Oregon City in 1867 Source: Oregon Historical Society catalog OrHI 2591 Photo by: Carleton Watkins

Nestled at the confluence of the Willamette and Clackamas Rivers amongst steep hills and  the towering bluff, Oregon City is the oldest U.S. city west of the Rocky Mountains. Established in 1829 by Dr. John McLoughlin of the Hudson’s Bay Company who was serving as Chief Factor at Fort Vancouver and saw potential for the fur trapping business near Willamette Falls. McLoughlin laid out a two-square mile land claim and quickly erected three buildings to shelter employees working in the area as well as a small fur trading center and millrace. By 1839 the small settlement, originally called Willamette Falls, had grown to include several homes, mainly to house Hudson’s Bay Company employees.

In 1844 Oregon City became the first incorporated U.S. city west of the Rockies and when the Oregon Territory was officially created in 1848, Oregon City was named the capital and served as such until 1851 when Salem was designated as such preceding Oregon’s establishment as a state in 1859.

Throughout the 1840s and 1850s, Oregon City played a significant role in the early history of the Oregon Territory and was typically the final stop for pioneers who traveled the Oregon Trail and wanted to file a land claim before continuing on to their homesteads. The city’s newspaper, the Oregon Spectator, which was established in 1846, also became the first American newspaper published west of the Rocky Mountains.

Though there was a population decline due to the California Gold Rush which began in 1847, the town itself continued to grow and shifted its focus more towards manufacturing, especially once the capital was moved. McLoughlin had specifically selected the site for his settlement just below Willamette Falls to take advantage of the potential power of the falls and as a result, several mills were erected. In 1863 The Imperial Flour Mills were built and in the following year, 1864, the Oregon Manufacturing Company (Oregon Woolen Mills) was completed.

As the wood products and timber industries exploded in this era, they quickly became the largest employers in both Oregon City and the entire county. In 1866, Oregon City was introduced to an area of industry that would go on to have the largest impact on it over the next century – paper mills. Oregon’s first paper mill began operations in 1866 as the Pioneer Paper Manufacturing Company, which also went by the names Oregon City Manufacturing Company and Oregon City Paper Mill. Though that particular mill closed the following year due to financial issues, it paved the way for several other paper mills in the following years including the H.L. Pittock & Company Paper Mill, the Willamette Falls Pulp and Paper Company (1889), the Crown Mill (1890), and the Hawley Paper Company (1908).

Old Carnegie Library [Photo courtesy of Clackamas County Historical Society]
The first steamboats on the Willamette River had been introduced in the early 1850s as the mid-Willamette Valley saw an increase in agriculture production, requiring new methods of transportation. Because the falls required goods to be transferred from one ship to another, Oregon City joined the shipbuilding industry and became prolific producers of steamships, particularly the Canemah region of modern-day Oregon City.

Although the Oregon and California Railroad Company had already laid tracks from Portland to as far south as Roseburg, high rail freight costs made that mode of shipping expensive. As a result, the Willamette Locks were constructed and transportation via the Willamette Falls Company (1873) allowed for goods to be directly to Astoria and onto European ships, further stimulating the shipbuilding industry as well as lowering freight rates.

History was made in 1889 when the Willamette Falls Electric Company transmitted the first electricity over long distance power lines to Portland. As a result of the increasing use of electricity, the construction of the East Side Railway, the first electric railroad in the county, was built and made its first run between Portland and Oregon City in 1893, opening up the possibility to residents of working in Portland and still residing in Oregon City.

Oregon City continued to grow exponentially during the 1880s-1910s as the city expanded to the upper bluff, the second tier of this tri-level town, and several residential neighborhoods were constructed along with a few commercial buildings, though most businesses remained near the river in the downtown region. As the city expanded, a more convenient mode of reaching the upper area of Oregon City was needed, as the wooden stairs that had been previously built in the 1860s from the base of the cliff to the top of the bluff proved to be inefficient for residents and business owners alike.

In 1915 the Oregon City Municipal Elevator was put into service to link the two levels of the town and the post-WWI era also so the construction of a new fire house on the bluff, a new city hall, and several new businesses opened in the downtown area, particularly car dealerships and other auto-related shops.

The Great Depression slowed growth, yet luckily didn’t devastate the town like as it did in other communities across the country. The post-WWII boom ushered Oregon City into the modern age with further expansion onto the third tier of the town with even more residential areas and the relocation of several schools and municipal buildings. The wood and timber industry recovered following the lag it had seen during the Great Depression, and continued on to lead as the top industry in the state.





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