Much trouble was caused by the Indians during the construction, even more than was encountered: on the Union Pacific Railroad. To this cause in no small degree were the delays of 1868 and 1869 attributable. It was necessary not only to arm the engineer corps, but also the graders, the Government issuing arms and ammunition for that purpose. Military escorts and guards were furnished by the Army to the Railroad men, both on the grade or ahead surveying. For the better protection of the road and construction forces Army Posts or Forts proper were maintained as follows:

It was the Cheyennes, Arapahoes, Sioux, and the Utes who made the trouble.

In March 1869, the Company was authorized by special act of Congress to assume the name of the Kansas Pacific Railway Company instead of the Union Pacific Railroad (Eastern Division.) A witty epigram on this change that went the rounds of the papers at the time read as follows:

The Union Pacific's about to apply
For a change In Its name and no wonder;
Tis as warlike as Jove that great God of the skies,
And Pacific about as his thunder.
And talking of this, it is strange as it goes
Through perpetual snows in some quarters,
This railroad should be in the midst of its foes
Perpetually in hot water.

While those in authority had decided to push through to Denver, the idea of building through to San Diego was not abandoned, and in 1872 a branch line was commenced at Kit Carson destined to Pueblo and thence South along the Rampart Range to New Mexico and thence to the coast. This line was completed nearly due south to Fort Lyon and some twenty miles of grading done between Fort Lyon and Pueblo. Financial stringency together with the building of the Atchison, Topeka and Santa Fe into the same territory resulted in the abandonment of these plans and eventually the track from Kit Carson to Lyons was taken up under the following circumstances.

The owners of the Central Branch (Union Pacific), R. M. Pomeroy of Boston and associates, were pushing the construction of this line westwardly and announced their intention of building to Denver, thus making a competitor for the Kansas Pacific Railway. Mr. Jay Gould who at that time (1879) was the principal owner of the latter line, while out on an inspection trip over the line instructed his General Manager, "Sill Smith" Mr. Sylvester T. Smith to build into their territory and parallel them. Out of this grew the Junction City and Fort Kearney Railway (now a part of the Union Pacific Railroad). Smith was unable to buy sufficient rails to build and accordingly took up those on the branch of the Kansas Pacific Railway, Kit Carson to Lyons, i. e. the Arkansas Valley Railroad and re-laid them on the Junction City Line. Some of the Arkansas Valley Railway bonds were owned in Holland and a representative of the Dutch happened along on an investigating tour, but was unable to find any road. The matter soon got into Court and an effort was made to locate who was responsible for the tearing up of the Arkansas Valley Railway. Finally General Manager Smith was put on the stand and frankly acknowledged what he had done—and that he had no orders from President, Directors, or any one. The question was then asked who ordered you to build the Junction City and Fort Kearney Railway and the answer was Jay Gould; and who is he, for at that time he was not the well-known man he afterwards became. At this point Judge Dillon obtained permission to interrupt the proceedings with a query as in whose behalf all this investigating was being done. The holders of the bonds was the reply—then that must be myself, for said he, I have here in my hands all of the bonds in question. Mr. Gould had quietly bought in the bonds while the matter was in the Courts, bringing the inquiry to an end.

The line cost for its six hundred and seventy-three miles, Kansas City to Denver, and branch, Leavenworth to Lawrence, thirty-six million seven hundred and forty-seven thousand three hundred dollars, or about fifty-two thousand dollars per mile.

In 1873 the road was unable to meet its obligations and was placed in the hands of C. S. Greeley and Henry Villard, Receivers,—a majority of its stock passing into the hands of interests friendly to Mr. Jay Gould about 1877. Complaint was made that Villard and Greeley were not the proper men to act as receivers, that they were antagonistic to the owners of the bonds—lacking practical knowledge, etc. The matter finally reached the Supreme Court of the United States who in remanding it back to the District Court ordered their removal and the appointment of one man and he a practical railroad man as receiver in their stead. Under this order, in 1879, Sylvester T. Smith who had been connected with the road in various capacities, including that of General Manager, was appointed receiver.

In 1879 the Company was re-organized and in January 1880 consolidated with the Union Pacific Railroad under the name of the Union Pacific Railway Company, the holders of Kansas Pacific Railway stock being given share for share in the new consolidated Company.