Public Public PolicyLand GrantsRailroadMichiganLegislationHistory An early student of railroad land grants, John Bell Sanborn noted that "for most of the Michigan roads, the information regarding the use of the lands has been too scanty to be of any importance in a general study of the subject."1
After the construction of the Illinois Central demonstrated proof of concept that land grants would get railroads built, Congress was inundated with requests for new grants. The states argued that the grants were necessary to build railroads which in turn would bring settlers, growth, and prosperity. (Meints, RfM, 51) Congress passed two new land grant laws, one in 1856 and another in 1857, that affected Michigan, Wisconsin, and Minnesota, beginning a new series of land grants.2 The 1856 law authorized the transfer of 20 million acres of land to eight states so that they could promote the construction of 4,649 miles of railroad. Approximately, 1150 of those miles were proposed in Michigan, for which the state received 3.775 million acres of federal land. (Meints, RfM, 51) This meant that approximately one-quarter of the granted railroad mileage was located in Michigan but only a little over a fifth of the proposed land was pledged to Michigan. So it seems that Michigan did not get its fair share here: building more railroads with less federal land than other states.3
The 1856 law was a little different from the 1850 law that authorized the Illinois Central. First, the 1850 law granted the federal land directly to the ICRR. Michigan chose to divide its portion into 60-section lots which would be given to the companies only upon completion of each twenty mile section of line.4 The state also granted railroads in the lower peninsula a tax exemption of seven years and ten years for lines in the U.P. Lower peninsula lines were assessed a one-percent per-annum tax on capital stock (which was increased to two-percent after ten years).5 The tax exemption was a state policy designed to encourage railroad construction; it was not — as some farmers and anti-railroad agitators liked to argue — a marker of corruption. (Decker, 14) Last, in order to eligible to receive the granted lands, each railroad's capital stock had to be paid in full. Subscribed stock did not count.(Meints, 52)
In Michigan, Congress specified six routes as eligible for land grants. These were:
Because the routes were to be assigned to individual railroad companies by the state legislature, many companies were formed to compete for the routes. Meints notes that "the lobbying was furiously intense." (Meints, RfM, 54)
1. ⇑ John Bell Sanborn, "Congressional Grants of Land in Aid of Railways," University of Wisconsin Bulletin in Economics, Political Science, and History 2, no. 3 (Madison: University of Wisconsin Press, 1899), 98. ⇑
2. ⇑ Decker, 14; 11 Statues at Large 20, 21 (June 3, 1856) and 195 (March 3, 1857). ⇑
3. ⇑ Decker, 14; 11 Statues at Large 20, 21, Decker, and Sanborn, all note that the law was passed on June 3, 1856. ⇑
4. ⇑ Meints (p. 52) notes that an additional 60-section lot was awarded for the completion of the first twenty miles, or 120 sections total for the first twenty and 60 sections for each twenty thereafter. ⇑
5. ⇑ Leslie E. Decker, Railroads, Lands, and Politics: The Taxation of the Railroad Land Grants, 1864-1897 (Providence, RI: Brown University Press, 1964), 14; Sanborn, 96; Laws of Michigan (1855), 153ff; Laws of Michigan (1857), 346ff. ⇑
Decker, Leslie E. Railroads, Lands, and Politics: The Taxation of the Railroad Land Grants, 1864-1897. Providence, RI: Brown University Press, 1964.
Meints, Graydon M. Railroads for Michigan. East Lansing: Michigan State University Press, 2012.
Sanborn, John Bell. "Congressional Grants of Land in Aid of Railways." University of Wisconsin Bulletin in Economics, Political Science, and History 2, no. 3. Madison: University of Wisconsin Press, 1899.
This was Sanborn's Ph.D. dissertation. He discusses Michigan's land grants in detail on pp. 95-98.
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