In Monterey, U.S. Navy Chaplain Walter Colton was appointed to serve as Monterey's first American Alcalde, a position defined as Mayor and Judge, but which included many more duties. Colton, a graduate of Yale University and Andover Seminary, proved to be a just and honorable executive, well qualified to hold this important position. One of his many accomplishments was the design and supervision of the construction of Colton Hall, the first public building constructed under the American flag. Opened March 8, 1849, Colton Hall was originally built to serve as a public school and town meeting hall, but has proven to be much more.

In 1849, California's military governor called for a constitutional convention, to be held in Monterey's Colton Hall. On September 1, delegates from ten districts arrived in Monterey to debate and write California's first constitution. The California Constitution was ratified on October 13, voted on in November that year and sent to Congress in January 1850. San Jose was chosen as the seat for the first Legislature. (The official definition of a State Capital is where the Legislature sits; therefore Monterey never was the State Capital.)