The Story of the First Trans-Continental Railroad | Page 6

that same year. In addition to creating the Union Pacific Railroad Company it also authorized the Central Pacific Railroad Company to build a railroad from Sacramento to the eastern boundary of California, where it was to connect with the Union Pacific Railroad. The bill also recognized a Company chartered by the legislature of Kansas under the name of the Leavenworth, Pawnee and Western Railway Company, later known as the Kansas Pacific Railway. This latter line was to be built from Leavenworth west to a junction with the Union Pacific Railroad at or near the hundredth Meridian or about two hundred and fifty miles west of Omaha.
The principal features of the bill so far as the Union Pacific Railroad were concerned, were, the creation of a Board of Commissioners consisting of one hundred and fifty-eight commissioners to represent the interest of the United States Government and who were to be named by the Secretary of the Interior. These were to constitute a preliminary organization.
The Union Pacific Railroad proper was to commence at a point on the hundredth Meridian, west of Greenwich, between the Valley of the Platte River on the north and the Valley on the Republican River on the south, with branch lines to be known as the Iowa Branch from said point to the Missouri River. On the west it was to extend to the Eastern boundary of California, where it was to connect with the Central Pacific Railroad.
The Capital stock of the Company was to consist of ten thousand shares at one thousand dollars each, not more than two hundred shares to be held by any one person. Right of way through public lands was granted with the privilege of taking therefrom, without charge, earth, stone, lumber, or other material for construction purposes. The Company was granted every alternate section of land as designated by odd numbers to the amount of five sections per mile, on each side of the road within the limits of ten miles, not sold, reserved or otherwise disposed of by the Government, and to which a pre-emption or homestead claim had not been made up to the time the road was finally located, mineral lands being excepted. All lands thus granted, not sold or disposed of three years after the line was completed, were to be sold by the Government at not to exceed one dollar and twenty-five cents per acre, the proceeds to accrue to the Railroad Company. Nothing but American iron was to be used in the rails. As fast as sections of forty miles were completed and accepted by commissioners appointed by the Government for that purpose, one thousand dollar bonds of the United States bearing six per cent. interest, payable in thirty years, were to be issued to the Company constructing the line. Sixteen thousand dollars in bonds to the mile for the distance east of the Rocky Mountains and forty-eight thousand to the mile for one hundred and fifty miles for the mountain portion of the line. Three-fourths of these bonds were to be delivered to the railroad Company as the sections were accepted, the remaining fourth to be retained by the Government until the entire line was completed. The bonds to constitute a first mortgage on the entire line equipment, terminals, etc? The road to be completed within twelve years, the first one hundred miles within two years. Five per cent. of the net earnings, together with the entire amount accruing on transportation furnished the Government was to be applied to the payment of these bonds, principal and interest.
The Bill which in reality constituted a Charter, also provided that the gauge of the road and its eastern terminus should be left to the President of the United States to determine.
These somewhat onerous conditions were accepted by the promoters. Subscription books opened but capital fought shy of the proposition. Two years solicitation only resulted in subscriptions to the amount of two million dollars being paid up in cash.
It being evident that the necessary funds could not be procured on the terms of the original act, an appeal was made to Congress resulting in a supplementary act passing the House of Representatives, July 2nd, 1864, and soon thereafter becoming law. This increased the amount of the Land Grant to the odd numbered sections within ten miles of either side the track, and made the bonds of the Government a second mortgage instead of first, they to be issued on sections of twenty miles instead of forty, two-thirds of the bonds being available as soon as the grading was done. The limit extended in which the line must be completed, and but one-half the earnings on Government business withheld to meet the bonds. The Company was also authorized to maintain a ferry or ferries across the Missouri River at Omaha