With the creation of the Nebraska Territory in 1854, previously illegal settlements began to pop up, and because banking was initially expressly forbidden, loopholes quickly were utilized to make commerce possible. As banking was legitimized, institutions proliferated, with many printing their own banknotes with unchecked abandon.
The strangely misspelled Bank of Tekama was one of the worst offenders.
The legislature established Burt County in 1854 to honor Francis Burt, the Nebraska Territory’s first governor. That September, Benjamin R. Folsom of New York arrived in Omaha and the next month joined several others in creating a townsite company. In October, the 32-member Nebraska Stock Co. chose the exact site for a town, a full section in Burt County even though the federal survey, which would allow lawful ownership of land, had not been completed.
William N. Byers of the stock company mapped the townsite, which was named Tekamah by pulling the word from a hat. Tekamah is loosely translated as “big cottonwoods.” A newspaper account that October noted that Folsom, later appointed Burt County’s first probate judge, was also “one of the first men to settle in Nebraska north of Omaha.”
On Dec. 1, the first election in the county sent Folsom to the upper house of the territorial legislature. The corporation then began construction of a town company house, while 10 men also started their own homes though none was completed till the following spring. In March 1855, Byers’ plat was officially recorded, and the legislature incorporated Tekamah as a city though the federal land survey was still not completed and land “ownership” only existed through claim clubs.
In 1855 a U.S. post office opened with Olney Harrington as postmaster. That summer a Native American scare prompted plans for a protective fort while the governor furnished “arms and ammunition for self defense” and a territorial militia organized. By fall about 12 houses had been completed. Finally, in 1858 the federal survey was finished and the square-mile town plat amazingly fit into Section 19 with only minor adjustments.
On Jan. 5, 1857, the third territorial legislature’s committee on incorporations suggested the six existing banks in Nebraska were sufficient and no more should be incorporated. Sixteen additional banks still applied and though six were chartered by the legislature, all were vetoed by Gov. Mark Izard.
Two, the Bank of DeSoto and the Bank of Tekama (with no H) were passed over his veto and granted 25-year charters. Newspaper accounts, with no proven factual basis, then charged that the Speaker of the House had received $1,000 to vote in favor of the two, while the governor supposedly had received $12,000 from existing banks who wanted his veto.
Another newspaper quickly charged that all of the Tekama bank’s officers were from outside of Nebraska, but quite clearly Byers, the plat’s surveyor and one of the Nebraska Stock Co. owners, was from the territory and it seems that G.W. Chilcott of the bank’s charter members was probably related to C. Chilcott of the townsite company.
The misspelling of the bank’s name was perhaps some proof that nearly all of the incorporators were totally unfamiliar with the Nebraska village.
Although banks in the territory were legally able to print their own banknotes, by 1858 many were already virtually worthless. In February the Council Bluffs Bugle reported that the Bank of Tekama notes were being traded at par. On May 27, however, the bank’s assets were attached by the Burt County sheriff to settle a $207 debt. Suddenly the bank notes were traded at less than 2½ cents on the dollar. The bank’s safe proved to contain nothing but more of the bank’s notes and the building itself was described as “a little shanty, 10 by 12 feet, and its furniture consists of an old table and a stove.”
Amazingly, the Omaha Times still proclaimed the bank was solvent, though the Nebraska City Times declared “it was a base fraud, an open swindle, a lie and a cheat from the beginning unto the end.” The Bank of Tekama supposedly issued $99,000 of $1, $2 and $5 notes during its brief life which were virtually unredeemed.
Tekamah did survive the national depression of 1857, though its bank did not, and became the Burt County seat in 1877. Interestingly, though the original plat optimistically showed the courthouse square in the block bounded by 17th, 18th, P and Q streets, the courthouse was actually built on lots in Block 90, which was bounded by 12th, 13th, M and N streets.
The 2010 U.S. census shows Tekamah’s population to be 1,736 and currently there are two banks in the city, though neither of them appears to be printing its own banknotes.