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LAND SOLD IN ILLINOIS.
Aereg, Population 1814 119,631 12,282 1838
359,537 1816 104,255 1834.
347,823 1816 183,908
2,062,707 272,427 1817 177,722
3,088,554 1818 220,449
388,233 476,183 1822
481,105 662,128 1827
250,000 1830 314,407 157,445 1849.
350,000 1831 334,557 1850...
200,000 851,470 1832 225,338 1861.
Increase of per bead Years.
Acres sold. population, increase. 1830 to 1835.....
3,330.062 114,982 25 1835 to 1840..
6,419,814 203,756 32 1840 to 1845..
2,150,670 185,942 11 1845 to 1850...
2,609,509 189,355 14 The five years ending with 1840, embrace the years of great speculation, when the lands went into the hands of persons who got them on credit, and held them for speculation. More lands in the hands of speculators bave been hanging upon the market in competition with the government lands, and with the 8,000,000 acres held by the State for various purposes, and sold from time to time. This depressed the average quantity of government lands sold in that State during the subsequent tive years.
The State of Illinois very early commenced ibe system of public improvements by State loans. The opening of the New York and Erie Canal in 1824, gave an immense impulse to Western progress, and it will be observed in the table of land sales tbat they doubled in 1828 and 1829, continuing to increase until the Lubble burst. The great success of the Erie Canal afforded a tempting example to Illinois, because her situation in relation to the lakes is nearly the same. She abuts on Lake Michigan New York does on Lake Erie, and her great river, Illinois, holds the same relation to the State navigation as does the Iludson to Lake Erie. Ilence, the connection of the two latter by the Erie afforded an exact model for the connection of the two former. As early as 1823, the route had been explored. The population was too sparse to undertake it, however, until, in 1829, Congress made the grant of 290,914 acres, mentioned in the abore table, in aid of it. The State then passe d an act to raise a loan of $500,000, to carry it on. The work was placed under a special commission, and was to extend from Peru, on the Illinois River, to the Chicago River, five miles from its mouth, say 100 miles. When that work was projected there were but about 16,000 families in the whole State, and the expense of the work was estimated at $8,651,337, yet this canal was but a subordinate part of an immense sys tem of internal improvements for which an act was past in 1837. This act created a Board of Fund Commissioners to manage the fiscal concerns of tho public works, and a Board of Public Works to determine routes and super intend the execution. This internal improvement system embraced the fol
lowing works, showing the total length of each railroad projected in the State, and the aggregate length of all the railroads :
Miles. Per mile. Total. expended. Central Railroad.....
4573 $8,326 $3,809,145 $145,765 Southern Cross Railroad........
294 8,200 1,410,800 42,763 Northern Cross Railroad.
2344 8,480 1,976,355 515,311 Shelbyville and Paris Branch Central Railroad...
71} 19,588 757,113 61,203 Peoria and Warsaw Railroad..
116 8,351 966,396 75,255 Alton and Shelbyville Railroad
71 8,295 764,845 5,200 Bellville and Lebanon Railroad
231 7,000 164,700 371 Bloomington, Mackinaw, Peoria, and Pekin Railroad ...
534 11,736 630,810 38,022
$23,524,781 These were among the first projects of the young State. There were then 70,000 log-cabin farmers in the State, and these loans were about $300 each family. For all the purposes mentioned, stocks were issued.
The works commenced under this law, and the effort to sell the bonds at a moment when the financial horizon began to lower, and all other States were desperately pressing the market, produced ruinous losses. In 1842, the State debt had assumed the following shape.
ILLINOIS STATE DEBT, DECEMBER, 1842. Bonds sold to the State Bank of Illinois, of account of bank stock.
$1,765,000 Bonds sold to Bank of Illinois, of account of bank stock 900,000
$2,665,000 00 Bonds sold to Irwin & Beers on account of Internal Improvements.
1,000,000 Bonds sold to N. Biddle.
1,000,000 Hall & Hudson...
100,000 Boorman & Johnson..
100,000 Lieutenant Levy..
4,000 January & Dunlap..
300,000 M. B. Sherwood...
60,000 John Delafield.....
283,000 A. H. Bangs.
50,000 Erie County Bank.
100,000 Bank of Commerce.
100,000 Commercial Bank of Buffalo..
100,000 Nevins & Townsand, by Dr. Barrett.
180,000 E. Riggs, by Dr. Barrett...
60,000 Bank of United States, by Dr. Barrett.. 100,000 M. Sberwood, by Dr. Barrett..
100,000 Bonds hypothecated to State Bank of Illinois, by Dr. Barrett.
100,000 Bonde sold to M. Kennedy and others, by J. D. Whiteside
120,000 Bonds left with Macalister & Stebbins, by J. D. Whiteside on deposite, and by them sold.
£122,650 equal to.... Bonds sold to State Bank, by J. D. Whiteside.....
844,122 00 100,000 00
Deduct 7 bonds of $1,000 each received from Commercial Bank of
of Auditors outstanding.....
of $1,000 each, hypothecated to Macalister & Stebbins, yet outstanding, as per statement of Fund Com. missioner, with interest at the rate of 7 per ceot per
annum on this sum... Sold to contractors on Northern Cross Railroad, 94
bonds of $1,000 each, 84 of which were hypothecated to Fund Commissioner, by the contractors, for the sum of $42,000, Illinois State Bank paper, leaving balance of $10,000.....
Total debt on account of bank and Internal Improvement bonds and scrip......
Illinois and Michigan Canal Stock. Bonds sold by government...
1,000,000 00 Amount sold by Governor Reynolds to President of the United States Bank.....
... 1,000,000 00 Amount sold by Governor Reynolds and Gen. Rawlings to John Delafield .....
300,000 00 Amount sold by Gen. Thornton on Canal...
1,000,000 00 advanced by Wright & Co. on contract with
Judge Young and Governor Reynolds,
£30,000, by terms of contract equal to... 145,188 00
in London ...
116,000 00 808,085 00 294,190 00
$2,665,000 00 5,614,196 94 4,338,907 71
116,000 00 808,085 00 294,190 00
Total debt upon which interest accrues..
The annual interest on this debt was $830,182.
To meet these liabilities the State had the following resources at the time unavailable :Lands remaining unsold of Canal Grants ..
288,985 67 Lands granted to the State, under the provisions of an act entitled “ An
Act to Appropriate the Proceeds of the Sales of the Public Lande,
and to grant Pre-emption Rights;" approved September 4th, 1841. 210,132 85 Lands purchased by the State for Internal Improvement purposes.... 40,332 00 Amounting to..
489,750 49 Amount due Canal Fund from sale of lands, town lots, stone, timber.. $201,964
In 1840, the following named purchasers of bonds had failed to pay for them ac cording to contract, to wit:John Delafield, in the sum of..
$433,000 A. H. Bangs.
50,000 Bank of Commerce at Buffalo
80,000 Commercial Bank at Buffalo..
90,000 Erie County Bank....
97,500 Amounting to .....
$730,500 The bonds, as the names of the buying parties indicate, were put upon
the market with little scruple. The New York Free Banking Law, which had been started in 1838, at that time allowed stocks of Western States to be taken as security for circulating bills, and this opened a market for many. The American Exchange Bank in New York, and the other institutions named, bought them for that purpose. Many of those banks failed utterly, and the State never got anything. General Thornton was sent to London by the contractors on the canal to sell the bonds they had taken from the State, and his terms were such as he could get. Messrs. Wright & Co. were a banking house largely interested in Cairo city, and through them $500,000 worth of railroad iron for the Central Railroad was procured on the bonds, and some cash advances for the use of that road in addition. The bonds sold to J. Delafield, of the New York Phænix Bank, were to be paid for in instalments at par, on the condition that no more stock was to be put upon the market. The State, however, made an issue of sterling bonds, which knocked the market price down 20 per cent, and Delafield repudi. ated the contract, on the ground that the State had violated it. The State was now bankrupt, with all the public works incomplete. They remained in this position until 1843, when it was proposed to make the canal lands a special pledge for a sum necessary to complete the canal. This was estimated to require $1,600,000. Accordingly, the Legislature of Illinois passed a law for the purpose of raising the funds necessary to complete the Illinois and Michigan Canal, authorizing the Governor to place the canal and all the canal lands in trust for the security of the lenders. The main provisions of this act are-
“1. That the Governor should be anthorized to negotiate a loan solely on the credit of the canal and its lands of $1,600,000, to bear 6 per cent annual interest. The holders of existing canal bonds, and other claims on the canal, are to have the first right to subscribe in proportion to their claims, and the claims in respect of which they so subscribe to be duly registered.
"That this canal and canal property should be vested in three trustees, one to be named by the Governor, and iwo by the subscribers to the loan.
“That at least $400,000 of this loan should be paid in during the course of the first year after the execution of the trust deeds.
“That the canal shall be finished in three years from the commencement of the trust.
" That no sales of the canal lands shall be made until three months after the completion of the canal, when the trustees are to offer them for sale.
“That all the proceeds of the canal and canal property should be first applied to the repayment of interest and principal of the proposed loan of $1,600,000.
“2. To payment of interest on the canal stock registered by holders who are subscribers to this new loan.
“3. To payment of interest on the canal stock, not so registered.
“ 4. To reimbursement of the registered canal stock held by the subscribers to the said loan; and after the due performance of these various engagements on the part of the trustees, the canal shall revert to the State of Illinois.
“The property assigned to trustees as security for the loan was as follows:The canal, that cost the State....
$5,000,000 The lands, amounting to 230,476 acres, valued, after the completion of the canal, at $10 per acre..
2,304,670 Lots in the various towns on the canal, valued at..
$9,204,670 Messrs. Ryan & Oakley were appointed commissioners to raise the amount, and aided by David Leavitt, Esq., President of the American Exchange Bank, which was a large holder of the canal bonds, succeeded in obtaining the required sum--the leading banking houses in London taking up the subject. The loan was completed, Messrs. David Leavitt and W. Swift · were appointed trustees on behalf of the bondholders, and the work pushed to completion. The lands, on being sold, more than realized the estimated values on which the trust was based, and the revenues of the work have equalled expectations, so far as to leave but little room to doubt that the canal will soon, fulfilling its condition by discharging the canal indebtedness, revert to the State.
The other great work, and perhaps the most important to the State interest, is the great Central Railroad. This work, as mentioned in the above table, was to have been 4571 miles long, at an estimated cost of $8,809,145, and the State actually, before its failure, expended upon it $1,016,905, mostly for a depôt in Cairo, for clearing out the track, and in grading and embankments. The iron which had been purchased for this road was afterward sold at a loss. The Federal Government had a claim upon it for duties, it not having been laid upon the road within the time required by the then law for the remission duties. The works were going rapidly to destruction, but nothing was done until September 20, 1850, the Federal Congress made a grant of lands in aid of it.
The following is a synopsis of that law:
ACT OF CONGRESS DONATING LANDS. SECTION 1. Grants right of way through the public lands, 200 feet wide, with privilege of taking materials for construction; earth, stone, timber, &c.
Sec. 2. Grants every alternate section of land, 12 sections wide, the whole length of road and branches. In case the lands there are occupied, an equivalent quantity elsewhere, not over 15 miles from the road. The road to be commenced simultaneously at both ends. The lands to be sold only as the work progresses. This grant does not include the reserve canal lands.
Sec. 3. United States land reserved sections not to be sold for less than double the minimum price of the public lands.
Sec. 4. The road to remain a public highway for the use of the United States Government, free from toll or other charges.
Sec. 5. If the road is not completed in ten years, the State of Illinois shall