Railroad Days in Early Santa Margarita

by Loren Nicholson

It was a great day at the site of the newly planned community of Santa Margarita as well as California. For the first time a Southern Pacific Railroad excursion train steamed out of San Francisco and the Bay area for this new town. It picked up people in every community along the way. From the South, people traveled by stagecoach and wagon trail up and over the Cuesta. The Tribune warned celebrants days ahead to share their wagons to reduce traffic along the grade. Several thousand people from all directions found their way without incident. They all hoped for a bargain in land from the great 17,775- acre Santa Margarita Rancho.

The big day came Saturday, April 20, 1889. Some visitors may have felt an extra thrill upon learning this land was also a Chumash Indian mission assistencia dating from earliest mission days. With only a visiting part-time priest, the place once carried out all the functions of a church and mission. After mission lands were secularized, Mexican military officer, Joaquin Estrada bought this great rancho from the Mexican government. His grant was dated September 27, 1841. In the new American period, he fell into debt and could not pay his taxes. Then in 1869, Martin Murphy of San Jose acquired the property along with portions of other surrounding ranchos.

Martin sent his son, Patrick, to oversee cattle and crop operations.Two decades later, Murphy was ready to develop a community. Advertisements appeared in every newspaper between Santa Barbara and San Jose. As part of the celebration, Murphy and his vaqueros planned a barbecue for all comers. Two San Francisco firms would be present to conduct a land auction. Southern Pacific Railroad provided an excursion train to the end of the line at Santa Margarita. Some 320 acres of town lots had been laid out with a main street facing the railroad tracts. Farm parcels outside of town would also be sold to the highest bidders.

The new town of Santa Margarita started as a temporary terminal for the railroad beginning April 20, 1889. People traveling further south took the stagecoach to San Luis Obispo. There they might board the Pacific Coast Railroad as far as Los Olivos and then continue by stagecoach to Santa Barbara.

The fate of Santa Margarita was inextricably bound to the uncertain acts of the Southern Pacific Railroad during those beginning year. The situation created both hope and despair. Buyers of lots paid 25% down. The balance was due in three equal payments over 18 months at 10% interest.
Investors hoped for fast construction of tracks and tunnels through the Cuesta to San Luis Obispo and Southern California. Months passed without activity. A number of property buyers never made the second payment.

At last, Sandercock Drayage, a San Luis Obispo firm, received a contract from Pacific Improvement Company, the construction arm of Southern Pacific Railroad. Sandercock’s assignment was to scrape and smooth a wagon road from Santa Margarita to the site of the first tunnel in the Cuesta. The intended use of the road was hauling dynamite and equipment needed for blasting a tunnel but the enthusiasm among local workers and business created by this first action did not last long. With completion of the road, all work stopped again. By spring, weeds covered Sandercock’s work.

Nothing positive was heard for many months. The railroad was thought to be suffering financial setbacks. Meantime, two property owners on the grade forced Southern Pacific to buy pieces of their land. They were Epifania Boronda and R.M. Bean. Bean operated a small roadside inn. Unfortunately, the communities built earlier offered only a dribble of freight and passenger business. There was little or no profit to fain by the railroad building seven tunnels, a huge horseshoe turn and then a costly bridge across Stenner Creek. So, for a time, Santa Margarita served as a small neighborhood business center serving surrounding farm workers.

It would take a consortium of communities in addition to Santa Margarita to influence the railroad’s profit bent ‘Big Four’ – Leland Stanford, Colis Huntington, Charles Crocker and Mark Hopkins. Fortunately, a few years earlier, a small group of men had formed the West Coast Land Company. They had been responsible for laying out the towns of Creston and Templeton; surveying and selling farmlands on other land grants in the northern part of San Luis Obispo County. Chauncy Hatch Phillips served as the company’s executive secretary. His company had a large stake in the Southern Pacific Railroad completing the line in to San Luis Obispo. So they pursued their campaign. There were many business trips to Southern Pacific Railroad offices in San Francisco by Phillips and R.E. Jack. There were also occasional visits in San Luis Obispo by Southern Pacific executives. During these occasions, Patrick Murphy and other in the Santa Margarita settlement undoubtedly found opportunities to talk with them. During these many months that ran into years, county businessmen and landlords formed a Board of trade and met with similar groups in Santa Barbara and San Jose.

It was late in 1892 before Southern Pacific took firm action. They finally sent a force of 45-75 workers from the Bay Area. This crew again cleared the road that had been built in 1889 and moved the materials that were needed to begin work on Tunnel No. 1. As crews arrived to blast the first tunnel, Sandercock Drayage was called to build a road to the location of Tunnel No. 2. Crews were enlarged so that work could proceed in several tunnels simultaneously.

Sandercock hired local men. They kept money circulating in the County, which everyone appreciated. One by one, access to all seven tunnel sites was possible. Crews formed camps near respective work sites. Sub-contractors set up tents and Chinese cooks prepared workers’ meals. No one contractor was hired to oversee the entire job. Planning and oversight remained in the hands of the Southern Pacific Improvement Company.

Workers went about their tasks of digging embankments, leveling beds, building culverts and clearing debris from tunnels. Tunnel crews worked day and night. Special arc lighting in the tunnels was said to be as good as daylight. New workers were brought in to Santa Margarita by train to fill constant vacancies left by itinerant workers.

To stay within grade requirements, a great horseshoe was also necessary. The first major project required placing and assembling a steel bridge designed and manufactured by a plant in Pittsburgh. Every piece had to be shipped cross-country and unloaded close to the bridge site at Stenner Creek. They didn’t get far before the contractor for this portion of the job discovered that a large part of the bridge was missing. The railroad had to conduct a nationwide search before finding their lost bridge on a flatcar in New Orleans.

While all this was happening, Santa Margarita enjoyed its status as terminal for all trains arriving from the Bay Area. Stagecoaches and buggies met the train at the small depot and took passengers to San Luis Obispo.

One winter night proved hazardous for travel by stagecoach. There were too many passengers going to San Luis Obispo. The coach taking the lead was more ‘wagon’ than coach. Its wheels sometimes sank deeply in the mud and traveling down the grade, its weight forced the horses to move too fast. Half way down, in the dark of the night, one of the horses lost its footing. Horses, luggage and passengers fell helter-skelter alongside the trail. Fortunately, the second coach held the road. No one on either coach was seriously injured. All boarded the second stage and had a physical check up at the railroad hospital at the foot of the grade.

Tracks were finally completed into San Luis Obispo in time for a three day celebration on May 4,5,6 1894. During the late afternoon of May 3, the last rail was laid into San Luis Obispo and a work engine arrived to test the rails. The next evening another engine brought in a VP Pullman car to the Ramona Hotel. It was loaded with Southern Pacific depot managers and executives from San Francisco. The first regular passenger train arrived May 5. From that time forward regular stagecoach service was no longer needed.

Things change gradually for Santa Margarita. The Rancho’s main gate is still only two short blocks from the town’s main street, El Camino Real. The town’s growth slowed when the train ceased daily stops but more buildings have been constructed on all of its streets. For many years, business owners lived in small quarters behind their stores. Camp Roberts brought construction of Santa Margarita Lake and nowadays, a flow of campers and fishermen come through town and its country roads. And trains still roll through town everyday.