During the administrative infighting over the federal lands, Ohio's own canal lands were effectively kept out of market by adherence to the $3.00 minimum price adopted in 1838. But the continuing business depression and deranged money markets finally forced the legislature to reconsider its land policy in late 1841. Since the mid-thirties, Ohio had been devoting all its fiscal resources to completion of its expanded public works. The state debt soared to nearly $13 million in 1841; new bond issues in the east or in Europe were proving impossible except at heavy discounts; and a heavy arrearage of debt to the canal contractors was building up rapidly.18 To avert default or repudiation of its state debt, a fate which had already befallen several other states then engaged in heavy canal construction, the Ohio legislature authorized issue of "state scrip" in denominations of $100 or more, pledging the Wabash and Erie Canal lands as security, for the payment of debts to contractors. 19 On March 7, 1842, the general assembly enacted a new land law that reduced the price of unsold lands to $2.50 an acre or the appraised price, whichever was higher. Certain Miami Canal lands, which had been appraised officially at high prices, were reduced by legislative fiat to $4.00 or more an acre. The assembly ordered the lands sold only at public auctions, to be held at regular intervals, and established an 80-acre minimum (no maximum) size for any purchase. Land officers were authorized to accept either cash or state scrip in payment for lands.20

The 1842 law re-established a viable market for the lands. Over the next year more than 6,000 acres of Miami Canal lands were sold at an average price of $2.66 per acre; and 3,724 acres of Wabash and Erie lands were sold at a price averaging $3.47 per acre. Nearly all the payments were state scrip. The scrip, issued to contractors who in turn paid it out to laborers, was then circulating at a 30- to 50-percent terms of the attorney general's ruling. "Opinion of H. D. Gilpin, Attorney-General... June 26, 1840" (MS), WabashErie records.

18 Scheiber, Ohio Canal Era, pp. 140-163.

19 Ibid., p. 151; Alfred Kelley to Baring Bros., Mar. 7, 1842, Ohio Board of Canal Fund Commissioners' Letterbooks, Ohio State Archives.

20 Laws of Ohio 40: 72. By “cash" was meant, specifically, specie or notes of specie-paying banks. Because of the high premium for which specie sold in 1842, when it was obtainable, the law effectively provided only for land sales paid in state scrip.

discount in northwestern Ohio; hence the actual cost of the lands to purchasers was far less than the prices formally recorded.21

A notable departure from earlier Ohio land law was made by the legislature in 1843. Seeking to bring prices into line with prevailing market trends, the state ordered a reappraisal of the Wabash and Erie lands (also making provision for appraisal of its newly acquired partial sections whose ownership had been disputed). For the first time, squatters' rights were recognized in the state's land law: appraisers were required to evaluate any improvements worth $100 or more on land which had already been taken up by settlers.22 All Wabash and Erie and Miami Canal lands were then to be put up for sale at auction. Though squatters were not given outright preemption rights, they were entitled to receive the value of their improvements if outbid for the land at auction. Any land not taken at auction was then opened to private entry at the appraised prices, thus eliminating the fixed minimum price. No parcel smaller than 80 acres would be sold, and no upper limit was set on acreage that any purchaser might take. 23

This law governed canal land sales for four years. From its enactment until December 1846 nearly 46,000 acres of Wabash and Erie land were sold, at prices averaging $2.14 per acre, while about 13,000 acres of Miami Canal lands

21 Thomas Corwin to P. G. Goode, Apr. 8, 1942, WabashErie records; Ohio Auditor of State, Annual Report, 1842, p. 32. Payment of laborers in scrip is discussed in Edwin Philips, "Memoirs," ed. Francis P. Weisenburger, Northwest Ohio Quarterly 18 (1945): 103-104. Sales of Miami Canal lands were 6,091 acres at an average price of $2.66 per acre in 1842, 2,033 acres at $2.52 in 1843, 1,517 acres at $2.05 in 1844, 4,772 acres at $1.41 in 1845, and 4,427 acres at $1.98 in 1846. Wabash and Erie lands sold were 3,724 acres at $3.47 average price in 1842, 19,719 acres at $1.97 in 1843, 12,838 acres at $2.34 in 1844, 6,503 acres at $1.66 in 1845, and 6,772 acres at $2.72 in 1846. (Scheiber, "State Policy," pp. 92, 94.)

22 In 1834 the federal land office receiver had reported that many squatters had settled near the Auglaize River, hoping to enter lands under congressional preemption acts. But on Mar. 20, 1835, the Treasury Department ruled that the federal reserved sections were not subject to purchase under preemption laws. Until passage of Ohio's 1843 land law, Feb. 7, 1843, state legislation had recognized no rights of preemption or rights to the value of improvements. T. Van Horne to J. M. Moore, Sept. 25, 1834, and Levi Woodbury, secretary of the treasury, to the GLO, Mar. 20, 1835, Miami Canal dossier. On the importance of laws giving occupants the right to the value of improvements, in cases of disputed title or squatting, see Gates, Landlords and Tenants on the Prairie Frontier (Ithaca, 1973), pp. 13-45.

23 Laws of Ohio 41 (Feb. 7, 1843): 25.

were sold at an average price of $1.85. (See note 21, summarizing sales and average prices per year.) Although most of the buyers were local residents who took small parcels, at least one large-scale speculator, Daniel Chase of Toledo, who already owned extensive real estate in the Maumee Valley, obtained 4,130 acres of Wabash and Erie land in 1844 and 1845.24 Appraisals were a crucial determinant of sales, as was demonstrated by the concentration of sales almost exclusively in Darke County where most of the lands had been valued at $1.25 to $2.00 an acre. In 1845, for example, only 40 acres of Allen County lands were taken, and no sales whatever were made in Mercer, Van Wert, or Paulding Counties where appraisals were higher.25

Spokesmen for the residents of northwestern Ohio had welcomed in principle the reduction of prices to appraised values under the 1843 law; but they continued to agitate for further revaluations.26 By the mid-forties, moreover, there had been a change in the state's fiscal position with important ramifications for land disposal policy. The Ohio public works were finally completed in 1845, when construction of the Miami Extension Canal was concluded; and meanwhile, the end of the national business depression permitted re-funding of Ohio's state debt, so that the crisis in state finances was over. These developments reduced the pressure to squeeze maximum immediate revenues from land sales.27 At the same time, there was also rising concern for basic reform of the land laws to encourage actual settlement and discourage speculation. As early as 1839, Ohio's Governor Shannon (a notorious land speculator, as it happened) warned that the canal lands should be "sold in small quantities to actual settlers" in order to do justice to "the enterprising settlers in that rich and fertile part

24 Computed from entry books (MSS) of the Perrysburg state land office, records in state auditor's office, Columbus. 25 Lima Reporter, Nov. 11, 1845. As of November 1845 the location of unsold state canal lands in the Lima district included Wabash and Erie lands as follows: 59,840 acres in Henry County, 41,640 in Paulding, and 20,760 in Williams and Defiance. Unsold Miami Canal lands were located as follows: 10,840 in Allen, 14,000 in Darke, 40,670 in Mercer, 17,080 in Paulding, 12,200 in Putnam, and 6,660 in Shelby. In addition, there were some 200,000 acres of unsold state lands held under the canal grants in Ottawa, Wood, and Lucas Counties, all in the Perrysburg district.

26 See text at notes 28 ff.

27 Scheiber, Ohio Canal Era, pp. 153-155.

of our state." 28 Two years later, when a proposal was made in the legislature to keep half the state's canal lands out of market, pending a general market rise in land values, a western Ohio representative condemned the attempt as a state speculation at the poorer settlers' expense. This debate publicized once again the fact that northwestern Ohio remained a near wilderness, its settlement retarded not only by the business depression but also by the combination of a federal policy that held reserved lands for $2.50 an acre and a state policy that effectively priced canal lands beyond the reach of actual settlers.29

With the state's fiscal crisis ended, pressure for settler-oriented reform was carefully nurtured and eloquently pleaded by some leading politicians in northwestern Ohio. Most prominent in the land reform movement were editors and political organizers of the Jacksonian Democratic party's radical wing, which was powerful in the northwestern region. In a sense, these men took typical frontier-democratic views of the land question, as befitted representatives of a frontier district in a state whose other regions were better developed economically, 30 They kept up a drumfire of criticism against "the avaricious, unprincipled speculator," another typical frontier figure whose notorious earlier success in exploiting state land policy had resulted in engrossment of large tracts of land in their district and had retarded the region's improvement.31 The Democratic candidate for the legislature from Putnam County, for example, stood for election in 1845 on a platform demanding reappraisal of all the state canal lands "to their lowest possible value," and their sale "to actual settlers in small tracts-every applicant at the land office... being required to make oath that his design was to cultivate the land purchased.”

28 Wilson Shannon, quoted in (Columbus) Ohio Statesman, Dec. 3, 1839.

29 Ibid., Jan. 24, 1842.

30 On the northwest Ohio frontier alliance with immigrants and urban laborers in the party's radical wing, see Edgar A. Holt, Party Politics in Ohio, 1840-1850 (Columbus, 1931), pp. 422-423.

31 Lima Reporter, Nov. 11, 1845. For statistical data on retardation of development in northwestern Ohio, and on one major speculator's operations, see Scheiber, "State Policy," pp. 108-113. Earlier historians and geographers have explained retardation almost exclusively by reference to the extensive wetlands of the region, requiring heavily capitalized farming.

...

Meanwhile the district's leading Democratic newspaper called for "these lands to be sold and cultivated; as they are now they benefit no one, and... besides, the best of the timber is constantly being taken off in many places." 32 When land sales dropped off after 1844, reform spokesmen intensified their campaign for revision of the disposal laws. Denouncing "land monopoly" and state land laws ill-suited to northwestern Ohio's needs, the Democratic editor John Ackerman charged that not more than one-third of the privately owned land in the northwestern region was in the hands of actual settlers. "A policy has been pursued," he declared, “which has ever admitted of monopolizing the vacant lands in the hands of the wealthy. Every choice spot has been appropriated by the speculator, and can be had only by paying exorbitant prices." The federal reserved sections were overpriced at the $2.50an-acre minimum, the state lands were appraised too high, and considerable acreage was being held out of market as school lands. "That class of citizens who are able to purchase a home for $100, not more," he said, "are compelled to seek that home in the far west." The tide of emigration was bypassing northwestern Ohio. He demanded a policy of sales only to actual settlers, and he called for reduction of the minimum price to 50 cents an acre. Ackerman's contentions were supported by a legislative committee that reexamined state land policy in January 1847. Sales had been discouraged, the committee said, because the state land offices (located at Perrysburg and Lima) were inconvenient to Paulding and Henry Counties, where most of the unsold tracts lay, and also because the appraised values were set too high. To avoid the fatiguing journey to and from the land offices, and to obtain federal lands available at $1.25 an acre, potential settlers were going by canal packet down to the Ft. Wayne, Indiana, federal land office.34

33

In February 1847 the Ohio legislature responded to such pressures by adopting a new land law, fundamentally changing the state's

32 Candidate Knapp, quoted in Lima Reporter, Sept. 30, 1843; editorial, ibid., Nov. 11, 1845.

33 Ibid., Dec. 29, 1846, Jan. 12, 1847.

34 Report in Ohio General Assembly, Senate Journal, 184647, pp. 422-424. The chairman of this committee, Alfred Edgerton, owned vast tracts of land, which he had purchased from the state and federal land offices prior to 1836, in the immediate vicinity of Defiance.

policy. It was the first fully settler-oriented law adopted since the original canal-land grants of 1828, and it signified the abandonment of revenue maximization as the touchstone of policy. The 1847 act gave actual settlers a reduction in price of one-third off the appraised valuation. A maximum purchase of 160 acres of the discount price was permitted to those who filed the necessary affidavit stating intent to settle the land. Though speculation was not forbidden, it was thus discouraged by the new system of discriminatory pricing. The law also transferred the land office from Perrysburg to Defiance. Approximately 127,000 acres of unsold Miami Canal lands and 148,000 acres of Wabash and Erie lands were affected by the 1847 law.35 Widely hailed by proponents of reform, the law stimulated land sales in 1847. By favoring the actual settler, as one editor declared, the state derived new revenues "from a class of purchasers who, under the old system, had always contributed least in their sales." But still more important, "The man with small means can now go to the land office in the fullest confidence that when he gets there he will no longer be victimized. . . . Instead of being obliged to dodge the shark, he now meets brother."

a

"36

It remained to be seen whether so optimistic a view of the land law in actual operation was justified. State officials were quick to declare the new law a success and predicted rapid settlement and development "in a part of the State which is now, comparatively, a dense forest." 37 Acting in the spirit of the previous year's settler-oriented law, the legislature in 1848 made a further reduction of prices on the unsold land, cutting the appraised valuations to a maximum of $3.00 per acre. 38 This reduced the maximum price on any 160-acre tract, for anyone filing a settler's-intent affidavit, to $2.00 an acre. But settler-oriented legislation did not necessarily put unprincipled speculators at a disadvantage. It soon became public knowledge that many affidavits stating an intention to settle were being filed by persons who in fact had no such plans. In 1850 the legis

35 Act of Feb. 8, 1847, Laws of Ohio 45: 31. Acreage data given in State of Ohio, Executive Documents, 1846-47, part I, pp. 637-639; Ohio General Assembly, Senate Journal, 1846-47, Pp. 420-424.

36 Lima Reporter, Apr. 20, 1847.

37 Auditor of State, Annual Report, 1847, p. 29. 38 Act of Feb. 18, 1848, Laws of Ohio 46: 54.

lature therefore moved to close the loophole thus left in the 1847 law, by requiring that land officers should deliver no final deed to lands until one year after the sale; and, if persons who had filed affidavits had not in fact settled on the tracts, such entries should be disallowed.39 Administration again proved to be lax, as there is no evidence in either the state auditor's records or the land office entrybooks that any purchasers filing affidavits were ever refused patents to the land.

In March 1850 the legislature again reduced land prices for purchasers who filed the affidavit of intent to settle, allowing them a 50-percent reduction from appraised values. A further revision of the land law in 1852 provided for reduction of the maximum appraised value to $2.00 an acre-or an effective price of $1.00 to buyers declaring their intent to settle. An additional increase in the settler's discount, to 75 percent, went into effect in 1853, so that the remaining lands sold at 50 cents an acre to those filing affidavits. Administration of the laws was vested in a state land commissioner, thus centralizing responsibility for land disposal in the state. 40

Sales increased commensurately as effective prices were cut well below the $1.25 minimum for which federal lands were being sold in the nearby Indiana land district, and even farther below the $2.50 price for which congressional reserved lands were being held in the canal

39 Act of Mar. 23, 1850, ibid. 48: 92. Examination of the state land office entry books (MSS, state auditor's office) for the Lima and Defiance districts indicates that all purchasers, from 1847 to 1853, declared their intent to settle and filed the affidavit. It was common practice, however, for a married couple to file adjoining-tract claims, and the names of several large-scale speculators prominent in northwestern Ohio appear among the entrymen. See the published list of purchasers, 1847-53, in State of Ohio, Executive Documents, 1853-54, doc. 22.

40 Acts of Apr. 16, 1852, Laws of Ohio 50: 180 and sec. 14 on reduction of price to 25 percent of appraised value after Jan. 1, 1853; act of Jan. 12, 1853, Laws of Ohio 51: 293. Prior to 1852 the state land officers were usually the register and receiver of the federal land offices at the land office towns, a practice customarily followed in the states. The legislature decided to adopt an independent land administration, separated from federal personnel, when an investigation of 1852 revealed that purchasers had been sold Ohio lands with the understanding that they were federal lands. The land officers pocketed the price difference-a tidy profit. See Ohio General Assembly, Senate Journal, 1852, pp. 418-419; and State of Ohio, Executive Documents, 1852-53, part I, pp. 201-207. The same investigation uncovered fraudulent state sales of 3,000 acres at the settler's discount price to purchasers who used dummy entrymen.

region of northwestern Ohio. By early 1852 less than 50,000 acres of the Ohio canal lands remained unsold. In that year nearly half this total was sold at the reduced prices, and a land rush was anticipated when the remainder was prepared for sale at 50 cents an acre to settlers on January 1, 1853. The auction, eagerly awaited by speculators and potential settlers alike, was held at Defiance on the third day of January. In charge was the state land commissioner, Reuben H. Gilson, who opened the sale at 8 a.m. By 8:30 a.m. Gilson had closed the auction room and ended the sale; but he also opened the door to a legislative investigation that revealed a hectic half hour of blatant corruption and insiders' cynical machinations. Gilson, it was revealed, had cooperated handin-glove with a group of five speculators (including John Paul, his partner in a railroad construction company) by distributing blank applications to them in advance. The inside group had discovered an oversight in the much revised land laws, which now no longer applied the 160-acre maximum purchase at the settler's discount prices on all the available lands. When the sale opened at 8 o'clock, Gilson's group filed its applications instantaneously; and Gilson hammered down to them some 5,500 acres of the best lands, all at the 50-cent-per-acre price! In addition, upon auctioning that afternoon some additional lands recently transferred to Ohio by the Federal government in settlement of a long-standing claim Gilson accepted bids only from those men who had filed written bids in the morning. As a result, these lands-which were generally far superior to any other parcel then available, the rest having been on the market for yearswere sold to Gilson's cronies at the minimum price.41

A storm of protest followed, and on January 12, only nine days after the rigged auction sale, the legislature closed the loophole by putting a maximum 160-acre purchase on any state land sold at the settler's discount.42 Gilson was denounced by land reformers in northwestern Ohio as one of "the overgrown land speculators... who hold real estate in the counties of the northwest at unpurchasable and exorbitant prices." Finally, the state attorney general

41 Report of the Joint Select Committee Appointed To Examine into Alleged Frauds at the Defiance Land Office, in Senate, March 6, 1853 (Henry, Ohio, 1853).

42 Kalida Venture, May 20, Aug. 19, 1853.

ruled the sales illegal and ordered the lands returned to the state. Gilson meanwhile was rewarded by appointment as the federal land office receiver at Defiance.43

Following return of the protested lands, state sales during 1853 amounted to about 18,000 acres at an average price of 50 cents an acre. In reaction to the 1853 land office scandal at Defiance, and also to recurrent charges that speculators were using dummy entrymen to obtain settler's discounts, the legislature enacted a new law in May 1854. It abolished the office of state land commissioner, a convenient way of removing Gilson, and substituted a land agent with substantially the same administrative powers. 44 The 1854 land law also instituted a radical departure from a revenueproducing orientation that had persisted in the state's land-disposal policy since 1828; henceforth a purchaser applying for the 75percent reduction from appraised prices was required to attest that he owned no other lot or tract of land whatever.45

By this time only a few thousand acres of canal land remained, most of it of poor quality. Hence revenue from land sales in 1854 was only $1,024. In his report for that year, the state auditor remarked that only a few scattered tracts were still available; and afterward, revenues from sales of the canal lands were too small even to be reported separately.46 After the Civil War, new legislation authorized the state auditor to sell the remaining tracts for the best price offered.47

While the acreage of unsold canal lands was declining in the 1850s, Ohio officials were seeking to obtain for the state clear title to various disputed lands. Even among the lands already sold, there were many instances of dual title, stemming from inadvertant sales of the same tracts by state and federal land officers or from the state's sale of tracts never formally transferred to Ohio by the General Land Office.4

43 Defiance Frauds Report, pp. 28-30.

44 Act of May 1, 1854, Laws of Ohio 52: 120. See also correspondence of Gilson and criticism by the editor in Kalida Venture, Aug. 19, 1853.

45 Act of May 1, 1854, Laws of Ohio 52: 194.

46 State of Ohio, Executive Documents, 1853-54, doc. 22. 47 For state laws relating to canal lands after 1855, see William E. Peters, "Code of Land Titles in Ohio" (17 vols., typewritten, copy in state auditor's office), 991 ff.

48 Moreover, the state officers "had selected much land to which there was no shadow of claim... others were embraced twice, and in a few cases three times, counting in as

In 1850 the legislature authorized the governor to appoint a special agent to negotiate disputed claims with the Office, provided it could be done at no direct cost to the state treasury. Accordingly, the governor awarded a contract to the prominent former Congressman John W. Allen, who agreed to act as agent and lobbyist if he might receive one-third of any lands he obtained for Ohio. Allen used his influence in Washington to obtain favorable rulings by the General Land Office that confirmed certain disputed titles; and he also lobbied for a bill, passed by Congress in 1855, that ceded to Ohio some 120,000 acres of additional and disputed land under terms of the original canal grants.49 Allen's position evoked bitter comment in northwestern Ohio when he claimed 25,000 acres of land as his compensation. "He is preparing to locate this nice little farm near Defiance," one journal declared, "and the people of that quarter, justly outraged at the transaction, have held public meetings to prevent this speculating absorption of the public domain." Such pressures prevented Allen's claim from being approved, and after several years he accepted a cash settlement.50

The angry outburst against Allen was symptomatic of the more general resentment in northwestern Ohio of a continuing “land monopoly" in the region. In this vein, some radical Democratic spokesmen were calling for a general revision of state policy respecting "the tenure of lands and the quantity that any individual shall acquire." 51 Similarly, Salmon P. Chase, who was then a leader of the Democratic Party's reform faction, sought to link state land policy issues with the concurrent agitation for a national 160-acre free homestead bill. Spearheading the homestead cause in Congress, Chase also advocated cession to Ohio

many different grants." Taking school land claims into account, the GLO therefore had ruled that Ohio had been granted more land than was owed under congressional legislation. Memorial of John W. Allen, pamphlet, Feb. 28, 1857, in Wabash-Erie records. See also J. Butterfield to A. H. Stuart, Dec. 6, 1850, ibid.

49 Memorial of John W. Allen; see also Congressional Globe 30 (33 Cong., 2 sess.): 991.

50 Kalida Venture, Sept. 5, 1851; Memorial of John W. Allen. Referring to the "spirit and tenor" of newly adopted settleroriented land laws in Ohio, the state auditor refused to honor Allen's contract with Gov. Ford and would not allow his land claims. Auditor, Annual Report, 1851, p. 11.

51 Kalida Venture, Oct. 7, 1853. A radical Democratic editor thus called upon his party's leaders "to take a stand against land monopoly in their own State," declaring that otherwise