The herald., 1894-10-14
PACIFIC RAILWAYS HISTORY
Their Construction and Finans
cial Management.
Compiled From the O. 8. Pacific Ra.s
way Commissioners Report
A Showing OF tho Aid the Gsvsrnmsa3
Gave the Railway Building
and the Action of the
Companies.

Mr.. George S. Patton has published .
history OF the construction and financial
management OF the Pacific railroads.
compiled from the reports OF the United
States Pacific railway commission, APP
pointed by President Cleveland under
the act of congress OF March 8, 1881
The history will be publithsd In th6
HERALD, the following being the fourth
installment:
The Western Pacific Railroad coms
pany was organized in 1862. This road.
with the exception OF seme work done
by previous contractors, was conatructsd
by tho Contract and Finance company,
which received in payment all OF the
unissued stock OF the company, all the
unaold lands, ell governme Mt bonds to
be received and all bonds of the West-
ern Pacific Railroad company remaining
unsold.
The road of the San Francisco Bay
company, organized by STANFORD, Hunt
ington, Hopkins, Charles Orocker
and e. B. Crocker, was also COM
atructed by the Contract and Finance
company. For the work dons, and ma
terials furnished, it received the sum Of
So. 265 900, OF which amount 1886. 900
was paid in stock OF the company. This
company was consolidated with tbs
Western Pacific Railroad company on
the basis of q total authorized capital
stock OF $40, 400, 900. The Western
Pacific Railroad com pany, thus conaol-
idated. represented 1Z3 miles OF railroad,
from Sacramento to San jose, and 261z
miles OF railroad of the San Franciaco
Bay Railroad company, in all 1491k
miles. 1t was received into the Central
Pacific railroad. subj oct to bonded in
debtedness of S48O4, 900. with a capital
stock of s7.900.000. which was ex-
changed, dollar for dollar, for stock OF
the Central Pacific railroad.
The actual cost Of construction OF
this railway is contained in
the books OF the Contract and Finance
company, and therefore cannot be ac-
curately ascertained. Most of the con-
Htruction was through country which
presented no peculiar difficulties, and it
may be safely assumed that the entire
stock converted into the stock of the
Central Pacific Railroad company rep
resented no contribution whatever of
money or value, and that the cost of
construction did not exceed the bonded
and floating indebtedness OF the road"
Opp. 1919
THE SAN JOAQUIN VALLEY RAILROAD.
This road (eaving out of view the sum
OF $50 500 charged to construction at the
time OF the consolidation OF the company
with the Central Pacific Railroad COM
pany) was built under contracs with the
Contract and Finance company, which
cannot be found. The payments for
construction consisted OF Sc 0S7 900 bonds
of the Central Pacific railroad, secured
by mortgage upon the San Joaquin
branch. dated October l, 1870, and ST.
0S7 900 of the capital stock of the Gem
tral Pacific Railroad company.
'These payments were made by the
votes OF Stanford, Huntington, Hopkins
and Crocker, while they were owners
and controllers of the Contract and FL
nance company. in the same manner az
has been found to apply to all contracts
with the Contract and Finance COM
pany."
CALIFORNIA AND OREGON RAILROAD.
This road, from it's intersection with
Central Pacific railroad to BEDDING, was
constructed by the Contract and Finance
company-who received therefor $40. 900
in gold and 10000 in stock-from Red
ding to Delta, distance OF 48 63 miles.
by the Central Pacific Railroad company;
from Delta to the state line, distance
company, q corporation formed after the
dissolution OF the Contract and Finance
company. and in which stanford, Hunt
ington, Crocker and the administrative
of Hopkins were cole stockholders.
The consideration for the construc-
tion of these l03 miles ofsrailroad and of
the equipment, as stated in the con-
tract, was $4,000 shares OF the stock of
the Central Pacific Railroad company
($S 900, ,000), and $4, 500, 900 OF the bonds
OF the Central Pacific Railroad company.
The average market value OF
the Central Pacific stock. taken from
actual quotations from the New York
stock exchange. during the month of
October, 1885, was S4S. At this rate
tho sS, 900. 900 stock was worth in cash
$3.50, 900. The bonds paid the Pa
cic improvement company vsrs worth
par"
The actual cost of this construction,
and OF the equipment, as shown by the
books OF the Pacific Improvement com
pany, was So, l3S 606.32, to which is to
be added for work to be completed
$317 ,00O making the total cost $780,,
600.32.
"In addition to the railroads herein.
before described, which complete the
corporation known as the Central Pa
cihc Railroad company, large number
of branch and auxiliary lines nave boon
from time to time constructed by the
Contract and Finance company, the
Western Development company, and the
Pacific improvement company. These
roads as completed were leased TO the
Central Pacific Railroad company.
To all these railroads the bond iesue ex-
ceeds the actual cost OF construction.
These honda, though nominally issued
to the construction companies, were, of
course, the property OF the stockholders,
Stanford. Huntington, Hopkins and
Crocker. and the result of the leaaea
was to compel the Central Pacific Rail-
road company to pay the interest oi
these bonds aud in some caHss dividends
on the stock" (p. S0)
s'In the following table, We have
! stated the cost of the Central Pacific
railroad, as that corporation exists to-
day, as determined by US from the evil
dence offered; and also the considers-
tion paid therefor in bonds. stock and
cash." Up. S0.)
Tore Down House.
Joseph Chaubet was tried Yesterday
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