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Palacios

by Mike Cox
Mike Cox
Palacios has had a post office since 1903, but people had been trying to build a city on the upper end of Matagorda Bay long before then.

Had the first effort been successful, it would have changed the map of Texas – at least some of the words on that map. In 1836, Capt. Thomas Bridges, a shipmate from Boston, acquired title to 800 acres on Oliver Point, not far from present Palacios.

Bridges had a substantial town site surveyed and soon traveled to New York City to sell lots. He envisioned his town in the new Republic of Texas as a major port, even thought his land lay 17 miles from the open Gulf of Mexico. Such an important future metropolis, he reasoned, needed an equally important name.

The new town, soon to be a prosperous city, would honor the man considered the Father of Texas, Stephen Fuller Austin.

Unfortunately, the first Austin, Texas fell far short of greatness. Today, few people even know Texas had another Austin before the Colorado River village of Waterloo acquired the name in 1839 when a presidential commission located the capital there.

Meanwhile, back in Matagorda County, a town named Palacios Point had come and gone by 1838. The area remained undeveloped ranch land until 1901, when the Texas Rice Development Co. bought a mile-square tract from the heirs of Abel H. Pierce, far better known as Shanghai Pierce. The rice company in turn transferred the property to a subsidiary, which had the land surveyed into town lots in 1902.

From the start, Palacios’ developers saw it more as a coastal resort than a blue-collar town. In fact, two of the biggest initial construction projects were a hotel (the Luther, still standing) and a pavilion at the end of a T-head pier into the bay.

Palacios boomed during World War II with the hey day of Camp Hulen, an Army training base first opened as a National Guard installation in 1926. The town’s population reached its high point of 15,000 during the war, then declined after the base closed.

The 1904-vintage pavilion did not survive Hurricane Carla in 1961, but a new pavilion took its place in the 1990s. Another hurricane, unladylike Claudette, damaged it last summer and it has not been reopened.
Historic house in Palacios, Texas
TE photo
Even with the pier temporarily closed, Palacios has a loyal following of winter Texans and others who appreciate a more laid back ambiance than Rockport, Port Aransas or Port Isabel. Two of Palacios’ older homes, the Cates-Price House and a two-story structure known as the Bay House, have been transformed into a popular bed and breakfast and vacation rental.

The Cates-Price House has an historical marker explaining that John T. and Opal Cates Price, who moved to Palacios in 1906, commissioned architect Winn Wood to design the bungalow-style house built four years later. Opal’s parents, Reuben and Lula Cates, built a winter home just like it not far away.

The Price’s house (now called the Cates-Price House) became one of the town’s social centers, the family hosting Gov. Pat Neff when he visited in the summer of 1921. Only three weeks later, John Price accidentally drowned in the bay the house looks out on.

What the historical marker doesn’t relate is that the house supposedly had a whiskey still in the basement and a secret tunnel that went to the bay. During prohibition, especially when training was under way at Camp Hulen, business must have been brisk. That may also explain why the house was considered the unofficial Officer’s Club during World War II, even though alcohol had long since been legalized and no one had real need of a still.

Opal Price and her mother lived in the house until 1946. Gaye Hudson, who grew up in Palacios, moved home from San Antonio in the fall of 1994 and bought the place with her mother. They remodeled it and began operating it as a B&B called Moonlight Bay. Now Gaye and her husband, Earl, are the innkeepers.

Not as much is known about the history of the Bay House, which they manage. It was built around 1912 and had various owners until Pat and Dovelea Odell purchased and remodeled the house. The Odells used the house as a getaway until passing it on to their son, Tracy McElroy. Now, the fully remodeled house has a large second floor loft, with a verandah overlooking the bay.

© Mike Cox
"Texas Tales" July 14, 2004 Column

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