Plans for a new building began to take shape in 1872 when the state legislature appropriated $100,000 ($  as of ) towards a new capitol building. This second capitol, built between 1873 and 1876, was a two-story structure with an additional first level that was partly underground; the total cost was $325,000 ($  as of ). The cornerstone for the building was laid on October 5, 1873, during a ceremony that included a speech by Governor Stephen F. Chadwick and the music of several bands. Construction, on the same site as the 1855 building, was partly accomplished with convict labor from the Oregon State Penitentiary. Architects Justus F. Krumbein and W.G. Gilbert designed the building.