Land Policies. The American Economy: A Historical Encyclopedia

In the original colonial charters, the king granted land to the
joint-stock companies or proprietors who then organized the
eastern seaboard. Prior to the formation of the United States,
most settlers could purchase land, but the terms and quantities allotted to individuals varied with each colony. In Virginia, land could be acquired through outright purchase or
under the headright system. Under that system, an individual
who paid for the transatlantic passage of another person received 50 acres of land for free; the more passages that were
paid for, the more land the individual received. In Massachusetts Bay, the local town officials parceled out the land. In
New York, officials received large land grants in lieu of payment for their services. No uniform system of land disbursement existed.
After the formation of the government established under
the Articles of Confederation, various states, especially Virginia, ceded land to the national government. Since the Articles did not grant the federal government the power to tax,
land sales became the only available source of direct revenue,
although states did receive requests for funds (which were
usually ignored). The legislative representatives passed three
acts that dealt with this territory. The Ordinance of 1784,
proposed by Thomas Jefferson, divided the entire region
into ten self-governing districts that could apply for statehood once the population equaled the number of people living in the smallest state. The next year, Congress passed the
Ordinance of 1785. This act established the method of selecting surveyors, the system of surveying the land, and the
terms of the land sale. Surveyors mapped out 7 east-west
ranges of 6-mile townships located north of the Ohio River.
Each of these townships was divided into 36 sections of 640
acres each. In each township, officials designated section 16
for educational purposes. In addition, the national government, until 1804, reserved the right to 4 other sections as
well as one-third of the mines located in the area. Private individuals or speculators could purchase a minimum of 640
acres for $1 per acre plus any costs. Since the government
desperately needed money, all sales had to be transacted in
specie (coins) or the paper currency called Continentals.
Most individuals could not afford to purchase $640 worth of
land in cash all at once, so the early sales went to speculators,
who then sold smaller plots to individual farmers at a higher
rate per acre. Congress passed the final act under the Articles, the Northwest Ordinance of 1787, which united all of
the territory into 1 administrative unit that could later be
subdivided into 3 to 5 territories. When the population of
the territory reached 60,000, the territory could apply for admission as a state. A state constitution had to be drafted that
guaranteed the freedom of religion and a right to trial by
jury, and then Congress could approve admission. Although
this last law did not deal directly with the sale of land, it did
encourage investment and migration by promising that individuals who moved west would be treated just like every
other American.
Land Policies in the Early Republic
After the ratification of the U.S. Constitution, the federal government continued its former land policies until 1796. In that
year Congress allowed the sale of larger plots, ranging from
640 to 5,760 acres, on credit. An investor would purchase the
land at $2 per acre and pay 5 percent down, 50 percent in 30
days, and the balance in a year. If the transaction was done in
cash, the investor received a 5 percent discount. Four years
later, Congress passed the Harrison Land Act of 1800. This
legislation allowed for the sale of 320 acres at $2 per acre, with
the payments due over four years. By 1804 the minimum size
of plots that could be sold fell to 160 acres.
As a result of the smaller purchase requirements and the
extension of credit, more speculators purchased land from
the federal government, especially after the War of 1812. By
1819 the government held more than $24 million worth of
notes, and then a panic hit the United States. Within a few
months, the government began requiring cash payment for
all future transactions. Congress also established the General
Land Office, first under the Department of the Treasury and
then under the Department of the Interior. At the same time,
the minimum purchase requirement dropped to 80 acres and
then fell to 40 by 1820. Nine years later, individuals could

purchase public domain land for $1.25 per acre before any
government auction.
As the country moved from a subsistence economy to a
market economy, the amount of land sold dramatically increased. By 1840 the federal Treasury experienced a surplus
from the profits and from higher tariffs. Henry Clay proposed that the national government disburse some of the
funds to the states for internal improvements such as roads,
canals, and land reclamation. The only stipulation he placed
on his bill suspended the disbursements if the average tariff
rate exceeded 20 percent. Since the rate went up the following year, only one disbursement payment was made. In 1841
Congress passed Clay’s Land Distribution Bill, which granted
citizens, individuals who had applied for citizenship, a head
of household, or a male over the age of 21 the opportunity to
claim 320 acres of land with one year to pay off the balance.
Land sales boomed. Then, in 1854, Congress authorized the
sale of unsold land after a 30-year period at the rate of $1.25
per acre. These low prices created a speculation fury. Veterans
of the Mexican-American War also received military bounties in 1847, 1850, 1852, and 1855. Each veteran who had not
already received land could receive 160 acres for his services.
Many of these veterans redeemed the bounties and then sold
the land to investors for a cheaper price than that asked by the
government.
Land Acquisition (1803 to 1860)
By the time of the Civil War, the United States had acquired
additional lands. The first major acquisition occurred in 1803
when the government negotiated with France to buy the
Louisiana Purchase. President Thomas Jefferson hoped to
buy an island at the mouth of the Mississippi as a point of
transshipment for American goods traveling from the interior down the Mississippi River. He sent special envoys to
France to negotiate the agreement, but Napoleon had other
plans for the land. He had hoped to use the Louisiana Territory to feed the slave population on Haiti. Once the Haitian
revolutionary Toussaint-Louverture led a successful slave rebellion against the French, Napoleon proposed that the
United States buy the approximately 529 million acres of the
Louisiana Purchase for $15 million. Although Congress debated the agreement, it finally ratified the treaty, thereby increasing the public domain substantially.
The United States also increased the size of its territory in
1819 with the cession of lands from Spain, under the
Transcontinental Treaty. Then, in 1846, the United States and
Great Britain finalized an agreement over the Oregon Territory. The United States obtained all the territory south of the
forty-ninth parallel, adding an additional 180,644,480 acres
to the public domain. Two years later, at the conclusion of the
Mexican-American War, the United States acquired most of
the Southwest—another 338,680,690 acres in present-day
Arizona, New Mexico, and California—in the Treaty of
Guadalupe Hidalgo. In 1850 the U.S. Congress passed a joint
resolution that allowed for the annexation of Texas. According to the Compromise of 1850, Congress agreed to pay the
outstanding debts of Texas in exchange for a cession of land
to New Mexico, and Texas became part of the United States.
When Congress appropriated funds for the construction of
the Transcontinental Railroad, the proposed route had to go
through part of Mexico to achieve the best grade for the
tracks. In 1853 Congress ratified a treaty with Mexico for the
Gadsden Purchase, paying $15 million for 78,926,720 acres of
land. The only other substantial acquisition of land occurred
in 1867 when the United States purchased 375,303,680 acres
in Alaska from Russia, at a cost of $7.2 million. (See Table 1.)
Table 1 Major land acquisitions
Year of acquisition
State cessions 1781–1802
Louisiana Purchase 1803
Transcontinental Treaty (Spain) 1819
Oregon 1846
Mexican-American War 1848
Texas 1850
Gadsden Purchase 1853
Alaska 1867
Land Policies from the Civil War through 1900
Between 1867 and 1879, Congress appropriated funds for
four land surveys: the Hayden survey from 1867 to 1878, the
King survey from 1867 to 1872, the Wheeler survey from
1869 to 1879, and the Powell survey from 1869 to 1879. The
United States established the U.S. Geological Survey in 1879
and charged it with classifying public lands and studying the
geology and natural resources of the public domain.
Prior to the Civil War, Congress debated several homestead acts and passed one that the President James Buchanan
vetoed in 1860. The South resisted the passage of such an act,
but once Northern Republicans controlled Congress during
the Civil War, they secured passage of the Homestead Act of
1862. The legislation allowed citizens, individuals in the
process of becoming naturalized citizens, any head of household, Union veteran, and males over the age of 21 who had
never been an enemy or aided an enemy of the United States
to claim 160 acres for only a small filing fee. Before title could
be transferred, the individual had to establish residency on
the land for five years and improve the property. People could
also pay for the land after six months instead of waiting out
the five years. Smaller plots of 80 acres in alternate sections to
railroad lands could also be settled. After the Civil War, Congress allocated 160 acres for Union veterans, and two years
later, the residency requirements for the veterans changed
when Congress passed legislation that permitted the years of
military service to be deducted from the five-year requirement. Congress also passed the Morrill Land-Grant College
Act in 1862. Designed to encourage the growth of agricultural and mechanical schools (A&Ms), this legislation
granted each state 30,000 acres for every representative it had
in Congress. The land could be sold and the profits used to
construct school buildings, or it could become the location of
the institution.
During the 1870s, Congress actively promoted westward
migration by passing several acts that helped persuade

Americans to settle in the arid region west of Kansas. In 1873
the Timber Culture Act granted individuals 160 acres of land
if they planted one-quarter of the property in trees. Five years
later, Congress passed the Timber and Stone Culture Act,
under which individuals could purchase land rich in timber
and stone for $2.50 per acre. More Americans took advantage
of these two acts than the third, the Desert Land Act of 1877.
Hoping to entice Americans to settle the Great American
Desert, the government offered 640 acres for irrigation at
$.25 per acre at the time of filing and another $1 per acre at
the end of two years. The sale of land under the Homestead,
Timber Culture, Timber and Stone, and Desert Land Acts
proved so successful that the superintendent of the census
noted that by 1890, the frontier line had disappeared. However, during the 1870s, numerous fraudulent claims created
the need to establish the Public Lands Commission to investigate land claims made under the Preemption and Homestead Laws that were sold to investors. Subsequently, Congress reformed land policies in 1891. Under the General
Revision Act, legislators stopped government land auctions,
repealed the Timber Culture Act, restricted the total number
of acres available to one individual to 160 acres, and allowed
the president to establish forest reserves.
Land Policies from 1891 to the Present
The General Revision Act of 1891 marks a transition point in
federal land policies. Congress increased the size of the plots
being sold to as high as 640 acres and lowered residency requirements to three years in 1912. Ranchers could receive an
entire section of land if engaged in the raising of livestock.
Other pieces of legislation dealt with restricting the use of the
land or managing federal reserves.
During the late nineteenth century, Presidents Benjamin
Harrison, Grover Cleveland, William McKinley, and Theodore Roosevelt exercised their power under the General Revision Act to set aside 194 million acres of land as reserves.
Roosevelt placed a tremendous emphasis on the scientific
management of these lands, appointing Gifford Pinchot as
his chief forester. He would also remove 172 million acres of
forest from the land available for settlement, under the terms
of the Forest Reserve Act of 1891. He, more than any other
president, encouraged the shift from land disposal to conservation and the setting aside of reserves. By 1905 Congress created the Forest Service under the Department of the Interior
and then the Department of Agriculture, to administer national forests. In 1916 the management of the national parks
transferred to the National Park Service.
Although the federal government restricted the available
land for sale to individuals, homestead grants continued at an
escalated pace after the passage of the Forest Homestead Law
of 1906, which opened up agricultural lands in forest reserves. Congress also passed a new policy in 1905 to encourage the sale and improvement of desert lands. The Newlands
Reclamation Act allowed states to use 95 percent of the revenue generated by land sales in the western states to fund irrigation projects. The act proved more successful than the
Desert Land Act of 1877.
By the Great Depression, the amount of land available for
homesteading had declined dramatically. Yet some pockets
remained. Then, in 1934, Congress passed the Taylor Grazing Act, which removed an additional 80 million acres of
grazing lands in 22 western states from the property available to the public. Homesteading continued to decline from
1934 on, except in Alaska (where Americans could claim
land as late as 1986).
Beginning in the 1960s, Congress passed a series of acts
designed to protect the natural resources of the country. The
Wilderness Act of 1964 covered all wilderness areas. In the
same year, Congress also approved the Land and Water Conservation Fund, which appropriated money for the creation
and maintenance of outdoor recreational facilities. In 1965
legislators passed the Water Quality Act, establishing clean
water standards on the federal level. And by 1968 the Wild
and Scenic Rivers Act allowed for the preservation of rivers
with “remarkable recreational, geologic, fish and wildlife, historic, cultural, or other similar values.”
The policies of the 1960s continued into the 1970s. At the
beginning of the decade, the national government made the
protection of the environment a priority by passing the National Environmental Policy Act of 1970. Three years later,
Washington issued a list of threatened wildlife granted protection under the Endangered Species Act. In Alaska 80 million acres of land were withdrawn from public use as forest
reserves, wildlife refuges, and scenic areas, and by 1980 Congress had added an additional 47 million acres to the national
park system in Alaska. Finally, in 1976, Congress approved
the Federal Land Policy and Management Act (FLPMA) to
retain all remaining public lands, to survey all natural resources on the land, and to manage the land. Following the
passage of the FLPMA, Congress repealed the Homestead Act
in the lower 48 states and in Alaska in 1986.
As of the year 2000, the United States no longer had a policy of free or cheap land for its citizens. Debate in the federal
government continues to focus on issues such as controlled
fires in the national parks and the preservation of endangered
species. (See Table 2.)
Table 2 Land policy legislation
Homestead Act 1862
General Mining Law 1872
Timber Culture Act 1873
Desert Land Act 1877
Timber and Stone Act 1878
General Revision Act 1891
Forest Reserve Act 1891
Forest Management Act 1897
Newlands Reclamation Act 1902
Forest Homestead Act 1906
Enlarged Homestead Act 1909
Taylor Grazing Act 1934
Water Quality Act 1965
Wild and Scenic Rivers Act 1968
National Environmental Policy Act 1970
Alaska Native Claims Settlement Act 1971
Endangered Species Act 1973
Federal Land Policy and Management Act 1976
Alaska National Interest Lands Conservation Act 1980

Finances
The original intent of the founding fathers in selling land
held in the public domain focused on generating revenue for
the fledgling nation. Land sales comprised between 1.3 to 9.1
percent of the total receipts of the government in 1801 and
1820, respectively. That amount jumped to a maximum of 49
percent in 1836. The percentage of income derived from the
sale of land declined dramatically in the post–Civil War period, as high protective tariffs generated the majority of the
federal revenues: By 1880 land receipts amounted to a mere
0.3 percent of the federal income. However, during this same
period, the government initiated policies to encourage Americans to migrate westward by offering free or inexpensive
land.
Since the amount of revenue generated from the sale of
public lands continued to decline, the increased legislation
that facilitated the disposal of the public domain occurred for
other reasons. Congress was not interested in simply generating money to pay the federal debt. Other motivations include
the need to address social problems, such as a wave of massive immigration, a rise in the number of squatters in the
post–Civil War period as the country experienced several financial panics that left many Americans deeply in debt, and
the rise of tenant farming in the South. By opening up western lands, the government solidified control over the West,
and as the population increased in these areas, the territories
completed the process of becoming states as specified in the
Northwest Ordinance of 1787. In this respect, another of the
original intentions of the founding fathers was fulfilled.
U.S. policies regarding land sales also created a variety of
problems. First among these was the problem of incomplete
record keeping. Although the General Land Office had the responsibility for recording sales, land agents failed to use a
uniform system to document transactions. In addition, many
people attempted to defraud the government by not fulfilling
residency or improvement requirements. The American public, from the beginning, argued that the government policies
benefited the speculator more than the individual farmer.
Some contended that the sale of public lands at auction allowed groups of investors to form combinations that could
artificially hold down the prices. A huge outcry occurred as
railroad companies, after receiving more than 64,900,000
acres in land grants, began charging high prices to transport
the produce of farmers while providing rebates to large trusts
such as Standard Oil.
Although historians do not agree on the exact motivations
behind specific bills, they do find patterns indicating that the
political parties influenced land policies. For instance, the Republican Party favored giving free land to homesteaders, the
Whigs encouraged the sale of land and the disbursement of
revenues to the states for internal improvements, and the Democrats promoted preemption. Other patterns concern the
amount of land sold or granted during specific periods. Interestingly, the amount of land disposed of under the Homestead Act increased after the General Revision Act of 1891.
Prior to the passage of the act, only 52 million acres had been
claimed, whereas an additional 230 million acres fell under
the Homestead Act provisions after 1891. The federal government’s disposition of public land occurred in 1910, when
approximately 25 million acres were sold or granted to individuals or the states. Table 3 illustrates how the government
disposed of public lands.
Table 3 Disposition of the public domain, 1781–2002
Type of disposition Acres
Disposition by methods not elsewhere classified* 303,500,000
Granted or sold to homesteaders
287,500,000
Total unclassified and homestead dispositions 591,000,000
Granted to states for:
Support of common schools 77,630,000
Reclamation of swampland 64,920,000
Construction of railroads 37,130,000
Support of miscellaneous institutions
21,700,000
Purposes not elsewhere classified
§ 117,600,000
Canals and rivers 6,100,000
Construction of wagon roads 3,400,000
Total granted to states 328,480,000
Granted to railroad corporations 94,400,000
Granted to veterans as military bounties 61,000,000
Confirmed as private land claims
** 34,000,000
Sold under timber and stone law
†† 13,900,000
Granted or sold under timber culture law
‡‡ 10,900,000
Sold under desert land law
§§ 10,700,000
Total miscellaneous dispositions 224,900,000
Granted to state of Alaska
State selections
*** 90,100,000
Native selections
††† 37,400,000
Total granted to state of Alaska 127,500,000
Grand total 1,271,880,000

Note: Data are estimated from available records.
* Chiefly public, private, and preemption sales, but includes mineral entries,
scrip locations, and sales of townsites and townlots.
The homestead laws generally provided for the granting of lands to
homesteaders who settled upon and improved vacant agricultural public
lands. Payment for the lands was sometimes permitted, or required, under
certain conditions.
Universities, hospitals, asylums, etc.
§ For construction of various public improvements (individual items not
specified in the granting acts), reclamation of desert lands, construction of
water reservoirs, etc.
** The government has confirmed title to lands claimed under valid grants
made by foreign governments prior to the acquisition of the public domain
by the United States.
†† The timber and stone laws provided for the sale of lands valuable for timber
or stone and unfit for cultivation.
‡‡ The timber culture laws provided for the granting of public lands to settlers
if they planted and cultivated trees on the lands granted. Payments for the
lands were permitted under certain conditions.
§§ The desert land laws provided for the sale of arid agricultural public lands to
settlers who irrigated them and brought them under cultivation. Some desert
land patents are still being issued.
*** Alaska Statehood Act of July 7, 1958 (72 Stat. 338), as amended.
††† Alaska Native Claims Settlement Act of December 18, 1971 (43 U.S.C. 1601).
Land Policies 431
The land policies of the U.S. government have influenced
settlement patterns, facilitated the development of an internal land transportation system, and assisted states in creating
recreation, education, and municipal areas. Since the 1970s,
the government has increasingly focused on managing the remaining natural resources, and the disposition of the public
domain has virtually ceased. Nonetheless, it is clear that the
decisions made in the past continue to impact Americans
today.
—Cynthia Clark Northrup
References
Czech, Brian, and Paul R. Krausman. The Endangered
Species Act: History, Conservation, Biology, and Public
Policy.
Baltimore, MD: Johns Hopkins University Press,
2001.
Gates, Paul Wallace.
Public Land Policies: Management and
Disposal.
New York: Arno Press, 1979.
Hibbard, Benjamin Horace.
A History of the Public Land
Policies.
Madison: University of Wisconsin Press, 1965.

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