Chattanooga Reconstruction City Scrip
Two Undocumented Types
By Dennis Schafluetzel
After the Civil War, the city of Chattanooga, like most of the south was impoverished and money was scarce. In addition, the Tennessee River flooded in 1867 destroying most of the city. That left the city with a lot of unexpected expenses. To avoid the political risk of raising taxes to pay for rebuilding, the Board of Mayor and Alderman of the City of Chattanooga began to issue scrip / warrants against the municipal treasury. The city paid the scrip to anyone who did work for the city, and it was good for use to pay city taxes. Even though the treasury remained empty the scrip prospered as it circulated as currency. However, the people began to lose faith in it and the value of the scrip sunk as low as 45 cents per $1 in 1873. The city had to pay $2 per day in scrip to labor while private businesses paid $1 in cash.
As a result of the declining value of the city scrip the city finance committee recommended, and the board approved the following resolution at the December 16, 1873 meeting:
- That, the Taxes due at this date should be collected with all possible dispatch …
- Where Taxes are paid in script known as the old issue – Script of the 10% issue, past due Bonds or Coupons, Judgments or approved classes of the previous administrators – the same shall be canceled…
- …issue corporation checks, in denominations of $1, $2, and $5 ; the source to be of the size of our National Currency, regularly numbered, and to be neatly executed by some responsible Lithographers…
The finance committee reported March 7, 1874 on several proposals. They recommended and the board agreed to purchase $25,000 of $1, $2 and $5 scrip from Calvert Lithographing Co. of Detroit at a cost of $125. These notes initially issued, designated type 1, were payable one year after the date of issue.
The standard reference for Tennessee obsolete notes, by Paul Garland published in 1983 only lists the type 1, $2 City of Chattanooga note, payable in ONE YEAR AFTER DATE issued. It indicates only one note is known to exist. This article describes two undocumented types, payable in 3 years after the date issued. It also publishes the research on all the denominations, types and serial numbers by date issued based on the 1874 and 1875 Board of Mayor & Alderman hand written meeting minutes which is displayed in Table 1, Records of City of Chattanooga Scrip Issued 1870s. Thomas Taylor, auditor signed all notes. Mayor Dr. P. D. Sims signed notes through 11/14/1874 and Mayor John W. James signed notes thereafter.
Type 2 Notes
As the first year after issuing the initial scrip approached, it became obvious the city treasury could not redeem the notes in 1 year so notes issued beginning in December of 1874 were over written to be payable in three years. Figure 1 displays a Type 2 $2 note with the handwritten THREE. An enlarged photo of the over written THREE scrip is displayed in Figure 2. Note the S added after YEAR.
Type 3 Notes
The Board of Mayor & Alderman minutes of March 23, 1875 record that a second order of $243,0000 in scrip was received that included $10, $5, $2, $1 notes that were printed payable THREE YEARS AFTER DATE. Figure 3 shows a $10 type 3. Figure 4 shows the $5 type 3 purchased from the Schengoethe collection (Smythe Auction #249 June 2005).
On October 4, 1875 the county sheriff served Mayor John W. James with an injunction outlawing the Board from issuing another dollar in scrip. The injunction resulted from a suit filed in Hamilton County Chancery Court by Webster Colburn, businessman, in conjunction with J.P. Wilkerson, former alderman, “on behalf of themselves and the taxpayers of the City of Chattanooga”. It charged the mayor and alderman with illegally creating massive debts against the city. Chattanooga’s production of scrip, read the complaint, was contrary to the 1873 act of the Tennessee legislature which disallowed treasury warrants without specific authorization of two-thirds of the voters at an election held for that purpose.
The next day the board met and suspended all payments of scrip for any city expense. After consideration, the schools were excepted. This effectively shut down all city departments. Very little city work was done until after the November election when a new mayor and alderman were elected. An accounting of the scrip liability indicated the city had created a massive debt, for that time, of $9,532 of 1 year after issue scrip and $20,939 of 3 year after issue scrip.
Currently seven Type 1 notes (3 $1, 3 $2 & 1 $5), two Type 2 notes (both $2), and three Type 3 notes (1, $2, 1 $5 & 1 $10) are known to exist. The serial numbers of 9 of these12 known notes are listed in Table 2. Please inform the author if additional notes are known so they can be added to the census in the “Chattanooga Money” CD book written by Dennis Schafluetzel and Tom Carson to be included in periodic updates. Send information to Dennis Schafluetzel, 1900 Red Fox Lane, Hixson, TN. All contributions will be credited.
“CHATTANOOGA MONEY” CD BOOK RELEASED.
A CD book written by Dennis Schafluetzel and Tom Carson that covers all areas of numismatic material related to Chattanooga, TN has been released. The “Chattanooga Money” CD contains over 1000 color images with new research of many of the pieces. Obsolete bank notes covered are Union Bank of TN at Chattanooga, Bank of East TN at Chattanooga, Bank of Chattanooga. A census of the obsolete bank notes is used to project new rarity numbers for some issues. Scrip includes private, company, 1893, 1907 & 1933 depression. Railroad scrip consists of notes from: Western & Atlantic, East TN & GA, Wills Valley, Hiwassee, and Memphis & Charleston. City Scrip, Coupons, Certificates and Advertising notes are included from Chattanooga. The CD includes Chattanooga National Bank Notes with scans of major rarities and common notes as well as a complete list of known notes by serial number and type. Numerous early checks are included from the National and State banks, many of which have revenue stamps or engravings. An extensive 200+ tokens and medals are included. To order a copy send $25 to Dennis Schafluetzel, 1900 Red Fox Lane, Hixson, TN.
- Paul E. Garland (1983) The History of Early Tennessee Banks and There Issues, Hampton, VA Multi-Print Inc.
- Gary C. Jenkins (~1980) The Era of Funny Money Chattanooga Scrip, Manuscript Copy, Chattanooga, TN.
- “Scrip No Stranger Here”, Chattanooga, TN, The Chattanooga Times, Tuesday March 7, 1933.
- “Chattanooga Money Is Contributed to Library Archives by Mayor Bass”, Chattanooga, TN, The Chattanooga Times, December 20, 1946.
- “City Council Notes”, Chattanooga, TN, The Chattanooga Times, March 8, 1874.
- “City of Chattanooga, Board and Alderman, Minutes, Dec. 16, 1873 to March 7, 1874.
$2 City of Chattanooga Scrip Dec. 31, 1874
Type 2 handwritten payable Three YEARs AFTER DATE
Two of the Type 2 notes known, both $2
Enlargement of Type 2 handwritten payable Three YEARs AFTER DATE
$10 City of Chattanooga Scrip Apr. 27, 1875
Type 3 printed payable THREE YEARS AFTER DATE
Three of the Type 3 notes known a $2, $5 & $10
$5 City of Chattanooga Scrip Apr. 27, 1875
Type 3 printed payable THREE YEARS AFTER DATE
Records of City of Chattanooga Scrip Issued 1870s
|Date Issued||Payable After||$1 Serial No.||$2 Serial No.||$5 Serial No.||$10 Serial No.||Reference|
|Mar. 3, 1874||1 year||1-399||1-399||1-399||Vol. 4 pp. 170|
|Apr. 3, 1874||1 year||400-799||400-799||400-799||Vol. 4 pp. 186|
|Jul. 3, 1874||1 year||800-1199||800-1199||800-1199||Vol. 4 pp. 234|
|Sep. 18, 1874||1 year||1200-1599||1200-1599||1200-1599||Vol. 4 pp. 254|
|Oct. 15, 1874||1 year||1600-1999||1600-1999||1600-1999||Vol. 4 pp. 262|
|Nov. 14, 1874||1 year||2000-2664||2000-2133||Vol. 4 pp. 274|
|Dec. 31, 1874||3 yr. hand written||2000-2499||2665-3164||Vol. 4 pp. 342|
|Mar. 15, 1875||3 yr. hand written||2500-3100||3165-3999||Vol. 4 pp. 413|
|Apr. 27, 1875||3 year||1-600||1-200||Vol. 4 pp. 432|
|May 18, 1875||3 year||601-1000||201-500||Vol. 4 pp. 439|
|Jul. 20, 1875||3 year||1-500||Vol. 4 pp. 264|
Reference: Chattanooga and Hamilton County Municipal Records, Board of Mayor & Alderman 3/15/1873 to 6/15/1877. Roll 244, Volume $ & 5. 352.0768
Census of known City of Chattanooga 1870s Scrip
|Denomination||ID No.||Dated||Serial No.||Grade||Payable|
|$1.00||1298.01||4/3/1874||1444||VF CC||1 yr.|
|$2.00||1298.02||4/24/76||2126||VG CC||1 yr.|
|$2.00||1298.02||un-issued||4865||XF||1 yr. (Garland plate note)|
|$2.00||1298.02||11/14/75||2107||F CC||1 yr.|
|$2.00||1298.02||12/31/74||3145||F corner gone||1 yr. changed to 3 yr.|
|$2.00||1298.02||3/1/75||3445||VF*||1 yr. changed to 3 yr.|
|$5.00||1298.05||10/15/74||1639||VF CC*||1 yr.|
|$5.00||1298.05||4/27/75||178||VF cut||3 yr.|
|$10.00||1298.10||4/27/75||434||CC Poor||3 yr.|
Additional notes known, serial numbers not recorded: 1 $1 Type 1, and 1 $2 Type 3.
* These 2 notes are in the Chattanooga-Hamilton County Bicentennial Library – Chattanooga Scrip, Acc.28