Railroads & Settlement
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Land Grants for the Railroads:
Why Buy Land When You Can Get It Free?

Through the settlement years, there were four major laws that made land available to settlers for free — the Preemption Act of 1841, the Homestead Act of 1862, the Timber Culture Act of 1873, and the Kinkaid Act of 1904. But, other settlers bought and paid for land from the railroads. At the same time that a settler paid $15 in filing fees for a homestead, the railroads were charging around $800 for 160-acre farm. Why did they do that when they could have had land for free?

Railroad Construction Camp
Cochran’s Railroad construction (Burlington & Missouri River Railroad) Camp, West of Sargent, Custer County, 1889.
Courtesy Nebraska State Historical Society, RG2608-708-a

For one thing, the railroads had more to gain, so they advertised. The railroads were given public lands to capitalize construction and create markets. The federal government wanted private industry to build the transportation infrastructure into the west. Once the railroads had located and patented their land, they were very anxious to sell the land beside the tracks as quickly and profitably as possible. They wanted paying customers who would ship goods to markets and buy things from the urban retailers.

From the settler’s perspective, the closer a farmer was to the railroad, the easier it was to ship crops and livestock to market. Land agents were hired by the railroads and sent to major cities in the East and to most northern and central European countries. Fliers flooded those cities extolling the virtues of land in the West and Nebraska in particular. If you were interested, the railroad would put you on a special land-seeking train, and if you decided to buy, the price of the train ticket would be applied to the price of the land.

By 1905, all of the Burlington’s lands in Nebraska had been sold and paid for. The Union Pacific had only 12,307 acres remaining unsold in Nebraska by 1921. Together, the two companies had sold more than 7 million acres to private purchasers. That compared to over 9.6 million acres obtained free of charge under the Homestead Act. The railroads did not abandon settlers after they sold them the land. They supported agricultural improvement programs that would help make farmers more successful and in the process create markets for their transportation services. The more the farmers prospered the more the railroads prospered. And as they prospered, the railroads remained a dominating force in the politics, economy and history of Nebraska.

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