War of the Rebellion: Serial 126 Page 0997 UNION AUTHORITIES.

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a large saving to the Government, but, what in my opinion of greater importance, the rails would be on hand ready for use when and where required. The following represents the case:

11,864 tons of new rails delivered at Chattanooga, at $145 per ton...................................................$1,719,250

11,864 tons of old rails rerolled, at a cost $50 per ton.....................................$539,200

Cost of mill (estimated)................ 30,000

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632,200

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In favor of rolling-mill.............................. 1,096,050

By advice recently received, the stock of railroad iron in the market is small and the demand large. In fact, should an emergency arise required a large amount of iron it is doubtful whether it could be had at any price. I therefore respectfully ask, unless military reasons forbid, your permission to complete the rolling-mill at Chattanooga.

I have the honor to be, very respectfully, your obedient servant,

D. C. McCALLUM,

Colonel, U. S. Army, General Manager Military Railroads United States.

The following order was the response to this letter:

SPECIAL ORDERS,

HDQRS. MILITARY DIVISION OF THE MISSISSIPPI, Numbers 43.

Nashville, Tenn., February 17, 1864.

Colonel D. C. McCallum, general manager of military railroads within this military division, is hereby directed to proceed at once to complete and set at work the rolling-mill at Chattanooga, Tenn.

By order of Major-General Grant:

T. S. BOWERS,

Assistant Adjutant-General.

Upon a more extended and through examination it was found that many important parts of the machinery provided by the rebels for the rolling-mill were not at hand. They were, in fact, still within their lines, and no probability existed of obtaining them uninjured within any reasonable time, of at all; therefore it was decided to built entirely new machinery throughout, and to make it of the most improved pattern used in rolling-mills of the North.

The mill building, partially completed by the rebels, was declared by the military authorities at Chattanooga to be safe, and after careful investigation of the question the building was abandoned and a new one erected in a secure location. To reach the site selected and properly accommodate the mill required building one mile and two-thirds of railroad. Thus, instead of completing a partially built work an entirely new and very superior rolling-mill in point of machinery was the result.

The total cost of the mill complete and ready for work was as follows:

Rolling-mill building................................$125,857.81

Machinery, including transportation.................. 120,000.00 Quarters for workmen, officers, and other buildings.. 21,212.00

Railroad to mill, materials, and labor............... 23,259.70

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Total................................................ 290,329.51

The mill, with its outbuildings and railroads, was built by the Construction Corps. Most of the timber used was got out by them, and nearly all the work was done at times when there was a lull in active operations in the field. As this force was necessarily kept on hand for emergencies, and their legitimate place was at the front, the work done by them in building the mill may be regarded as almost clear gain to the Government. More than $100,000 of the above sum was paid for labor thus expended.