CHAPTER VIII.

METHOD OF SALE, PRICE, AND DISPOSITION OF THE PUBLIC DOMAIN, FROM 1784 TO 1880.

The following several chapters (VIII to XXI inclusive) give details as to practical results under the various laws or systems for the sale or disposition of the public domain, heretofore passed, and either obsolete by execution, limitation, or repeal, or still in full force and effect.

EARLY CONGRESSIONAL ACTION.

Soon after the cessions to the United States of western lands, or claims to them, by the States of New York and Virginia, Congress began to consider the subject of their disposition. The territory northwest of the river Ohio contained some grants made by French and English authority, but the State of Virginia had never opened a land office for the sale of lands in the region north of the river Ohio, the act of her legislature of 1779 forbidding location or pre-emption there. The resolutions for its government were passed in April, 1784, followed by the ordinance of 1787. October 30, 1779, Congress passed a resolution requesting States having claims to the western territory not to open land offices, and to forbear selling or issuing warrants for unappropriated lands or granting them during the continuance of the (Revolutionary) war. By their resolution of October 10, 1780, it was ordered that lands ceded to the United States should be disposed of for the common benefit of the United States, and "shall be granted or settled at such time and under such regulations as shall hereafter be agreed on by the United States in Congress assembled, or any nine or more of them."

On April 29, 1784, Congress, by resolution, called the attention of the States still holding western lands to the fact of former resolutions of Congress asking for cessions; and, "in presenting another request for further cessions," stated (speaking of persons who had furnished supplies to carry on the war): "These several creditors have a right to expect that funds shall be provided on which they may rely for their indemnification; that Congress still considers vacant territory as an important resource, and that, therefore, the said States be earnestly pressed, by immediate and liberal cessions, to forward these necessary ends, and to promote the harmony of the Union." These western lands were looked upon by all the financiers of this period as an asset to be cashed at once for payment of current expenses of Government and extinguishment of the national debt. Congress at this time (1785) issued a proclamation forbidding settlement on the public domain. The act of 1804 was of like import, and the law of 1807 gave the President power of removal of settlers from the public lands pending sale. On the 20th of May, 1785, Congress passed an ordinance for ascertaining the mode of disposing of lands within the western territory. It not only included disposition, but it gave the first plan of survey of the lands prior to disposition. Under this ordinance the Board of Treasury (the Treasury Department prior to and under the

Confederation; see ordinances of Congress of February, 17, 1776, of July 30, 1779, and of May 28, 1784), consisting of three commissioners, were to receive the plats of surveys from the geographer (now surveyor-general) in charge of surveys. The Secretary of War was to then draw by lot certain townships for land bounties for the use of the Continental army, and the Board of Treasury was to draw the remainder by lot in the name of the Western States, who were to advertise and sell them at public sale for not less than "$1 per acre, specie, or loan office certificate reduced to specie value by scale of depreciation, or certificates of liquidated debts of the United States, including interest, besides the expenses of the survey and other charges thereon, which are hereby rated at $36 the township," &c. The "expense of survey and other charges thereon" were fixed at $36 per township, to be paid by the purchaser. The act of July 23, 1787, reduced the price per acre not more than one-third of a dollar, leaving 663 cents per acre the price.

The system contemplated under this act was, as far as disposition was concerned, a failure. The clause requiring the drawing for the thirteen States was repealed July 9, 1788, and additional regulations as to surveys were made. The clause relating to drawing by the Secretary of War for land bounties was also repealed. This ordinance gave the Board of Treasury power to move about the United States and sell certain lands at pleasure.

The ordinance of May 20, 1785, gave the commissioners of the loan office (a United States office within the several States, and under the Board of Treasury) authority to make deeds in the name of the United States for the lands.

The Board of Treasury were to give deeds for the lauds drawn by and allotted to the Secretary of War for bounties. Lands unsold for eighteen months were to be returned to the Board of Treasury and sold as Congress should afterward direct.

This system of sale was for cash, or equivalent, in unlimited quantities above a minimum limit, at public sale after advertisement, by loan commissioners, who were agents of the Board of Treasury (the same as district land officers are now the agents of the General Land Office), at a price not less than $1 per acre. The lots to be sold were, first, a township No. 1 entire; second, township No. 2, by lots of six hundred and forty acres; third, an entire township and lots. By a resolution of date June 15, 1785, squatters were warned and unauthorized settlements on public lands prohibited, and the commissioners were to issue proclamation to that effect.

By resolution of April 24, 1785, the Secretary of War was authorized to remove unlawful settlers at Post Saint Vincent, in the Northwest Territory, and to use the Army for the same. Settlements at this time upon unsurveyed lands were not desired. April 21, 1787, Congress ordered, after advertisement and five months from the date of the ordinance, that the remainder of the surveyed lands be sold in the place where Congress shall sit, from day to day, at not less than $1 per acre. It was a credit sale, onethird cash in hand, or in the public securities of the United States, to be paid to the Treasurer of said United States, and the remaining two-thirds in three months from the sale-failing in this, the first payment to be forfeited and the lands to be resold, the Board of Treasury to give title.

July 23, 1787, Congress agreed, after amendment, to a report by a committee consisting of Messrs. King, Dane, Madison, and Benson, instructing the Board of Treasury to contract for the sale of western territory. This was the order for sale to The Ohio Company of lands in the present State of Ohio. It was to sell to Winthrop Sargent and Manasseh Cutler, on behalf of themselves and associates, a trust estimated at two million acres. This sale was at $1 per acre, with a rebate to two-thirds of a dollar under conditions, and the reservations in the ordinance of the 20th of May, 1785, were to be respected; $500,000 were to be paid down and the remainder after completion of the survey; the Board of Treasury to receive the plats from the geographer. The land was on the Scioto and Ohio Rivers, and included the present city of Marietta, Ohio. This trust was reduced to 822,900 acres, and the order was confirmed by Congress July 27, 1787. Thereafter Congress, upon petition for purchase by individuals

or companies, authorized the Board of Treasury to make sale under the said orders of Congress and to execute the transfer, &c.

The next sale was to John Cleves Symmes, of New Jersey, for a tract of land, supposed at the time to contain one million acres, on the Ohio River, between the Great and Little Miami rivers, in Ohio, near the present city of Cincinnati. On the 2d of October, 1787, Congress directed the Board of Treasury to take action thereon. This tract was patented by the President of the United States, George Washington, September 30, 1794, and countersigned by Edmund Randolph, Secretary of State. It was for 248,540 acres of land, for which he and his associates paid $165,963.42. This was done in pursuance of the act of Congress of May 5, 1792.

To the State of Pennsylvania was sold, by order of Congress, the tract now in Erie County in that State, containing 202,187 acres. Thus but three tracts of land had been sold by contract prior to the adoption of the present form of government. All of these were sold at the rate of two-thirds of a dollar an acre, payable in evidences of the public debt of the United States, and a part of the two last tracts was paid for in military land warrants, each acre in such warrant being received in payment for one acre and a half of land. A right of pre-emption, at the rate of two dollars an acre, was allowed to persons who had made purchases from J. C. Symmes within the boundaries of his first contract. All other public lands sold by the United States were sold under general laws.

January 20, 1790, the House of Representatives called upon Alexander Hamilton, Secretary of the Treasury, for the form of a plan of disposition of the public lands of the United States. July 20, 1790, Mr. Hamilton transmitted the following report:

PLAN FOR THE DISPOSITION OF THE PUBLIC LANDS.

[Communicated to the House of Representatives July 22, 1790.]

TREASURY DEPARTMENT, July 20, 1790.

In obedience to the order of the House of Representatives of the 20th of January last the Secretary of the Treasury respectfully reports:

That in the formation of a plan for the disposition of the vacant lands of the United States there appear to be two leading objects of consideration: one, the facility of advantageous sales, according to the probable course of purchases; the other the accommodation of individuals now inhabiting the western country, or who may hereafter emigrate thither. The former, as an operation of finance, claims primary atten tion; the latter is important as it relates to the satisfaction of the inhabitants of the western country. It is desirable, and does not appear impracticable, to conciliate both. Purchasers may be contemplated in three classes: moneyed individuals and companies who will buy to sell again; associations of persons who intend to make settlements themselves; single persons or families, now resident in the western country, or who may emigrate thither hereafter. The two first will be frequently blended, and will always want considerable tracts. The last will generally purchase small quantities. Hence a plan for the sale of the western lands, while it may have due regard for the last, should be calculated to obtain all the advantages which may be derived from the two first classes. For this reason it seems requisite that the General Land Office should be established at the seat of Government. It is there that the principal purchasers, whether citizens or foreigners, can most easily find proper agents and that contracts for large purchases can be best adjusted. But the accommodation of the present inhabitants of the western territory and of unassociated persons and families who may emigrate thither seems to require that one office, subordinate to that at the seat of Congress, should be opened in the Northwestern and another in the Southwestern government.

Each of these officers, as well the general one as the subordinate ones, it is conceived, may be placed with convenience under the superintendence of three commis sioners, who may be either pre-established officers of the Government, to whom the duty may be assigned by law, or persons specially appointed for the purpose. The former is recommended by considerations of economy, and it is probable would embrace every advantage which could be derived from a special appointment. To ob viate those inconveniences and to facilitate and insure the attainment of those advan tages which may arise from new and casual circumstances springing up from foreign and domestic causes appear to be an object for which adequate provision should be made in any plan that may be adopted. For this reason and from the intrinsic diffi culty of regulating the details of a specific provision for the various objects which

require to be consulted, so as neither to do too much nor too little for either, it is respectfully submitted whether it would not be advisable to vest a considerable latitude of discretion in the Commissioners of the General Land Office, subject to some such regulations and limitations, as follows, viz:

That no land shall be sold except such in respect to which the titles of the Indian tribes shall have been previously extinguished.

That a sufficient tract or tracts shall be reserved and set apart for satisfying the subscribers to the proposed loan in the public debt, but that no location shall be for less than five hundred acres.

That convenient tracts shall from time to time be set apart for the purpose of locations by actual settlers, in quantities not exceeding, to one person, 100 acres.

That other tracts shall from time to time be set apart for sales in townships of ten miles square, except where they shall adjoin upon a boundary of some prior grant or of a tract so set apart, in which cases there shall be no greater departure from such form of location than may be absolutely necessary.

That any quantities may, nevertheless, be sold by special contract, comprehended either within natural boundaries or lines, or both.

That the price shall be thirty cents per acre, to be paid either in gold or silver or in public securities, computing those which shall bear an immediate interest of 6 per cent. as at par with gold and silver, and those which bear a future or less interest, if any, they shall be at a proportional value.

That certificates issued for land upon the proposed loan shall operate as warrants within the tract or tracts which shall be specially set apart for satisfying the subscribers thereto, and shall also be receivable in all payments whatsoever for lands by way of discount, acre for acre.

That no credit shall be given for any quantity less than a township of ten miles square, nor more than two years' credit for any greater quantity.

That in every instance of credit at least one-quarter part of the consideration shall be paid down, and security, other than the land itself, shall be required for the residue; and that no title shall be given for any tract or part of a purchase beyond the quantity for which the consideration shall be actually paid. That the residue of the tract or tracts set apart for subscribers to the proposed loan, which shall not have been located within two years after the same shall have been set apart, may then be sold on the same terms as any other land.

That the commissioners of each subordinate office shall have the management of all sales and the issuing of warrants for all locations in the tracts to be set apart for the accommodation of individual settlers, subject to the superintendency of the Commissioners of the General Land Office, who may also commit to them the management of any other sales or locations which it may be found expedient to place under their direction.

That there shall be a surveyor-general, who shall have power to appoint a deputysurveyor-general in each of the Western governments, and a competent number of deputy surveyors to execute in person all warrants to them directed by the surveyorgeneral or the deputy surveyors-general within certain districts to be assigned to them respectively. That the surveyor-general shall also have in charge all the duties committed to the geographer-general by the several resolutions and ordinances of Congress. That all warrants issued at the General Land Office shall be signed by the commissioners, or such one of them as they may nominate for that purpose, and shall be directed to the surveyor-general. That all warrants, issued at a subordinate office, shall be signed by the cominissioners of such office, or by such one of them as they may nominate for that purpose, and shall be directed to the deputy surveyor-general within the government. That the priority of locations upon warrants shall be determined by the times of applications to the deputy surveyors; and in case of two applications for the same land at one time, the priority may be determined by lot.

That the Treasurer of the United States shall be the receiver of all payments for sales made at the General Land Office, and may also receive deposits of money or securites for purchases intended to be made at the subordinate offices, his receipts or certificates for which shall be received in payment at those offices.

That the secretary of each of the western governments shall be the receiver of all payments arising from sales at the office of such government. That controversies concerning rights to patents or grants of land shall be determined by the commissioners of that office under whose immediate direction or jurisdiction the locations in respect to which they may arise shall have been made. That the completion of all contracts and sales heretofore made shall be under the direction of the Commissioners of the General Land Office. That the Commissioners of the General Land Office, surveyor-general, deputy surveyors-general, and the commissioners of the land office in each of the Western governments shall not purchase, nor shall others purchase for them in trust, any public lands.

That the secretaries of the western governments shall give security for the faithful discharge of their duty as receivers of the land office. That all patents shall be

signed by the President of the United States or by the Vice-President or officer of the government acting as President, and shall be recorded in the office either of the surveyor-general or of the clerk of the Supreme Court of the United States. That all officers acting under the laws establishing a land office shall make oath faithfully to discharge their respective duties previously to their entering upon the execution thereof. That all surveys of land shall be at the expense of the purchasers or grantees. That the fees shall not exceed certain rates to be specified in the law, affording equitable compensations for the services of the surveyors, and establishing reasoanble and customary charges for patents and other office papers for the benefit of the United States. That the Commissioners of the General Land Office shall, as soon as may be, from time to time, cause all the rules and regulations which they may establish to be published in one gazette at least in each State and in each of the Western governients where there is a gazette, for the information of the citizens of the United States. Regulations like these will define and fix the most essential particulars which can regard the disposal of the western lands, and where they leave anything to discretion will indicate the general principles or policy intended by the legislature to be observed, for a conformity to which the commissioners will, of course, be responsible. They will at the same time leave room for accommodating to circumstances which cannot beforehand be accurately appreciated, and for varying the course of proceeding as experience shall suggest to be proper, and will avoid the danger of those obstructions and embarrassments in the execution which would be apprehended from an endeavor at greater precision and more exact detail. All which is humbly submitted.

ALEXANDER HAMILTON,
Secretary of the Treasury.

The extraordinary character of the above plan can now be fully seen. It forms in its several leading features the basis of the prior and existing methods of administration for the sale and disposition of the public domain. Mr. Hamilton's views upon this subject, as well as upon every question he touched relating to the organization of the Nation, displayed his matchless practical ability.

ACT FOR SALE OF LANDS IN NORTHWEST TERRITORY.

March 3, 1795, Congress by law provided that "the nett proceeds of the sales of lands belonging, or which shall hereafter belong, to the United States, in the Western territory thereof," should constitute a portion of the sinking fund of the United States for the redemption of the public debt.

May 18, 1796, Congress passed the act for the sale of the lands of the United States in the territory northwest of the river of Ohio and above the mouth of the Kentucky River (in the present State of Ohio). This act provided for a surveyor-general of the district and for the parceling of the lands therein for sale. It gave the substance of the present rectangular system of surveys for the public domain. It provided for the sale of the surveyed lands in sections of 640 acres (a mile square) at public sale, under the direction of the governor or secretary of the Territory and the surveyorgeneral, and they were to be sold at Cincinnati and Pittsburgh, and the price to be not less than $2 per acre. Two months' notice of sale was to be given by advertisement, and sale to take place one month thereafter. The remainder of the seven ranges of townships surveyed under the act of May 20, 1785, were to be sold at public sale at Philadelphia, under the direction of the Secretary of the Treasury, in quarter townships, eight sections of 640 acres each, taking out the four sections in the center, which were reserved.

The townships directed to be sold in sections under the ordinance were to be sold at Pittsburgh, under the direction of the governor or secretary of the Northwest Territory and such person as the President should appoint. They were to be sold to the highest bidder, one-twentieth part of the purchase-money to be deposited, a moiety of the sum bid to be paid in thirty days to the Treasurer of the United States, and one year's credit for the residue; the President thereafter to issue patents, countersigned by the Secretary of State, and recorded in his office. If the purchaser made entire payment at the time of sale, he was to have a deduction of 10 per cent. from the credit part, and patent should issue immediately.