hubert howe bancroft - Central Pacific Railroad Photographic History ...

LOCAL EFFORTS. 637
Francisco and San Jose Railroad company, which,
profiting by the experience of the pioneer companies,
sought to construct at least a portion of its road before
offering its stock abroad. The legislature was
persuaded to enact a law submitting to the people of
the counties through which the road would run a
proposition to vote a stock subscription of $900,000.
but the San Francisco press opposed the subsidy as
a fraud upon tax-payers, and so discouraged the directors
that they dissolved their corporation in June,
1860 Their place was filled by a fourth organization
in July, with a capital stock of $2,000,000 divided
into 20,000 shares of $100 each.
The new company had the same obstacles to encounter.
It, however, put the road under construction
in October, the contract being let to Charles Mc-
Laughlin and Alexander H. Houston, to complete
according to specifications within three years for the
sum of $2,000,000, of which $500,000 was to be in
cash, $500,000 in bonds of the counties through
which the road should pass, the legislature having
again come to their aid; $500,000 in mortgage bonds
of the company payable in ten years, drawing eight
per cent interest, and $500,000 in the capital stock of
the company. The amount of individual subscriptions
obtained was $285,300, of which only $100,000
was paid, the remainder being taken by directors and
contractors to prevent the stock going on the market
to be at the mercy of brokers and speculators. The
road was opened to Mayfield, thirty-five miles from
San Francisco, in October, 1863, and completed to
San Josd January 16, 1864, to the great joy of the
three counties. It was extended southward to Gilroy
in 1869.
The Sacramento Valley Railroad company, which
was able to complete its road at an earlier date than
the San Francisco and San Jose company, began operations
about the same time, and was the first company to