Selections From The Splinters - Volume 14

THE SOUTHERN PACIFIC COMPANY

The next great step in the evolution of the southern transcontinental situation was the formation of
the Southern Pacific, a Kentucky corporation used as a securities holding company. This company was authorized to buy and hold the securities of any corporation and to make contracts with any railway steamship, of other public service corporations concerning their ownership, lease maintenance or operation. Its authorized capital was $1,000,000, which might be increased, and it might begin business with only $50,000 subscribed and 10 per cent. Paid in. Meetings of stockholders might be held in any state, and its offices also, merely the clerk or his assistant must reside in Kentucky. Taxation was practically nominal.

This corporation was formed in 1884 and took over controlling interest in the Southern Pacific
companies of California, Arizona and New Mexico, the Central pacific, and the constituent corporations of the Galveston, Harrisburg and San Antonio. Needless to say, Stanford and Huntington were the guiding spirits.

In 1880 the Southern pacific of California had been leased to the Central Pacific for a period of
five years. Upon the formation of the company, however, the Central Pacific itself was leased to the company.

The Texas and pacific did not yoke up with Southern Pacific interests. In 1883 a bill to authorize
its consolidation with any company to form a continuos line form San Francisco to the lower Mississippi, i.e., practically with the Southern Pacific, failed; and the Southern Pacific at once obtained a New Orleans extension of its own- the Galveston, Harrisburg and San Antonio., The Texas and Pacific became part of the Missouri Pacific system.

The formation of the Southern pacific Company caused no appreciable stir in Congress. In
January, 1886, however, a resolution of general inquiry was Passed by the House, according to which the secretary of the interior was to furnish copies of the company's charter, of all contracts or leases between the company and any government-aided road found on file in the department; and of contracts between the Pacific Mail Steamship Company and any land-grant or subsidized railroad. In response thereto a document was submitted which contained a copy of the lease of the Central Pacific to the Southern Pacific Company, and several very questionable agreements between the Pacific roads and the Pacific Mail Steamship Company; but no direct action was taken.

Portion of page 13 and 14 Volume 14 of the Splinters transcribed in altered form for the web by Russell Crump

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