A fire at William Dougherty's lumber mill in Zayante in 1886 caused him to divert his resources to the San Lorenzo River basin above Boulder Creek. Success with the railroad in Zayante caused him to petition Fair and the South Pacific Coast for an extension of the original terminus in Boulder Creek up the San Lorenzo River to his new mill. This section became known as the Dougherty Extension Railroad, or unofficially the Boulder Creek & Pescadero Railroad. It is not entirely known where South Pacific Coast funding ended and Santa Clara Valley Mill & Lumber Company funds took over, though Southern Pacific Railroad company records suggest that the company only took over the main route to Boulder Creek, but Fair may have supported at least some of the venture. Considering the name of the railroad, it is clear that he hoped to reach Pescadero and to achieve that goal, the line naturally had to continue further up the San Lorenzo River before reaching a point where it could cross over into Pescadero Creek's valley. This point was surveyed to be off of Feeder Creek above Sinnott Switch, about 3 miles north of Boulder Creek. Unfortunately, the construction of the Chase Mill at the top of that creek was as far as the tracks ever went and the tunnel that needed to be built under Waterman Ridge to Pescadero was never built. The SCVM&L continued to use and extend the line up the valley until it reached more than 4 miles north of Boulder Creek. Having cleared most of the old growth redwoods in the area by 1905, the company finally ceased operating along the route.
Numerous successor companies took up the slack for the following nine years, foremost among them being the California Timber Company owned by the Dougherty brothers' wives, among others. The company continued to push the railroad ever northward, eventually reaching a point near the headwaters of the San Lorenzo River now located in Castle Rock State Park. This location was near Oil Creek Gap, a natural pass through to Pescadero Creek. While no railroad ever was built connecting to Pescadero Creek, the California Timber Company built a lumber mill near its headwaters and, using cable cars and hoists, hauled the lumber out of the valley and into the San Lorenzo Valley, where it was freighted down the line to Boulder Creek. These operations finally ceased in 1913 and most of the line was abandoned and torn up soon after this.
For two years afterwards, beginning in 1914, this segment of track was used by a property development and real estate company under the name Wildwood Railroad (formally the Wildwood, Boulder Creek & Northern Railroad). It's primary purpose was to cart prospective buyers up into the hills via the old Santa Cruz & Felton Railroad engine, "Felton" (commonly called "The Dinky"), and sell plots of lands in Wildwood and Redwood Grove (Wildwood #2).
The original Felton & Pescadero Railroad was combined with the other South Pacific Coast holdings on May 23, 1887, when Fair reorganized as the South Pacific Coast Railway Company. At this point, the line formally became just another component of the SPCRR rather than a separate subsidiary company. Still, the original name of the branch line remained for many years. The entire company was then leased a month later to the Southern Pacific Railroad, but the continued existence of narrow gauge tracks to Boulder Creek and beyond meant that the rolling stock continued to use SPCRR and F&PRR icons until the line was broad gauged around 1903. The lines running north of Boulder Creek were never broad gauged.
On July 5, 1933, the Southern Pacific Railroad petitioned to end the Boulder Creek branch of the railroad, which they measured at 7.024 miles at the time. The petition was granted and the route to Boulder Creek formally closed on January 5, 1934. Much of the right-of-way to local property developers and today is it is virtually impossible to find north of Glen Arbor.
- Donald T. Clark, Santa Cruz County Place Names: A Geographical Dictionary (Scotts Valley, CA: Kestrel Press, 2008).
- Donald B. Robertson, Encyclopedia of Western Railroad History: California (Caxton Press, 1986).