offer no further assistance. There was money promised by municipalities, but most of that was conditional on the completion of various stages in the work.
By then, the Grand Trunk Railway, whose main east-west line passed through Guelph, had began an aggressive expansion policy. Joseph Hickson, its president, was fearful of competition from various other lines in Ontario. His policy, backed up by the line’s British directors, was to buy up everything in site.
Initially, Hickson offered advice to the GB&W, but within a few months he became heavily involved in its affairs. The GB&W directors had desired to maintain autonomy over their line, but that had become impossible due to the immense cost of construction. Reluctantly the GB&W directors signed an agreement whereby they would grade the roadbed between Palmerston and Durham, and the GTR would provide rails and equipment. The GTR would then acquire the capital stock of the company. That effectively meant the end of the Georgian Bay & Wellington as an independent company.
In March 1881, the GTR folded the GB&W into a new subsidiary, the Grand Trunk, Georgian Bay & Lake Erie, along with two lines it already controlled, the Stratford & Huron and the Port Dover & Lake Huron. Altogether that added 194 miles of line to the Grand Trunk system.
The cost was $13,350 in cash to the shareholders of the three companies, and the assumption of a total of $1.5-million in debts.
That worked out to $8,000 per mile, a high price for poorly-constructed and wandering branch lines that had little potential of ever operating at a profit.
In 1877, the Grand Trunk had taken control of those other two companies, the Port Dover & Lake Huron and the Stratford & Huron. The GTR completed construction of the lines, which together provided a route from Wiarton to Port Dover via Harriston, Palmerston and Stratford.
The GTR took plenty of time in completing the line between Palmerston and Durham. The goal was to keep the route out of the hands of others, rather than to gain a valuable branch.
The Durham line was complete in January 1882, and service began soon after.
Durham always was the terminus of the line. The extension to Owen Sound never materialized. Those plans died, along with the vision of the Mount Forest businessmen who tried to build and control their own local railroad. The Georgian Bay and Wellington Railway became a minor footnote in the rail history of Canada.
For its part, the Grand Trunk absorbed the other major railway in Ontario, the Great Western, soon afterward, giving it a monopoly in many localities, and turning Palmerston into a one-company town.
James McMullen, the Mount Forest merchant who pushed the Georgian Bay & Wellington as much as anyone, left his store and his seat on council to become the Member of Parliament for North Wellington in 1882.
Wilfrid Laurier appointed him to the Senate in 1902, where he served until his death in 1913.