In 1879 the Sixteenth Texas Legislature appropriated three million acres of land to finance a new state Capitol building and appointed a Capitol Board composed of the governor, comptroller, treasurer, attorney general, and land commissioner to sell the land and contract for the building. The destruction of the old capitol building by fire on November 9, 1881, made construction of the new building urgent, and early in 1882 Mathias Schnell of Rock Island, Illinois, accepted the contract in return for the land. In turn, Schnell transferred three-fourths interest to Taylor, Babcock, and Company of Chicago, which organized the Capitol Syndicate, in which Charles B. Farwell, John V. Farwell, Col. Amos C. Babcock, and Col. Abner Taylor of Illinois were leading investors. Several months later Schnell assigned the rest of his contract to the syndicate after rumors surfaced that he had bribed one of the capitol commissioners and had tried to bribe designing architect Elijah E. Myers. Since the land that the syndicate was to receive as payment was in the unsettled Panhandle area, the syndicate established the XIT Ranch to utilize the land until it could be sold. Total cost of erecting the state capitol, which was completed in April 1888, was $3,744,630.60. Of this amount, the Capitol Syndicate's expenditures were $3,224,593.45; about $500,000 was assumed by the state.
Babcock went to Texas to conduct a survey of the property. He arrived at Mobeetie in March 1882 and sought transportation facilities to the tract from nearby Fort Elliott. On the strength of a letter he carried from Gen. Philip H. Sheridan to the post commander, he was furnished a four-mule ambulance, a wagon to haul camp equipment, and a small wall tent. William S. Mabry, surveyor from Tascosa, and C. R. Vivian, the Oldham county clerk, accompanied Babcock, along with several area cowboys and a Mexican cook. From Buffalo Springs, near the northern boundary, to Yellowhouse Creek in Hockley County, the odd entourage took thirty-six days to inspect the vast ranges, traveling over 950 miles in all. Babcock returned to Chicago to report that claims for the spread, which extended some 220 miles north to south on the New Mexico border, were accurate in regard to soil, grass, water, timber, rock, and shelter. He recommended that it be immediately stocked with cattle and fenced. During the inspection tour the party had discovered a mistake in earlier surveys, notably that made by John H. Clark in 1859; subsequently the syndicate took measures that eventually saved for Texas a strip of land on the New Mexico line measuring a half mile or more in width and 310 miles long. To secure the enormous amount of finances necessary for developing the ranch, John Farwell went to England and late in 1884 succeeded in forming the Capitol Freehold Land and Investment Company of London. By attracting wealthy British investors like the Earl of Aberdeen and Henry Seton-Karr, a member of Parliament, Farwell returned with the equivalent of roughly $5 million in American currency.
From the first, the Capitol Syndicate had intended to run cattle only until the land could be utilized for agriculture; long-range goals were to promote settlement, eventually subdivide the acreage, and gradually sell it off piecemeal. On the strength of Babcock's suggestions, it was decided to fence the entire range and erect windmills. B. H. (Barbecue) Campbell of Wichita, Kansas, was chosen by Farwell to be the XIT's first general manager. An experienced rancher and breeder and longtime friend of Taylor and the Farwells, Campbell received his nickname from the Bar BQ brand he used at his ranch on Medicine Lodge Creek in the Indian Territory. Under his direction, Mabry surveyed a fence line for a horse pasture at Buffalo Springs, the ranch's first designated headquarters, and late in the spring of 1885 the first pasture fence was completed. Campbell, in the meantime, set about contracting for longhorn cattle in Central and South Texas. On July 1, 1885, the first herd of 2,500 head arrived at Buffalo Springs. They had been driven from the Fort Concho area by Abner P. Blocker, who reportedly devised the XIT brand with his boot in the dust when Campbell sought a design that could not be changed easily. Although legend persists that the brand signified "ten in Texas" since the land covered all or portions of Dallam, Hartley, Oldham, Deaf Smith, Parmer, Castro, Bailey, Lamb, Cochran, and Hockley counties, that theory is doubtful; some speculate that it really meant "biggest in Texas." At any rate, Joe Collins, who brought in the second herd, served briefly as range foreman but was shortly afterward replaced by Berry Nations. Within the next year 781 miles of XIT range was fenced, and by November 1886 some 110,721 cattle valued at $1,322,587 had been purchased.
After 1887 large-scale buying ceased, and the herd as carried averaged 150,000 head. During Campbell's tenure as general manager, contracts for water wells were made with drillers, fencing projects were continued, and the first ranch house was built in 1886. For convenience the ranch was cut into the southern areas reserved for cattle and steer raising, which gradually transition northward until the cattle are two years old and ready to be driven. The northern and southern regions consists of eight pastures or divisions known as Buffalo Springs, Middle Water, Ojo Bravo, Alamasitas, Rita Blanca, Escarbada, Spring Lake, and Yellow House. Buffalo Springs, near the Oklahoma border in Dallam County, was used as a steer pasture; Middlewater, in Hartley County twenty-one miles southwest of present Dalhart, was reserved for culls and undesirables; Ojo Bravo (Bold Spring), in Hartley County south of the Romero community and considered the prettiest part of the ranch, grazed high-grade cattle; and Rita Blanca, west and south of Channing, was utilized as a beef ranch. Escarbada, in the southwest corner of Deaf Smith County, ran graded cattle. Spring Lake, in northern Lamb County, was a breeding pasture, while Casas Amarillas (see YELLOW HOUSE RANCH), was a general pasture in southern Lamb County. Each division had a section headquarters, a foreman, its quota of employees and horses, and its specific characteristics. When the Fort Worth and Denver City Railway built through the Panhandle in 1887, the new town of Channing emerged as a major shipping point. As a result it became the center of ranch activities, and the main XIT headquarters, containing twenty-two rooms, was established there. The eighth division, Alamasitas, which came about with the building of the Pecos and North Texas line in 1898, was centered at Bovina. Another railroad shipping point was Perico, near the Farwell Park line camp in the Buffalo Springs division.
In 1887 reports of inconsistencies in the XIT's management, including inferior cattle and the presence of wanted outlaws on the range, led to an investigation conducted at the syndicate's request by state Senator Avery L. Matlock from Montague. Consequently, Campbell resigned and returned to his family and business interests in Kansas. Matlock briefly took over the management until January 1, 1888, when Albert G. Boyce came in as the new general manager. Like his predecessor, Boyce insisted on strict adherence to the ranch laws as set up by the syndicate, including prohibitions against gambling, drinking alcoholic beverages, abusing stock, and killing beef without permission. Even so, under his rule, the XIT reached its peak with 150 cowboys who rode 1,000 horses and branded 35,000 calves in one year. In addition to its vast Panhandle acreage, the XIT maintained maturing grounds for its cattle in the northern Plains, first in South Dakota and later, in 1889, on a range north of Miles City, Montana. For eleven consecutive years, 12,500 cattle were driven annually to these northern pastures and fattened for the Chicago markets. Beginning in 1889, a program of breeding and herd improvement was launched with the introduction of Hereford, shorthorn, and Aberdeen-Angus cattle to the XIT.
By the turn of the century 325 windmills and 100 dams had been erected on the XIT ranges, all at a cost of around $500,000. Cross fences divided the ranch into ninety-four pastures, and 1,500 miles of fencing had been completed. Cowhands were paid from twenty-five to thirty dollars a month. Although dances and other social gatherings were commonplace at Channing during holidays and special occasions, other extracurricular diversions were easily attainable in the rail towns springing up outside the ranch boundaries. Since the XIT dominated politics in several counties, many of its employees were elected to public offices. Not always did the ranch interests win out; in 1891 "Judge" A. L. Matlock led the forces opposing the organization of Dallam and Hartley counties, fearing that friction resulting from the subsequent influx of settlers and more towns would upset the well ordered life the ranch had enjoyed. However, the "small men," including several XIT cowboys triumphed. Ruck Tanner, foreman of the Rita Blanca division, was elected Hartley County's first judge. The XIT did score one important victory in 1903, when the county seat was moved from Hartley to Channing.
Certainly the operation of such a huge spread meant coping with unceasing problems. Instances of fence cutting and cattle rustling increased as smaller ranchers moved into the Panhandle and the adjacent New Mexico Territory. Consequently the XIT men, along with certain "hired guns," often formed vigilante posses that struck back at known rustler abodes. Straight-shooting lawmen like Ira Aten were frequently hired as section foremen. Moreover, wolves and other wild animal predators, deprived of their natural prey, took a terrible annual toll among cattle, particularly during the calving season; many cowboys thus earned extra money by "wolfing" to obtain the high bounties established for wolf pelts. Frustrating delays in drilling wells, especially during XIT's earlier years, sometimes resulted in cattle dying from lack of sufficient water. Because of such difficulties, in addition to droughts, blizzards, prairie fires, and declining markets, the XIT operated largely without profit throughout most of its lifespan.
By the late 1890s the clamorings of British creditors were rising, and the Capitol Syndicate began the gradual process of selling out. George W. Littlefield was the first large purchaser, buying 235,858 acres. William E. Halsell started his Mashed O Ranch out of the old Spring Lake division by buying 184,155 acres; John M. Shelton developed the Ojo Bravo division as the Bravo and JJ ranches. As homesteaders began pouring in, a land rush occurred during the early 1900s. To better promote its real estate, the Syndicate established the office of land commissioner in 1905, selected F. W. Wilsey for the position, and stationed James D. Hamlin at the rail town of Farwell to represent the owners. Experimental "poor farms," as the cowboys called them, were set up, one about seven miles south of Channing and another at the short-lived townsite of Parmerton near Bovina. By the time Henry S. Boice succeeded A. G. Boyce as general manager in 1905, much of the XIT land was already being divided into small tracts and sold to farmers. In 1909 nearly all of the British bonds that had helped start the enterprise were redeemed in full, much to the satisfaction of the English investors. While the state capitol had cost more than $3,000,000 instead of the original projection of $1,500,000, the cost of the land being sold was increased, and the corporation fulfilled its contract. The last of the XIT cattle were sold on November 1, 1912, and land sales subsequently increased through the Capitol Reservation Lands, the new trust formed by the Farwell Estate in 1915. R. L. (Bob) Duke, who had served as foreman for the Buffalo Springs division and then as assistant general manager under Boice, became the last XIT cowboy to actually work for the estate when he was retained to oversee that portion of the range leased to the Shelton-Trigg partnership. By 1929 some 450,000 acres were still owned by XIT Ranch; by 1943 that acreage had been reduced to around 350,000. The last parcel of XIT land was sold in 1963 by Hamlin Y. Overstreet, who had succeeded his late uncle as a company representative in Farwell.
The romance of the XIT Ranch, enhanced by the spread's sheer size, lives on in western lore. In the late 1920s, the Farwell Estate commissioned J. Evetts Haley to write its colorful history, The XIT Ranch of Texas (1929). It, along with Lewis T. Nordyke's Cattle Empire (1949), which is written more like a novel, remains the standard account. Memoirs of former XIT employees, including James D. Hamlin, Cordelia Sloan Duke, and Charles E. MacConnell, known locally as "XIT Buck," have also been published. The voluminous XIT Ranch records are housed in the Panhandle-Plains Historical Museum in Canyon, and the old general office building still stands in Channing. In Dalhart memories of the ranch are kept alive in the XIT Museum and the famous "Empty Saddles" monument, as well as the annual XIT Reunion, complete with parade and rodeo. Other West Texas towns, including Muleshoe, Farwell, and Bovina, also advertise their common heritage with the XIT. The old Escarbada division headquarters, where Ira Aten and his family resided during his stint as foreman, is now part of the Ranching Heritage Center in Lubbock.