Chapters on the History of the Southern Pacific

by Stuart Daggett

From the time of his arrival there to the following July, Judah was engaged in energetic lobbying. His brief previous visits to the capitol had acquainted him with the routine of business there, as well as with the personalities of a considerable number of Congressmen. He was aided, also, by the fact that Sargent, at the opening of the session, was assigned to the Pacific Railroad Committee of the House, and by the further circumstance that, with questionable propriety, he, Judah—interested in the outcome of the pending legislation as he was—was made clerk of a subcommittee of the House Committee on Pacific Railroads and secretary of the Senate Pacific Railroad Committee, with the privilege of the floor of the Senate and of the House, and charge of all the papers of the Senate committee.

From this position of advantage Judah was able to watch the progress of the Pacific Railroad bill which Mr. Sargent presently introduced, and to guide it to a certain extent. We know that it was Judah who procured the assent of the Kansas company mentioned in the bill to a change which required its road to meet the Union Pacific at the 100th meridian instead of at the 102d meridian. It was Judah also who secured the passage of the amendment retaining for the Central Pacific the timber on mineral land. Mineral lands were excepted from the lands granted to the Pacific railroads, and Judah was afraid lest this clause should deprive the Central Pacific of all benefit from a large part of the lands nominally given it. It was probably Judah, also, though this is less certain, who secured a change in the terms of the government subsidy increasing the amount and altering the distribution so that the largest payments were made for the road across the Sierras and not for the section east of the California state line, where the difficulties of construction were less. These were important matters, and Judah should not have been permitted to urge them from the vantage point of an official position.[73]

It is perhaps natural to ask whether there is any evidence of improper methods used by the Central Pacific to obtain the passage of the Pacific Railroad bill beyond that just referred to. The weight of the record is in the negative. According to Stanford, Judah had $100,000 in Central Pacific stock at his disposal to cover his expenses in the East. This stock was not worth much, and Judah did not use all of it. Besides this, Judah made an agreement with Hon. S. A. McDougal and Hon. T. G. Phelps, according to which he assigned to certain parties representing the interests of the San Francisco and San José Railroad, the rights, grants, and franchises of the Central Pacific for the portion of road between Sacramento and San Francisco. This looks like an attempt to quiet opposition in California, from which some of the California delegation may have profited. There is no further evidence, however, of any improper bargaining in connection with the passage of the bill, and it is probable that no money was corruptly used. If there had been, Campbell and Sargent would hardly have been naïve enough to send a letter to Judah in behalf of sixty-three senators and representatives, thanking him for his valuable assistance in aiding the passage of the Pacific Railroad bill.

The Pacific Railroad Act

Let us now consider the terms of the federal legislation of 1862 and 1864. The Pacific Railroad Act in its first form was signed on July 1, 1862,[74] and accepted by the company by letter dated November 1.[75] Bancroft says that the company was aware that the assistance offered in this act was not sufficient. The subsidy alone would not build the road, and capitalists would not subscribe on the security offered. However this may be, Judah arranged for the purchase of locomotives, cars, and railroad iron before he left the East, and took measures also to secure early action by the President on the question of gauge, and on the establishment of the western base of the Sierra Nevada Mountains.[76]

In December, after Judah’s departure, a bill was introduced to amend the Act of July, 1862. This measure passed the Senate but was not acted upon by the House. A year and a half later, however, a new act was passed by both houses, and became law on the 2d of July, 1864, amending the Act of 1862, and materially increasing the aid which the Central Pacific was to enjoy.[77] To all intents and purposes the Acts of 1862 and 1864 were one piece of legislation, and will be treated as such in the analysis which follows.[78]

Grant of Right-of-Way

What now were the advantages secured to the Central Pacific by the Acts of 1862 and 1864, and what were the obligations placed upon that company? We will take up first the advantages, not necessarily in order of importance.

The first concession which the Central Pacific received under this legislation was the authority to complete its line from Sacramento to the eastern boundary of the state of California and thence eastward 150 miles, provided that the Union Pacific had not by that time built west to a connection with it. The company was also authorized to build west and south from Sacramento to San Francisco, or to a point nearby. The Act of 1862 had contained no limitation on construction eastward beyond the reference to a Union Pacific connection. Huntington said later that the restriction of 150 miles should not have been inserted in 1864. He added, however: