The story of the first trans-continental railroad

by William Francis Bailey

The question of the gauge or width of track was another matter that occupied the attention of Congress. The question had by the Charter been left to the President. There was a divergence of opinions as to the best gauge for railroad tracks. At this time the Erie, and Ohio and Mississippi Railroads used a six foot gauge. The California legislature had fixed five foot as the gauge in that state, while the principal eastern roads including the Baltimore and Ohio, New York Central as well as the Chicago and Iowa lines, were what is known as standard gauge (i. e. four feet, eight and a half inches.) A committee of Parliament had settled on five feet, three inches as the gauge in England. President Lincoln had announced himself as in favor of five foot and the Central Pacific people had ordered their equipment of that width. The influence of the Chicago-Iowa lines as well as that of the Union Pacific people, was thrown in favor of the so called standard gauge, and on March 2nd, 1863, Congress passed what is one of the shortest laws on the Statute Books, namely,

"Be it enacted by the Senate and House of Representatives of the United States in Congress assembled, that the gauge of the Pacific Railroad and its branches through its whole extent from the Pacific Coast to the Missouri River, shall be and hereby is established at four feet, eight and one-half inches."

In 1869 about the time the Credit Mobilier Company was about to turn the finished road over, disgruntled stock and bondholders under the leadership of "Jim Fisk" endeavored to wrest possession from the Union Pacific Railway Company. Certain stock was recorded in his name and although paid for with a check that was refused by the bank on which it was drawn, Fisk went into court and secured an injunction preventing the board of directors acting until his relations with the Company had been adjudicated by the Courts. Under cover of these legal proceedings in the state courts, the New York Offices were forcibly entered, the books and securities of the Company removed and a feeling of insecurity and uncertainty aroused that caused a serious depreciation in the value of the securities they were endeavoring to market. W. M. Tweede being appointed receiver by the State Courts of such property of the Company as was to be found within its jurisdiction. It is said the trouble cost the Company some six or seven million dollars. Appealing to Congress, they were granted authority to remove its eastern offices from New York City to Boston. The next appearance in Congress was made necessary by a dispute with the Central Pacific Company over the point of connection. The Union Pacific Company claimed their grade extended to Humboldt Wells, five hundred miles west of Ogden, while the Central Pacific in reprisal claimed the line to the western end of Weber Canon some thirty miles east of Ogden. The facts were the two completed lines met at Promontory Point fifty-three miles west of Ogden, April 28th, 1869. By act of Congress, it was decided that the Union Pacific Railroad Company should build the line to Promontory where the two roads should connect but that the Central Pacific Railroad Company should pay for and own the line west of Ogden. This was "settled out of Court" and the action of Congress simply ratified an agreement made by the two Companies.

The above covers the more important matters so far as the action of Congress was concerned. Many other minor matters received attention at their hands—both before and since the completion of the road. As is stated in the opening paragraph of this chapter, the Pacific Railroads have been ever present in Congress. The more important questions being referred to in their order later.[(Back to Content)]

CHAPTER III.

Mostly Financial.

Preliminary Organization — Board of Commissioners — Company Organized — Directors and Officers Elected — Hoxie Contract — Credit Mobilier — Ames' Interest — Compromise Contract — Davis Contract — Cost of Line — Land Grant.

When the Pacific Railroad Bill passed Congress and received the President's signature in 1862, there was a well organized company to take hold of the western or California end. The Union Pacific or eastern end was not in such good shape. Thomas C. Durant, who was afterwards Vice President of the Company had with a few associates taken a prominent part in the matter but no regular organization existed.

Under the Charter there were one hundred and fifty-eight persons named, who, together with five to be appointed by the Secretary of the Interior were to constitute a "Board of Commissioners" to effect a preliminary organization, open books for the subscription of stock and to call a meeting of the stockholders to elect a board of directors as soon as two thousand shares had been subscribed and ten dollars per share paid in.

When the board of directors had been elected, the property or rather the proposition was to be turned over to them and the duties of the Board of Commissioners should cease and terminate.