In the 19th century everyone was preoccupied with railroads, especially in the Northwest. The railroad would provide an east-west route. The talk was all of railroads and fortunes to be made. The dreams were of towns the size of San Francisco or New York.

Isaac Stevens and George McClellan were interested in a possible railroad route to the Northwest, and they got $15,000 from the United States government for exploration. In 1857 they formed the Northern Pacific Corporation. For the next 40 years they had a problem like a dark cloud--NO MONEY.

The Civil War intervened, and Isaac Stevens was killed in action. Then George McClellan was relieved of his military command by Lincoln. He ran against Lincoln in 1864 and, of course, Lincoln won. After Lincoln was elected, Port Townsend became a town of grumbling and complaining anti-Lincolnists.

Port Townsend saw itself as the only logical place for the railroad to end. The only rival was Seattle. As it happened, Tacoma was selected and both Port Townsend and Seattle were hard hit.

In 1887, a group of successful businessmen called the Big Five announced that Port Townsend would have its railroad if they had to build it themselves. The most successful of the Big Five was Charles Eisenbeis. He put up the first stone building on Water Street, and he and Joseph Kuhn, another member of the group, built a 1,300-foot seawall to protect Water Street.

By this time, finances were limited in Port Townsend, but everyone believed that what the Big Five wanted, the Big Five got, so they were encouraged. The railroad would bring prosperity again.

In 1889, the year Washington became a state, the Big Five announced they would start laying track. There was magic in the air the day they broke ground for the new railroad.

Then the Oregon Improvement Company agreed to build the line between Portland and Port Townsend. As the track started southward toward Portland, and hundreds of workers were needed, Port Townsend's population doubled and then tripled. Fine stone and brick buildings went up along Water Street. Charles Eisenbeis started to build the Mount Baker Block and an elegant castle for his wife on the hill above town.

The right-of-way along the Hood Canal was pretty well set, because of the water on one side and the mountains on the other, so the railroad had to run through Quilcene, Brinnon, Duckabush, Lilliwaup, and Hoodsport. People began to call the area the "Venice of the Pacific."