.^■%, ^/-,^V' ^. c.^- "^(^ %. ,K^^^' K /"', .■^■ a\>" oV' A HISTORY OF PUBLIC PERMA- NENT COMMON SCHOOL FUNDS IN THE UNITED STATES, 1795-1905 BY FLETCHER HARPER SWIFT, Ph. D. (Columbia) Professor of Education, University of Minnesota NEW YORK HENRY HOLT AND COMPANY 1911 Copyright, igii, BY HENRY HOLT AND COMPANY !C!.A2924?0 PREFACE The existence to-day of public schools in most of our states may be said to be due directly, though of course by no means solely, to vast endowment funds provided by previous genera- tions. In view of the part these funds have played in nearly every state, it is surprising that they have received so Little atten- tion from historians. The two most widely known histories of education in the United States, Boone's and Dexter's, give almost no information regarding them. Boone Hmits his discussion to .out seven pages and Dexter, his to two pages. State histories of education are equally disappointing to one seeking information upon this topic. Wickersham's History of Education in Pennsylvania, one of the largest and most compre- hensive of state histories of education, contains no organized statement regarding the common school fund of Pennsylvania estabKshed in 1831. References to the fund are made here and there, but more space is given to describing the domestic sur- roundings of various prominent schoolmen than is given to this fund. It is not included in the index, a fact which further empha- sizes the small place it occupies in the work. No doubt one of the causes for the silence of the historians is the difl&culty of secur- ing reliable information respecting the public permanent common school funds. This difficulty is discussed somewhat fully in Chapter One. The present volume is the first attempt to give a comprehensive account of these funds and their influence. Part One, designed for the general reader, is devoted to a broad survey of the origin, management, loss, and effects of the public perma- nent common school funds. Part Two is designed primarily for reference. It contains a summary of the origin, condition in the year 1905, and administration of the public permanent common IV PREFACE school fund or funds of each state and territory, arranged accord- ing to the alphabetical order of states. \ The present work was begun in 1902. No effort has been spared to make it accurate. The original documents have been consulted in every case where possible. Furthermore, every account in Part Two save that of Pennsylvania has been sub- mitted to the state superintendent of public instruction or some other state ofl&cial for reading and criticism. In some cases the help given has been most valuable. During the six years occupied in completing this work correspondence has been carried on with ofhcials in every state. It was hoped in the beginning that this correspondence and the data returned with it might be added as an appendix, but this has proved impracticable. Into an account as comprehensive as this some errors will almost inevitably creep, and the author will be most grateful to anyone who will call his attention to such. No one can be more aware than the author of the importance of certain topics omitted. Several topics which it was designed to include have been excluded, owing to the limits of space set by considerations respecting publication. It has proved necessary to omit from publication what was originally designed to be Part Three. This part contained a detailed account of the history of the funds in six t5^ical states : — Connecticut, New York, Massachusetts, Maine, Florida, and Indiana. These accounts were most important as intensive studies to the student of American educational or economic his- tory, and served as a basis for Part One. The more important Tables included in Part Three have been added in an Appendix. To one who has attempted to gather data covering a large territory no explanation will be necessary as to why the accounts in Part Two are not brought down to the year 19 10. Even the federal authorities are frequently unable to get data from states, and it is needless to say that the individual and obscure seeker after statistics encounters many greater difficulties. Certain states must be written to a dozen times before any response is received and then the data is incomplete and incorrect. The laws and regulations concerning the administration of the funds PREFACE V in most states have changed Kttle since 1905. To attempt to revise these individual accounts would be to postpone indefinitely the pubUcation of a work already too long delayed. Moreover, any permanent value of such a work as this must lie chiefly in the account it gives of the origin and history of the funds, as data for any year would speedily pass out of date. The foot-notes in each part are numbered continuously. Within the same series of foot-notes where the number of a foot- note is repeated, the foot-note itself is not. The author wishes to express his most sincere thanks to Pro- fessor Paul Monroe and to Professor Edward L. Thorndike of Teachers College, Columbia University; to Professor Monroe who suggested the subject treated in the following pages and under whose guidance the beginning of this study was conducted; and to Professor Thorndike who, together with Professor Monroe, reviewed the manuscript and made many practical and valuable suggestions. To the superintendents of schools and other state ofi&cers from CaHfornia to Maine most grateful acknowledgments are made for the courtesy, patience, and invaluable assistance they extended. F. H. S. Untv^ersity of Minnesota, Minneapolis, Minn. September, 1910. v\m^ CONTENTS PART I ORIGIN, MANAGEMENT, LOSS AND INFLUENCE OF PUBLIC PERMANENT COMMON SCHOOL FUNDS Chapter Page I. Introduction. Permanent School Funds and the Rise of Free Schools. Present Condition and Importance of Permanent Funds 3 11. Early Sources or School Support and Evolution of Pub- lic Permanent School Funds 23 III. Federal Sources of Permanent Common School Funds . 39 IV. State Sources of School Funds and the Creation of Per- manent Common Funds 81 [anagement of Public Permanent Common School Funds 107 VI. Loss of Public Permanent Common School Funds . . 129 VHj^ Purpose and Effects of Public Permanent Common School Funds 160 PART II PUBLIC PERMANENT COMMON SCHOOL FUNDS AND LANDS IN THE STATES. A SUMMARY OF THE ORIGIN, PRESENT CONDITION, AND ADMINISTRATION OF THE FUND IN EACH STATE VIII. Alabama. Sixteenth Section Fund. Valueless Sixteenth Sec- tion Fund. School Indemnity Land Fund. Surplus Revenue Fund 207 rx. Alaska 213 X. Arizona 214 XL Arkansas. Common School Fund. Permanent School Fund. Sixteenth Section Fund. Surplus Revenue Fund . . 216 XII. California. State School Fund. Township Funds . . . 221 XIII. Colorado. Public School Fund 226 XIV. Connecticut. School Fund. Town Deposit or Surplus Revenue Fund 22S XV. Delaware. Public School Fund. Surplus Revenue Fund 238 XVI. District of Columbia. Lottery Fund 242 XVII. Florida. State School Fund. Township Funds .... 243 vii VIU CONTENTS Page XVIII. Georgia. Academy Fund. Free School Fund. Poor Fund. School Fund. Surplus Revenue Fund 247 XIX, Idaho. Public School Fund 251 XX. Illinois. Township Fund. School Fund Proper. Surplus Revenue Fund. The County School Fund 254 XXI. Indian Teemtory 259 XXII. Indiana. Bank Tax Fund. Common School Fund. Con- gressional Township Fimd. County Seminary Fimd. Delinquent Tax Fund. Saline Fund. Sinking Fimd. Surplus Revenue Ftmd 260 XXIII. Iowa. Permanent School Fund • . 268 XXIV. Kansas. State Permanent School Fund 271 XXV. Kentucky. Common School Fund. Literary Fund Surplus Revenue Fund ... 275 XXVI. LoxnsiANA. Free School Fund. Perpetual School Fund. Sur- plus Revenue Fund 279 XXVII. Maine. Permanent School Fund. School Taxation. Town, Ministerial and School Funds 283 XXVIII. Maryland. Free School Fund. Surplus Revenue Fund . . 296 XXIX. Massachusetts. Massachusetts School Fimd 299 XXX. Michigan. Primary School Fund. Swamp Land Fund . . 312 XXXI. Minnesota. Permanent School Fund. Swamp Land Fund. 316 XXXII. Missouri. County Public School Fund. Public School Fund . Special District Fund. Township School Fund . . . 321 XXXIII. Mississippi. Chocktaw or Sixteenth Section Fimd. Chick- asaw Fund 325 XXXIV. Montana. PubHc School or State School Fund 329 XXXV. Nebraska. Permanent School Fund 332 XXXVI. Nevada. State School Fund 335 XXXVII. New Hampshire. Common School or Institute Fund. Lit- erary Fund. Surplus Revenue Fimd 338 XXXVIII. New Jersey. The New Jersey Permanent School or State School Fund. Surplus Revenue Fund 342 XXXIX. New Mexico. Permanent Fund 347 XL. New York. Common School Fund. Literature Fund. Town Funds. United States Deposit Fund 349 XLI. North Carolina. Literary Fund 361 XLII. North Dakota. Permanent School Fund 365 XLIII. Ohio. Irreducible State Debt or Common School Fund . . 368 XLIV. Oklahoma 378 XLV. Oregon. Common School Fimd 380 XL VI. Pennsylvania. Common School Fimd 383 XL VII. Rhode Island. Permanent School Fund 387 XL VIII. South Carolina. Permanent School Fund 389 XLIX. South Dakota. Permanent School Fund 391 L. Tennessee. Common School Fund. Permanent School Fund 394 CONTENTS IX Page LI. Texas. County School Funds. Permanent School Funds 400 LII. Utah. State School Fund 406 LIII. Vermont. Huntington Fund. Permanent Public School Fund. Spanish War Claims Fund. United States De- posit Fund 408 LIV. Virginia. Literary Fimd • • . 420 LV. Washington. Common or Permanent School Fimd .... 423 LVI. West Virginia. Irreducible Fund or School Fund .... 426 LVII. Wisconsin. School Fund 429 LVIII. Wyoming. Common School Permanent Fund 434 Appendix "A." Tables relating to the History of Permanent Public Com- mon School Funds. Revenues and Expenditures in Connecticut, Florida, Indiana, Maine, Massachusetts and New York 437 Bibliography. General 457 Bibliography. Arranged by States 460 Index 469 PART I ORIGIN, MANAGEMENT, LOSS, AND INFLUENCE OF PERMANENT COMMON SCHOOL FUNDS CHAPTER I INTRODUCTION RELATION OF PERMANENT SCHOOL FUNDS TO THE RISE OF FREE SCHOOLS — PRESENT CONDITION AND IMPORTANCE OF PERMA- NENT FUNDS The existence of free schools in the United States is so universally accepted to-day that the period of indifference, struggle, and hard- ship through which they passed and out of which Early Opposition ^ ® . . to Principles of they arosc is well-nigh forgotten. Schools were free in some states, such as Maine,^ Wisconsin,^ Kansas,^ and West Virginia,"* from the time of their admission into the Union. In others, such as Massachusetts, Connecticut, New York, Pennsylvania, Arkansas, Ohio, and Indiana, a large part of the support for public schools was drawn from pupils' tuition fees, known as rate bills. That the responsibility of educating the child rests upon the state and not alone upon the parent or guardian, that the state or community has a right to tax the property of all its members, whether or not they have children attending the schools, are prin- ciples of education which have won acceptance among us gradually and in the face of bitter opposition. In many instances the only right recognized as belonging to the state was the right to grant the townships permission to tax themselves. And only after permis- sive taxation had existed for some time was it possible to enact compulsory taxation for schools. For example, in Massachusetts permissive taxation had existed from 1647,^ but it was not until 1 Constitution of Maine, 1820, Art. VIII. 2 Constitution of Wisconsin, 1848, Art. X, Sees. 3, 4. 3 Letter, Apr. 18, 1868, from P. McVicar, Kansas Supt. Public Instruction, in Report of Connecticut Board of Education, 1868, p. 54. 4 Constitution of West Virginia, 1863, Art. X, Sec. 2. 5 Mass. Coll. Records, Vol. II, p. 203. 3 4 PERMANENT COMMON SCHOOL FUNDS 1827 that it became compulsory. In that year towns were author- ized and empowered as before, but now for the first time directed to raise by town tax the money necessary to maintain such schools as the law required.^ The indifference existing in certain states during the first half of the nineteenth century toward establishing free schools for the masses may be seen in the failure of such states as Florida and Georgia to use lands or funds available for such purpose. Upon her admission into the Union, 1845, Florida received from the United States Government section numbered sixteen in each town- ship, amounting to over one million (1,053,653) acres.^ At first these lands were regarded as belonging to the township in which they lay, but as far as can be learned only one township ever attempted to make use of its school lands,^ so that three years later the state passed an act directing the lands to be sold and the proceeds merged in a permanent state school fund.^ Article fifty-four of the constitution of Georgia, 1777, provided that " Schools supported at the general expense of the State should be established in each county," and in 1783 the governor was empowered to grant one thousand acres of land for the establish- ment of such free schools.^° Subsequent pro\isions and appro- priations were made, so that by 1836 an annual revenue of about forty thousand dollars w^as available for free schools. But in 1845 only fifty-three out of ninety-three counties applied for their share.^^ Up to i860 the income was often diverted from its lawful use, and often rejected with contempt owing to the stigma of the badge of pauperism attached to receiving it.^- An attitude similar to this prevailed to a greater or less extent throughout the United States. 6 Laws of Mass., 1S27, Chap. 143, Sec. 4. 7 Table of Land Grants, Report U. S. Commissioner of Education, 1892-93, II, p. 1283. 8 U. S. Bureau of Education, Circular of Information, No. 7, 1S88, p. 20, note 2. 9 Laws of Florida, Fourth Session, 1S48-49, Chaps. 230-231. 10 Constitution of Georgia, 1777, Art. 54; Hinsdale, B. A., Documents Illustrative of American Educational History, p. 13 14. 11 U. S. Bureau of Education, Circular of Information, No. 4, 1S8S, p. 27. 12 Ibid., p. 26. INTRODUCTION 5 Private schools and academies increased in number and were attended by the well-to-do; the free public school being regarded as a charity or pauper school. It is said that in 1834 Massachusetts alone contained nine hundred and fifty private schools and acad- emies.^^ Despite these early harassing conditions, by the year 1870 a system of free schools had become established in practically every Existence of State State in the Union. In almost every state these Sysreins Due to systems had been begotten and nurtured by one Perman^en/ School °^* ^^rc general public permanent common school ^^^^^ funds; by which term is meant a fund the principal of which the state constitution or laws provide shall be kept per- manently invested, and whose income alone, therefore, can be used for the support of common schools. The principal of the fund may be held by the state, as in Connecticut and Minnesota, or di- vided among and intrusted to the counties, towns, cities, and vil- lages, as in Indiana and Missouri. These general permanent pub- lic funds differ from the permanent local funds in that they owe their origin to an act or grant which made provision for the entire state or territory or for the component units of the same, town- ships or counties, and did not originate in some act, grant, be- quest, or gift affecting one or only a limited number of communi- ties within the state. Many townships and cities do possess funds of this strictly local type, but the present work does not attempt to include such, except in so far as is necessary in showing the evolu- tion of general permanent state or public funds. It is difficult to ascertain the true condition of the permanent funds of many states. In some it would appear that officers Real Condition of immediately related to these funds are ignorant, Fund^^f'ten '^ °° ^o^ Only of their history, but also of their present Unknown condition. The data given in both state and federal reports are sometimes incorrect, frequently misleading. Thus the federal reports for 1905 and 1906 both indicate that 13 Massachusetts and Its Early History, Lowell Institute Lectures, pp. 4S6-487, published by the society, 1869; Boston, Mass., U. S. Commissioner of Education, Report, 1S92-93, Vol. II, 1237. 6 PERMANENT COMMON SCHOOL FUNDS Delaware derived no common school revenue from any permanent fund/** though crediting her with a permanent fund of $350,000;^*^ whereas Delaware in reality possesses a permanent common school fund known officially as the Public School Fund, having an invested principal in 1905-06 of $938,097,^^ yielding an annual revenue of $34>303-77>^^ which is approximately ten and eight-tenths per cent of the total common school revenue for 1905 * Further evidence of lack of accurate information and of the difficulty of securing correct data is shown by the two following conflicting statements, the first taken from an unpublished type- written account furnished by the New York State Department of Finance, December 23, 1906, the second from the report of the controller: (i) "The U. S. Deposit Fund is invested in municipal securities and in mortgages. . . . The fund has been kept inviolably intact." (2) "A liberal estimate of the present worth of the $1,442,837.91 [of the U. S. Deposit Fund] held by the loan commissioners of the entire state will not exceed $1,000,000 of sure assets. The losses suffered by the principal .... from April 4, 1837, to September 30, 1905, amount to $333,862.17." is Table VII, pp. 20, 21, attempts to show the real condition of the permanent common school fund in each state as far as it has been possible to ascertain it. It will be seen that the Funds Classified: ^ , r n n • i r i i • i Intact Funds, funds fall naturally mto two classes, lunds which are intact and credit funds. Intact funds repre- sent a real investment. Connecticut, Massachusetts, Maryland, Oregon, South Dakota, Utah, and Wyoming are among the states which appear to have kept their funds intact. There are three classes or types of credit funds. The first class includes funds the principal of which has been lost or diverted outright, but which is * For source of data and fuller statement on this point consult the account given in Part II. 1* Report U. S. Commissioner of Education, 1905, Vol. I, 410; Ibid., 1906, Vol. I, 306 (data for 1904-05). 15 Ibid., 1905, Vol. I, 419; 1906, Vol. I, 315 (data for 1896-97). 16 Delaware Treasurer's Report, 1905, P- 20. 17 Ibid., p. 23. 18 New York Comptroller, Report 1906, p. 280. INTRODUCTION 7 recognized by the state as a permanent debt on which the state must pay an annual revenue, the rate of interest or amount being fixed by law. The funds of Tennessee, Kentucky, and the greater portion of that of Louisiana are examples of this class. The second type of credit fund is one concerning which the laws provide that the state may expend the proceeds belonging to the principal as fast as they are paid into the treasury, credit the same to the fund, and pay interest on the account thus established. Such funds might be called permanent state accounts for common schools. Maine, Michigan, and Ohio have pursued this policy. A third class of funds which are in part practically credit funds are funds whose moneys have been borrowed by the state and which to-day are represented by state bonds, which will in all probability never be redeemed, and which constitute what is practically a state debt. It will be recognized that this third method of employing the moneys belonging to the principal of the permanent fund is differ- ent from using them to purchase state bonds in the open market. The fund of California is very largely a credit fund of this third class. In at least sixteen of the states the permanent common school funds are entirely or in part credit funds. Table I, see p. 8, shows for each fund in certain states: (i) the amount of the principal intact, (2) the amount which is a credit fund (1905). In federal and in most state reports these credit funds are re- Misconception ported from year to year without comment as per- ConditioiT of Funds manent funds, so that many states appear to have and by Lax Use^of permanent productive sources of revenue for "^^^^^ common schools which, in reality, have nothing save an additional source of taxation. Furthermore, the lack of uniformity in the use of the terms "school fund" and "common school fund," which are used in some states to designate permanent funds and in other states to designate annual school revenue derived from a variety of sources, is another misleading factor which must be reckoned with, and which makes it necessary to devote at least a paragraph to the topic of titles of the permanent school funds. "School fund" is the title given by the constitutions to the state PERMANENT COMMON SCHOOL FUNDS Table I. Credit Funds'* State'' Principal^ Total Intact 1 Credit I. Ala. $2,83i,29S<« $2,831,295 2. Ark. i,i28,5oo<^ 1,128,500 3. Cal. $3,237,834 2,026,000 5,263,834 4. Del. 759.312 178,850'^ 938,097ft 5- la. 4,746,405 10,937'' 4,757,342 6. Ky. 2,418,997 « 2,418,997* 7. La. 243,930 (189s) 1,130,867'' 1,759,387 8. Maine 442,757^ 442,757 g. Mich. (1903) 5,201,852'',/ 5,201,852 10. Miss. 2,464,644™ 1,002,023!? 3,466,667 ''^ II. Nev. (1906) 1,038,078 612,000'' 1,651,078 12. N. H. 59,470",/,' 59,470' 13. Ohio 4,902,110'',/ 4,902,110 14. Tenn. 2,512, 500^ 2,512,500 15. Vt. 344,949 775,269 1,120,218 16. Wis. 2,045,513 1,563,700'' 3,609,213 permanent common school fund in West Virginia,^^ Connecticut/" „ , . „ ^ and Wisconsin.^^ This same title is employed Confusing Use of r j Term " School in California by the treasurer and by the con- Fund " ^ ^ troller to designate the "total current annual ^ Data in this table are taken from letters and data received from state oiEcers and from state and federal reports quoted under accounts for each state in Part II. *.For 1905 unless indicated otherwise. •^ Table VII, pp. 20, 21, gives valuations for all states, being arranged in alpha- betical order. '' Practically a permanent state debt. ^ Established or recognized as a permanent state debt by the law or by the constitution. / State uses moneys as they are paid into the treasury; credits them to the fund; pays interest on the account thus established. A non-payable debt. ft Secured by state bonds; interest is paid from ordinary state revenues; this state has no direct state tax. * Interest on this principal is derived from the sinking fund. * Data taken from the report of the United States Commissioner of Education; may include some local permanent funds. ' Now used for supporting teachers' institutes only. "^ Amount intact not verified. 19 West Virginia Constitution, Art. X, Sec. i. 20 Connecticut Constitution, Art. VIII, Sec. 2. 21 Wisconsin Constitution, 1S48, Art. X, Sec. 2. INTRODUCTION 9 school revenue derived from all sources." ^^ Alabama ^^ and Dela- ware ^^ also employ the term "school fund" to designate common school current revenue. In Indiana,^^ New York,^^ Oregon,^^ and Washington ^* " Common School Fund " is the title of the permanent state common school fund. Georgia uses the same term to desig- nate the total public school revenue derived from fourteen different sources; ^^ Kansas, to designate the total annual revenue for common schools derived from all sources; ^° Nebraska, the income from the state tax, fines, and forfeitures, and interest on permanent school funds; ^^ Ohio, the income derived from the school tax.^^ In some states the report of the state superintendent of schools frequently employs a title different from that provided by the con- stitution and the laws. Thus, in Washington " Permanent School Fund" is often used to designate the common school fund. Cali- fornia fails to make any specific provision for a title for her per- manent common school fund, though both constitution and laws refer to it as the state school fund.^^ Custom frequently fixes upon a permanent fund a name different from its official title. Thus the Michigan Primary School Fund and Swamp Land Fund are often called the "Seven Per Cent Fund" and the "Five Per Cent Fund." 34 "Permanent School Fund" is the title employed by the greatest 22 Statement received from A. B. Nye, California Comptroller, in letter, Dec. 15, 1906. 23 Public School Laws of the State of Alabama, compiled by O. J. Turner, 1895. Also Report Alabama State Supt. of Education, 1897-98, pp. 58-59; Ibid., 1886, p. 7. 2* Delaware School Laws, 189S, p. 38, Sec. 27. 25 Indiana Constitution, 185 1, Art. VIII, Sec. 2. 26 Laws of New York, 1905, Chap. 587. 27 Constitution of Oregon, 1859, Art. VIII, Sec. 2. 28 Constitution of Washington, 1889, Art. IX. Sees. 2, 3. 29 Georgia School Law, 1903, Sec. 38. Also Report Georgia School . Commis- sioner, 1903, p. 404. 30 Report Kansas State Supt. Public Instruction, 1880, p. 8. 31 Nebraska School Law, 1899, p. 54. 32 Ohio School Law, 1898, Sec. 3951. 33 California School Laws, 1903, apply this title to Art. IX, Sec. 4, of the Con- stitution. See also Report California Supt. Public Instruction, 1S64-65, p. 249. 34 Report State Supt. Public Instruction, Mich., 1903, p. 24. lO PERMANENT COMMON SCHOOL FUNDS number of states; "Public School Fund" comes next to this in fre- quency of usage. Table II, without attempting to be complete, presents many of the titles employed. Table XVII showing the titles of all the permanent state school funds in each state will be found on pp. 100-106. Table II. Official Titles op Permanent Common School Funds and States Employing Them Title No. States Permanent School Fund 12 I Ark., 2 la., 3 Ky., 4 Me., 5 Minn., 6 Neb., 7 N. D., 8 R. I., 9 S. C, 10 S. D., II Tenn., 12 Tex. State Permanent School Fund I Kansas (Name of State) Permanent School Fund I New Jersey Public School Fund S I Del., 2 Col., 3 Idaho, 4 Mont., 5 Mo. Common School Fund 4 I Ind., 2 N. Y., 3 Ore., 4 Wash. School Fund 3 I Conn., 2 W. Va., 3 Wis. (Name of State) School Fund I Massachusetts Common School Permanent Fund I Wyoming Permanent Public School Fund I Vermont State School Fund 4 I Fla., 2 Nev., 3 Utah, 4 Cal. Free School Fund 2 I La., 2 Md. Sixteenth Section Fund Ala., Miss., and other states Primary School Fund 1 Michigan Chickasaw Fund I Mississippi Institute Fund I New Hampshire School Fund Proper I Illinois Ohio Irreducible State Debt I Ohio Alaska ^^ and the District of Columbia * never possessed a gen- eral permanent common school fund nor reservations either of land or of money with which to establish such funds. Pennsyl- vania and Georgia both formerly had permanent common school funds, but to-day possess none. Georgia devotes state revenues derived from railroad and land rents and from certain bank stock * Consult the accounts given for each state in Part II. 35 Statement contained in private letter received August 9, 1906, from E. E. Brown, U. S. Commissioner of Education. INTRODUCTION II to the support of common schools.^^ But the sources of these reve- nues do not appear to have been set apart permanently for this pur- pose.* The remaining states and territories all possess one or more permanent common school funds, intact or credit, or reservations of land or of money from which such funds will be created. The permanent common school funds differ greatly in value, as might be expected. Texas possesses two, the combined principal of which amounts, in iqc^, to over fifty-two mil- Inequality of ^ Funds of lion dollars ($t; 2, 660,489).^^ Minnesota's fund is Different States ^ ^ ' ' > y/ next in size,t amounting to nearly eighteen million dollars ($17,824,135.12).^* The two states having the smallest per- manent school funds are New Hampshire and South Carolina. The principal of the former's fund amounts to about fifty-nine thousand dollars ($59,470);^^ the latter's in 1906, to about forty- six thousand dollars.^" In many states the permanent funds and the proceeds which should have been added to them have been cared for so carelessly, diverted, squandered, wasted, and embez- zled so shamefully, that what ought to be a magnificent endowment, whose income would to-day be yielding an appreciable relief from taxation, has dwindled to an almost negligible sum, or exists as a permanent state debt on which interest is paid out of the taxes levied upon the present generation. Twenty-eight million dollars is a conservative approximate estimate of the sums lost or diverted in twelve states, as follows: * Consult the accounts given for each state in Part II. t Consult footnote 43 on this point. 36 Georgia School Law, 1903, Sec. 38. Also Report Georgia School Commis- sioner, 1903, p. 404. 37 Data furnished Nov. 23, 1906, by J. W. Stephens, Texas State Controller; of. account given in Part II. 38 Biennial Report, Minn. Supt. of Public Instruction, 1905-06, p. 352. 39 Statement received July 17, 1907, from H. C. Morrison, N. H. State Supt. Public Instruction. *o Data furnished Dec. 10, 1906, by R. H. Jennings, S. C. State Treasurer. 12 PERMANENT COMMON SCHOOL FUNDS Table III. Money Lost or Diverted Belonging to Permanent School Funds * Alabama $2,500,000 Arkansas 1,250,000 California 6,800,000 Georgia 1,100,000 Indiana 3,000,000 Kansas 2,000,000 Louisiana 1,130,867 Massachusetts 2,842,512 North Carolina 2,525,000 Tennessee 1,888,985 Vermont 1,015,269 Virginia 1,826,516 Total $27,880,149 In a few states, such as West Virginia,^^ and Massachusetts,'^ a limit has been set which the principal of the permanent school Limited and fund may not exceed. In a few other states, of Growing Funds which Connecticut is an example, no means of increasing the principal of the fund exists at present, other than wise investment. However, most states have set no limit to the principal, and in many the funds are being increased rapidly from certain sources, the revenues from which are to be forever added to the principal of the fund. In Minnesota the Permanent School Fund is increasing at the rate of nearly a million and a half a year. Twenty-four of the states and territories possess reservations of unsold school lands, the estimated value of which must be added to the present principal in order to get a true conception of the present and prospective relative size of the funds in the different states. On p. 20 will be found Table VII, giving complete data. Table IV presents (i) the principal of the funds in the different states, in millions and thousands, arranged in order of value, and (2) the per cent of the total common school revenue in each state * For sources of these data see Chapter VI on Loss, in Part I; also accounts for each state in Part II. *i Constitutional amendment adopted 1902, statement received Feb. 18, 1907, from T. C. Miller, W. Va. State Supt. of Free Schools. 42 Mass. Resolves, 1894, Chap. 90. INTRODUCTION 13 derived from the income of the principal. Table V shows (i) the funds arranged in the order of their estimated total value, including the estimated value of unsold school lands, and (2) the estimated value of unsold school lands, stated in millions and thousands, the proceeds of the sales of which will be added to the principal of the permanent common school funds.'*^ Table IV. « Permanent Common School Funds in Millions and Thou- sands,* Grouped in Order of the Value of Their Principal in the Year 1905. « Per Cent of Total Common School Revenue Derived FROM Their Income f Principal Per Principal Per Cent States mil- thou- Ce7it States mil- thou- lions sands lions sands Group I Group II Texas $52,660 27.69 New York $8,971 •7 Minn. (1904) 15,978** 5-3 N. Dak. 8,263 12.6 Mo. (1902) 11,566 7-9 Kansas (1902) 7.531 9-3 Ind. 10,641 S-i 111. 7,033 3-7 Group III Group IV Neb. 6,238 II. 9 Ohio 4,902^^ 1-59 Cal. 5,263'^ 6. Mass. 4,880 1.2 Mich. (1903) 5,201^^ 4-5 S. Dak. (1906) 4,807 11.9 Okla 5,000 Iowa 4,757"^ 2. Oregon 4,599 13-5 N. J. (1902) 4,523 2.05 '^ Data in this table are taken from answers returned by state officers and from state and federal reports quoted under accounts for each state in Part II. * Table VII on p. 20 gives complete valuations, states being arranged in alpha- betical order. '^ For 1905 unless indicated otherwise. <^ Wholly or in part a credit fund; see pp. 5, 6, 7. For real condition of these funds see Table VII, p. 20. * « See foot-note 43 for estimate of value. This does not include one-half Swamp Land Fund. See account given in Part II. t See accounts in Part II for data for Indian Territory and Oklahoma. 43 It is impossible to secure a satisfactory estimate of the value of unsold common school lands. The estimates given are in many cases based on surface area and do not include the value of such products as minerals, oil, etc. In Minnesota, in 1904, the unsold lands belonging to the Permanent School Fund (according to data furnished the author Sept. 27, by J. W. Olsen, Supt. of Pub. Instruction) 14 PERMANENT COMMON SCHOOL FUNDS Table IV — continued Principal Per Principal Per States mil- thou- Cent States mil- thou- Cent lions sands lions sands Group V Group VI Wis. $3,609'^ 2.6 Ala. $2,S3i0 ^ T Tf w CO -J- ^ CJ* rq coo O^^toQO^t^NCOMpicoc^ -^ MCOiowcOcoc-iacoOOCslocOCOOtvt-^ CO CO w m TT f 1 CT^io t^ to w Cm m c^ 0^ 0^ 0^ »o « rj -* q_ ■^ coo '^ t^; <^ *o c^^ ^^t,^^t*?"l;^ °^ Total Receipt for Commc School CO w N 00 co:» CO '-T d^ tC fTcO^OO' cCo' *-^ *^ O'CO" coo" cClO C> CO tC CO tC N 00 w 00 CO t^co uiwO^t^tot^c-iQ , "* cotn-^NO ■'t-MOOOoo i-io-^N cot^ inoo o CO , 00 Tj- Tj- ro ^ C^ , t^ " , o> M ■n ^ " -rcoMoa5uO"COTrcoOMCOt^o- J, O '^ w m t^ O' t^ CO 1^ M sO t^ Total Income from ermanen te Comm lool Fun and and Rent 0_ CN, CO M M ^ 10 C^CO t-t t^CO Tl-O^'^COOOtO CO sO u^ ri G- -^ CO ci tC ooT ..J- M 10 - 00 CN r^co G^MmpjoCMo t^ CO ►^O ^ CO « 1-1 ^00 Ci 10 « O^CO COCMOCO OCOCO CO ^1 --."^2-1 M 00 vO 1 N-*i-i c)^"_^"OmO" « CO CO 03 CO II ■T3 >r m <^ CO CO CON OtO CO-CO 000^ ■.t CO 100 CO r^ M »o "rt la 3 sS_ ^ COS? coo coio cocoo t^O" oai3 1 t 1 1 CO M 1 1 1 tC 1 H-T lOvd" 1 tocol 1 1 1 1 ^cTl 1 "d""! 1 col Oco N^^ M Tj- t^ 1 I--0 r-CO C^TfM .00 ^'^> ' ' ' \0 ^Z) Tt ' MOO r^O 'oco' 'coc*co' 'co'>oc^ H »/^^ " -0" S ^ ds to m" -^co" pT '■r CO* •<* " ri M N -a -a CO ,n CO 00 v^M 000 n'^O _ S oS> o'o,,8o8, 0,00 E2 3 O m M C Si c g-^ 1 M 0" '^ 1 1 1 pr 1 6^ "-^ in 1 00" -- "^ c;; -? d M- d pt; * do" ■K> 1 1 1 1 to 1 1 1 1 Mcol llfMiol'oOo' OO'lOO •^ Tj- CO w^ ■0 1-CO OOm UNO W 0" c? M 10 -«^ pT ►T 'f d" =^ W 00 NCO MU-iO TtaO ■a o « M rv. •-" 10 [>.in "o-g-o rr t^ 00 000 Q 1 c>» cSTf 01^ COlOO COOO to-*l 1 1 lOC^i ii-tG^Oi CSiOO gw ^ ;.. 1 1 ? 1 0- ^ 1 1 1 ?! 00" 1 M CO^ OOMO ClOQ lo C^ t^O^'-' -^t^o 1-1 < in sD •^ CO " " " " " " Rate of Int. St. Pays on Cr. Fund or Loan % -* --t to to-" * 1 1 ^11 1 \0 coo \0 1 1 ■» 1 1 1 =8 1 1 * i.« 1 1 1 MM \D '^vO '^-O t^ coo '^ Tf -^ WM -^ t^ -Vi -Ki -Vi °-;3'SSt3 00 t-^ Amouni Princip Borrow by Sta Secure by State Bondi 1 1 1 1 ^'' 1 1 1 1 1 1 ! i 1 -* t^ 1 0" 1 1 1 1 11 "^^ 1 1 1 r^ ^ 1 1 i i 1 "^ 1 M 1 ^ 1 1 1 1 1 1 0^ 1 1 1 1 »n 1 1 1 1 1 1 in 1 1 1 ^^ ! 1 1 1 1 ^ ^&^ yS m" ^ «>. lip >i ^. -1 -i; — • '5 1 1 1 1 Jo 1 t 1 1 1 1 1 li iIImIi sM iIIm M 1 .1 <-. ■" OJ ^l 1 1 -^ ° 1 1 « 1 1 1 1 M 1 ^f^ 1; " CO -O CO dooof^ MN cod^ ^ nj Smco'T 00 "to s ""Sm « 1 0, " Tt- -< "* C^ U 5 «* * C) « to M s 3. c u-a ^ ri ri CO to "o" 00 M CO CO ^ 11 ffi fi 1 1 1 1 CO 1 ►^ 1 i i 1 1 1 0| icoicOMi 1 1 lOIC-l 1 1 1 \ "^ •t; 3 OD 10 to 1 1 o^ 1 1 1 t \ 1 "^ 1 °- " 1 1 1 1 ^„ 1 - 1 1 1 1 1 " e-g ^fa 1 1 1 1 ^ \ ^ ^ i t^ cs 0> Tj- sd" CO 00" d" hT Co" CO Tf ^ to-x5 f^ 5C "g ajC/3 ?? t-> t^ CI -^O) CO M Ph c CO cs" 4 ^ «" cd" o g ■Sfe ,^ o^N«ii. tv. CO COnO ■« c^ N S. t^ t^co M rl t^ ^0 CO 5 CO >-^0 CO ■* o o CO N CT' ■sO vD in CI ■* CO G^oo tocoM tot^K'tooco t^r^- r^O O to cor^ocot^o "CO -^^ toco CO q^ Tj- qso^oo^ q^ .^^ 'n.S' M lOOO CO 10 To q; t^^l P c w 1 1 00" cooo" c^ 1-1 ^ fi fl 1-1 „.- ^ 3 O o65 O C h U r^ -•-• O W§ CI— . c o rt O E-g few o E E faSQ -.->^ CD CO H coco tv.cOMMNCT'-^OQ CO 00 e^ "^^^ "1 ^ ^ 1 ^ .MOO ^CO CO T|- TT M vO ' *C "^ ^^ ^ "1^^ ^ *-iv " M fOsO" H hT fT to V^CO icT'^ o o I ■^ O c^ O G^ moo f> -^ c *0 G^MCO t~>.0 O t-^ ^1 S iti'-i o o >" > /3 c .^ .C! 60 ^' *-" £ '^ - o'^-T-it;! S2«^ 3t3 ^ C "".S3 gS"^ rti!i « 'S «'2'«^ " " 5 ■^ O S g c rt rt 3j; ta K D S w E' 151 ||l|ll^|c^«^;^« # e^3M Secure Educational landers undertook to form a new state for Ameri- Land Grants. 1 1 ■ r -t /-t^t New England Can veteran soldiers and their families. The state was to be located between the Ohio river and Lake Erie. Colonel Pickering drew up a plan of government and Put- nam prepared a petition to Congress for permission to plant a colony. The importance of this petition is that it contains the first suggestion of a policy of federal land reservation for the sup- port of education. In the same year, 1783, Colonel Bland of Virginia made a motion Plan of in Congress to accept Virginia's cession of western Colonel Bland j^j^^jg ^^ ^^^ ^^^^^ offered by the state. In this motion it was proposed that the land thus ceded should be laid 125 Journals of Congress, VII, pp. 46-48. 120 Journals of Congress, IX, pp. 67-70. 127 Acts and Laws of Mass., 1783-Sg, pp. 218, 273-274. 12'* Journals of Congress, XI, pp. 221-223. 120 Encyclopedia Briltanica, Vol. XVII, p. 758. 130 Report Conn. Board of Education, 1853, p. 63. 44 PERMANENT COMMON SCHOOL FUNDS out in definite districts, each of which was to become a state as soon as it contained twenty thousand inhabitants. In these dis- tricts bounty lands were to be given to continental soldiers. The motion further provided that Congress should reserve one-tenth of the territory and appropriate the income derived from the sale to several specific objects, one of which was the founding of semi- naries of learning.^^^ As noted above, after Virginia had ceded her claim to the western territory, the federal possession of the western lands was considered Thos. Jefferson's assured. Congress therefore felt called upon to ^^^° consider plans for their survey, sale and govern- ment. Thomas Jefferson prepared a plan for the government of this western territory. His plan was adopted April 23, 1784. It contained no provision for the support of education. This plan, however, was intended for the temporary government only. On May 20, 1785, Congress adopted an ordinance which pro- Ordinance of 1785. vided the manner of survey and of sale of the Gr^ts of SecWon western lands. The ordinance reads in part as Sixteen for Schools f qUowc • "An ordinance for Ascertaining the Mode of Disposing of Lands in the Western Territory. "Be it ordained by the United States in Congress assembled, That the territory ceded by the individual states, to the United States, which has been purchased of the Indian inhabitants shall be disposed of in the following manner: A surveyor from each state shall be appointed by Congress or a committee of the states, who shall take an oath for the faithful discharge of his duty, before the geographer of the United States, who is hereby empowered and directed to administer the same; and a like oath shall be administered to each chain carrier by the surveyor under whom he acts. "The surveyors . . . shall proceed to di\'ide the said territory into town- ships of six miles square, by lines running due north and south, and others crossing these at right angles, as near as may be. "The geographer shall designate the townships or fractional parts of the 131 George W. Knight, History and Management of Land Grants for Education in the Northwest, p. 8 (Apud I, Bancroft, Appendix). FEDERAL SOURCES OF SCHOOL FUNDS 45 townships by numbers progressively from south to north; always beginning each range with No. i. . . . ". . . . The townships respectively shall be marked by subdivisions into lots of one mile square, or 640 acres, in the same direction as the external lines and numbered from i to 36." Here follow provisions regarding the mode of sale; one of which reads: "There shall be reserved for the United States out of every township, the four lots being numbered 8, 11, 26, 29 . . . for future sale. There shall be reserved the lot No. 16, of every township, for the maintenance of public schools within the said township." 1^3 The adoption by Congress of the plan contained in the ordinance of 1785 cut short the dreams of the company headed by Colonel Pickering and Rufus Putnam. Nevertheless, Ordinance of 1787 ^ ' and the Ohio Putnam and Beniamin Tupper orsfanized a new Company , rr o company, known as the Ohio Company, with pur- poses quite similar to those of the old New England company. On July 5, 1787, Manasseh Cutler, one of the directors of the Ohio Company, arrived in New York where Congress was in session, and opened negotiations in behalf of the Ohio Company for the purchase of a large tract of land. The prospect of such a large sale made it incumbent upon Congress to make further provision for the government of the western territory. The Journals of Congress, which record the passing of this ordinance, read as follc.vs: "A/'cording to order, the ordinance for the government of the territory of ti - United States northwest of the River Ohio was read a third time and passed as follows: "An ordinance for the Government of the Territory of the United States, North West of the River Ohio." This is a long ordinance covering nine pages and providing for the government of this region. Pages 90-93 read in part as follows : "It is hereby ordained and declared by the authority aforesaid, that the folio-Rang (six) articles shall be considered as articles of compact between ^^ Laws of United States of America, 1789-1815, Vol. I, Chap. 32, pp. 563-569. \ 46 PERMANENT COMMON SCHOOL FUNDS the original states and the people and states in the said territory, and forever remain unalterable, unless by common consent, to wit: "Article the first. . . . "Article the second. . . . "Article the third. Religion, morality and knowledge, being necessar}' to good government and the happiness of mankind, schools and the means of education shall forever be encouraged. . . . " i^s The rest of this article is taken up with provisions regarding the Indians. The original ordinance makes no reservation of lands for education, but in the contracts for the sale of lands made there- after, lot i6 was set aside in each township for schools and two townships for a university- It will be seen that this ordinance of 17 87 contains no general nor specific provision for the reservation of lands for education. Ordinance of 1787 Article III, frequently quoted as the source of our Fedeiaf L^nd'° °^ national land policy, might mean much, little or Grants for Schools nothing. The benevolent school land policy adopted by Congress, and which has frequently and erroneously been attributed to this ordinance, cannot be found here. Indeed, the action of Congress during the next ten days would seem to indicate that it deserved little of the praise which has ever since been heaped upon it. The ordinance of 1785 and the contract for the sale of western territory are the two instruments out of which the federal policy of reserving lands for educational insti- tutions arose. The Ohio Company originally asked for the following reserva- tions, i. e., gifts of land from Congress: one lot in each township Federal Land ^^^ ^he support of schools, one for the ministry, Schoois^anT ^°^ ^^^^^ townships for the support of an institution Religion in Ohio Qf higher learning. Congress obiected to these Company's o o o j Contract 1787 demands and did not come to terms until Dr. Cutler submitted an ultimatum. In this he repeated the original demands of the Ohio Company, save that he now asked for two instead of four townships for an institution of higher education. Cutler's threat to buy lands of some individual state, added to 133 Ibid., 17S7, p. 90; Ibid., pp. 221 ff. FEDERAL SOURCES OF SCHOOL FUNDS 47 Congress' pressing need for money, resulted in the passage of an ordinance which authorized the board of treasury to contract for the sale of lands on the terms and with the reservations demanded by the company. This ordinance was passed July 23, 1787. Four days later it was modified slightly upon the insistence of Dr. Cutler. As passed on July 23, it reads in part as follows: "Powers to the board of treasuiy to contract for the sale of western terri- toiy." (It is provided,) "That the Board of Treasury be authorized and empowered to contract with any person or persons for a grant of a tract of land . . . upon the following terms . . .: The purchaser or purchasers, within seven years from the completion of this work, to lay off the whole tract at their own ex- pense into townships and fractional parts of townships, and to divide the same into lots, according to the land ordinance of the 20th of May, 1785; "(i) Complete returns whereof to be made to the Treasury Board. The lot No. 16, in each township or fractional part of a township, to be given perpetually for a purpose contained in the said ordinance. The lot No. 29 in each township or fractional part of a township, to be given perpetually for the purposes of religion. "(2) The lots Nos. 8, 11 and 26, in each township or fractional part of a township, to be reserved for the future disposition of Congress. Not more than two complete townships to be given perpetually for the purposes of an university, to be laid off by the purchaser or purchasers as near the center as may be, so that the same shall be of good land, to be applied to the in- tended object by the legislature of the state. The price to be not less than one dollar per acre for the contents of the said tract, excepting the reservations and gifts aforesaid." i^* The next large purchase of land was made by John Cleve Symmes, who, in the year 1787, made a contract with the board of treasury which later resulted in a purchase of over Reservations for three hundred eleven thousand (^11,682) acres of Schools and . . \o f / Religion in Symmes' land in Ohio.^^^ Symmes' contract reserved lands for schools, religion, and one township for an insti- tution of higher education. 134 United States Land Laws, 1838, pp. 24-2^. 135 " Educational Land Policy of the United Stales," Barnard's American Journal of Education, Vol. 28, pp. 929-938. 48 PERMANENT COMMON SCHOOL FUNDS Lot 29 for the support of the ministry was granted by the United States in no instances except in land purchased by the Ohio Com- pany and by Symmes. The figures given below show the method of surveying lands in conformity with the provisions of the ordinance of 1785. The Congressional lands surveyed are divided into townships six miles and R^seivSn^of Square. It will be seen that for the boundaries School Sections q£ ^-j^g townships, north-and-south and east-and- west lines must be secured. In order to get a point from which to start these lines it is necessary to designate certain meridians as principal meridians, and certain parallels as base-lines. A meridian- line is an arbitrary line selected by the surveyor and may be any- where in the state. In some states we find several principal me- ridians, in others only one. Beginning with any principal meridian the townships are numbered east and west from it by tiers, the first tier east being called range one, east; and the first tier west being called range one, west. The townships are numbered in the same manner both north and south from the base line. Any township may, therefore, be easily described and located, thus: Township 3 N., Range 2 W. of the first principal meridian. Owing to the convergence of meridians the townships become narrower as one proceeds northward from the base-line. It therefore becomes necessary to run correction lines to be used as new base-lines. Each township is supposed to be six miles square and is divided into thirty-six sections, numbered as in figure 2. Each section contains six hundred forty acres. Figures i and 2 show the method of surveying and the division of the township into sections. It might be well to point out some of the more important forces which originally influenced Congress in making reservations of Causes of Federal ^^^^ for schools. These forces may be summa- Land Grant Policy j-j^gj ^s follows: (i) the example set by states, such as Connecticut and Massachusetts and others, of reserving sections for schools in newly surveyed townships, (2) interest in the cause of education, (3) the need of selling the western lands, (4) the desire to make westward emigration attractive. Massachu- setts, in 1788, for the sake of encouraging settlement in her eastern FEDERAL SOURCES OF SCHOOL FUNDS 49 territory, had provided for the reservation of school lands. In Chapter II it was pointed out what Connecticut and New York did I ^IGU] x% 1 7 s 6 Cm reetio 5 ^ Line k .a, 3 <£; \ 2 I 1 TV in II I B.I W. n.i E. II III IV Bass. Line Figure 2. — Six Miles Square. 6 5 4 3 2 1 7 8 9 10 11 12 18 17 16 15 14 13 19 20 21 22 23 24 30 29 28 27 26 25 31 32 33 34 35 36 Figure 3.— One Mile Square. NWM N3^NEM SEM NEJ4 S.K in this same direction. The efforts of the original states to provide schools, which have been described, suggest something of the public interest respecting education. Nevertheless it must be admitted 50 PERMANENT COMMON SCHOOL FUNDS that, although in certani localities and with certain individuals, free education was regarded as necessary for the commonwealths, there was a long perioci of struggle and experimentation to be passed through, before the public mind was ready to accept the principle underlying the establishment of free schools. Certain men in Congress in 1785 and 1787 were deeply interested in the cause of public education. On the other hand, it must be evident from the difficulties which Dr. Cutler experienced in obtaining his demands, that it was the need of selling tlie western lands which led Congress to make the reservations for schools and universities. Emigration westward had been slow and Congress had become discouraged. It was for the sake of otTering an offset to the hard- ships of the wilderness that Congress consented to make provision for schools. The reservation of sections for common schools arose out of the ordinance of 17 85. The land reservation which arose from the ordinance of 1787 is the reservation of townships Ushed^ty*Oniilmn- ^o^ the benefit of an institution of higher learning, ces of 1785 and ]\;]-q general policy was declared or provided for in cither of these ordinances. The educational provisions of the land ordinances and of the powers of the treasury were purely specific in their application. The second related only. to the territory ceded by individual states and purchased by the United States of the Indians; the first only to the sale of land made to the Ohio Company .^^"^ Nevertheless, the principle which had been expressed in the ordinance of 1785 and in the sale contracts of 1787 became a precedent for the federal Government, and in every public-land state admitted into the Union at least one section in every township, or an equivalent in land or scrip, has been granted for the use of schools, and at least two townships for an institution of higher learning. Ohio received three townships for an institution of higher learning; Florida, Minnesota, and Wisconsin, four each; and Utah seven.^^^ 136 Hinsdale, B. A., Documents Illustrative of American Educational History, Report of U. S. Commissioner of Education, 1S92-93, p. 1270. 137 Report of U. S. Commissioner of Education, 1S67-6S, p. 6S. FEDERAL SOURCES OF SCHOOL FUNDS 51 Tennessee was the first state to be admitted into the Union in which the federal Government owned lands. But no federal grant of lands for schools was made to this state until First State to Receive Section 1806, ten years after its admission. Consequently Sixteen, Ohio, 1802 , ^ . , . , . . the first state in which section sixteen was granted for the support of schools was Ohio. The grant originally offered to her in the enabling act of 1802 reads as follows: "An act to enable the people of the eastern division of the territory north- west of the River Oliio, to form a constitution and state government, and for the admission of such into the Union, on an equal footing with the original states, and for other purposes. "Sec. I. Be it enacted, etc. ... "Sec. 7. That the following propositions be and the same are hereby offered to the convention of the eastern state of the said territory when formed, for their free acceptance or rejection; which, if accepted by the convention, shall be obligatoiy upon the United States. "First. That the section numbered sixteen in every township, and where such section has been sold, granted or disposed of, other lands equivalent thereto, and most contiguous to the same shall be granted to the inhabitants of such township for the use of schools. "Second. That [certain salt springs and lands be granted to the state] for the use of the people thereof, the same to be used under such terms . . . and regulations as the legislature of the said state shall direct. . . . "Third. [That one-twentieth part of the net proceeds of the lands lying within the said state sold by Congress from and after June 30, 1802, be] ap- plied to laying out and making public roads. "Provided always, that the three foregoing propositions herein offered are on the condition that the convention of the said state shall provide by an ordinance, irrevocable without the consent of the United States, that every and each tract of land sold by Congress, from and after the 30th day of June next, shall be and remain exempt from any tax laid by order, or under au- thority of the state, whether for state, county, township, or any other purpose whatever, for the term of five years, from and after the day of sale." i^s It will be seen from the above quotation that Congress offered to the people of the state about to be formed, certain grants of land including section sixteen, salt lands and a certain per centum of the net proceeds of the land sold by Congress after the admission of the state. These propositions were offered upon cci "^ain stated 138 Laws of the United States of America, 1789-1815, Chap. 300, pp. 496-498. 52 PERMANENT COMMON SCHOOL FUNDS conditions, viz., that the lands sold by Congress should be free from all state, county, and township taxes. The grant made in the above act provided no school lands for a large portion of the state. Over eleven million acres of land within Ohio, more than one- fourth of the land area of the state, were included in the Ohio Company's purdiase, the Symmes purchase, the Original Grant Virginia Military Reserve, the Connecticut West- ern Reserve, the United States Military Reserva- tion, and miscellaneous grants made by the federal Government to corporations, individuals, and Ohio. The grant of the section numbered sixteen to the inhabitants of each township did not apply to these lands. Over seven million acres of land in Ohio, exclusive of Virginia's Military Reservation, one-third of the state, was totally unprovided for, while the remainder was given one thirty-sixth of the land owned by the United States, to aid in sup- porting public schools. It was not to be expected that the people of Ohio would be satisfied to accept propositions manifestly so in- equitable.* Of all these reservations, grants, and sales, the sales to the Ohio Company and to Symmes, together equal to about 1,200,000 acres, were the only ones in which section sixteen or other sections had been reserved for schools. Consequently there were more than nine million acres within the state in which no school lands had been reserved.^^^ The constitutional convention of Ohio passed an ordinance and resolution on November 29, 1802, making provision for the grant of school lands to those sections of the state which had been left unprovided for. Congress, by an act passed March 3, 1803, accepted the "Modi- fications and additions" proposed by Ohio and admitted Ohio as a state. As a result of this act land equal approximately to one thirty-sixth their area was granted for schools to all portions of the state not affected by the sixteenth section grant. * For a fuller description of the areas not included under the sixteenth section grant and for an account of the school lands subsequently granted for them, consult account of Ohio Irreducible Debt, Part II, Chapter XLIII. 139 Barnard, Anier. Jour, of Ed., Vol. 28, p. 933; Chase, Statutes of Ohio, pp. 74-75. FEDERAL SOURCES OF SCHOOL FUNDS S3 The question involved in the Ohio controversy was a far-reaching Congress Makes one and One which might be met with upon the for^Grant 0°^'^'°° admission of a state wherein lands had been set- Lieu°of^s^e^tfo? ^led upon, which, upon survey, proved to fall ^^^•^^^^ within section sixteen. In 1826 Congress, by an act entitled "An act to appropriate lands for the support of schools in certain townships and fractional townships, not before provided for," made general provision for all such cases. Section one of this act provided that: "There shall be reserved and appropriated, for the use of schools in each entire township, or fractional township, for which no land has heretofore been appropriated or granted for that purpose, the following quantities of land, to-wit, for each township or fractional township containing a greater quantity of land than three-quarters of an entire township, one section; for a fractional township containing a greater quantity of land than one-half, and not more than three-quarters of a township, three-quarters of a section; for a fractional township containing a greater quantity of land than one-quarter, and not more than one-half of a township, one-half section; and for a fractional township containing a greater quantity of land than one entire section and not more than one-quarter of a township, one-quarter section of land." 1*0 The policy which Congress had adopted of granting lands for schools to the Northwest Territory was soon extended to the South. Congressional On December 27, 1789, North Carolina had ceded Policy Expended ^^ the United States the sovereignty and territory South, 1803 Qf ^YY lands within the present limits of Tennessee. In 1796 Tennessee was admitted into the Union, but the federal Govermnent retained the title to the public lands within the new state, and it was not until 1806 that Tennessee received a grant of public lands. Between 1796 and 1806 much of the public land had been taken up by settlers. In this latter year the United States granted to Tennessee the public lands lying within the state on which the Indian title had become extinct.^'^^ Thereupon, the state passed an act requiring that newly acquired lands should be surveyed and laid out " so as to form sections as near six miles square I'lo Statutes at Large, Vol. IV, p. 179. 1*1 Report Tenn. Supt. Public Instruction, 1S91, pp. 24-26; Laws of Tenn., 1806, Chap. I, Sees. i-6. 54 PERMANENT COMMON SCHOOL FUNDS as the case will admit" and that six hundred forty acres fit for cultivation should be laid off in each such six mile square division and "appropriated for the use of schools for the instruction of children forever." It will be seen that the policy pursued with respect to Tennessee differed from that pursued with the western states, in wdiich school sections were reserved throughout the entire area during the territorial period and granted to the state upon its admission to the Union. From this time until 1848, in every newly surveyed congressional township, one section was granted for the support of schools. In 1846 the commissioner of the land oflQce, and Two Sections ,0 r 1 rr-. Granted for Com- m 1 847 the Secretary of the Treasury had each mon Schools, 1848 , , . , , r 1 1 1 1 recommended an mcr eased grant of school lands to the new states and territories. In the first session of the thirteenth congress, February 15, 1848, when the question was being put on the passage of the bill concerning the admission of Wisconsin into the Union, John A. Rockwell, a member of the house of representa- tives, from Connecticut, moved an amendment granting section thirty-six in each township in addition to section sixteen for schools. This amendment was rejected by a vote of eighty to fifty-eight. In the act establishing the territorial government for Oregon in August, 1848, and in the act for IMinnesota, approved March 2, 1849,^"^ it was provided that sections numbered sixteen and thirty- six of each township should be reserved for the use of schools. The Oregon act reads : "An Act to Establish the Territorial Government of Oregon. Approved August 14, 1848. "Sec. 20. That when the lands in the said Territory shall be surveyed under the direction of the Government of the United States, preparatory to bringing the same into market, sections numbered 16 and 36 in each township in said Territory shall be, and the same are hereby, reserv'ed for the purpose of being applied to schools in said Territory, and in the States and Territories hereafter to be erected out of the same." ^^ This was the first act appropriating two sections for the support 1^ An Act to establish the territorial government of Minnesota, Sec. 18; Statutes of Minnesota, 1849-58, p. xl. ^*3 Statutes at Large, Vol. IX, p. 330. FEDERAL SOURCES OF SCHOOL FUNDS 55 of schools. The first state to receive two sections of each township was Cahfornia, admitted September 9, 1850; the second, Minnesota, admitted May 11, 1858; the third, Oregon, admitted February 14, 1859. While Congress had been bestowing millions of acres of lands upon every new public land state, with the exception of Virginia, Vain Efforts of Connecticut and Tennessee, it had done nothing to'^Secure^Land ^^r any of the original states or the states carved ^^^^^^ out of them. Yet by the resolution of 1780, already referred to, Congress had given its pledge that the western lands should be disposed of for the benefit of all. It is not sur- prising, therefore, that some of the eleven original states unprovided with federal lands, should have made an earnest effort to secure some of them. In 1 82 1 Maryland passed resolutions stating that all of the states had equal rights in the public lands, and that those for whom no appropriations had been made were entitled to such appropriations. The resolutions read as follows : "Resolved, by the general assembly of Maryland, That each of the United States has an equal right to participate in the benefit of the public lands, the common property of the Union. "Resolved, That the States in whose favor Congress have not made- ap- propriations of land for the purpose of education, are entitled to such ap- propriations as will correspond, in a just proportion, with those heretofore made in favor of the other States." ^^ Copies of these resolutions were transmitted to Congress and to the governors of the several states with a request that they sub- mit them to their respective legislatures. Governor Hester of Pennsylvania, in 1821, urged the legislature of his state to consider the question of uniting with other of the original states in demanding of the federal Government an equitable proportion of the public lands for the support of schools.^"^ Con- necticut, New Hampshire, Vermont, and Virginia indorsed Mary- lands' resolutions. Massachusetts reported unfavorably upon them. 1*4 Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1274, 1*5 J. p. Wickersham, History of Education in Pennsylvania, p. 268, 50 PER^IANENT COMMON SCHOOL FUNDS New York drew up and accepted a counter report. Ohio adopted "a long and carefully prepared reply." Here the matter ended."*^ The states in which section sixteen was not reserved for schools are as follows: The thirteen original states, Indian Territory (admitted with Oklahoma in 1907), Kentucky, Receiving Section Maine, Tennessee, Texas, Vermont, and West Virginia. Kentucky, Maine, Vermont, and West Virginia, like the thirteen original states, contained no public land. The case of Tennessee has been explained in a preceding para- graph. The Republic of Texas retained the title to her public lands upon her admission into the Union. On July 26, 1839, she had provided for a reservation of three Spanish leagues, thirteen thousand two hundred and eighty-four acres in each county for the support of schools. In 1840 this county grant was increased to four leagues, or 17,712 acres. Owing to these two facts Congress was neither able nor called upon to grant lands to Texas for the support of schools, and, as pointed out in Chapter I, of this part, Texas to-day possesses the largest permanent fund of any state in the Union.* All the land in Indian Territory belonged to members of Indian tribes, and Congress had no authority to reserve any of it for schools. In place of the usual grant of land Congress appropriated five million dollars which became a part of the per- manent school fund upon the territory's admission into the Union with Oklahoma.! Table X presents the states which received no federal grants or appropriations for common schools. Table XI shows the area of the land reserved by Congress in the states in which section sixteen or sections sixteen and thirty-six in each township were donated for common schools. The areas given here are taken from the tables last published by the federal land office, issued in 1896. The areas are evidently estimates. In the separate accounts in Part III will be found statements of * Cf. separate accounts given for each of these states in Part II, t Letter to F. H. Swift, September 13, 1906, from Fred L. Warner, Secretary of (Oklahoma) Board for Leasing School Lands, we Bernard C. Steiner, History of Education in Maryland, pp, 56-57. FEDERAL SOURCES OF SCHOOL FUNDS 57 the area each state actually received, where this has been ascer- tainable. Some states have not yet completed the survey of their lands and in others the area reported from year to year varies. In view of these and certain other facts it seems best to abide here by the area given in the federal tables which, though subject to modification, will answer sufficiently for a general comparison. Table X. States Which Received no Federal Grants for Common Schools Thirleen Original Slates A dmitied Connecticut Delaware Georgia Maryland Massachusetts New Hampshire New Jersey New York N. Carolina Pennsylvania Rhode Island S. Carolina Virginia Vermont 1791 Kentucky 1792 Maine 1820 W. Virginia .... 1863 Texas 1845 Table XI. Area of Township Sections Granted for Common Schools * Group I. States Receiving Section No. 16 Acres Date of Grant Alabama 901,725 Arkansas 928,057 Florida i>o53i653 Illinois 985,141 Indiana 601,049 Iowa 978,578 Louisiana 798,085 Michigan 1,003,573 Mississippi 838,329 Missouri 1,162,137 Ohio 710,610 Wisconsin _ 958,649 Mar. 3, 1803 June 23, 1836 Mar. 3, 1845 Apr. 18, 1818 Apr. 19, 1816 Mar. 3, 1845 Apr. 21, 1806; Feb. 15, 1843 June 23, 1836 Mar. 3, 1803; May ig, 1852; Mar. 3, 1857 Mar. 6, 1820 Mar. 3, 1803 Aug. 6, 1846 * Taken from p. 4, Tables of Stale Grants of Public Lands, issued by federal land office, March 12, i8g6. G. F. Pollock, acting commissioner, stated in letter, August 27, 1906, that no tables of stale land grants had been compiled since 1896. <^ From Report of U. S. Commissioner of Education, 1892-93, II, p. 1283. 58 PERMANENT COMMON SCHOOL FUNDS Group II. Territories and States Receiving Sections Nos. i6 and 36 Acres Date of Grant Arizona 4,050,346 California 5,610,702 Colorado 3>7i5,555 Idaho 3,063,271 Kansas 2,876,124 Minnesota 2,969,991 Montana 5,102,107 Nebraska 2,637,155 Nevada (3,985,422) 2,ooo,ooot New Mexico 4,309,369 North Dakota 2,531,200 Oklahoma 1,276,204 Oregon 3,387,520 South Dakota 2,813,511 Washington 2,488,675 Wyoming 3,368,924 May Mar. Mar. Mar. Jan. Feb. Feb. Apr. Mar. Sept. Mar. 26, 1864 3, 1853 3> 1875 3, 1863 29, 1861 26, 1857 28, 1861 19, 1864 21, 1864 9, 1850 2, 1861 Feb. 14, 1859 Mar. 2, 1861 Mar. 2, 1853 July 25, 1868 Group III. State Receiving Sections Nos. 2, 16, 32, and 36 Acres Date of Grant Utah 6,007,182 Sept. 9, 1850 Salt Lands Group IV. Indian Territory received $5,000,000 grant from Congress in lieu of the usual land donations. See account given above and in Part II. Texas and Tennessee also present special cases. Of all federal lands which have been employed by the states to establish permanent common school funds, the sixteenth and thirty-sixth sections have contributed the most. However, no inconsiderable portion of these funds has been derived from lands gained from grants, given, in many instances, for particular objects other than schools but under such terms that it was possible for the state to devote the proceeds to t In place of this original congressional grant Nevada accepted 2,000,000 acres of land, with the privilege of selecting any unappropriated lands whether lying within sections 16 and 36 or not. {Report Nevada State Land Register, 1905, 1906, pp. 8, 14.) FEDERAL SOURCES OF SCHOOL FUNDS 59 education. In other cases Congress has simply granted lands without specifying the object to which they were to be devoted. In granting Ohio salt lands and a certain per centum of the proceeds of the public lands sold after the state's admission into the Union, Congress provided two sources of money which have contributed to permanent common school funds in many states. According to the last federal tables, thirteen states have received grants of salt and contiguous lands, commonly spoken of as saline lands, the total area of which amounts to States Devoting Saline Lands to 606,04 ^ acres.^'*' Arkansas, Indiana, Missouri,^^* School Funds , "J, . , ,. ' , ' and Ohio are among the states which have devoted the proceeds of saline lands to their permanent common school funds. The acreage of saline lands granted to these five states is as follows: Ohio, 24,216 acres; Indiana, 23,040 acres; Arkansas, 46,080;^^^ Missouri and Nebraska ^^° each 46,080. Ohio, the first state to receive the grant of saline lands has made the proceeds of them a part of the Irreducible Ohio Saline Lands _, ,., ii-ii- Debt, which she established m place of creating a permanent common school fund.^^^ A congressional act enabling the territory of Indiana to form a constitution, granted to the state all salt springs within the terri- indiana Saline tory and land reserved for the use of the same with ^^^^ such other land as the President of the United States may deem necessary for the proper working of the salt springs, not exceeding thirty-six sections.^^^ In 1832 the legislature of Indiana petitioned Congress for permission to sell these lands. Congress granted the request upon two conditions: (i) that the land be sold at not less than one dollar and twenty-five cents per 1*7 Tables. State Land Grants of Public Lands, Gen. Land Office, March 12, 1896, p. 8. 1*8 Laws of Missouri, 1837, Act passed Feb. 6. 1*9 Answers returned Sept. 7, 1906, by John Hineman, Ark. State Supt. Public Instruction. 150 Data furnished Sept. i, 1906, by Neb. Supt. Pub. Inst. 161 Ohio School Law, 1898, Sec. 3952. See also account of Ohio fund given in Part II. iM Boone, R. G., History of Education in Indiana, p. 181. 6o PERMANENT COMMON SCHOOL FUNDS acre; (2) that the proceeds be applied to education. By a special Act, 1834, the proceeds of the saline lands were regarded as a per- manent fund known as the Saline Fund, the income of which was devoted to schools. In 1851, the Sahne Fund became a part of the Common School Fund by the provisions of the new constitu- tion. The total proceeds of the saline lands were $89,478.47. By reference to the Ohio Enabling Act, quoted above, it will be seen that in the case of Ohio, Congress left it to the option of the state to determine what use should be made of the proceeds of the sahne lands. But in the case of Indiana, although at first Congress appears not to have specified the object, yet when the state applied for the right to sell these lands. Congress required that their pro- ceeds should be devoted to education. This illustrates a general tendency evident in the acts of Congress with respect to lands granted to the states. At first it was left largely to the state to determine the mode of disposing of these lands, and the objects to which their proceeds were to be devoted, but as time went on the provisions of Congress became more and more specific and ex- acting. In 1 841 Congress passed an act granting five himdred thousand acres of land to each of the following states : Alabama, Arkansas, II- internai Improve- hnois, Indiana, Louisiana, Michigan, Mississippi, ment Lands ^^^^ Missouri for internal improvement. The ob- jects to which the act empowered the states to apply the net pro- ceeds of the sales of these lands were as follows: roads, rail- ways, bridges, canals, improvement of waterways, and drainage of swamps. The lands were granted on condition that the states should grant free transportation for United States mail, United States troops, and war supplies. The act provided that similar land grants should be extended to all states admitted subsequently to the passage of the act. The act reads: "An act to appropriate the proceeds of the sales of the public lands and to grant preemption rights. "Sec. 8. And be it further enacted, "That there shall be granted to each state specified in the first section of this act five hundred thousand acres of land for purposes of internal improve-' FEDERAL SOURCES OF SCHOOL FUNDS 6i ment. Provided, that to each of the said states which has already received grants for said purposes, there is hereby granted no more than a quantity of land which shall, together with the amount such state has already received as aforesaid, make five hundred thousand acres, the selections in all of the said states to be made within their limits respectively, in such manner as the legislature thereof shall direct; and located in parcels conformably to sectional divisions and subdivisions, of not less than three hundred twenty acres in any one location, on any public land except such as is or may be reserved from sale by any law of Congress or proclamation of the President of the United States, which said locations may be made at any time after the lands of the United States in said states respectively, shall have been surveyed according to existing laws. And there shall be and hereby is, granted to each new state that shall be hereafter admitted into the Union, upon such admis- sion, so nauch land as, including such quantity as may have been granted to such state before its admission, and while under a territorial government, for purposes of internal improvement as aforesaid, as shall make five hundred thousand acres of land, to be selected and located as aforesaid. "Sec. g. And be it further enacted, "That the lands herein granted to the states above named shall not be disposed of at a price less than one dollar and twenty-five cents per acre, until otherwise authorized by a law of the United States, and the net proceeds of the sales of said lands shall be faithfully appKed to objects of internal im- provement within the states aforesaid, respectively, namely: Roads, railways, bridges, canals and improvements of water courses and drainage of swamps, when made or improved shall be free for the transportation of the United States mail, and ipunitions of war, and for the passage of their troops, without the payment of any toll whatever." ^^^ Nineteen states have received grants of land under the Act of 1841, amounting to nine million five hundred thousand acres of land.^^'^ Five, at least, have devoted internal States Devoting Internal Improve- improvement lands to the permanent common ment Lands to iiri^i-r- Permanent School school fund. California regarded the sixteenth and thirty-sixth section lands as belonging to the townships ^^^ and created her first permanent state fund for the support of common schools from the proceeds of the sales of the live hundred thousand acres of internal improvement lands which the state received upon her admission into the Union in 1850. 153 U. S. Statutes at Large, Vol. V, Chap. 16, approved Sept. 4, 1841. 154 Report Cal. State Supt. Public Instruction, 1864-65, p. 249. 62 PERMANENT COMMON SCHOOL FUNDS Iowa in 1846/^^ Wisconsin in 1849/^^ Oregon in 1859,^^' Kansas in 1861,^^® and Nevada in 1864,^^^ each by its constitution adopted in years just named, united its internal improvement lands with the township section lands in the establishment of a permanent common school fund managed by the state. Kansas, however, failed to enact laws to carry out the provisions of her constitution respecting these lands, so that their proceeds were never added to the state permanent school fund.^'^^ As early as 1825, North Carolina created a permanent common school fund, known as the Literary Fund. Among the several sources named from which this fund was to be Swamp Lands , . 1 • i i i n .1 derived, were mcluded all vacant unappropriated swamp lands in the state. It need scarcely be stated that these were state and not federal lands. By an Act of Congress passed in 1850, supplemented by later legislation, swamp lands amounting in all to over eighty million acres have been granted to fifteen states.^^^ "The swamp land grant is an indefinite grant since it is of all the swamp and overflowed lands rendered thereby unfit for cultivation and remaining unsold at the date of the grant. The acreage given in this table [Table XII, p. 66] represents the lands claimed up to this time; as there is no hmit to the quantity the state may claim in the future, the true amount granted cannot be stated." 161 The full force of this statement taken from the federal report is clearly shown in the grant made to Arkansas which follows: "An act to enable the state of Arkansas and other states to reclaim the swamp lands within their limits. "Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, to enable the state of Arkansas to construct the necessary levees and drains to reclaim the swamp and over- 155 Constitution of Iowa, 1846, Art. IX, Sec. 2, p. 3. 15* Constitution of Wisconsin, Art. X, Sec. 2. 157 Constitution of Oregon, 1859, Art. VIII, Sec. 2. 158 Constitutional Ordinance, Sees, i, 6, 7, Gen. Laws of Kan., 1861, p. 46. 169 Constitution of Nevada, 1864, Art. XI, Sec. 3. 180 Kansas School Law, 1905, p. 5. 161 Tables. State Grants of Public Lands, Gen. Land Office, Mar. 12, 1896, p. 9. FEDERAL SOURCES OF SCHOOL FUNDS 63 flowed lands therein, the whole of these swamp and overflowed lands, made unfit thereby for cultivation, which shall remain unsold at the passage of this act, shall be and the same are hereby, granted to said state. "Sec. 4. And be it further enacted, That the provisions of this act be extended to, and their benefits be conferred upon, each of the other states of the Union in which such swamp and overflowed lands, known and designated as afore- said, may be situated." 1^2 It would appear that the following states provide or have pro- vided for devoting a part or all of the proceeds derived from the sale of swamp lands to the support of common states Devoting '■ ^ ^ Swamp Lands to schools: Alabama, Florida, lUinois, Indiana, Lou- Conunon Schools . . tv/t- 1 • -n/r- -» • • isiana, Michigan, Minnesota, Mississippi, Mis- souri, Ohio, Oregon, and Wisconsin. The method by which the proceeds of these lands have been devoted to the principal of permanent common school funds differs considerably. Wisconsin provides that five per cent of the proceeds of the sales of federal public lands lying within the state shall be added to the principal of the school fund. Florida provides that twenty-five per cent of the proceeds of the sales of public land, now or hereafter owned by the state, should be added to the principal of the state school fund.^^^ These are general provisions applying to all lands received from the federal Government, save school lands, and therefore necessarily include swamp lands. Some states make specific provision that a certain per cent of all the proceeds of swamp lands shall be added to the principal of the permanent Common School Fund ; Oregon adds ten per cent to her Common School Fund.^^^ Illinois added largely to the permanent County School Funds estabhshed in 1835, from the proceeds of the sales of swamp lands. In 1868 Missouri made provision for making permanent the County School Funds established in 1839, and in doing so devoted the proceeds of the sales of 3,185,479 acres of swamp lands to those funds.* * See accounts given for each state in Part II. 162 U. S. Statutes at Large, Vol. IX, Chap. 84, p. 519. 163 Constitution of Florida, Art. XII, Sec. 4. 16^ School Laws of Oregon, 1897, p. 47, Title XIII, Sec. 21. 64 I^ERMANENT COMMON SCHOOL FUNDS Minnesota, by Chapter V, General Laws, 1865, directed that 525,000 acres of swamp lands be reserved for the support of certain One-half Minne- State educational and charitable institutions. An Devot^''to^ ^^""^^ amendment to the state constitution, adopted in Common Schools jgg^^ article 8, section 2, provided that one-half of all swamp lands then held, or which might thereafter accrue to the state, shall be appropriated to the "Common School Fund," and one-half to the state educational and charitable institutions; the principal of the funds derived from the sales of such swamp lands to be forever preserved inviolate and undiminished. Not until 1907, however, was an act passed which resulted in making these constitutional provisions effective. Since 1907, however, Minne- sota has distributed to the common schools of the state one-half the income of the swamp land fund together with that of the Permanent School Fund. As the result of this act, Minnesota has established a second permanent public common school fund. In 1908 the invested principal of one-half the Swamp Land Fund, amounted to $621,636.17, and the interest on the same to $18,637. i6.i'^^« The constitution of Indiana, 1851, provided that the surplus of the proceeds of swamp lands remaining after the expenditure of the amount necessary for the reclaiming of the lands should be added to the principal of the common school funcl.^'^''' In 1890 it was estimated that eight hundred fifty thousand dollars was due to the common school fund from this source, but owing to the dishonesty of swamp land commissioners, and to insufficient legislation, nothing had been added.^'^'^ Mississippi, in her constitution of 1868, pro- vided that the proceeds of swamp lands, with certain specific excep- tions, should constitute a part of the Common School Fund.^^'^ Alabama had disposed of her swamp lands in a similar way in her 164<» Data supplied to F. H. Swift by Minnesota Auditor's Department, Dec. 2S, 1908; also Advance Report from Biennial Report, 1907-08, Minnesota State Auditor, p. ix. 165 Constitution of Indiana, 1S51, Art. VIII, Sec. 2. 160 Report Ind. Supt. Public Instruction, 1866, p. 73; Boone, R. G., History of Ediicalion in Indiana, p. 200. 167 Constitution of Mississippi, 1S68, Art. VIII, Sec. 6, FEDERAL SOURCES OF SCHOOL FUNDS 65 constitution of the same year.^^^ Ohio has included the proceeds of swamp lands in her Irreducible Debt.^*^^ Michigan established a separate account from the proceeds of the sales of her swamp lands. The state uses the money as the proceeds are paid in and pays five per cent on this account, whence it is commonly known as the Five Per Cent Fund, although its official title is the Swamp Land Fund.^^" The so-called swamp lands from which Michigan derived her Five Per Cent Fund, were in reality military bounty lands. Con- Miiitary and grcss, in scction 2, of an Act passed December 24, University Lands ^g^ ^^ entitled, " An act for completing the existing military establishment," provided that any uncommissioned officer or soldier, honorably discharged from the military service, should be allowed and paid as a bonus, three months' pay and one hundred sixty acres of land.^'^^ By an Act passed May 6, 181 2, mihtary bounty lands were set aside in different regions. About two million acres, reserved in Michigan territory and later erroneously declared to be worthless, were returned to the state. These became the basis of the Swamp Land Fund established by the act of the legislature of Michigan in 1858.^^^ In lieu of these Michigan lands, one million, five hundred thousand acres were set aside in the territory of Illinois, and five hundred thousand acres in the territory of Missouri, north of the Missouri river.^'^^ Arkansas devoted to her Common School Fund two townships granted for the state university .^^^ The above account makes evident the variation in the objects to which the states have devoted their grants of salt, internal improvement and swamp lands and the proceeds of the sales of the IC8 Constitution of Alabama, 186S, Art. XI, Sec. 10. 160 Ohio School Report, 1901, p. 9. 1™ Report Mich. Supt. Public Instruction, 1903, p. 24. 171 U. S. Statutes at Large, 12th Congress, Vol. II, Chap. X, pp. 669-670. "2 Laws of Mich., 185S, No. 31, Sec. 5, p. 171; Report Mich. Supt. of Public Instruction, 1889, p. 22, gives full account. See also Part II. 173 Act Apr. 29, 1816, U. S. Statutes at Large, Vol. Ill, Chap. CLXIV, p. 332. 174 Constitution, 1S68, Art. IX, Sec. 4, 66 PERMANENT COMMON SCHOOL FUNDS same. This variation, the difficulty of getting access to the neces- sary reports and the hmits of the present investigation make it impossible to show here to what extent these lands have been devoted to the support of common schools. Table XII, which follows here, shows the area of these lands, as estimated by the federal land commissioner. Table XII. Area of Internal Improvement, Saline, and Swamp Lands Granted to the States by the Federal Government * Stales Internal Improvement Acres Salt Springs and Contiguous Lands Acres Swamp Lands f Acres Alabama 500,000 Arkansas 500,000 California 500,000 Colorado 500,000 Florida 500,000 Idaho Illinois 500,000 Indiana 500,000 Iowa 500,000 Kansas 500,000 Louisiana 500,000 Michigan 500,000 Minnesota 500,000 Mississippi 500,000 Missouri 500,000 Montana Nebraska 500,000 Nevada 500,000 Ohio 500,000 Oregon 500,000 Wisconsin 500,000 Total 9,500,000 531,355.60 8,656,372.39 1,887,685.23 22,244,541.07 3,981,784.10 1.377,727-70 4,570,132.33 11,769,455.83 7,293,159.28 4,738,549.78 3,603,921.68 4,843,636.09 117,931.28 434,428.45 4,569,712.12 80,620,392.93 In addition to federal grants of land from which the states have derived moneys for permanent school funds, Congress, from the * Table taken from State Grants of Public Lands, 'J'S'bles, General Land Office, March 12, 1896, p. 8. t Claims reported to December 31, 1895, FEDERAL SOURCES OF SCHOOL FUNDS 67 first, has granted moneys which many of the states have employed either to create permanent common school funds or to enlarge Federal Money those already established. In the Ohio enabling Grants ^^^ quoted above, one-twentieth of the net proceeds of the lands sold by Congress after June 30, 1802, were granted to the state to be applied to laying out and making public roads. Every public land state, admitted since 1802, has received a grant of a certain per centum of the proceeds of the sales of lands belong- ing to the United States, sold after the state's admission into the Union. In the case of Ohio, as stated in the enabling act, this grant, together with others, was made on condition that no taxes of any kind should be levied upon the land for five years after the date of sale. The purpose of this condition was to prevent any individual from obtaining a tax title under the state, before the United States had received full payment of the purchase money. This purpose is clearly shown in the constitutional ordinance of Kansas. The constitutional ordinance of Kansas, adopted January 29, 1861, reads: "Whereas, the government of the United States is the proprietor of a large portion of the lands included in the limits of the state of Kansas as defined by this constitution; and whereas the state of Kansas will possess the right to tax said lands for purposes of government, and other purposes: Now, therefore, be it ordained by the people of Kansas, "That the right of the state of Kansas to tax such lands is relinquished forever, and the state of Kansas will not interfere with the title of the United States to such lands, nor with any regulation of Congress in relation thereto, nor tax nonresidents higher than residents: Providid always, That the follow- ing conditions be agreed to by Congress: " The conditions that follow include the grant of sections numbers sixteen and thirty-six in each township for common schools, two townships for a state university, five hundred thousand acres of land under the Act of 1841 and "Sec. 6. That five per centum of the proceeds of public land in Kansas, disposed of after the admission of the state into the Union, shall be paid to the state for a fund the income of which shall be used for the support of com- mon schools." )8 PERMANENT COMMON SCHOOL FUNDS In some states provision has been made in the enabhng act that the per centum granted by Congress be made a part of the state permanent school fund, as, for example, in North Dakota. Others have provided in general terms that such per centum as has been or may hereafter be granted by Congress on the sale of the lands in the state, should be added to the permanent common school fund. Illinois created her first state controlled fund from two and five- sixth per cent of the net proceeds of the sale of public lands granted by Congress.* The only permanent common school fund which New Mexico has at the present time consists of nineteen thousand six hundred seventy-five dollars and seventy-three cents derived from the congressional grant of live per centum of the sales of pub- lic land lying within the territory .^'^^ Some states have made general provisions which may appear to include the five per centum of proceeds of sales of public lands. Idaho, in her constitution, provides as one of the sources from other which the public school fund shall be derived or increased, " all grants of land or money made by the state for educational purposes or where no other specific purpose is indicated in such grant."^ The following states have received from Congress the per cent indicated of the proceeds of the sales of public lands :^" Ohio, Indi- ana, and Illinois received three per cent: Alabama, Per Cent ' r > j Granted to Mississippi, and Missouri received three and two Different States , _,.,,. per cent under separate acts. The followmg states received five per cent: Arkansas, California, Colorado, Florida, Idaho, Iowa, Kansas, Louisiana, Michigan, Minnesota, Montana, Nebraska, Nevada, Territory of New Mexico, North Dakota, Ore- gon, South Dakota, Utah, Washington, Wisconsin, and Wyoming. In 1841 Congress granted to Ohio, Indiana, Illinois, Alabama, Missouri, Mississippi, Louisiana, Arkansas, and Michigan, over and above what each was entitled to by the terms of their admis- * Consult account given in Part II. "5 Statement furnished Oct. 20, igo6, by Hyram HacUey, New Mexico Terri- torial Superintendent of Schools. 176 Gen. School Laws of the State of Idaho, 1897-98, Sec. 72. 177 Statement received Aug. 27, 1906, from Department of Interior, General Land Office, Washington, D. C. FEDERAL SOURCES OF SCHOOL FUNDS 69 sion into the Union, ten per centum of the net proceeds of the sales of pubhc lands made after December 31, 1841.^^^ It will be seen that this was an additional per centum grant. Some of these states devoted the moneys derived from this grant to their perma- nent common school funds. Louisiana did so by a constitution adopted in 1845.^^* Reference has been made to the use made of the proceeds of these grants by New Mexico, Illinois, Arkansas, Florida, and Idaho. The following states provide by their constitutions that moneys derived from this source shall be added to the principal of the state common school fund: California, Iowa, Kansas, Montana, Ne- braska, Nevada, North Dakota, Oregon, South Dakota, Washing- ton, Wisconsin, and Wyoming. The amounts which have been added to the permanent common school funds in the different states from this source have not been ascertained. Missouri, previous to 1900, had increased her perma- nent state school fund by about one million dollars from this source.^'''^ New Mexico, as noted above, has accumulated twenty thousand dollars. California, by an Act of Congress approved June 27, 1906, was granted payment of five per cent of the pro- ceeds of public land sales extending over a score of years. Under the requirements of the constitution this sum must be added to the perpetual school fund. Within two months after the approval of the act, warrants amounting to four hundred twenty-eight thou- sand, two hundred seventy-one dollars and sixty-one cents had been drawn to the credit of the state. It is expected that the amount involved will ultimately approach one million dollars.^^*^ In 1833 President Jackson caused the withdrawal from the United States Bank, of the Government deposit of ten million dollars, which amount the federal Government thereupon United States . . , ^ Deposit Fund distributed among the various state banks. Indi- ana is an example of a state which used part of this as a basis for a permanent common school fund. It is suffi- 178 Constitution, 1845, Title 7, Art. 135. 179 Boone, Education in the United States, p. gi. ISO Report California Controller, 1905-06, pp. 24-28, 29. 70 PERMANENT COMMON SCHOOL FUNDS cient to say that Indiana chartered a state bank on January 13, 1834, consisting of ten banks located in different parts of the state. On shares of stock held by individuals, an annual tax of twelve and one-half cents a year was issued. Section 15 of the charter of the state bank provided that the money derived from the proceeds of this tax "shall constitute a part of the permanent fund to be devoted to purposes of common school education." In 1851 this fund became a part of the principal of the Common School Fund, adding to this latter fund about eighty million dollars.^^^ "Prior to 1825 the monetary and other interests of the United States had been characterized by much confusion and complexity. The federal debt of the United States Revolution amounted to nearly forty million ($40,000,000) Surplus Revenue dollars and the state debts assumed by the general govern- ment to twice as much more. The Louisiana purchase of 1803, together with certain individual claims upon the French, made a debt of fifteen million ($15,000,000) dollars, paid by the United States in bonds draw- ing six per cent interest, and due in fifteen years. The debt incident to the war of 1812 added another one hundred million ($100,000,000) dollars. Notwith- standing all which, by the second quarter of the centuiy, and within a single generation of Washington, and especially during the decade after 1827, the prosperity of the country was almost without precedent. The national debt had been liquidated, and there actually remained in the treasury a surplus of about forty million ($40,000,000) dollars." 1*2 By an Act of Congress approved June 23, 1836, entitled, "An Act to regulate the deposits of public money," it was provided that the money remaining in the United States treasury on January i, 1837, except the sum of five million ($5,000,000) dollars should be depos- ited with such of the states of the Union, in proportion to their number of representatives in Congress, as shall by law authorize their treasurers or other authorities to receive the same on the terms specified. The terms of the act made it a loan, not a permanent grant. An official receipt was required and an obligation on the part of the state to pay the amount recei^'ed or any portion of it when called for by the secretary of the United States treasury. 181 Reports of State Supt. of Public Instruction of Ind., 1872, Vol. II, p. 170; 1885-86, Vol. II, p. 11; 1900, p. 298. 182 Boone, R. G., History of Education in Indiana, pp. 193-196. FEDERAL SOURCES OF SCHOOL FUNDS 7 1 Not more than ten thousand ($10,000) dollars could be demanded from a single state without thirty days' notice. Section 13 of the act by which Congress made provision for this loan reads as follows: "An act to regulate the deposits of the public money. "Sec. 13. And be it further enacted, That the money which shall be in the treasury of the United States on the first day of January [1837], eighteen . ^ T o < hundred and thirty-seven, reserving the sum of five millions Act June 23, 1830 •' ' ° of dollars, shall be deposited with such of the several states, in proportion to their respective representation in the Senate and House of Representatives of the United States, as shall by law, authorize their treas- urers or other competent authorities to receive the same on the terms herein- after specified; and the Secretary of the Treasury shall deliver the same to such treasurers or other competent authorities, on receiving certificates of deposit therefor, signed by such competent authorities, in such form as may be prescribed by the secretary aforesaid; which certificates shall ex- press the usual and legal obligations, and pledge the state, for the safe keep- ing and repayment thereof, and shall pledge the faith of the states receiving the same, to pay the said moneys and every part thereof, from time to time, whenever the same shall be required by the Secretary of the Treasury for the purpose of defraying any wants of the public treasury, beyond the amount of the five millions aforesaid: Provided, That if any state declines to receive its proportion of the surplus aforesaid, on the terms before named, the same shall be deposited with the other states, agreeing to accept the same on deposit in proportion aforesaid: And provided further. That when said money or any part thereof shall be wanted by the said secretary, to meet appropriations by law, the same shall be called for in rateable proportions, within one year, as nearly as conveniently may be, from the different states with which the same is deposited and shall not be called for in sums exceeding ten thousand ($10,000) dollars from any one state in any one month, without previous notice of thirty days for every additional sum of twenty thousand ($20,000) dollars which may at any time be required. "Sec. 14. And be it further enacted. That the said deposits shall be made with the said states in the following proportions, and at the foUovring times, to-wit: one-quarter part on the first day of January, 1837, or as soon thereafter as may be; one-quarter part on the first day of April, one-quarter part on the first day of July and one-quarter part on the first day of October, all in the same year." i83 It was estimated that there would be thirty-seven million, four 183 Statutes at Large, 24th Congress, Session I, Vol. V, Chap. 115, p. 55. 72 PERMANENT COMMON SCHOOL FUNDS hundred sixty-eight thousand, eight hundred fifty-nine dollars and forty-seven cents ($37,468,859.47) in the treasury on January first to be loaned to the states. The entire loan was to be paid in four instalments of nine million, three hundred sixty-seven thousand, two hundred fourteen dollars and eighty-seven cents ($9,367,214.87) each, and all four during the year 1837-38. Only three instal- ments were ever paid, amounting to about twenty-eight million dollars. The money thus loaned to the states has never been called for by the federal Government and in all probability never will be. Many of the states, in practice at least, have regarded it as a permanent gift. By far the majority of the states set apart their portion, or a fraction of it, for the support of common schools. The in- come, or a portion of it, has reached the common schools in every state except four, Michigan, Mississippi, South Carolina, and Virginia. At least five states, Alabama, Delaware, Louisiana, Missouri, and New York, set apart all of their respective shares as a separate fund or united it with the permanent common school fund already states Devoting established. Missouri used her share, together Reveni^^Toan with seventy-two sections of saline lands as an to Schools original basis for establishing her state Public School Fund.^^"* New York established her share as a separate fund and provided that the income should be appropriated to common schools and high schools. Twenty-five thousand dollars of the annual revenue of this fund is added each year to the principal of the Common School Fund, and constitutes one of the chief sources by which that fund is being increased to-day. Delaware invested her share in the same securities as the principal of the Public School Fund and provided that the income derived from this investment should be divided among the three counties of the state in the same manner as the income of the Public School Fund. North Carolina received one million, four hundred thirty-three thousand, seven hundred fifty-seven dollars ($1,433,757). She 18* Bourne, Edward G., History of the Surplus Revenue of 1S37; Report Missouri Supt. Public Instruction, 1869, p. 38. FEDERAL SOURCES OF SCHOOL FUNDS 73 provided that of this share, one million, one hundred thirty-three thousand, seven hundred fifty-seven dollars ($1,133,757) should Fractions of be added to the Literary Fund. The following Loan^DevoteT"^ states devoted the interest on a fraction of their to Schools share to the support of common schools, thus mak- ing this portion of their respective loans practically a permanent fund or loan for common schools: Maryland devoted the interest on seven-ninths of her share to the support of common schools; Indiana and Illinois each employed two-thirds of their shares for the same purpose; Kentucky, four-sevenths and Georgia, one-third. Maine distributed her share chiefly per capita; a small part of it was devoted to the schools. Massachusetts and New Hampshire distributed their shares among the towns. In both states some towns used the income for schools. " In Portsmouth, New Hamp- shire, the inhabitants voted to divide the revenue which fell to the town, per capita. The sum due to each man, woman, and child was between two and three dollars. An agent was appointed to receive and distribute the money. About two hundred suits were almost immediately commenced against him as trustee to individ- uals owing small sums and he was thus placed in a rather embar- rassing position." ^®^ Connecticut deposited all her share except about one thousand dollars with the towns. The loan thus made became known as the Town Deposit Fund. Until 1855, three-fourths, and since 1855 the whole of the income of this fund, according to Bourne,^^^ was devoted to aid common schools, but the Secretary of the Board of Education writes that '' in most cases the interest on this fund exists on paper only and is not a substantial contribution to the support of schools." ^^^ Vermont loaned her entire amount to the towns who were held responsible to the state in the same manner that the state is responsible to the federal Government.^*^ Investi- i**5 Bourne, E. G., History of the Surplus Revenue of 1837, p. 83. 188 Ibid., pp. 50, 122. 187 Report Conn. Board of Education, 1903, p. 43.- 188 Statement received Nov. 9, 1906, from Mason S. Stone, Vermont State Supt. of Education. 74 PERMANENT COMMON SCHOOL FUNDS gation carried on by the Vermont state department of education in 1906 revealed the fact that eighty per cent of the towns have ab- sorbed their portion of the United States Deposit Fund. Such towns pay interest on their portion of the fund at the rate of six per cent.^*^ Table XIII which follows here shows the amount each of the twenty-six states received as its share of the United States Surplus Revenue Loan, the amount set aside as a permanent fund for common schools, when ascertainable, and the amount lost, when ascertainable. Table XIII. Permanent Common School Funds or Deposits Derived FROM United States Surplus Revenue Distributed in 1837 * State Share Received Set Apart as a Perma- ne>ii Fufzd or Deposit for Co»ivion Schools A->7iou>it of Portion thiis Set Apart Di- verted, Lost or E.xJunisted Original Use of Principal Final Disposition, or Present Condi- tion of Principal I. Ala. 2. Ark. 3. Conn, $669,086 286,751 764,670 $669,086 286,751 763,670 $669,086 .751 Used for capital of State Bank and branches. Interest used for schools till 1843 3^^d since 1854.'^ Entire amount used as principal of the Bank of the State of Ark. Law devoted interest to schools. But law was dead letter. Little, if any, ever reached the schools. All except $1,000 was divided among the towns. Most has been lost by towns, which how- Credit Fund.'^t Credit Fund.f Town Credit Funds, t 189 Ibid., personal letter, dated Nov. 9, 1906. * Compiled from E. G. Bourne, History of the Surplus Revenue of iSjy, and from accounts given in Part II of the present work. All notes reading Bourne refer to the above work. '^ Bourne, pp. 44-47. t For a description of Credit Funds, see Chapter I. FEDERAL SOURCES OF SCHOOL FUNDS Table XIII — continued IS State Share Received Set Apart as a Perma- nent Fund or Deposit for Common Schools Amount of Portion thus Set Apart Di- verted, Lost or Exhausted Original Use of Principal Final Disposition, or Present Condi- tion of Principal 4. Del. S- Ga. 6. 111. 7. Ind. 7SI 1,051,422 477>9i9 860,254 $286,751 350,000 335,592 567,126 335>S92 567,126'* ever continued to pay interest. Prior to 1855, f income, and since 1855, all the income was de- voted to schools.* Interest on J was appropriated for schools but probably used for state gen- eral expenses till 1870. » Principal borrowed by the state and used for extravagant in- ternal improvements Interest devoted to common schools. J Two-thirds distrib- uted among counties to be loaned. Inter- est on loans devoted to common schools. One-third used for capital of State Bank. Made a part of the permanent Common School Fund, 1851. Practically part of Public School Fund. « Lost: Appar- ently not recog- nized as a debt by Georgia. Principal ex- hausted. Con- tinued as a Credit Fund.f ^ Ibid., p. 122. <* Report, Connecticut Board of Education, 1903, p. 43; and Bourne, pp. 50, 122. « Bourne, pp. 52, 53. ' Bourne, pp. 60, 61. ^ Bourne, p. 122, states that the two-thirds, the interest on which was devoted to schools, was lost. Ibid., pp. 63, 64, shows it is impossible to state accurately the amount lost. I For a description of Credit Funds, see Chapter I. 76 PERMANENT COMMON SCHOOL FUNDS Table XIII — continued Slate Share Received Set Apart as a Perma- nent Fund or Deposit for Common Schools Amount of Portion thus Set Apart Di- verted, Lost or Exhausted Original Use of Principal Final Disposition, or Present Condi- tion of Principal 8. Ky. $1,433,757 $850,000 $850,000 Principal used to purchase bank stock and to pay state debt. Interest on $850,000 devoted to common schools.*^ Seized by State Credit Fund.f 9. La. 477,919 477,919 477,919 Exhausted by appro- priations in 1839. Since 1839 con- tinued as a credit fund, devoted to support common schools since 1855. ^ Permanent debt. Interest devoted to common schools. 10. Me. 11. Md. 955,838 955,838 i 681,387 i 681,387 Interest, 1839, paid from annual revenue of the Baltimore and Washington Rail- road. Later out of taxes. J Credit Fund.f 12. Mass. 1,338,173 I Some used for schools. Most used for town expenses.* 13. Mich. 14. Miso. 15. Mo. 286,751 382,335 382,335 382,335 Reported to be intact.w* 16. N. H. 17- N. J. 669,086 764,679 I 611,743 n Divided among Most all princi- c See account given in Part II; also Bourne, pp. 65-68. Part II; also Bourne, pp. 68, 69. < Distributed among tov^rns, some of which used it for schools. Most appear to have apportioned it per capita among entire population. Bourne, p. 71. 1 Bourne, p. 73. Acts of Maryland, 1839, chap. 33. ' Divided among towns; some of which used it to establish permanent school funds; number and value of funds so established not ascertainable. ^ Bourne, p. 81. '^ Large loss, amount not ascertainable. ■j" For a description of Credit Funds, see Chapter I, FEDERAL SOURCES OF SCHOOL FUNDS Table XIII — continued 77 Stale Share Received Set A part as a Perma- nent Fund or Deposit for Common Schools Amount of Portion thus Set Apart Di- verted, Lost or Exhausted Original Use of Principal Final Disposition, or Present Condi- tion of PritKipal 18. N. Y. 19. N. C. 20. Ohio 21. Penn. 22. R. I. 54,014,520 i>433,757 2,077,260 2,867,514 382,335 54,014,520 i>i33>7S7 382,335 $333>862'' i>i33.757 226,794 counties which ap- pear to have ex- hausted it in erect- ing buildings and paying war debts. Interest kept up; paid largely out of taxation. Since 1867 interest on | devoted to schools.* $300,000 was added to the Literary Fund at once. Eventually all the surplus rev- enue N. C. received, except $100,000 was devoted to the sup- port of schools. Loss due to Civil War and reconstruction evils. Borrowed by the state.P Distributed among counties. Loaned at 6%; 5% devoted to schools. 1851 "Bal- ance" was added to common school fund Amount not ascer- tainable. 8 In 1836 the interest from the entire a- pal exhausted. Credit Ac- count, f State repudiated debt. Apparently con- tinued as a credit fund.*! * Bourne, p. 122. Report, New York Comptroller, 1906, p. 280. "P See account in Part II; also Bourne, pp. 91-93. 9 See Part II; also Bourne, pp. 95-99. j For a description of Credit Funds, see Chapter I, 78 PERMANENT COMMON SCHOOL FUNDS Table XIII — continued State Share Received Set Apart as a Perma- nent Fund or Deposit for Common Schools Amount of Portion thus Set Apart Di- verted, Lost or Exhausted Original Use of Principal Final Disposition, or Present Condi- tion of principal 23. s. c. 24. Tenn. 25. Vt. 26. Va. >I,05I,422 I.433.7S7 669,086 2,198,427 $669,086 t 'i,433>757 500,000 mount was devoted by law to common schools. But only $155,541 appears to have ever been made a part of the perma nent school fund The state appears not to recognize her indebtedness techni- cally. But the an- nual appropriation exceeds the interest on the surplus revenue. '', * From 1841 to 1865, interest devoted largely to common schools; but no part of the principal was ever set apart for a permanent school fund. ^ At first loaned to towns, which ex- hausted most of it; in 1906 made a part of the state perma- nent school fund. Exhausted banking. * About 20% of principal is in- tact. About 80% is a Credit Fund. Some states have increased the principal of their permanent com- * Bourne, p. 122. »■ Report, United States Commissioner of Education, 1896-97, I, 642. * Bourne, p. 114. X It is possible that $225,793 was added to the Literary Fund, but the data is not clear. Bourne, p. 120, FEDERAL SOURCES OF SCHOOL FUNDS 79 mon school funds from claims against the United States Govern- ment for services rendered in war, or other moneys returned by the War Claims federal Government as reimbursement for taxes it SdToofs^ *° h3,d previously levied. The state of Maine, by an 1828-1904 Act passed by the legislature February 23, 1828, made provision for the establishment of the Permanent School Fund, for the benefit of primary schools.^*^^ This act reserved, together with certain state lands, all moneys received by Maine on account of war claims against the United States for services rendered in 1812. The Permanent School Fund was deprived of the moneys from this source by a Repeal Act passed March 11,1835-''' In 1 861 Congress passed an act directing that a direct tax of twenty million dollars be annually laid upon the United States, Federal War ^^^ apportioned among the states and territories ^^^^^ according to the provisions of the act. In 1891 an act was passed providing for the return of this tax to the states and territories.^^^ Massachusetts,^^^ Kentucky,^^^ and South Caro- lina ^^^ are among the states which have provided that the moneys received as the result of this act should be added to their permanent school funds.^^"* As the result of these acts Kentucky added six hun- dred six thousand, six hundred forty-one dollars and three cents ($606,641.03) to her Permanent School Fund; Massachusetts, six hundred ninety-six thousand, four hundred seven dollars and eighty- eight cents ($696,407.88) to her School Fund. By the same act by which Massachusetts added the proceeds of the direct tax to her School Fund, she also added twelve thousand, forty-three dollars and seventy-three cents ($12,043.73) of United States war claims.^^^ Vermont, in 1904, by number 42 of the acts of that year, seques- tered as permanent fund for public school purposes the reimburse- ment to the state of two hundred forty thousand dollars for moneys 190 Laws of 1828, Chap. 403. 191 Maine School Report, 1901, p. 52. 192 U. S. Statutes at Large, 1861, Chap. XLV, Sec. 8, p. 294. 193 Fifth-seventh Annual Report, Board of Education of Mass., 1892-93, p. 102; Laws of Ky., Act approved Mar. 12, 1892; Constitution of South Carolina, 1895. 194 U. S. Statutes at Large, 1891, Chap. 496, p. 822. 8o PERMANENT COMMON SCHOOL FUNDS expended in the Spanish- American war. The creation of this fund was the beginning of a new period in the history of permanent school funds in Vermont. A complete account is given in Part II. In a previous chapter it has been pointed out that Congress makes annual appropriations for the support of schools in Alaska and the District of Columbia. All of the land Congressional Appropriation in Indian Territory belonged to members of the five civilized tribes and Congress had no authority to reserve any of it for school purposes. In lieu of the grant of sixteenth and thirty-sixth section lands for common schools, Con- gress made an appropriation of five million dollars ($5,000,000) with interest at three per cent from June 16, 1906. The statehood bill, by which Indian Territory and Oklahoma were to be combined, pro- vided that this appropriation should constitute a part of the perma- nent school fund upon the admission of the state into the Union.* The purpose of this chapter has been to present the sources provided by the federal Government which have been employed to establish or increase the permanent common school Conclusion r i • i • mi funds m the various states. The earliest permanent common school funds were those derived from state lands and moneys. In view of the fact that the first of these, Connecticut, was derived from lands lying in Ohio, within federal domain, and in view of the fact that many of these federal sources have contributed largely to permanent funds of state origin, it seemed best to treat the federal sources of permanent school funds before taking up the topic of state sources. Nevertheless, it must be borne in mind that the establishment of state permanent funds for common schools by Connecticut and New York was but the final stage in a process of evolution. This process has been traced in Chapter II, under the topic of Local Funds. However, the ordinance of 1785 was passed ten years prior to the establishment of the first permanent fund so that it is dijBScult to say to what extent the policy of the states which derived their funds from state rather than federal sources, was the result of principles individually conceived and to what extent it was an adopting of the policy pursued by the federal Government. * See separate accounts for Indian Territory and Oklahoma in Part II. CHAPTER IV STATE SOURCES AND ESTABLISHMENT OF PERMANENT PUBLIC COMMON SCHOOL FUNDS Interest turns naturally toward those states which received no grant of land from the United States Government and so were forced to employ their own resources. The previous Classes of State ^ ■; ., i r i i r t i Sources Similar chapter described federal grants of lands and money out of which public land states created per- manent common school funds. The purpose of this chapter is to consider the sources which the states of their own initiative have set aside, either to establish or to increase their permanent com- mon school funds. It might seem desirable to attempt to dis- tinguish between those sources set aside as original capital out of which the permanent common school funds were created and the sources from which they have been increased. However, it would be difficult to do so, owing to the fact that in some cases the sources originally provided were the proceeds of current revenues, so that there was in the beginning no accumulated capital. States containing no federal lands have set aside many of the sources employed by the public land states for increasing their funds; such as escheats, licenses, bequests, and fines. In Chap- ter II, state sources of permanent common school funds were divided into two classes: (i) state lands, and (2) state moneys. In view of the fact that lands are the oldest state source, it may be well to consider them first. The states which derived their permanent funds or a portion of them from the proceeds of the sales of lands originally belonging to or claimed by the state and not from a grant to it, State Lands as ^ . a Source of as a gift, by the federal Government are: Connecti- cut, New York, Georgia, New Jersey, North Caro- lina, Pennsylvania, Maine, Massachusetts, Texas, and New Hamp- Si 82 PERMANENT COMMON SCHOOL FUNDS shire. In Chapter III it was shown how Connecticut came to possess a reservation of lands lying in the northeastern corner of Ohio. In 1795 provision was made for the sale of all lands remain- ing unsold, about three million, three hundred thousand acres.^^^ This land was sold for one million, two hundred thousand dollars ($1,200,000) ^^^ which became the original principal of the School Fund of Connecticut. New York, by an Act of legislature, April 2, 1805, provided that the net proceeds of five hundred thousand acres of unappropriated state lands, the first to be sold after the passing of the act, should be appropriated as a permanent fund for the support of common schools.^" Georgia provided for the establishment of her Permanent Com- mon School Fund in 181 7. In 181 8, by the Land Lottery Act, lots numbers 10 and 100 in each surveyor's district, were set apart and reserved for the benefit of common schools. Subsequent legis- lation made the proceeds of these lots a part of the Permanent School Fund. New Jersey provided for the establishment of her Permanent Common School Fund in 1817.^^^ Subsequent legisla- tion has provided that the proceeds of all lands belonging to the state, now or formerly lying under water, shaU be added to the principal of the Permanent Common School Fund.^^^ North Caro- lina provided as source from which her Permanent Common School Fund, known as the Literary Fund, established in 1828, was to be derived, moneys paid to the state for entries on vacant lands, and the proceeds of vacant and unappropriated swamp lands in the state.i^^ The Permanent School Fund of Maine and the Massachusetts School Fund were both derived from lands lying in Maine, at one time all owned by Massachusetts, but subsequently shared by the two states upon their separation in 1820. In the year 1828 Maine created her Permanent Common School Fund and reserved thirteen 195 Report Conn. Board of Education, 1S53, p. 69. 188 Ibid., 1876, p. III. 197 Laws of New Jersey, 1817, Act passed Feb. 12. 198 New Jersey School Laws, 1903, Sec. 16S-169. 199 North Carolina Revised Statutes, 1836-37, Chap. 66, pp. 378-379. STATE SOURCES AND ESTABLISHMENT 83 townships for the same.^°" Twelve more townships were added to it in 1850, one year before the first distribution of the revenue of the fund. The total area of lands thus far set aside was about seven hundred twenty-six thousand, six hundred twenty-five acres/"^ The proceeds realized from the sale of these lands amounted to approximately two hundred seventy-eight thousand, two hundred thirty-nine dollars ($278,239)/°^ In 1868 ten town- ships whose timber and lumber had been devoted to the Permanent School Fund in 1864, were now, themselves, added to it.^"^ In 1786, Pennsylvania passed an act setting aside sixty thousand acres of unappropriated state lands for the purpose of endowing public schools.^^^ But the proceeds of the sales of the lands reserved by this act never reached the public schools. They were probably given to county academies.^"^ Pennsylvania finally suc- ceeded in passing an act in 1831 by which was actually estab- lished ^°^ her Common School Fund. The original capital of this fund consisted of state lands. It has not been possible to learn the area of these lands, but it would appear that in 1834 about a mil- lion and a half of dollars had been realized from the sales.^*^^ Massachusetts, by an Act passed March 31, 1834, provided that the moneys in the treasury on January i, 1833, derived from the sale of lands in Maine, together with fifty per centum of all moneys thereafter to be received from the sale of Maine lands (and certain other moneys) shall be appropriated and constitute a permanent fund for the aid and encouragement of common schools.^^ In 1859 it was provided that "all avails of the moiety on the sales of certain Back Bay Lands (made lands) ^°^ be added to the Massa- 200 Maine Laws, 1828, Chap. 403. 201 Computed from data given in Maine School Report, 1857, p. 17. 202 Maine School Report, 1855, p. 16. 203 Resolves of the State of Maine, 1868. 20* Section VII, Act approved Apr. 7, 1786. 205 J. p. Wickersham, History of Education in Pennsylvania, p. 257. 206 Sections I-III, Act passed Apr. 2, 183 1. Quoted by Wickersham, pp. 292-293, see foot-note 205. 207 Mayo, A. D., The American Common Schools, etc., Report U. S. Commissioner of Education, 1895-96, pp. 261-262. 203 Mass. Resolves, 1852, Chap. 79, Second Resolve. 84 PERMANENT COMMON SCHOOL FUNDS i chusetts School Fund.^'^'' The sum added to the principal of the fund from the proceeds of the sales of these lands was four hundred fifty-six thousand, nine hundred thirty-six dollars ($456,936).^^'^ Texas in 1839 made provision for granting to each county in the then Republic 13,284 acres.^^^ In 1840 the county grant was increased to 17,713 acres.^^^ From these lands were created sepa- rate permanent school funds commonly spoken of collectively as the County School Fund. It is estimated that under these acts the counties have received 4,162,320 acres.^^^ Upon being admitted into the Union Texas provided for the establishment of a state pub- lic permanent common school fund.'^^ Approximately 38,000,000 * acres of state lands have been devoted to this fund. The total area reserved by Texas out of its domain for the County School Fund and the Permanent School Fund, prior to 1900, amounted to approximately 42,053,058.11 acres.* As pointed out in Part II, the Literary Fund which New Hamp- shire provided for in 182 1, never became a permanent fund. Her first Permanent Common School Fund, therefore, appears to be that established by an Act approved January 28, 1867, which pro- vided that the proceeds of the "wild lands" lying within the state should constitute a part of the Literary Fund.^^^ Twenty-five thousand dollars ($25,000) was realized from the sale of these lands.^^^ This fund seems never to have been appropriated for common schools. Beginning with the year 1884, its income has been expended to support teachers' institutes. * See estimate given in account of Permanent Common School Funds of Texas, Part II. 209 Acts, 1859, Chap. 154. 210 Annual Report, Mass. Board of Education, 1892-93, p. 102. 211 Act approved Jan. 26, 1839, Laws of the Republic of Texas, 1839, pp. 120-122. 212 J. J. Lane, History of Education in Texas, U. S. Bureau of Education, Cir- cular of Information, No. 2, 1903, p. 27. 213 Letter to F. H. Swift from J. J. Robinson, Acting Land Commissioner, Oct. i, 1908. 214 Constitution of Texas, 1845, Art. X. Sec. 2. 215 Laws of New Hampshire, 1867, Chap. XLII, Sec. i. 216 Statement in letter dated July 5, 1907, received from H. C. Morrison, N. H. State Supt. PubUc Instruction. STATE SOURCES AND ESTABLISHMENT 85 The following table shows the area, date, and value of reserva- tions of state owned land in so far as the data have been ascertained : Table XIV. Lands Originally Belonging to States and Reserved by Them for Permanent Common School Funds State Date Area {Acres) Proceeds Penn. 1786 183 1 60,000 a Conn. 1795 3,300,000 * $1,200,000 N. Y. 1805 1819 500,000 * 400,000 Lands in the military tract es- cheated to the state. * 1821-55 991)559 ' 2,100,000'^ Ga. 1818 Lots Nos. 10 and 100 in each sur- veyor's district. « N.J. Riparian lands.« An indefinite grant. N. C. 1828 Vacant and unavailable swamp lands; moneys paid for entries on vacant public lands. os Me. 1828 & 1850 1868 726,625 278,239 Ten townships. Mass. 1834 3,500,000 1,000,000 Texas 1839-99 42,053,059 50,000,000 Includes County Funds and Per- manent School Fund. Proceeds, merely an estimate. N. H. 1867 a 25,000 The moneys and the sources of moneys which the states have devoted to their permanent common school funds include licenses, state Money escheats, Confiscations, forfeitures, taxes on banks, Reservations appropriations. United States debts to the states, bank stock, lotteries (New York and Rhode Island), gifts, proceeds °- Area unknown. * See history of the Permanent Common School Fund of New York, Part II. c Under constitution, 1S21, Article VII, section 10. <* Report, New York State Superintendent of Public Instruction, 1857, PP- iS, 22. All other sources during the same period had contributed less than $1,000,000. Ibid. * Not including several thousand acres of land to townships for the establish- ment of local funds within the township. 86 PERMANENT COMMON SCHOOL FUNDS of funds previously established, supreme court fees (New York), slave money (Florida), moneys for exemption from military serv- ice, and many others. Many states have set apart the proceeds from various classes of licenses as original sources from which moneys for the estab- Marriage and lishment of their permanent common school funds Tavern Licenses were derived or as sources for increasing those funds. Delaware, the second state to establish a permanent com- mon school fund, provided that the money paid into the state treasury on account of marriage licenses and tavern licenses between February 9, 1796, and January i, 1806, be and is hereafter to be applied under the direction of the legislature for the estab- lishment of schools in the state. These licenses constituted the sole sources originally provided by the act establishing the Public School Fund of Delaware, although at one time the proceeds of about nineteen different kinds of licenses were devoted to increas- ing the principal of this fund.^^^ North Carolina named taxes on liquor licenses and auction licenses as two of the sources from which her fund was to be derived.^^* Vermont, in the act establishing her Liquor, Auction, -. , . , ". and Peddlers' fund m 1 82 5, set apart the amount accrued from licenses to peddlers as one of the sources of her first Permanent Common School Fund.^^^ Rhode Island, by the original act which established her Permanent Common School Fund, reserved for that fund taxes on auctions.^"'' Virginia, the fifth state to establish a Permanent Common School Fund, set apart a number of sources of revenue, several of which it appears no other state had as yet employed for Escheats, Fmes, V r • r Gifts, and this purpose : escheats, confiscations, fines, pen- alties, forfeitures.^'^ Tennessee, in 1827, passed a general school law which consolidated all school funds into one 217 U. S. Bureau of Education, Circular of Information, 1S93, No. 3, p. 161. 218 North Carolina Revised Statutes, 1836-37, Chap. 66, pp. 378-379. 219 Act passed Nov. 17, 1825, Report Vt. State Supt. Ed., 1906, pp. 11, 12. Con- sult account given in Part II. 220 Stockwell, Thos. B., History of Public Education in R. I., p. 45. 221 Acts of 1809, of Virginia, XIV, Sec. i. STATE SOURCES AND ESTABLISHMENT 87 Fiaes Common School Fund. The sources set aside for this fund include escheats, intestate estates, gift of six thousand acres of land and bank stock.^^^ Not less than twenty-one states have set apart for their per- Escheats and manent common school funds the proceeds of in- intestate Estates testate estates and of other property, escheating to the state. At least eight states have provided for increasing their permanent common school funds from the proceeds of fines. Indiana, in 1816, by her constitution, provided that moneys paid for exemption from military service or fines assessed for any breach of penal laws should be applied to the sup- port of county seminaries.^^^ In 1838 gambling moneys were added, and later fines for selling salt without having it inspected.^^^ The fund thus constituted was known as the County Seminary Fund. It was not a permanent fund but merely an annual revenue. It was managed by the commissioners of the several counties. In 1 85 1 it was made a part of the Common School Fund, by the newly adopted constitution, and so became a part of the Permanent Com- mon School Fund.^^^ The proceeds from fines and forfeitures have Table XV. Comparison of Sources Contributing to Indiana School Fund Year Amount of Fines Amount Added by and Forfeitures Other Sources 1868 & $32,904 $2,143 1875^ 46,339 3>67S i88s« 49,860 6,664 1895 59,969 14,867 1902 " 43,444 9,706 1903 e 41,433 12,080 ° The data for the year 1885 are taken from R. G. Boone, History of Education in Indiana, p. 189. * Report, Indiana State Superintendent of Public Instruction, 1878, p. 80. * Ibid., 1906, p. 811. 222 Laws of Tennessee, 1827, Chap. 64. 223 Constitution of Indiana, 1816, Art. IX, Sec. 3. 224 Revised Statutes, Sec. IV, Report Ind. State Supt. of Public Instruction, 1900, pp. 299-300. 225 Constitution of Indiana, 1S51, Art. VIII, Sec. 2. 88 PERMANENT COMMON SCHOOL FUNDS added more to the principal of the Common School Fund in Indi- ana than the proceeds from the seven other sources provided by law. Missouri, on February g, 1839, provided that the proceeds of fines and forfeitures and other moneys collected within each county should be paid into the county treasury for the county school fund.^^*^ No provision appears to have been made for making this fund permanent until 1868.""'' In 1904 Wisconsin added twenty- four thousand, three hundred ninety-one dollars and forty-nine cents ($24,391.49) to the principal of her school fund, which sum was derived from penal fines/^^ Other states used the proceeds of penal fines and forfeitures for the support of schools but did not devote them to the permanent common school fund; for example, Illinois pays fines and forfeitures to the school superintendents in the counties in which they are collected and they are distributed by them annually. It has already been stated that Tennessee, in providing for her state Permanent Common School Fund in 1827, included a gift of land. At least nine states have, at one time or Gifts ' another, provided that the principal of their perma- nent common school funds might be increased by gifts not other- wise appropriated or gifts made for educational purposes. A large number of states, besides Tennessee, have devoted bank stock owned by the state to the Permanent Common School Fund. Among these may be mentioned Vermont, North Carolina, Kentucky, Indiana, and New Jersey. The proceeds of the direct tax and of war claims returned to the states were moneys due them for value received and must there- fore be mentioned in this chapter. They have been discussed already in Chapter III, which should be consulted for a fuller treatment of this topic. 226 Report Missouri Department of Public Schools, 1903, p. 94. 227 Act approved Mar. 22, 1868. 228 Data furnished F. H. Swift, Sept. 12, 1906, by Wisconsin Department of Public Instruction. STATE SOURCES AND ESTABLISHMENT 89 Maine, in an act already referred to, by which she estabh'shed her Permanent School Fund, provided that all moneys received by Maine from Massachusetts on account of war War Claims claims agamst the United States for services ren- dered in the War of 1812 should constitute a part of the original principal of this fund. However, the Permanent Common School Fund was deprived of this source by a Repeal Act passed March 7, j-g^2_229 jjj iSgi the principal of the Massachusetts School Fund was increased by twelve thousand forty-three dollars and seventy- three cents ($12,043.73), the proceeds of war claims collected from the United States, and by six hundred ninety-six thousand, four hundred seven dollars and eighty-eight cents ($696,407.88) from the United States direct tax of 1861, making a total from these two sources of seven hundred eight thousand, one hundred fifty-one dollars and sixty-three cents ($708,151.63).^^° A number of states have made important additions to the prin- cipal of their permanent common school funds, from the proceeds of taxes levied upon banks chartered by the state. Maryland, in 1813, created her first Permanent Common School Fund, the seventh to be established in the United States, by an act which levied twenty cents on every one hundred dollars of the capital stock of the banks of the state. The proceeds were invested in bank stock, a portion of which was placed to the credit of the fund itself and the remainder to the credit of the several counties."^^ Vermont set apart as one of the sources of her School Fund in 1825, moneys accruing from six per cent on the net profits of the respective banks chartered by the state.^^^ In Chapter III reference was made to moneys which Indiana devoted to common schools, derived from the proceeds of taxes on the state bank and which were made a part of the Common School Fund in 1 85 1. Other states have employed bank taxes as a means of increasing their permanent common school funds, but as the 229 Maine School Report, 1901, p. 52. 230 Fifty-seventh Report, Board of Education of Mass., 1892-93, p. 102. 231 Laws of Maryland, 1813, Chap. 122; 1S20, Chap. 182. Also Controller's Re- port, 1853 and the following years. 232 Act passed Nov. 17, 1825. 90 PERMANENT COMMON SCHOOL FUNDS national banking system became established in the United States, many state banks surrendered their original charters so that revenue from this source was diminished. In a number of states it is provided that the Permanent Common School Fund may be increased from moneys appropriated by the State Appro- State. Georgia, in 1817, by an act which estab- pnations lished her first Permanent School Fund, set apart two hundred fifty thousand dollars ($250,000) for this purpose.^^^ Rhode Island established her permanent school fund in 1828 by an act which appropriated five thousand dollars ($5,000) as a basis for this fund.'-" Massachusetts, in 1894, provided that one hundred thousand dollars ($100,000) shall be paid into the Massa- chusetts School Fund out of the treasury of the commonwealth until the principal of the state fund shall amount to five million dollars ($5,000,000) .234 New Jersey in 181 7 provided that one-tenth part of all moneys thereafter to be raised for the use of the state should constitute a part of the Permanent Common School Fund.^^' Taxes ^ Texas, by the first constitution adopted in 1845, provided as the original principal of the Permanent School Fund one-tenth of the annual state revenue derived from taxes.'^^ Besides certain sources which have been extensively employed by the different states for increasing the principal of their perma- nent common school funds, many sources have Miscellaneous ■' ^ been used by a limited number of states, in many cases not more than one state. Thus, in New York, the only source by which the principal of the Common School Fund is at present increased is twenty-five thousand dollars ($25,000) derived from the income of the United States Surplus Revenue Fund.^^^ Nevada provided as one of the sources by which her state fund shall be increased, two per cent of the proceeds of all toll rates and bridges.^^^ 233 Prince's Digest, 1836, p. 18; also Circular of Information, 1888, No. 2, pp. 24-34- 234 Resolves of Massachusetts, 1894, Chap. 90. 235 Laws of New York, 1897, Art. 4, Chap. 413, Sec. 80. 236 Nevada School Law, 1897, p. 2)Z> Art. XIX, Sec. i. STATE SOURCES AND ESTABLISHMENT 91 Maine, in 1864, provided that moneys derived from the sale of grass and timber upon ten townships should be added to the account of the principal of the Permanent School Fund.^^' Montana set apart as one of the ten sources from which the principal of the state school fund may be increased proceeds from the sale of timber, stone material or other property from school lands, other than those granted for a specific purpose.^^^ Minnesota adds to the principal of the Permanent School Fund royalties on iron ore taken from school lands.^^^ Many states distribute the rents on lands reserved for the Permanent Common School Fund as a part of the annual revenue for common schools. Some states add the rents of unsold school lands to the principal of the Permanent Common School Fund. Among the states which have provided that these rents shall be added to the principal of the fund are California,^" Minne- sota,24i New Jersey ,^^2 Maine,^^^ and North Dakota.^^^ Nebraska,^^^ however, and many other states distribute such rents together with the annual revenue for common schools. At least two states provided that the principal of their permanent common school fund should be increased by balances of the annual revenue unexpended during the previous year. In 1906 Maine added about three thousand dollars ($3,000) to the principal of her fund.^^^ Massachusetts ^^"^ and Rhode Island ^^^ provided that por- 237 Act Mar. 21, 1864. 238 Enabling Act, Sees. 10, 11, 13, Montana (Civil) Codes, 1895, Vol. I, p. cxxxiii. 239 Statement furnished Sept. 27, 1906, by J. W. Olsen, Supt. of Public Instruc- tion in Minn. 240 Constitution of California, 1879, Art. IX, Sec. 4. 241 See note 239. 242 N. J. School Law, 1903, Sees. 168, 169. 243 Maine School Law, 1905, p. 40, Sec. 127. 244 Constitution of N. D., 1889, Art. 9, Sec. 153. 245 Data supplied Sept. i, 1906, to F. H. Swift, by Neb. State Supt. of Public Instruction. 246 Data furnished July 27, 1906, to F. H. Swift, by Edward Wiggin, Sec. State of Maine Education Department. 247 Public Statutes of Mass. relating to public instruction, including laws in force, 1892. 248 School Law Pertaining to Education, 1896, p. 39. 92 PERMANENT COMMON SCHOOL FUNDS tions of the annual revenue of their permanent common school funds forfeited by schools owing to their failure to fulfil the lawful requirements for receiving the same, shall be added to the principal of the Permanent Common School Fund. In presenting the sources which states have devoted to permanent common school funds it has been attempted to give them as far as it was possible in the order of their development. Conclusion ^^ . , , , , . , . No reference has been made to their relative importance except in the case of Indiana. The fact that a source has been provided for increasing the permanent common school fund in any state cannot be taken as evidence that the source actually does or ever has contributed anything to the funds. Thus the constitution of Colorado, 1876, provided five sources from which the principal of the Public School Fund might be increased, namely, (i) estates escheating to the state, (2) grants, (3) gifts, (4) devises made to the state for educational purposes, (5) proceeds of all lands granted to the state for educational purposes by the United States. The fifth source is the only one from which anything has ever been added to the principal of the Public School Fund.^"^^ In Indiana eight sources have been set aside for increasing the principal of the Common School Fund. Most of these sources have never contrib- uted anything, and at present only three of them, fines, forfeitures, and estrays, do contribute anything. This topic will be considered somewhat more fully in Chapter V, in connection with the topic of loss and diversion of the perma- nent school funds. There it will be shown that in some cases sources provided by the constitution have never become effective, owing to the failure of the legislature to enact necessary laws. The failure is sometimes due to the fact that the legislation which exists is not complete; for instance, in some states where it has been pro- vided that escheats should be devoted to the permanent school fund, the law does not specify the period of time after which such property shall be claimed by the state. It will be shown that some funds lose annually many thousands of dollars for such reasons 249 Statement from Katherine L. Craig, State Supt. of Public Instruction of Colo. See account in Part II, STATE SOURCES AND ESTABLISHMENT 93 as these. More careful and thoroughgoing legislation is needed in many of the states. In the following chapter will be discussed the various modes which have been employed for the management of these funds and the losses which they have suffered. Having described the sources both federal and state out of which the public permanent common school funds have been created steps in the ^.nd by which they have been increased, it is now stlTe^pSSlnlnt fitting to give some account of the steps by which School Funds ^^e funds became established in the several states and the relative order in which they were established. Every fund created by the original states and the states carved out of them has a history peculiar to itself. On the other hand, permanent school funds created out of the proceeds of the sales of federal land grants were established in a comparatively uniform manner. The acts and resolutions relating to the federal land grant to Ohio, quoted in Chapter III, reveal the steps involved in establishing a permanent school fund in a public land state. Allowing for varia- tions in individual states, the more important steps may be stated as follows: (i) Congress passes a law providing a territorial govern- ment for a certain area. By this law the school sections in each township are reserved; (2) Congress passes an act known as the Enabling Act, authorizing the territory to form a constitution. In this Enabling Act Congress offers propositions granting school, university and other lands upon certain conditions; (3) the consti- tutional convention meets and embodies these propositions and conditions in the constitution or in some ordinance attached to the constitution which becomes accepted or adopted by the state; (4) After the admission of the state into the Union legislation is enacted carrying out the provisions of the constitution; (5) the lands are thereupon either sold or leased; (6) the proceeds of the sales or rents are covered into the treasury and thence withdrawn and invested. The rent from the leased lands is distributed by some states annually among the schools of the state together with the income of the invested principal. In some states, however, land rents are added to the principal. The purchasers of school lands, like the purchasers of other pub- to O 00 lO CI •c ■■to w O CO H lO CO CO NO _o OO t^ ■* lo CO 1 E CO H CO CO CO 1 ^ 1 •& 00 o H t-. cd 8" O \0 CO O NO C CO lO o H^ CO a *^~' 0} n" i-T On c?oo 1) -5 VO ON f~ O CO (U o C^ to NO NO NO m a «© NO O CO lO lO lO W (M On NO NO NO ^ .s lO H H VO lO lO *rt t^ O OI NO NO NO § W CI •^ MD NO NO NO lO NO ON On (3 NO NO 00 lO CO 01 r-- S W '-' On lO r^ NO H «^ CO S rt MD 00 O" H~ tC T? oT On s S H C) Ov OI NO CO t^ H -^ ^ H M H H W ro w t^ oo ooo o O ■* 00 CO CO On lO 01 On O lO lO r^ ro M C> CO lO M vo t^ H lO CO r^ c ^ ^ H^ oo ^ ^ t^ r^ O O NO Tt OI 00 00 lO a o" ro lO 00 oo (N ro r^ O MO 00 lo O O On o U vO P» ^ CO lO t^ ro M CO CO CO '■^ CO 0* CO O H H H H H H H H H ^ ja; 1 t^ On 'i- loO 00 t^ 0) Net- H On On Sh r^ ro ■* H O lO CI NO NO Ol t^OO o CO lO ChOO O ^ H^ ^ « NO looo > *+-( " t^OO IN M CO CO NO Qn On H On ^ (D lO t-^00 ro M -^00 t^ OO 00 NO m -w H H M H H M H ^ (U o ^ lo O ■* O I^ On O 00 O NO nj vn Tj- t^ H CO TJ CO On O jC lO o 0) H On TJ-00 M 0« ^ NO 0_ ^ m^ H oo lO H M On NO O lO O^ On lO Ol CO CO M t^ ON 01 c 8c ^4H On 00 On 00 NO W .2 lO t^ On O -* ■* t3 vo r^ r^ CO M ^O C 03 0) r-» 00 On O OJ O H H CO C! ^ CO On H H 00 t^ !>. r^ M Ol 00 CO in lO lo wo OO NO 0) 0^ lO t^ t^ t^ c 0) r^ lo w o 0) 01 01 lo o< 00 O ■* -* ^ S H M -* •* Th ^ ^ "a ■8 VD On t^ O 00 H 00 H .s O OO NO O CO ^ ■^ H !< On CO 't O^ c^ Ol lO H f^ s ^ c> tC o" lo o" 00 0> O NO H o' o' t^OO 1 lO t^ NO o t^ 00 00 e© HO) C) 01 CO ■* 't ^ O lO CO lO 0) CO 01 Ol r^ oo (N vo lO CO CO 01 o o o 0__ ^ ON O On O CO h H lO |o d oo" <> On O On -:^ 00 O CO cT c ^ a, o in M H t^ ■* 't 01 CO H CI o 00 t^ O 9, O o_^ O o o O m" h n cf N cT cT of cT cf 6^ ^M rH *-< i-( »-l »-< C^ CNl ^ r^ t^\0 O^ H 01 o O t^ r^ O u-> \o r^ O o 00 M OnOO M O r^ lo O O CO CO & O H lO VO f^ 00 On On lO NO 00 00 N r^ ^+H 00 . r^ cooooocococooooooo OOOOCOCOCOOOOOOOOOCOOOOOOOOOCOOOOO ON 1 M M H H H M H M M H HHHHHMMHMHHMMMH M H H 1 STATE SOURCES AND ESTABLISHMENT 95 lie and state lands pay a certain fraction of the price at the time of the sale, the remainder in instalments with interest on the portion unpaid. As a result, the permanent common school fund in a public land state consists, prior to the exhaustion of school lands, of two parts: first, unsold school lands, and, second, moneys derived from the sale of school lands. The annual income is derived chiefly from some or all of the following sources : interest on the invested principal, interest on deferred land payments, rent on leased lands, royalties on ore, moneys derived from hay, timber, or stone permits. Having described the sources out of which the various states created their public permanent common school funds and the steps Order of Establish- involved in the establishment of these funds, it CommonSor''* ^^ now proper to show the order in which the ^^^^ different states established their funds. Uninter- esting as this topic may appear, several vital questions lie within it. But these questions cannot be discussed here. The most that can be done within the remaining limited space of this chapter is to show how early in the history of our nation, men interested in education gave serious consideration to the policy of supporting public schools in whole or in part from the income of public per- manent endowments. The order of establishment of permanent school funds shows also with what rapidity this policy spread and was adopted until it became practically universal. The spread and adoption of this, was the beginning of the spread and acceptance of the principles of free and democratic education. That this is true will appear in Chapter VI. As stated in Chapter II of this Part, Georgia, by an Act passed July 31, 1783, attempted to provide for the establishment of a _,. , T^_ , , fund for the support of free schools in each of the First Efforts to ^'^ Establish Per- respective countics of the state, by a grant of one manent Common jo School Funds thousand acres apiece, but this act did not result in the establishment of permanent funds. The New York legislature, in 1786, had provided that in townships subsequently to be surveyed one lot should be reserved, thereafter to be applied by the legislature for promoting literature in the 96 PERMANENT COMMON SCHOOL FUNDS state.^^° The fund created by the sales of these hterature lands was the first permanent fund established by any state, but its purpose was to aid, not common schools, but academical depart- ments for the preparation of teachers. As stated in the first part of this chapter, Pennsylvania, as early as 1786, endeavored to establish a permanent common school fund by setting apart for this purpose sixty thousand acres (60,000) of unappropriated state lands.^°^ But the public schools appear to have derived no aid from this act. The proceeds of these lands probably were given to aid county academies.^"^ The first state to establish a permanent fund for the support of common schools was Connecticut which did so in 1795.*^ Delaware followed the next year.^^^ It was ten years after the establishment of the School Fund of Connecticut that New York created a permanent fund for common schools.^*^ Five years later, 1810, Virginia established her Literary Fund, being the fifth state in the Union to establish a common school fund.^^^ During the next fifteen years most of the other thirteen original states established such funds. Massachusetts attempted to maintain her schools without the aid of a permanent fund, and with the exception of New Hampshire which offers a special case, was the last of the thirteen original states to establish a permanent common school fund, doing so in 1834.^^ It may be said, therefore, that by the year 1834, the policy of establishing permanent common school funds had been accepted by the original states. Meanwhile, seven public land states had been admitted into the Union as follows: Ohio, 1802; Louisiana, 1812; Indiana, 1816; Mississippi, 1817; Ilhnois, 1818; Alabama, 1819; Missouri, 182 1. Each of these seven states had received its grant of sixteenth section school lands, but these lands were originally, upon the states' admission into the Union, granted to the townships, and did not, therefore, result in the establishment of a fund controlled by the state. It is true that in many instances what were at first township funds, have been merged into single 250 Laws of New York, 1786, Chap. 67. 251 Act passed Feb. 9, 1796. 252 Act passed Feb. 2, 1810. STATE SOURCES AND ESTABLISHMENT 97 funds controlled by the state. Thus Alabama, admitted in 1819, provided in 1828 that the proceeds of sales of sixteenth section lands should be paid into the state treasury and the state should become trustee of the fund and liable to pay the districts and town- ships interest on the principal at the rate of six per cent.^^^ Illinois, by legislation enacted between 1818 and 1821, had established a state controlled fund entitled School Fund Proper.* Indiana, in the year 1834, established the Saline Fund as a permanent fund for common schools, managed by the state.^^^ In the case of Indiana this fund had existed since 1816, but it was not until 1834 that pro- vision was made for making it a permanent, state-controlled source of school revenue. Besides the original states and public land states, Vermont, Kentucky, Tennessee, and Maine had been admitted into the Union previous to the year 1834. Three of these states had provided for the establishment of a permanent common school fund; Kentucky in 1821,25^ Vermont in 1825,2^9 and Maine in 1828.20° -pable XVI. which follows here, shows the order in which the different states established their permanent common school funds, and the order in which they were admitted into the Union. Table XVII is added for reference. It presents the states of the Union in alpha- betical order and attempts to show every public permanent com- mon school fund ever established by any state. It includes there- fore lost funds as well as credit and intact funds. It shows also whether the fund was first provided for by act of legislature or by constitution, and, further, the original sources out of which the fund was created. In order to avoid misconception regarding the data presented under the heading '' Original Capital or Principal," refer- ence should be made to foot-note 43 in Chapter I, and to foot-note (g) accompanying Table XVII. * See account given in Part II. 253 Laws of Alabama, 1828, Chap. 26. 254 Boone, R. G., History of Education in Indiana, p. 186. 255 Acts of Kentucky, 1821, p. 35, Chap. CCLXXXIV, approved Dec. 18, 1821. 98 PERMANENT COMMON SCHOOL FUNDS Table XVI. Public Permanent Common School Funds Arranged in the Order of Their Creation 1795-1905 * States and Titles Created Mode Date Ad- mitted in- Territories to Union I. Conn. School Fund 1795 Act O-t 2. Del. Public School Fund 1796 Act 0. 3. N. Y. Common School Fund 1805 0. 4. Tenn. 1806 Act 1796 5. Va. Literary Fund 1810 Act 0. 6. S. C. 1811™ 0. 7. Md. Free School Fund 1813 ^ (1812, Act) 0. 8. Ind. Congressional Township Fund 1816 Constitution « 1816 Saline Fund « (1S16, 1834 Established as Per- Const. «) manent School Fund 9. Ga. Permanent School Fund « (1783) 1817 -i U) is i 3 c P! ^ t^ ^ n Jii^ ir, O eS i fO ^ « g ro ro O 00 .>0 O O O \0 »o t^vo vOoOr^OoOM vor^ OOOOOOOOOOCOCOOOCXl t^OO t^OO 00 00 00 00 00 00 00 HHHHHHHHMMMMHMMI-iMM MH ^-^ o -a P .2 3 o > u P^ IJ-i'o o O -o J" o >~ „ tn O £ a ^ ._ ^ ^ 3 o c S.^^ « d u 3 « So 5 2 ° O « 2 T3 ^8fS-g gs ^2 Ph ci, Hco 2 > 13 a IS en C & O 52 '^ C tn r9 3^, O vo H ro C^oo O 1^ O 00 ^ -+ OH >-^00 S 00 00 -ti M H H -U << u uo (^ •ti o (^rt rt o 2 o (U o cj c/^m o "^ a =3 -o < O ■t5 PH en d D rt 3 o^" .sj-^ a c-i •" S -M tj ' — ^ y d aj ^ S c3 d ;3 ,r! .^H i< c3 d fi a, aj (D CO H fflT3 (■5 C CJ Ti .P. M =3 CO ^ " -^ '" "^2 cij tn j; -r; 2 cd & §j Oj -g 1:i ° tn ;3 -^^ tn (L) t/3 M-l ^ '^ ~ c " -^ S -f O g toco <^0 C '■^ *-■ n ^^ rf ^ ft-S CJ ^ aj "^^ aj.« in _>p. £0 U 2 CJhO^ « ^ ^ a,^^ H,6 .5^ &. oj S 3 aj CO 3 S 03 O tn t3 M-i §-2 -d cu & S-Sf:^^ ii n 73 «5 aj 3 r; 5i 01 CO -5 U -^ S c '-S aj g « 2 d '3 =! 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Cf }^ 1 ^^ ^^ > rt ^ OJ oJ ^ c 3 o (U _o 3 c OJ ■o Si ^ l-< >. 0) a Xi 3 13 <« u 03 S c a 4) bO •n ni -H d K tJ Ui en O bO 5 ID ti OhTJ d &6 c "3 ^ <2 1— 1 Oi jj in a s « 3 a, N o o I-I Ol cu nj H B Ul r^ OJ u 3 m M 1 JJ U3 £ S^ '-' 3 MH O ° s N 0) bO y " 3*^ t? S -I •_§ O (u C/) >-l CHAPTER V MANAGEMENT OF PUBLIC PERMANENT COMMON SCHOOL FUNDS The question whether the Permanent Common School Fund was owned and should be managed by the state or by smaller units such as towns and counties was easily settled in Question of -^ Township Versus Connecticut, New York, Massachusetts and other State Management i i r i i i states where the fund was created by an act of the legislature and did not arise from the proceeds of the sale of township lands. But in states to which had been granted federal lands for schools, the question at once arose whether these lands belonged to the township or to the state, and if to the township, to what extent the state could supervise or control the management. The first funds of sixteenth-section-lands origin were regarded as belonging to the townships and managed by the townships or the state or county for the township. However, a tendency to regard the state as the lawful owner and manager soon appeared and eventually triumphed. Every state, since the admission of Minne- sota in 1858, has devoted its township lands to a public, perma- nent, state-controlled school fund. Four distinct stages are evident in the transition from township to state management. In the first stage the lands are regarded as Four stages in the property of the township in which they are fi^om ^wnship to located and the funds derived from them are state Management managed by the respective townships. In the second stage township ownership continues, but the funds are managed for the respective townships by the several counties in which the townships lie. In this stage the township funds are kept separate, and each township receives an income proportionate to the fund intrusted by it to the county. The third stage is like the second in most respects except that the state, instead of the county, manages the funds for the townships. 107 io8 PERMANENT COMMON SCHOOL FUNDS In the fourth stage, the township lands are declared to belong to the state. The state manages the lands, creates a fund derived from their proceeds, and distributes the income of this fund among the counties, townships, or districts in proportion to their school population, average attendance or upon some other general basis deemed just and equitable. In this as in other evolutionary processes the stages do not appear in chronological order. Thus, the lirst state to receive a grant of the sixteenth section lands, Ohio, represents the third stage. Hav- ing described the stages, it is now possible to discuss them in the order in which they arose. Each of the following states regarded, and continues to-day to TownGhip regard the sections lying within the townships as Ownership belonging to the same, and administers the fund derived therefrom as township funds: Ohio, admitted in 1802.-'^^ lUinois, admitted in 181 2.-^'* Indiana, admitted in 1816."'^^ Alabama, admitted in 1819.'^'^ Louisiana, admitted in 1820.^'^'^ Missouri, admitted in 1821.-*^^ The Enabling Act of Ohio, quoted in Chapter III, reads in part, "And be it further enacted, . . . that the section numbered six- Township Owner- teen in every township . . . shall be granted to Management? the inhabitants of such township for the use of *^^*° schools." This form of grant unquestionably makes the township the true owners of the school lands, but an Act of Congress passed March 3, 1803, granting school lands for 262 School Laws of Ohio, iSgS, compiled by State Commissioner of Common Schools. 2(53 Report Ind. Supt. of Public Instruction, iSgS, p. 60. 2M School Laws of 111., 1903, Art. Ill, Sec. 34. 205 Data furnished Jan. 8, 1907, by I. W. Hill, Ala. State Supt. of Education. The state holds these funds in trust for the townships. Cf . account given in Part II; also Ala. School Law, 1S95, Chap. 4, Sec. 1007. 2-i2. 142 PERMANENT COMMON SCHOOL FUNDS the commonest causes of loss have been bad loans, unpaid notes, and unpaid interest on bonds and notes. The loans made from Losses from the Connecticut School Fund previous to 1810 re- Bad Loans g^j^g^ ^^ gj.g^^ j^gg^ ^j^gj^ ^^^ ]ame5 H. Hill- house accepted the position of Commissioner of the School Fund, he found that the principal of the fund consisted chiefly of debts due from the original purchasers of the Western Reserve, and the substituted securities which had been accepted in their stead. In many cases interest had fallen greatly in arrears and nearly equaled the principal. The excellent manner in which Mr. Hillhouse brought about order and the way in which he saved the fund is recounted in Part II. As stated above, the Controller of New York, in 1905, estimated that the total losses suffered by the prin- cipal of the United States Deposit Fund from April 4, 1837, to September 30, 1905, amounted to $333,862.17.^''^ Prior to 1843, $27,918 of the Congressional Township Fund of Indiana was lost through unpaid mortgages.^^^ The first losses suffered by the school fund of Arkansas were caused by loaning the proceeds of the sales of the sixteenth section lands on insufficient security. In Arkansas as early as 1870 the claims of the state in the form of practically worthless notes and bonds for school lands amounted to three-fourths of a milhon of dollars.^^^ The Permanent School Fund of Iowa prior to 1868 had suffered losses amounting to over one hundred twenty-five thousand dol- lars ($125,000).^^ No estimate more recent than 1868 of losses suffered by this fund has been available. One of the chief causes of this loss was loaning the fund on insufficient securities.^^^ The state has issued six per cent bonds to the extent of ten thousand, nine hundred thirty-seven dollars, eighteen cents ($10,937.18) to cover loss arising prior to January i, 1874.^^^ The State Superintendent of Public Instruction of Nebraska 332 Cotton, F. A., Education in Indiana, p. 176. 333 Report U. S. Commissioner of Education, 187 1, p. 73; Ibid., 1901, I, p. 393. 334 Report la. Supt. of Public Instruction, 1868, p. 18. 335 Statement received Nov. 15, 1906, from State Auditor of Iowa. LOSS OF SCHOOL FUNDS 143 states that the first investments of the proceeds of the sales of public lands were made at a loss of one thousand, five hundred forty-seven dollars and four cents ($1,547.04), and the investments made in the year 1868 resulted in an aggregate loss of three thousand, four hundred thirty-nine dollars, sixty-seven cents ($3,439-67) •''' Alabama, Mississippi, and Missouri are among the states which report losses through unpaid notes. Many notes given in Alabama for school lands from 1837-74, inclusive, remain Losses Through , ^# #-r7 , Unpaid Notes unpaid. In some cases the title of sixteenth sec- and Interest • i i tion lands were surrendered to townships but the lands continued, though unpaid for, to be occupied and cultivated for years.^^^ In Mississippi, in 1833, an act introduced the system of leasing lands belonging to the Literary Fund for a term of ninety-nine years. The rents frequently went unpaid and the fund dwindled away through the decrease in value of the notes given.* The losses sustained by the Missouri fund have already been treated at length in this chapter. It is impossible to form even a rough estimate of how much of the State Permanent School Fund of Kansas has been lost. The earlier reports all indicate that large sums belonging to the fund have been lost. In 1878 the Superintendent of Public Instruction wrote that the state had sustained great losses in the sale and management of school lands, and added, " these losses are rapidly increasing, and if they continue, will amount to millions of dol- lars." ^^^ In 1894 a long list of bonds was reported on which inter- est had been due for several years or longer, including one hundred thousand dollars worth of bonds " upon which interest has not been paid for a long time." ^^^ The Permanent School Fund of Texas in the year 1 899-1 900 had a nominal income of one million, one hundred fifty-seven thousand dollars ($1,157,000), the real income amounted to eight hundred, eighty-five thousand dollars ($885,000). * Cf. account given in Part II. 338 Report Neb. State Supt. of Public Instruction, 1869-70, pp. 70-73. 337 Report Ala. State Supt. of Education, 1879, p. 9. 338 Report Kansas State Supt. of Public Instruction, 1878, p. 36. 338 Ibid., 1893-94, pp. 50 ff. 144 PERMANENT COMMON SCHOOL FUNDS The loss was due to the fact that about two hundred seventy-five thousand dollars ($275,000) per year of interest on land noted was not paid. The defaulted interest up to 1900 amounted to at least seven hundred thousand dollars ($700,000).^^° The permanent common school funds in a number of states have suffered severe losses from the failure of banks in which moneys „ , ^ ., beloncring to the funds were invested. As might Bank Failures & t> o be expected this was a more common occurrence in the early days of our country before the banking system had been placed on a firm basis. Alabama appears to have lost through the failure of the state bank all of her share of the United States Surplus Revenue Loan which she had set aside for common schools.^"*^ Mississippi invested the proceeds of her Literary Fund in stock of the Planter's Bank. This bank also failed and the money belonging to the Literary Fund was lost. In 1838, by an Act passed January 19, Tennessee established a state bank with nine branches. The bank was capitalized at $5,000,000. In this five million were included among other moneys, the Common School Fund and Tennessee's share of the United States Surplus Revenue Loan of 1837, the latter amounting to $1,353,209.^^ The bank almost at once entered upon a career of wreckage, in which, of course, the two funds named above were involved. The failure of the bank finally came during the Civil War and in the failure the Common School Fund and the Surplus Revenue Fund were lost.^'^^ Failure of banks in North Carolina during the Civil War and reconstruction period resulted in a loss to the Literary Fund of about one million dollars ($1,000,000). The only reported loss incurred by the Common School Permanent Fund of Wyoming occurred in 1893 through the failure of a bank. The Common School Permanent Fund's share of the loss was five thousand, seven hundred sixty-eight dollars, thirty-five cents ($5,768.35).^'^^ 3*0 Report Texas Supt. of Public Instruction, 1899-1900, p. XLVII. 341 Bourne, E. G., History of the Surplus Revenue Fimd of ISjy, p. 122. 312 Ibid., pp. 110-115. 3*3. Statement to F. H. Swift, Dec. 12, 1906, from Robert P. Fuller, Wyo. Com- missioner of Public Lands. LOSS OF SCHOOL FUNDS 145 In the years from 1874 to 1879 something over one hundred seventy-nine thousand dollars belonging to the Permanent School Fund of Arkansas was destroyed by fire.^^'* The report of the Superintendent of Public Instruction of Missouri in 1870, previously referred to in this chapter, names two counties in which the records of the township fund had been burned, and two in which the court-house had been burned, in each instance the permanent school fund suffered loss. Mismanagement, dishonest management, theft, embezzlement, absconding of debtors and of ofl&cers intrusted with the principal, constitute some of the wrongs committed against Loss Through ° ° Dishonesty and the permanent common school funds in many of Embezzlement the states. Robert McEwen, State Superintendent of Schools, 1836-40, succeeded in robbing the Common School Fund of Tennessee of thousands of dollars. A committee of seven was appointed by the legislature in 1839 to examine his accounts. The real condition was revealed by an investigation by a committee of five subse- quently appointed. This committee reported that Superintendent McEwen " was a general operator in a variety of ' wild cat' schemes, such as banks insolvent from the beginning; loans to partners in mercantile houses; land companies in Texas and Alabama, with a constant reputation for 'note shaving.' "^^^ During his four years of office Superintendent McEwen had borrowed from the Common School Fund $121,169. Prior to 1880 Indiana had been granted one million, two hundred fifty-seven thousand, five hundred eighty-eight (1,257,588 acres) of swamp lands. The constitution, 1851, article 8, section 2, provided that the proceeds of the sales of swamp lands, after deducting the expense of selecting and draining them, should constitute a part of the Common School Fund. In 1866 the Super- intendent of Public Instruction wrote: "These lands have nearly S'** Report Ark. State Supt. of Public Instruction, 1883-84, p. 39. ^5 Mayo, A. D., Organizatioji and Development of the American Common School in the Atlantic and Central States of the South, 1830-60; Report of the U. S. Com- missioner of Education, 1899-1900, pp. 552, 553. 146 PERMANENT COMMON SCHOOL FUNDS all been sold yet nothing from this source has been added to the fund. Much might have been added if the swamp commissioners had been honest." ^'*^ In 1890 it was estimated that $850,000 was due the Common School Fund of Indiana from the proceeds of the sale of swamp lands.^^' In the year 1897 the Permanent Common School Fund of Ne- braska lost two hundred fifty-nine thousand, eight hundred forty- two dollars, eighty-seven cents ($259,842.87) through embezzle- ment.^^* The principal of the permanent common school fund in many states has failed to receive certain moneys due it. Some states have enacted laws which proved incomplete; Moneys Diverted ^ from the Others have failed to add to the principal of the fund moneys due it; still others have diverted to some other object moneys due the principal. Arkansas provided that the principal of the Permanent School Fund should be increased by ten per cent of the net proceeds of the sales of all state lands, but the act failed to Losses Through Incomplete State whether the Land Commissioner or State Treasurer should have charge of this matter. It is estimated that through the incompleteness of this statute the Com- mon School Fund, from 1875 to 1895, was deprived of fifty thou- sand dollars ($50,000) .^^^ The constitution of Indiana, 1851, which provided for the crea- tion of the Permanent Common School Fund, set aside eight sources for increasing the principal. As far as the records show, only three of these, fines, forfeitures, and estrays, have ever added any- thing to the principal. Reference has already been made to the moneys from the sales of swamp lands of which this fund has been deprived. An act was passed by the legislature of Indiana in 1843, which provided that the proceeds of escheated estates should be set apart for the support of the schools. However, the act 346 Report Ind. State Supt. of Public Instruction, 1866, p. 73. 347 Boone, R. G., History of Education in Indiana, p. 200. 348 Data furnished, Sept. i, 1906, by Neb. State Supt. of Public Instruction. 349 Report Ark. State Supt. of Public Instruction, 1895-96, p. 171. LOSS OF SCHOOL FUNDS 147 failed to state the lapse of time after which heirs' claims to estates shall not be allowed. The result has been that not a dollar has been added from this source to the Common School Fund.^^" Florida in 1851 provided that the state should borrow from the principal of the Seminary Fund or Common School Fund not more Permanent School than $25,000 to be used to pay the general expenses General state""^ of the State. The act directed the governor to Expenses execute a bond for the sum so borrowed, bearing seven per cent annual interest.^^^ No provision was made for the time or means of paying the bond. Consequently its payment rests upon the pleasure of the state. "After May, 1861 (Arkansas), diverted from their proper pur- poses and used for general expenditures seven thousand, two hun- dred sixty dollars ($7,260) of the Seminary Fund and four thousand, six hundred thirty-three dollars ($4,633) of the Saline Fund," which should have been added to the principal of the Common School Fund.='52 California, by an act of the legislature in extraordinary session, in 1906, authorized and directed a transfer of five hundred thou- sand dollars ($500,000) from the " State School Land Fund (the term applied in California to the uninvested proceeds of the sale of Common School Lands) to the general fund for the purpose of aiding in purchasing a site and erecting a state building in San Francisco. On this money the state pays four per cent interest.^^^ This five hundred thousand dollars ($500,000) is an indefinite loan.354 The Common School Fund of Indiana has lost thousands, per- haps millions, of dollars from the failure to add to the principal Money Due Princi- nioneys which rightfully belonged to it. In 1872 pal Not Added -^ ^^g claimed that two million dollars ($2,000,000) from the surplus profits of the Van Dalia Railroad, was due the 350 Indiana Revised Statutes, 1843, Chap. XXVIII, Sec. 125; Boone, R. G., History of Education in Indiana, p. 203, note. 3^1 Acts and Resolutions of the State of Florida, 1850-51, Chap. 342, Sees, i, 2. 352 Reports of Commissioner of Education of U. S., 1871, p. 73; 1901, p. 393. 353 Report Cal. Controller, 1905-06, p. 24. 354 Statement furnished F. H. Swift, Dec. 15, 1906, by Cal. Controller. 148 PERMANENT COMMON SCHOOL FUNDS Common School Fund as a result of the provision that taxes levied on corporations should constitute a part of the Common School Fund.^^^ Kansas, by her constitution in 1861, included among the sources from which her Permanent Common School Fund was to be derived the five hundred thousand acres of land to which the state was entitled under the Act of Congress, 1841.^^^ These lands were never added to the Permanent School Fund.^" We may estimate this loss at one million, five hundred thousand dollars ($1,500,000) at least. The Literary Fund of Virginia is losing large sums annually through failure to add to it the proceeds of fines as provided by law. Joseph W. Southall, State Superintendent of Public Instruc- tion, in his report for 1904-05 wrote as follows: "This fund would be increased far more rapidly if some more stringent plan were adopted for the collection of fines imposed for offences against the commonwealth, and the proceeds arising from escheated property and all waste and unappropriated lands. It is safe to say that thousands of dollars are lost every year out of this fund for lack of a better system of collecting fines and escheating derelict prop- erty." 3^» The same condition seems to have existed in Wisconsin. The law of Wisconsin directs that the county treasurers shall remit all penal fines received by them annually to the state treasurer. It is further provided by the state constitution that the clear proceeds of all fines shall be added to the school fund. "For the past forty-five years only a small fraction of the amount due the Common School Fund has ever been added to it." ^^^ "In 1881, Attorney- General Wilson found that many county treasurers were placing the amounts of the fines paid to them, in general funds of their counties and not transmitting them to the state treasurer. The 355 Boone, R. G. History of Education in Indiana, p. 206. 356 Constitution Ordinances of Kansas, Sees. 2, 6, 7; General Laws of Kansas, 1861, p. 5. 357 Kansas School Laws, 1905, p. 5. 358 Virginia School Report, 1871. Appendix, p. 19S; Ibid., 1904-05, Part I, p. XXXI. 359 Report Wis. Supt. of Public Instruction, 1S92-93, p. 147, LOSS OF SCHOOL FUNDS 149 trouble is not with the county treasurers ... it lies with the many justices of the peace who have come to consider the funds as official perquisites." ^^^ In 1892 Superintendent Oliver E. Wells wrote: "I recommend that the legislature give authority to some competent officer ... to examine the dockets of jus- tices of the peace and to commence action against those who do not make complete records of all convictions and fines in their dockets." ^^'^ In his report for the year 1893-94, the State Super- intendent of Public Schools wrote: "Prior to 1892 more than sixty thousand dollars ($60,000) annual loss to the school funds resulted from the failure properly to return the clear proceeds of penal fines as required by section two of Article X of the Constitution.'''^^ In 1904, twenty-four thousand, three hundred ninety-one dollars forty-nine cents ($24,391.49) was derived from penal fines which sum goes to increase the principal of the fund, but evidently the school fund is not receiving all that it should from this source. It is difficult to understand why a county like Dane should contribute, in 1904, two thousand, four hundred thirty-one dollars, ten cents ($2,431.10) while Milwaukee county contributed only thirty-five dollars, seventy-seven cents ($35.77). Dane county has a popu- lation of about seventy-five thousand, five hundred, whereas Mil- waukee county has a population of nearly three hundred sixty- four thousand. Dane is the capital city county and may be assumed to be reasonably intelligent and law-abiding and there is no reason for believing that in Milwaukee county there is a vastly greater respect for law than in Dane county. The failure of banks and the general depreciation of securities and of property during and following the Civil War deprived many Losses Throuph school funds of millions of dollars. It is stated the Civil War ^.j^^^^ ^j^g ^j.^jg valuc of real and personal property of the eleven southern states * in i860 was five billion, six hundred * Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North Caro- lina, South Carolina, Tennessee, Texas, and Virginia. 360 Ibid., p. 151. 361 Ibid., p. 152. 362 Ibid., 1893-94, p. 17'. I50 PERMANENT COMMON SCHOOL FUNDS million dollars ($5,600,000,000); in 1870, two billion, seven hun- dred million dollars ($2,700,000,000).^^^ "The owner of a piece of property (in Louisiana) assessed at five thousand ($5,000) dollars in 1850, paid ten ($10.00) dollars to the state. In 1873 he paid more than one hundred ($100) dollars on the same amount, a progress of 1,000 per cent in twenty-three years. The property now assessed at five thou- sand ($5,000) dollars would hardly sell for half . . . whilst in 1850 it would have probably sold for more, thus making in reality the increase of taxation from 1850 to 1873 equivalent to two thousand per cent." 3m It was almost inevitable that the Civil War should prove dis- astrous to permanent funds within the control of the states. It is not surprising to discover that some states used their common school permanent funds to buy munitions of war, others to liqui- date the state debt following the war. Florida, Georgia, Massachu- setts, Missouri, Virginia, and Wisconsin are among the states that used portions of their funds for the expenses of the Civil War. The funds in Tennessee, North Carolina, Kentucky and in many other states were seriously diminished during the same era. In i860 Florida gave her School and Seminary Fund to the state government in exchange for certificates of indebtedness.^^^ The moneys belonging to the fund were used to purchase arms and ammunition and for other similar purposes. The result was that the only really productive portion of the school fund remaining at the close of the war was about six hundred thousand (600,000) acres of unsold school land.^^® Georgia lost all permanent common school funds between i860 and 1870.^'^^ In 1872 the state of Louisiana sold at public auction the whole Free School Fund which had been invested in state bonds, amounting to more than one million dollars ($1,000,000).^^^ The state has established a 363 Report Va. Supt. of Public Instruction, 1872, p. 19S. 36* Gayarre, Chas., Financial and Political Condition of La., published by John W. Madden, New Orleans, 1874. 365 Laws of Fla., 1S60-61, Resolution No. 4. 366 Report Fla. State Supt. of Public Instruction, 1872, p. 7. 367 U. S. Bureau of Education, Circular of Information, 1SS8, No. 5, p. 26. 368 Report U. S. Commissioner of Education, 1S94-95, II, p. 1303. LOSS OF SCHOOL FUNDS 15 1 permanent debt in place of the fund so sold,^^^ but because the interest on this debt is paid from the school tax moneys the fund is practically a lost fund. The school fund in Missouri also suf- fered many losses during the period i860 to 1870.* Hon. John G. Dew, second auditor of Virginia, has the immedi- ate care of the Literary Fund of the state. Judge Dew reports the losses to the Literary Fund during and resulting from the Civil War, as follows: two hundred sixteen thousand dollars ($216,000), diverted; three hundred thousand dollars ($300,000), lost on bank stock during the Civil War; fifty thousand dollars ($50,000), lost on bank stock since the Civil War; seven hundred nineteen thousand, twenty-two dollars ($719,022), paid to West Virginia as her share of the Literary Fund.^^° Wisconsin borrowed one million, five hundred sixty-three thou- sand, seven hundred dollars ($1,563,700) from the school fund during the Civil War. This sum has never been returned and is practically a permanent debt secured by certificates of indebted- ness on which the state pays seven per cent interest. The interest is derived from state taxes whenever the income from other sources is insufficient.^^^ The principal of the Common School Fund of Tennessee is said to have amounted to one million, five hundred thousand dollars ($1,500,000) in the year i860, all of which was lost (1861-75).^''^ The loss to the Literary Fund of North Caro- lina has already been referred to. The failure of banks and the depreciation of securities which brought about losses to this fund were the result of the Civil War and the Reconstruction period. Prior to the Civil War the Literary Fund of North Carolina amounted to over two million dollars ($2,000,000). Less than one- half of this amount remained in 1869. The stocks belonging to the fund were sold at from ten to thirty-seven cents on the dollar. The proceeds of these sales were invested in fraudulent North * See above, also account given in Part II. 389 Constitution of La., 1879, Art. 233; Constitution, 1898, Art. 257. 370 Statement received Dec. 12, 1906, from Judge John G. Dew, by F. H. Swift. 371 Statement received by F. H. Swift from Wis. Dept. of Public Instruction, Sept. 12, 1906. 372 Report U. S. Commissioner of Education, 1895-96, I, p. 313. 152 PERMANENT COMMON SCHOOL FUNDS Carolina tax bonds bought at a discount. The state repudiated these bonds in 1870 and the whole fund was then lost except a few thousand dollars.^^^ The history of the Kentucky School Fund and of the various seizures and diversions of it given in Part II, offers a most inter- esting example of the manner in which the permanent common school fund was misappropriated in this state. Here it may be said that in 1845, ^i^^ hundred seventeen thousand, five hundred fifty dollars ($917,550) of state bonds, representing state indebted- ness to the fund, were surrendered to the Board of Education and burned in the presence of witnesses. (This loss perhaps should have been included under the topic loss by fire!) It should be noted, however, that the act, which is quoted herewith, provided that lists of the bonds should be made and that the state was in no wise released from any obligation to pay the interest on the school fund. An act to increase the resource of the Sinking Fund and to pro- vide for the burning of certain State Bonds and Coupons. "Sec. 4. Be it further enacted, That it shall be the duty of the board of education and commissioners of the sinking fund, to surrender to the governor of the state bonds held by them respectively; and it shall be the duty of the governor, upon the receipt of said bonds, to cause the same to be cancelled and destroyed, by burning, in the presence of the second auditor and treasurer. But before the bonds held by the board of education shall be burned, duplicate lists thereof, described by dates and numbers, shall be made and signed by the governor, second auditor and treasurer, one to be delivered to the secretary of state and the other to the second auditor, to be by them recorded in v^rell bound books, in their respective offices, and it shall also be the duty of the second auditor and secretary of state, to deliver to the board of education a copy of said duplicate list, signed by them respectively, and sealed w^ith their respective seals of office; and when so signed, sealed, and deHvered, said dupHcate copy shall stand in place of the bonds of the state now held by the said board of education, but the same shall not be passed by delivery, be transferred, nor assigned by said board to any person or corporation, . . . which shall be expressed on the face of said lists. ^^And be it further declared, That the rights of said board of education to the fund now claimed by it, shall not be regarded as in any wise impaired by anything in this act contained, or in any wise release the state from the 373 U. S. Bureau of Education, Circular of Information, 1S8S, No. 2, p. 170. LOSS OF SCHOOL FUNDS 153 obligation it is now under to pay the interest on the school fund; and in every respect, shall said fund be considered and held as sacred and inviolate as though the bonds had not been burned." 374 In 1850 the revised constitution of Kentucky set aside over one million dollars of state bonds and seventy-three thousand dollars ($73,000) of bank stock as an irrevocable debt to constitute a Per- manent School Fund.^^'' The interest on this fund is paid out of a sinking fund. By the year 1858 the Permanent School Fund of Rhode Island amounted to several hundred thousand dollars, over three hundred eighty-two thousand dollars ($382,000) having been added in 1837. In 1858, the state borrowed all but one hundred fifty-five thousand, five hundred forty-one dollars ($155,541) and then constituted that amount a Permanent School Fund.^^^ The losses suffered by many of the permanent common school funds already referred to were due, in part at least, to misappropri- Funds Mis- ation by the states of moneys belonging to these appropriated funds. Alabama, Louisiana, and Kentucky are three out of a considerable number of states which, have misappro- priated all or a part of their funds. Alabama by the year 1873 had diverted one million, two hundred sixty thousand, five hun- dred eleven dollars ($1,260,511) belonging to her Permanent School Fund.^" The present Permanent School Fund of Kentucky appears to date from 1838. The Literary Fund, which the laws of Ken- tucky, 182 1, had established and provided should forever be maintained,^'^^ seems to have disappeared in less than fifteen years, having been used by the state to meet its own general expendi- tures.^^^ 374 Ky. Acts, 1845, Chap. 264, p. 69. Cf. account given in Part II. 375 Laws of Ky., 1845, Chap. 264, Sec. 4; Constitution of Ky., 1850, Art. ir, Sec. i; Report U. S. Commissioner of Education, 1899-1900, I., p. 512. 376 Report U. S. Commissioner of Education, 1896-97, p. 642. 377 Reports U. S. Commissioner of Education, 1874, p. 5, and 1903-04, p. LXV; Report Ala. State Supt. of Education, 1882, p. 7, from Bourne, E. G., History of Surplus Revenue, 1837, p. 47, foot-note. 378 Acts of Ky., 1821, p. 35, Chap. CCLXXXIV, approved Dec. 18. 379 "Ed. and Lit. Inst, in 1832, Barnard," Am. Journal of Ed., 1S77, p. 335; Report U. S. Commissioner of Education, 1895-96, p. 324. 154 PERMANENT COMMON SCHOOL FUNDS In 1840, two years after a second attempt to establish a perma- nent state fund, the state seized the principal to liquidate the state debt. By 1843 the entire principal had been used for roads and the improvement of rivers, and the state owed the fund one hun- dred sixteen thousand dollars ($116,000).^^° The constitution of Louisiana of 1898 placed the Free School Fund among the perpetual debts of the state, reduced the interest from six to four per cent and declared that the same should be paid out of any taxes that may be levied and collected for general purposes of education.^*^^ In many states which have used all or part of the permanent common school fund we find the fund acknowledged as a state debt and the interest on it paid out of state taxes levied for general purposes. In such instances the fund continues to bring additional rQivenue for schools. In the case of Louisiana, however, owing to the fact that the interest on the fund is paid out of school taxes, the revenue for schools is in no way increased; it is merely "robbing Peter to pay Paul." It has often been but a step from borrowing the fund to repudi- ating the state's indebtedness to it. It has been noted that North states Borrow Carolina, in 1870, repudiated her indebtedness to and°Repudiate her Literary Fund which had arisen out of her ^^^^^ investing of moneys belonging to that fund, in fraudulent bonds. Both before and since that time other states have pursued similar policies respecting their public permanent common school funds. Vermont established her first common school fund in 1825.^^^ In 1848 the state owed this fund two hundred twenty-four thousand dollars ($224,000), and appropriated the fund to pay the debt. That is, the state borrowed the fund and then in 1845 repudiated the debt.3«2 Colorado invested four hundred eighty-eight thousand, six hun- dred thirty- three dollars, forty-four cents ($488,633.44) of moneys 380 Report U. S. Commissioner of Education, 1899-1900, I, p. 512. 381 Report Ver. State Supt. of Education, 1906, pp. 11, 12, Act passed Nov. 17, 1825. 382 Report Vt. State Supt. of Education, 1873-74, pp. 439-440. LOSS OF SCHOOL FUNDS 155 belonging to the Public School Fund in the so-called "excess warrants" of 1887, 1888, and 1889, which with interest, in the year 1906, amounted to over one million dollars. The state has redeemed about twenty-five thousand dollars of these warrants and the invest- ment without interest now (1906) represents four hundred sixty- three thousand, seven hundred sixty-five dollars, seventy-five cents ($463,765.75). The state has twice repudiated this indebtedness, and the warrants cannot be paid until some time in the future when a constitutional amendment shall be adopted.^^^ Chapter I and the preceding paragraphs of the present chapter have pointed out that a number of states have borrowed the princi- Significance of pal of their permanent common school fund, Permanent Itat^ entirely or in part, that they have used the moneys Debts * belonging to these funds and established in place thereof permanent debts or accounts on which they pay a fixed rate of interest. Maine, Michigan, and Ohio are among the states which have pursued this policy almost from the beginning. Such funds cannot be said to be lost as a source of school support, but in view of the fact that the interest on the principal is in most cases derived from taxation, directly or indirectly, they do not serve the purpose of relieving the people of the state from taxation, but are rather additional means of levying taxes. The same is true to a large extent of funds which have been in part borrowed by the state or invested in state bonds, the interest on which is paid out of state taxes. It is somewhat difficult to state the real significance of funds which have become perma- nent loans. Many states have pursued the policy of using all or a part of the principal of the permanent common school fund and substituting state bonds for the moneys borrowed. There are many considerations which encourage or favor this policy. In the first place, state bonds are considered one of the best and safest of all investments. In the second place, the question may well be asked why should the state not use moneys lying uninvested in Compare Tables I and III, Chapter I. 333 Data furnished F. H. Swift by Katherine L. Craig, Colo. Supt. of Public Instruction. 156 PERMANENT COMMON SCHOOL FUNDS its own treasury when it is in need of them. What advantage would it be to the schools of the state for the state to go outside to borrow money when it has moneys at hand which are unemployed ? Without attempting to render any decision regarding the wisdom of this policy it may be well here to note that certain states expressly provide against loans to the state from the school fund, as, for instance, West Virginia by her constitution. Furthermore, it may be well to distinguish between real investments in state bonds which the state must redeem at their maturity and investments in bonds which, in all probability, will never be redeemed, or instead of such investment in irredeemable bonds, the creation of a permanent account. It is true the account established or the certificates of indebtedness given by the state in exchange for the productive fund assure the schools a revenue, — a revenue in some cases greater than could be derived from the investment of money in ordinary securities. It would be very difficult in many states at the present time to place funds as so to bring five, six, and seven per cent, rates paid by a number of states on their credit funds and permanent debts. On the other hand, one of the purposes for which permanent school funds were established was clearly to aid the people of the state in raising money for the sup- port of the schools by taxation. When, therefore, the nominal income of the fund is derived from taxation, as it frequently is in the case of credit funds, permanent loans, and debts, the above important purpose is thwarted. The nominal amount of the school fund of Wisconsin, in 1892, was $3,358,502.50. Of this $1,563,700 consisted of certificates of indebtedness, leaving the actual amount available for investment, $1,794,802.50.^^'* The Superintendent of Public Instruction of Wisconsin wrote several years ago with reference to the fund of his own state: "The certificates of indebtedness are evidences of the disappearance of nearly one-half of the school fund. The law which directed the investment of the school funds in the purchase of state bonds provided for the cancellation of the bonds and substitution therefor of the certificates of indebtedness. The certificates are non-negotiable and non-transferrable. No provision whatever is made for their payment. The discretionary authority of the commissioners LOSS OF SCHOOL FUNDS 157 who are clothed with constitutional powers over its investment is thereby destroyed by . . . statutory enactment. The rate of interest on these certificates is seven per cent. The efifect is the creation of a perpetual state debt requiring the levy and collection of an annual state tax to the amount of $157,570 to pay the interest thereon. The interest paid . . . thus far amounts to $4,200,000 and the process seems just begun. . . . Additional burdens of taxation are the only fruits of the school fund, the very result it was intended to avoid. "This seems evident that a wise administration of all the provisions relating to the school fund should have resulted in a permanent endowment of from $15,000,000 to $20,000,000; that we have instead cash and money invested to the amount of $3,401,461.49 and a permanent state debt of $2,251,000; that the application of the available productive funds to the liquidation of the state debt would practically leave the state as though no provision had been made for the support of its schools; that the necessity for the disappearance of this money is not apparent; that the laws and records bear witness to transactions of more than doubtful propriety; and that the security for the debt is of ques- tionable validity." ^s* It is scarcely necessary to add that this statement applies not to the fund of Wisconsin alone but to many so-called credit funds, permanent loans, and debts. The discussion of losses to the permanent common school funds which has occupied such a large portion of this chapter, may well be closed by a summary showing the more important causes of these losses, and by a table showing the amount lost or diverted in some of the states, in so far as it has been possible to ascertain the same. The statement made at the beginning of this discussion to the effect that the account here is by no means complete should be kept in mind when consulting the table. The real condition of these funds can be best realized by consulting Table VII at the close of Chapter I. Table XIX. Summary of the More Important Causes of Loss to the Public Permanent Common School Funds in the United States 1. Lands sold for less than real value. 2. Unpaid for lands reverted to township. 3. Deeds improperly recorded or not recorded. 4. Sold by towns and no records of proceeds. 3S4 Report Wis. Supt. of Public Instruction, 1892, pp. 152-154, 161. 158 PERMANENT COMMON SCHOOL FUNDS Table XIX — continued 5. Bad loans. 6. Unpaid notes. 7. Unpaid interest on bonds or notes. 8. Mismanagement. 9. Dishonest management. 10. Absconding of school fund officers or debtors. 11. Theft or embezzlement. 12. Losses by fire. 13. Insutficient legislation. 14. ISIoneys due principal not added. 15. Moneys due principal diverted. 16. Fund borrowed by the state. 17. Fund used for state expenses. 18. Fund used to pay state debts. 19. Fund misappropriated by state. 20. Used for other purposes. 21. Exchanged for state securities — indebtedness later repudiated. 22. Fraudulent bonds. 23. Failure of state banks. 24. Depreciation of securities. 25. Civil War. Table XX. Losses to Public Permanent Common School Funds^ State c Amount Lost or Diverted 6 Date Title of Fund Credit Funds and Perma- nent State Debts c 6 Ala. $ 669,086 2,056,714 1848 U. S. Surplus Revenue Loan Sixteenth Section Land Fund $2,831,295 Ark. 26S,75r.49 After 1868 U. S. Surplus Revenue Loan 1,128,500 1,250,000 Before 1870 Common School Fund Cal. 6,000,000 Before 1861 Sixteenth and Thirty-sixth Section Lands Township Funds 2,026,000 Col. 463,765-77 After 1887 Public School Fund Conn. 138,640.09 Before 1810 School Fund Fla. Unknown 1860-65 State School Fund Ga. 750,000 350,000 1860-65 Common School Fund U. S. Surplus Revenue Loan 111. 613,362.66 School Fund Proper ^ This table must not be understood as necessarily showing the complete loss in any state nor all states which have suffered loss. « States having credit funds or permanent debts, not named here are Delaware, Maine, Michigan, and Nevada. See Table III, Chap. I. LOSS OF SCHOOL FUNDS Table XX — continued 159 State c Amount Lost or Diverted 6 Date Title of Fund Credit Funds and Perma- nent State Debt.s c b 111. Ind. $ 335,592.33 3,000,000 U. S. Surplus Revenue Loan Common School Fund Iowa 125,000 Before 1868 Permanent School Fund $ 10,937 Kan. 2,000,000 State Permanent School Fund Ky. La. 1,568,996.66 850,000 1,652,947.86 Before 1845 Before 1872 Permanent School Fund U. S. Surplus Revenue Loan Free School Fund 2,418,997 1,130,867 Md. Mass. Miss. 477,919.14 743,42975 2,842,572 50,000 Before 1872 1839 1859-64 U. S. Surplus Revenue Loan U. S. Surplus Revenue Loan Massachusetts School Fund Chickasaw Fund 1,002,023 Mo. Neb. 100,000 259,842.87 Before 1870 1897 Township School Fund Permanent School Fund N. H. N. Y. N. C. Ohio 35,000 (inc 333,862.17 1,400,000 1,133,757-44 Unknown ome) 1867-83 1837-1905 1860-70 1860-70 Institute Fund U. S. Surplus Revenue Loan Literary Fund U. S. Surplus Revenue Loan 59,470 4,902,110 Ore. 20,000 Before 1905 Common School Fund Penn. 1,500,000 Before 1870 Common School Fund R. I. 370,000 Before i860 U. S. Surplus Revenue Loan S. C. Unknown Tenn. 388,985 Before 1850 Common School Fund 2,512,000 1,500,000 1860-65 Common School Fund Texas 700,000 (income) Before 1900 Permanent School Fund Vt. 224,000 1845 Common School Fund 775,269 Va. W. Va. 556,000 0. 6,000 1860-65 Before 1871-75 Virginia Literary Fund School Fund Wis. Wyo. 1,563,700 5,768.35 1860-65 1893 School Fund Common School Permanent Fund 1,563,700 " Not including $719,022.62 paid to West Virginia as her share of fund. * This table must not be understood as necessarily showing the complete loss in any state nor all states which have suffered loss. "^ States having credit funds or permanent debts, not named here are Delaware, Maine, Michigan, and Nevada. See Table III, Chap. I. CHAPTER VII PURPOSE AND EFFECTS OF PUBLIC PERMANENT COMMON SCHOOL FUNDS The easiest way to kill an institution in a republic is to provide it with an endowment which removes from the people all responsibihty of contributing to its support. "There is surely a great need of a permanent school fund upon the principle that the best state schools result from a true equilibrium between state and local support and control." Report of the State Commission on Permanent Common School Funds of Vermont, p. 27. These funds have been wheel, ballast and lever of our states' systems of free schools. They set those systems in motion and kept them going. They maintained the equilibrium. They lifted them to higher and higher levels. Public sentiment regarding the need of free schools and the obligation to support them has passed through a marvelous transformation in the last hundred years. Con- Early Public Senti- . . . „ • , ment Respecting ditions existed quite universally m the earlier Free Schools ... , , , . , . part of the nineteenth century and continued m many states long after the middle of that century, which are diffi- cult to describe and more difficult for the present generation to realize. Schools were rare. School buildings were wretched and foul. Large numbers of them were not supplied with even bare necessities: thousands of them were destitute of water-closets. Teachers were untrained and ignorant; their wages small and uncertain, and frequently could not be collected when due. Edu- cational opportunities in different parts of the same state were totally unequal. Some districts maintained no free schools. Others supported free schools for a brief period. Taxation for schools, permissive in many states, compulsory in a few, frequently could not be levied owing to the hostile attitude of the public. Worse still, the real conditions could not be ascer- tained as there was almost no state supervision of schools and efforts to collect the most meager data proved futile. There were no 160 PURPOSE AND EFFECTS OF SCHOOL FUNDS i6i means at hand for equalizing or remedying conditions. Laws enacted for the benefit of free schools could not be enforced. The income of funds established to support free schools was often used for private schools or for the expenses of the state which not infrequently borrowed and exhausted the principal. Public senti- ment respecting the establishing and maintaining of free schools ranged all the way from indifference, disbelief, and contempt, to open hostility. Evidences of this attitude are to be found prior to 1850 in every state in the Union to a greater or less extent. Indifference to Free Schools For example, the constitution of Indiana, in 1816, in the West -, stated : "It shall be the duty of the general assembly, as soon as circumstances will permit, to provide by law for a general system of education ascending in regular gradation from township schools to a state university, wherein tuition shall be gratis and equally open to all." 389 Every township had been granted school lands upon the admission of the state into the Union, and the state itself had established funds to aid in the support of common schools. Notwithstanding this early provision, it is stated that from 1830 to 1840 almost no free public schools existed. During this period "the building of school-houses, the estab- lishment and conduct of schools . . . was left to popular vote. . . . Illiteracy in the state was alarming and seemed to be growing worse. In 1840 one-seventh of the population were wholly unlet- tered and a much greater proportion were very ignorant. Educa- tionally Indiana stood sixteenth among the twenty-three states." ^^^ It may be argued that the existence of such conditions in the West was due, in part at least, to the hardships of pioneer life and the sparseness of population, but in the East Contempt for Free ^ , ^ Schools in the where public schools had existed since colonial East and South , , . , , rr^, days, conditions were frequently little better. The free public school continued to be regarded as a charity school pro- vided for those who were unable to pay. In Massachusetts, the 389 Constitution of Indiana, 1816, Art. IX, Sec. 2. 3S0 Report Ind. Supt. of Public Instruction, 1885-86, p. 12. l62 PERMANENT COMMON SCHOOL FUNDS law of 1827 had required all public schools to be free, supported by taxation, nevertheless public schools were "languishing for support and to a degree destitute of public sympathy." ^^^ In 1834 Massa- chusetts contained no less than nine hundred fifty private schools and academies.^^^ The free school in the South was regarded, generally speaking, distinctly as a charity school. Striking evidence of the truth Free Schools of this is presented in the fact that the portion ChlritJ^Schoois of the Permanent School Fund established by m the South Georgia in 182 1, which was devoted to the sup- port of free schools, was commonly known as the Poor School Fund.^^^ The original act by which the Literary Fund of Mis- sissippi was established expressly states that the revenue of this fund shall be applied to no purpose whatever other than for the education of the poor white children.^^^ The legislature of Vir- ginia which provided for the establishment of the Literary Fund regarded it as a fund for the education of the poor. " This present general assembly solemnly protests against any other application of the said fund by any succeeding general assembly to any other object than the education of the poor." ^^^ In Florida in 1850 there were only sixty-nine public schools; in i860, ninety-seven. In i860 only two thousand, thirty- two pupils were reported as attending public schools, whereas four thousand, four hundred eighty-six were attending private schools.^^^ The attitude toward public schools is further revealed by the fact that the income of funds established for the Free School Moneys Used for support of tlicsc schools was frequently used to pay Private Schools . . i i t • • i i • teachers in private schools. It is said that m Indiana prior to 1850 the revenue of the permanent common school 391 Boutwell, G, S., Mass. School Fund, lis Origin and History, Report Board of Education of Mass., 1859, PP- 38-47- 392 "Mass. and Its Early History," Lowell Institute Lectures, pp. 486-487. 393 Cf. account given in Part II. 394 Alden's Digest of the Laws of Miss., 1839, Chap. 51, Sec. 9, p. 367. 395 Acts of Va., 1809, Chap. XIV, citation taken from Miller, History of Educa- tion in W. Va., p. 29. The Virginia fund appears to have been established in 1810. 396 U. S. Bureau of Education, Circular of Information, 1888, No. 7, pp. 19-20. PURPOSE AND EFFECTS OF SCHOOL FUNDS 163 funds was distributed to denominational schools and in many in- stances turned over to individuals who engaged teachers to instruct their children, with the children of others who might wish to join them.^^'' In 1844 the income of the Common School Fund of Tennessee " when received by the counties was, in nearly all of the districts, distributed among the private schools in the ratio of their enrolled pupils and was used as a credit on the tuition of those who were willing to accept it. It thus came to be regarded as a sort of charity fund." ^^^ In Florida it is stated that between the years of 1852 and i860 or later the income of the state school fund was in many instances distributed to the teachers of private schools.^^^ Frequently moneys and lands reserved for the establishment of funds for the support of free schools were left unemployed. The counties of Georgia made little use of the Appropriations for Free Schools provision of the grant of One thousand acres of land each for the establishment of free schools,^°*^ and only one township in Florida appears to have ever attempted to make use of its sixteenth section lands.'*^^ Indiana, in 1837, pro- vided for the distribution of one-half of her share of the United States Surplus Revenue Fund among the organized counties of the state for the use of common schools. Three counties, De Kalb, Lake, and Wells, never claimed their share.^*'^ That the failure to establish free schools was due to the attitude of the public toward them and not due to the failure to provide Legislation in laws for them is amply borne out by the numerous Schools" ^^^ 2,cts passed in all sections of the country. For Ineffective example, more than three hundred acts were passed in Tennessee relative to school funds.^*'^ Intelligent legis- lation was impossible as the facts on which to base it were not in S87 Rawles, W. A., Centralizing Tendencies in the Administration of Ind., p. 13. 388 Report Tenn. State Supt. of Public Instruction, 1891, p. 34. so* U. S. Bureau of Education, Circular of Information, 18SS, No. 7, p. 15. ** U. S. Bureau of Education, Circular of Information, No. 4, 18S8, p. 27. *>i Ibid., 1888, No. 7, p. 20, note 2. *^^ Boone, R. G., History of Education in Indiana, p. 196. *03 Report U. S. Commissioner of Education, 1895-96, I, p. 313. i64 PERMANENT COMMON SCHOOL FUNDS the Hands of the legislators and there was no means of securing them. Maine, Massachusetts, New York, and Florida each attempted to secure data from local units to serve as a guide in distributing funds and making laws. How fruitless their attempts were will appear in the account of the effect of permanent common school funds upon school returns. Here, however, Florida's ex- perience may be described. After Florida had established a Per- manent Common School Fund in 1848, she was unable to secure reports from the schools as to school attendance. From 1850 to 1 85 1 it was provided by law that a county, in order to receive its share of the revenue of the School Fund of Florida, must submit to the State Superintendent, prior to May, 1852, a report of the num- ber of children in each district of the county from five to eighteen years of age who had actually attended school in the district within three months of the date of the report. This law was repealed in 1852 owing to the impossibility of enforcing it. That the moneys upon which public schools depended prior to the establishment of public permanent funds were small, uncer- tain and fluctuating will appear upon recalling: Uncertainty and & rr r & Variation in the more important early sources of school sup- School Support . . .. . . , port: tuition, gifts, appropriations, lotteries, pro- ceeds of licenses and fines, taxes on occupations and commodities, and taxes on banks. Where schools were supported by rate bills their very existence depended on the attendance of the pupils. Home economy placed a premium upon staying away from school. It is almost needless to say that at the time towns and districts were refusing the state school moneys, they were opposing the levying of local taxes for schools. Taxation for teachers' wages was looked upon not only as a burden but as an imposition. This will be seen from a survey of conditions existing in many states, of which New York and Indiana may be taken as examples. New York, in 181 2, provided for the distribution of the common school fund revenue by an act which required each town to raise a tax equal to its full share, but left participation in the revenue to the option of the towns.^"^ The Act of 1795 had provided for ^O'* Laws of New York, 35th Session, 1S12, Chap, 242. PURPOSE AND EFFECTS OF SCHOOL FUNDS 165 the distribution of the annual appropriation of one hundred thou- sand dollars ($100,000), and had made a like provision, save that it required the town to raise a tax equal to one-half its share.^"'' The indifference of the people towards public schools was soon evident. As long as participation in the public money was optional large numbers of towns refused to take advantage of the public money.^*^^ The result was that in 1814 an act was passed making participation and consequently local taxation compulsory .'*°^ Indi- ana had permitted local taxation for school buildings since 1824. But as late as 1855 the Supreme Court declared it unconstitutional to levy a local tax for the payment of teachers' wages,^"^ and it was not until 1867 that local taxation for this purpose was allowed.^"^ Despite the conditions which have been described in this chapter thus far it would be a mistake to suppose that public opinion was a unit in opposing free schools. Although the Public Permanent dominant sentiment respecting them gave expres- School Funds f b & i- Abolition of sion to itself in indifference, scorn, and hostility, School Tax. , , , 11. , , Illustrated by yet there were those who regarded free schools Connecticut , , i i i , i t not only as a necessary burden but as an obliga- tion in which lay opportunity as well as duty. Previous chapters have related the steps by which the policy of providing perma- nent funds for the support of common schools was adopted in turn by town, state, and nation. The aim or incentive which in- spired those who labored for the establishment of permanent com- mon school funds in so far as it was related to schools and not to the sale of unsettled lands, was usually largely the result of pre- vailing conditions and sentiments. It is not surprising, therefore, that in Connecticut, which, in striking contrast to the majority of states, had long compelled its towns to levy a school tax, the estab- lishment of permanent funds should be regarded chiefly as a m.eans of escaping from taxation for schools. Perhaps, almost <05 Laws of New York, 1795, Chap. 75. <08 Randall, S. S., History 0/ the Common School System of the State of New York, ed. 185 1, p. 13. 407 Laws of New York, 1814, Chap. 192, Sec. 21. *08 Boone, R. G., History of Education in Indiana, p. 157. lo^ Boone, R. G., History of Education in Indiana, p. 29; Act Mar. 9, 1867. 1 66 PERMANENT COMMON SCHOOL FUNDS from the first, the purpose in the minds of the legislators and direct- ors of the school policy of Connecticut was that the revenue of the school fund should pay in full the wages of the common school teachers, and so relieve the towns and school societies from the burden of local taxation. The act which established the school fund and subsequent acts relating to its management show this in several ways: (i) by the absence of any provisions requiring state or local taxation for schools; (2) by refraining from naming any conditions whatever which must be fulfilled by towns and districts in order to share in the revenue; (3) by omitting to state any length of time which schools must keep open during the year; (4) by specific provision in 1801 that school societies which had expended all public moneys for teachers' wages might be considered to have fulfilled all necessary conditions even though some of the dis- tricts under their jurisdiction had conducted no school during the year. The Act of 1795 which established the School Fund of Connecti- cut, placed no limit to the use to which the revenue of the school Teachers' Board fund could be put. It Specifically provided that Oldest Lawful^ under certain conditions the society might vote ^^j®*^*^ to devote its school fund revenue to the support of the Christian ministry or public worship. But the first dis- tribution of this revenue did not occur until 1799, and the act of that year made the sole lawful objects to which the reve- nue could be applied the board and wages of teachers in ele- mentary schools or schools of a higher order in which Latin and Greek could be studied. Participation in the school fund revenue was optional. The Acts of 1795 and 1799 made no pro- vision compelling school societies to accept their share. Such provision appeared unnecessary as the revenue was given almost unconditionally. Owing to this total absence of requirements, the establishment of the School Fund of Connecticut ushered in a policy by which Evil Effects of the the responsibility of supporting schools was re- Connecticut Pohcy ^noved almost entirely from the community directly benefited by the school, and thrown back upon the PURPOSE AND EFFECTS OF SCHOOL FUNDS 167 state. The evils inherent in such a poh'cy were not foreseen by those who inaugurated it. Nevertheless these evils soon showed themselves and the School Fund of Connecticut became no- torious as an example of a magnificent endowment creating dis- aster. The Connecticut Code in force from 1700 to 1798 had compelled towns or school societies of more than seventy families to maintain Effect of Con- a school for eleven months. Many county towns Fund^on "school maintained a grammar school. The most serious Term and Support ^^f^^^ ^f j^e School Fund Acts of 1 795, 1799, and 1800, was that they failed to compel districts to maintain schools for any specified term. The law of 1801 permitted them to close school whenever the moneys provided by the state had been exhausted.'*^^ Not until 1840 was a law passed which at- tempted to reestablish a legal term. In that year it was enacted that no district should be entitled to any portion of the public moneys unless it had maintained a school for at least four months in the year, taught by a teacher or teachers fully qualified. It was not until 1858 that the six months' term required by the Code of 1700 was restored.'*^^ The result was that between the years 1801 and 1840 many schools were closed and others were kept open no longer than public money lasted.'*^^ A second serious defect in the School Fund Acts of 1795 and 1801 was that they contained no provision compelling the larger towns and societies to maintain grammar schools. Of all the evils following from the establishment of the School Fund of Connecticut perhaps the most disastrous was its effect . upon local taxation. As pointed out above, the Effect of Connecti- ^ '- cut School Fund Code of 1700, modified in 1754, which continued on Taxation . •, o 1 1 in force until 1798, had compelled all towns to levy a local tax of at least forty shillings on every thousand pounds."*^^ The School Fund began to contribute revenue for the support 4" Act of 1801, Par. 3. «2 Laws of Connecticut, 1858, Chap. XLII. *13 Conn. School Report, 1853, p. 45. *i* Report Conn. Board of Education, 1876, p. 103. 1 68 PERMANENT COMMON SCHOOL FUNDS of schools in 1799. With the gradual increase of its income there was an increase in disinclination to raise taxes. From 1821 to 1854 rate bills, gifts and income of permanent funds were almost the only sources of school support. During this period a town or society school tax was virtually unknown in Connecticut.^^^ In conclusion it should be noted that the Connecticut School Fund failed to make the schools of the state free. For seventy- three years after its establishment rate bills continued to contribute a considerable portion of the support of public schools.* The decline of the common school system of Connecticut under the influence of the School Fund was a most convincing demonstra- ^ .. ^ tion of the principle that an endowment which Second Aim of r- r Permanent School relieves the community from the necessity of Funds to Incite and Relieve Taxa- raising moneys by local effort is an injury alike tion. New York, • i i Maine Massachu- to the community and to the cause the endow- setts as Exeimples , . , . , , mi i i • i ment is seeking to advance. The lesson which Connecticut had learned at such a cost was not lost upon the other eastern states. They saw that the easiest way to kill an institu- tion in a republic is to provide it with an endowment which removes from the people all responsibility of contributing to its support. An early report of the State Superintendent of Public Instruction of New York contains the following statement: "Those who founded the common school system of this state never contem- plated that the permanent public fund would, at any time, yield a revenue adequate to the support of such an establishment." The Act of 1 81 2, as previously stated in this chapter, which was passed three years prior to the first distribution of the revenue of the New York Common School Fund, required that the town, raise a tax equal to its share of the revenue in order to participate in the bene- fits of the Common School Fund.^^^ Maine had made taxation for schools compulsory in 1821, the year following her admission into the Union. It was not until 1828 that she established the Permanent School Fund and not until * See Table VIII, Chapter II, p. 27. *18 Laws of New York, 35th Session, 1812, Chap. 242, PURPOSE AND EFFECTS OF SCHOOL FUNDS 169 1 85 1 that the first distribution of this revenue was made. Mean- while the schools depended very largely upon the proceeds of local taxes. No provision for permitting the discontinuance of these taxes was ever made. Massachusetts made local taxation compulsory seven years before the establishment of the School Fund. In January, 1828, Hon. W. B. Calhoun in a report made for the committee on education of the house of representatives of Massachusetts, declared "that means should be devised for the establishment of a fund having in view not the support but the encouragement of common schools and the instruction of school teachers.^^^ In February, 1828, the same committee specifically states that a fund sufficient to support common schools and normal schools would injure the school sys- tem and decrease public interest in it, and cites Connecticut as an example of this; but adds that a fund sufficient to give towns about one-third the amount they themselves raised would be an incentive to interest and effort. The act by which the Common School Fund of Massachusetts was created provided that there shall never be paid to any city, town or district a greater sum than is raised therein respectively for the support of schools.^^^ In the public land states the permanent common school fund has, in many instances, supported the schools largely and often entirely during the first years of the state's existence. On the other hand, as pointed out in the chapter dealing with the early sources of school support, the policy of supporting schools by local taxation had become established in some of the western territories and continued after their admission into the Union. The report of the Special Commission on the Permanent Com- mon School Fund of Vermont, 1906, contains an excellent state- ment of the purpose of a permanent fund. The statement given by this Commission was made after a careful study of the permanent school funds in the different states. On p. 23 the report of the Commission reads: "The primary fact is that good schools should <" Boutwell, G. S., Mass. School Fund, Its Origin and History, pp. 46-47. «8 Laws of Mass., 1834, Chap. CLXIX. lyo PERMANENT COMMON SCHOOL FUNDS exist everywhere, and their existence can be insured only by fixed, existing endowment funds devoted under the laws of the legisla- ture, to their effective supervision and maintenance. This is apart from any local, direct support, which should be actively continued and enforced by law." The Commission states the necessity of a permanent school fund in the following words: "There is surely a great need of a permanent school fund upon the principle that the best state schools result from 'a true equihbrium between state and local support and control.' " ^^^ The statement of the purpose of a permanent common school fund in the words of this Commission should be, "first, to render the means of school support certain and fixed, beyond recurring yearly debate and taxation of the people; second, to conserve and extend the two working principles of the existing law, especially of school taxation and school opportunity; and, finally, to lay the foundation of a true and actual supervision by the state, of public instruction in connection with its actual direction of an accounting for school moneys disbursed, particularly such funds as the state itself supplies to towns by taxation or through permanent invest- ment for the support of schools." '^^ The aims expressed in this statement are not theoretical. They represent the actual achievements of other states resulting from the creation of permanent endowments for schools. ^ The effects of these funds in public land states will be treated of in the latter part of this chapter. These states provided for permanent endow- ments for schools, coupled in many instances with state supervision, at the time of their admission into the Union. They do not offer as good an opportunity, therefore, of observing the influence of the permanent funds upon educational conditions as is to be found in commonwealths which at first possessed no state-controlled fund. For this reason Connecticut, New York, Maine, Massachusetts, Indiana, and Florida have been selected as states to be studied in detail. 419 Report of the State Commission on Permanent Common School Funds of Vermont, p. 27. 420 Ibid., p. 32. PURPOSE AND EFFECTS OF SCHOOL FUNDS 171 The aims which the states have sought to reahze through their Aims of Permanent permanent common school funds arc revealed Reveaied^in*^^ in three classcs of constitutional and legislative 8^/0^^°°^^ ^"^ provisions respecting these funds: Provisions (j) Provisions concerning the lawful use of the fund's income. (2) Provisions concerning conditions which must be fulfilled, commonly spoken of as conditions of participation, by the county, town or district in order to receive a share of the income. (3) Provisions concerning the method and basis of apportion- ment. The most important effects of the permanent common school funds arose out of these three classes of provisions and in many cases, as will appear later, the ability to enact and enforce these provisions was itself a result of the influence of the permanent funds previously established. The remainder of this chapter will, therefore, be devoted chiefly to the consideration of these provi- sions, and the aims they reveal and their results. There has been little uniformity in the objects to which different states have permitted the income of the permanent common school funds to be applied. In some states pro- Lawful Uses '- ^ ^ visions appear to be stated only in general terms, such as that the revenue of the permanent school fund "shall be faithfully appropriated for maintaining a system of free schools, and for no other purpose whatever." Some states leave it to the state superintendent or other authorities to interpret the general terms. As pointed out above, Connecticut, the first state to create a permanent common school fund, made teachers' wages and board the sole objects to which the income of the School Fund might lawfully be applied. New York followed the example of Connecti- cut and made the payment of the board and wages of teachers the sole lawful use of the income of the Common School Fund from the time of its first distribution in 1816. Maine hesitated to make restrictions regarding the application of the public school moneys but gradually defined the uses. The first distribution of the 172 PERMANENT COMMON SCHOOL FUNDS revenue of the Permanent School Fund took place in 1851. The law appears to have left it largely to the towns to decide to what objects of school expenditure their share of the income should be applied. Chapter 68 of the Law of 1876 required a municipal officer to make sworn returns of the amount of all moneys received or expended for school purposes, but did not call for a specifica- tion of the objects to which the moneys had been applied."*^^ In general the Maine laws have simply provided that the revenue must be applied to the support of public schools and have left the interpretation of the term "support" to the State Superintendent of Schools or to other school oflScers. The present school law, 1905, names seven objects as the only ones to which the income of the Permanent School Fund shall be devoted: (i) teachers' wages; (2) teachers' board; (3) fuel; (4) janitors' services; (5) conveyance of pupils; (6) pupils' board; (7) tuition. Moneys for erecting or repairing buildings, for the purchase of school property, apparatus, books and for insurance must be raised by local taxation.^^^ The laws of Tennessee require that the revenue of the Perma- nent School Fund shall be used for the support and maintenance of the public schools of the state,''^^ but leave the exact application of the income "to the judgment of the district directors who are to use the school fund apportioned to their district ... in such manner as will promote the interests of the public schools." "^-^ The failure to name in the laws the specific objects to which the income of the permanent common school fund may be applied is generally the result of one of several conditions. Where the public is indifferent and it is difficult to get local units to accept a share of the public moneys it seems unwise to make restrictions which will in any way deter them from accepting it. The existence of such conditions no doubt largely accounts for the failure of Florida to make provisions of this sort at first.'^^ In some of the public land states the income of the permanent school fund has been so *2i Me. School Report, 1901, p. 89. ^2 Me. School Laws, 1905, p. 8, Sec. ig. *23 Tenn. School Laws, 1895, p. 19, Sec. 34. 424 Ibid., p. g, Sec. 20. 425 Laws of Florida, 184S, Chap. 231, Sec. i. PURPOSE AND EFFECTS OF SCHOOL FUNDS 173 large, and the difficulties of supervision, resulting from the lack of means of communication in pioneer days, so great that it has been left to the districts to make such use of the moneys as they saw fit. Massachusetts has made no statutory provisions respecting objects to which the income of the School Fund may be applied. The only statement is found in the form prescribed for the sworn certificate of the school committee, sent annually to the Secretary of the State Board of Education.^'^'' From 1846 to 1854 the general educational expenses of the state and of normal schools were paid from the proceeds of lands belonging to the Massachusetts School Fund.^^ Since 1854 these expenses have been paid out of one- half the income of the fund received for these purposes, the other half of the income being distributed among the towns.^^ The following table represents the more important objects to which the income of the permanent common school funds may be lawfully applied, and some of the states providing them: Table XXI. Lawful Objects to Which Reventje of Public Permanent Common School Funds May Be Applied * Objects States I. For teachers' wages and training I. Per cent which must be appl ed to 100% — Conn., Ind., Mich., teachers' wages only Mo., Neb., R. I., Utah, W. Va. 96%— Ala. 90%— Cal. 2. Teachers' wages chiefly "• Del., la., Kan., Me., Mass., Md., Minn., Miss., Va. 3. Teachers' board Maine 4. Teachers' institutes only S. C. and N. H. 5. Expenses of summer normal schools Virginia 42SO Sixty-second Annual Report of the Board of Education of Mass., 1897-98, p. 209. *28 Law of Mass., 1846, Chap. 219; Ibid., 1849, Chap. 117, Sec. 3. 427 Laws of 1854, Chap. 300, Sees. 2, 3. " These states devote their revenue chiefly to teachers' wages. Cf. account given for each state in Part II. * Taken from accounts given for each state in Part II. 174 PERMANENT COMMON SCHOOL FUNDS Table XXI — continued Objects States II. For school-houses, construction, equipment, and care 6. Building and repairing school-houses and purchase of school furniture Miss., Mont. 7. Exclusively for building public school- houses N. C. 8. Rent and insurance Mont. 9. Fuel Me., Mass., Miss.* 10. Janitor service Me., Mass. 11. School libraries Cal., la. 12. Sundries Cal., la. III. For pupils' tuition and supplies - 13. Pupils' tuition in another district la., Me. 14. Pupils' transportation (conveyance) Me., Mass., Mont. 15. Pupils' board Me. 16. Free text-books Del., Md.,c Mass., Mont. IV. Supervision 17. Superintendent of schools Mass. 18. State department of education Ky. V. 19. School officers, committee, etc. Mass., N. J., Va. 20. For all school expenditures Except purchasing of lots and buildings Colo., Kan. Except repairing and furniture Colo. VI. For support of schools, apparently including all expenditures 21. Stated in general terms Ark., Fla., Ida., 111., Kan., La., Minn., Miss., N. J., N. Mex., N. Y., N. C, Ohio, Okla., Ore., S. D., Tenn., Vt., Wash., Wyo., Tex. 22. Revenue not kept separate from taxes Ga., Mont. The second class of legislative and constitutional provisions Conditions of which reveal the aims the states have sought to Participation realize through permanent school funds, are pro- visions respecting conditions which must be fulfilled by the school * Including water. * Including stationery. PURPOSE AND EFFECTS OF SCHOOL FUNDS 175 unit in order to receive a share of the permanent common school fund. Among the oldest and most influential of such conditions are, first, the submission of school returns, or reports by the local communities to the state; second, the levying of local taxes; and third, the maintenance of school for a term of specified length. The thing most necessary for the establishment of an effective system of schools was to secure returns from the districts and town- First Condition: ships throughout the state. Several things might School Returns |^g achieved through such returns. First of all, these returns would furnish data for intelligent legislation; second, they could be used as a basis for the wise distribution of the income of the permanent common school fund; and third, through these returns a bond of union would be established between the state department of education and the local communities. Connecticut, whose provisions respecting participation in the revenue of the School Fund were remarkable chiefly for their absence of requirements, made it necessary for school societies to furnish the state with some sort of returns. The Act of 1799, referred to above, provided, "That, in the future no order (for a share of the revenue of the School Fund) shall be drawn by any (school) society except on the receipt of a certificate, signed by the school society committee, stating that all moneys drawn from the public treasury . . . have been faithfully applied ... in paying and boarding instructors." Meager as these reports were, they, nevertheless, opened communication between the school societies and the State Commissioner of the School Fund. New York required the submission of school returns from the first.^^ Maine, by the law of 1850, provided that towns from which no returns are received by the Secretary of State by the loth of April shall receive no portion of the revenue of the Permanent School Fund.^^ As stated in a previous paragraph, Connecticut did not require Second Condition • school societics to levy a local tax in order to share Local Taxation ' ^^ ^^^ income of the School Fund. New York, profiting by the experience of Connecticut, provided in 1812 <28 Report N. Y. State Supt. of Public Instruction, 1833, pp. 12-13. <29 Acts of Me., 1850, Chap. 123, Art. 10, Sec. 6. 176 PERMANENT COMMON SCHOOL FUNDS that every town sharing in the revenue of the Common School Fund must raise taxes equal to its share.'*^'' Finding that many of the towns did not choose to share in the public moneys under such conditions, participation which had been at first optional was made compulsory .'^^^ The law by which the Massachusetts School Fund was created provided, "That there shall never be paid to any city, town or district a greater sum than is raised therein respectively for the support of common schools." ^^^ Five years later this state pro- vided that a legal tax of $1.25 must be levied for every child of school age within the town, city, or district.^^ In 1849 this rate was raised to $1.50:'^^'* Since 1865 the rate has been $3.00.'*^^ Massachusetts has further encouraged local taxation for schools by her method of apportioning school revenues. Since 1891 the portion of the income of the school fund which any town received has been determined in part by the ratio of its school tax to its total tax, towns having the largest ratio receiving the largest share.^^^ As stated in the earlier part of this chapter, it was not until 1841 that Connecticut required societies and districts to maintain Third Condition: ^^^^ schools for a Specified term.^^' New York Fixed School Term appears to have required, from the first, districts to maintain schools for at least three months. The length of the term which schools must be maintained in order to receive a por- tion of the revenue of the permanent common school fund varies to-day in different states all the way from three months in Cali- fornia and Kansas and other states, to nine months in Connecticut and New York. In addition to the three classes of conditions already mentioned, *30 Laws of New York, 181 2, Chap. 242, 431 Ibid., 1814, Chap. 192, Sec. 21. 432 Laws of Mass., 1S34, Chap. CLXIX, Sec. 3. 433 Ibid., 1839, Chap. 56. 434 Ibid., 1849, Chap. 117, Sec. 3. 435 Acts of 1865, Chap. 149, Sec. i. 438 Acts of Mass., 1891, Chap. 177. 437 Laws of Conn., 1841, Title IV, Sec. 32. PURPOSE AND EFFECTS OF SCHOOL FUNDS 177 Miscellaneous Provisions there are many others which have been employed to good advantage. Most of the states seem to have made use, and in some cases most important use, of their permanent common school funds as a means of inducing or compelling communities to improve local opportunities for education within themselves. The character and number of conditions of partici- pation vary in the different states even more widely than the lawful objects to which the public school moneys may be applied. In certain states, such as Arkansas, Louisiana, Tennessee, and Ohio, no restrictions or conditions are named.* On the other hand, in Connecticut five conditions must be fulfilled; in Massachusetts and Minnesota, four. Some of the most important requirements are the legal qualification of teachers, the visitation of schools, compliance with requirements regarding courses of study, pro- vision of free text-books, enforcement of the truancy law. The following table presents the conditions of participation which must be fulfilled by the cities, towns, and districts in the states mentioned, in order to share in the revenue of the permanent common school funds: Table XXII. Conditions of Participation Conditions t States I. Submission of school returns and reports Submit reports required by law to county superintendents Ore., Ind., Kan., Nev. Returns previously submitted Conn., 111., Me., Mass., Minn. Submit state superintendent reports re- quired by law- Utah Must send returns as to enumeration of pupils required by law Mo., N. Dak. * This statement is subject to correction. In certain states the conditions of participation are left to the regulation of the State Department of Education and do not appear in the laws. See paragraph on Massachusetts under title "Lawful Uses," p. 173. t Taken from the accounts given separately for each state in Part II. In cer- tain states the conditions which must be fulfilled are left to the regulation of the State Department of Education and are not stated in the laws. 178 PERMANENT COMMON SCHOOL FUNDS Table XXII — continued Conditions * States II. Raise local tax Raise fixed local tax Del., Mass., N. Y., R. I." Must raise and expend school moneys required by law Me., Vt. Raise local tax sufficient with school fund to support a school Wash. III. Must expend moneys for lawful objects Moneys drawn from public treasury ex- pended for teachers' wages only Conn. Must expend for tuition amount received from state auditor Ind. Must not divert school library moneys to other purposes N. Y. IV. Legal qualification of teachers Schools taught by duly examined and qualified teachers Conn., Fla., 111., Ky., Mich., Minn., Me., Neb., Nev., N. Y. V. Maintenance of school for lawful term Must maintain school not less than: Nine months Conn., N. J. Eight months Fla., N. Y. Six months Cal., Ky., Nev. Five months preceding year Mich., Minn. Twenty weeks annually Me.,* Utah Five months during current year Va., Wash. Three months Colo., Kan., Mo.,* Mont., Neb.,c Wyo. Twelve school weeks (sixty days) Ore. Maintain public schools as required by law Mass. VI. Attendance Must average not less than fifty pupils Fla. VII. Visitation of schools Schools visited according to law Conn. ffl Town must raise by local tax amount equal to the share it receives from the state. * Maintain school for six months if a tax of forty cents on $100 assessed valua- tion within the district plus public funds will maintain it for that length of time. « Not less than three months in a district having less than twenty pupils. Not less than six months in a district having from twenty to seventy-five pupils. Not less than nine months in a district having more than seventy-five pupils. * In certain states the conditions which must be fulfilled are left to the regu- lation of the State Department of Education and are not stated in the laws^ PURPOSE AND EFFECTS OF SCHOOL FUNDS Table XXII — continued 179 Conditions * States VIII. Equipment School facilities and accommodations suitable and satisfactory from a sani- tary standpoint Del., Fla., N. J.,«i Va. IX. Course of study Instruction given in subjects required by law Me. Regular and systematic instruction in physiology and hygiene Mich. , N. Y. Must not permit sectarian instruction Mont , Nev. X. Schools must be free to all children School free to every child in the district between six and twenty years of age Ky. XI. Free text-books Furnish suitable (free) text-books Me. XII. Enforce truancy law Comply with truant law Mass. XIII. Enforce compulsory education law Must enforce compulsory education law N. Y. XIV. General and inclusive Full compliance with all laws and deci- sions pertaining to common schools N. Y. XV. Apparently none « No restrictions or conditions named or exacted Ark., Tex. Ida., la.. La., Tenn., Not stated « Ala., Miss., Ohio, S. Dak. Not learned « N. C. N. Mex., Okla., S. C, Ariz., Ga., I. T., La., Md., N. H. By provisions for apportioning public moneys among school ^ Plans for school buildings must be submitted to State Board of Education for suggestions and criticisms, certain architectural requirements being specified by law. ' Subject to correction. * In certain states the conditions which must be fulfilled are left to the regulation of the State Department of Education and are not stated in the laws. i8o PERMANENT COMMON SCHOOL FUNDS units according to some fixed basis, e. g., the rate of local school tax or the number of teachers employed, aims are Aims Revealed in i i i i -, -, . . Basis of Appor- revealed and results secured as objective and as definite as those arising from naming condi- tions of participation and lawful objects. The question of the basis upon which the income of the perma- nent common school funds can be most effectively distributed is but a part of the larger question of the distribution of the school moneys. Mr. Cubberley in his volume. School Funds and Their Apportionment, has given a most able discussion of the different methods and bases which have been employed. The present dis- cussion will attempt to show the evolution of the more important of these methods. In Connecticut, from 1799 to 1800, the revenue of the School Fund was distributed among the school societies according to First Basis: Total their lists of polls and valuation. The result was Population ^Yiax the largest and most populous societies re- ceived the greater portion.'*^^ In New York, until 1851, the revenue of the Common School Fund was distributed among the counties and towns in proportion to their total population.^^^ The present method of apportionment of the income of the Permanent Common School Fund in New York is complex. The total population serves as a partial basis.^^° In the year 1820 a more just basis was established in Connecticut, namely, the number of children from four to sixteen years of age Second Basis: residing in the several societies. School socie- Schooi Census ^.jgg ^^gj-g abolished in Connecticut in 1856 and towns became the units of distribution.^^ With this exception, the basis of distribution has continued practically unchanged in Con- necticut up to the present time. The State Controller apportions the income of the School Fund among the towns upon the basis *38 Report Conn. Board of Education, 1876, pp. 111-113. *39 Unpublished account by N. Y. State Dept. of Finance, received Dec. 23, 1906. 440 N. Y. Consolidated School Law, 1905, Title 2, Art. i, Sec. 7. 442 Public Acts of the State of Conn., 1856, p. 39, Chap. VII, Sec. 3. PURPOSE AND EFFECTS OF SCHOOL FUNDS i8i of their school population (four to sixteen years) .^^ This basis of apportionment was adopted by Maine and Florida and many other states when they established their permanent common school funds and is the sole basis employed to-day by twenty-eight states. Several other states employ it as a fractional or part basis. The evils resulting from apportioning the funds on the basis of school population were early felt in Minnesota. The Superin- E ii Results of tendent in his report for 1875 recommended a School Population change to the number of children enrolled and the Basis. Minnesota Adopts Average next legislature enacted a law to this effect. Su- perintendent D. Burt, in his report for 1876, p. 9, wrote: "When our older states enacted laws for apportioning school money upon the basis of children between certain ages, nearly all such persons were actually members of the public schools, therefore such laws really made the scholars enrolled the basis of apportionment. The old plan (based on school population) gave an unfair advantage to districts in which there happened to be parochial schools maintained at private expense. In a (certain) district ... a settlement of Norwegians has maintained a private school so that the enrollment in the public school has never ex- ceeded twenty, while the district has drawn money on seventy-eight persons, fifty-eight of whom have not in the least increased the expenses of the public school." ^^ Superintendent Burt states further that the effects of the school population basis are especially disastrous in large cities where an undue per cent of the school population are at work, and where the schools continue to draw money for them. "Thriving centers of business attract . . . large numbers of persons between five and twenty-one who go thither to work and not to go to school. Upon the old plan (school census basis) out of three districts in a certain county, one educated eight hundred six scholars, on each of which it received in one year from the state fund $2.05; another educated five hundred twenty, on each of which it received $1.33; the third educated one hundred seventy-four, receiving only $1.25 *^ Conn. School Law, 1896, Sec. 182, p. 69. *** Report Minn. Supt. of Public Instruction, 1876, pp. 9-11. i82 PERMANENT COMMON SCHOOL FUNDS to each scholar. This plan of distribution afforded no inducement to open public schools no matter how many children were receiving no education." By opening one school for two persons for three months in the year a district drew public money on the whole mass.""^ "In some counties there have been annually from ten to thirty schools opened on the smallest possible scale, just long enough to draw public money. A majority of the children . . . could be left unschooled, and still the current school fund had to be appor- tioned even to districts that made no educational provision for many of their children. There was also no incentive to open schools in new counties. . . . The larger the scholastic popula- tion became before the schools were organized, the more money was drawn from year to year. To one county apportionments were made for four years, the last one on two hundred ten children, before it opened a school; to another, for six years; and to one for nine years before it secured schools. Another county accumulated about two thousand dollars ($2,000) before organizing schools, on which it lately supported four, whose average length was five and one-half months, without the aid of any special tax." '^ In Minnesota, prior to 1876, the income of the Permanent Common School Fund was distributed upon the basis of school population. In 1876 a law was passed making the number of pupils actually enrolled in school the basis.'*^ School population was the basis employed by Florida until 1894, when a constitutional amendment made the average attend- ance upon school the basis.""^ Next to school Average Attend- i . i . i i ance Adopted by population, average attendance is the most widely employed basis. It is found, among other states, in Florida, Minnesota, North Dakota,^' and Washington""® and in part determines the distribution of the revenue of the Permanent *45 Ibid., pp. 11-12. ^"le Constitution of Fla., 1894, Art. 12, Sec. 7. 447 Data furnished, Sept. 12, 1906, by W. L. Stockweli, State Supt. of Public Instruction of N. Dak. 448 School Laws of Wash., 1901, p. 25, Title II, Chap, i. Sec. 22. PURPOSE AND EFFECTS OF SCHOOL FUNDS 183 Common School Fund of New Jersey.*^'' In North Dakota the income of the Permanent School Fund is apportioned among the counties upon the basis of the number of children between six and twenty who have attended school sixty days, "exclusive of those who have attended educational institutions maintained strictly by the state." ^^ In Washington the income of the Common School Fund is apportioned among the counties in proportion to the total number of days of attendance.^^ Three bases of apportionment have been presented thus far: total population, school population, average attendance. Average attendance is the only one of the three which tends to incite local communities to establish schools. There is nothing in any one of them to incite an increase in the number of teachers employed or to improve the school organization. Moreover, these methods of distribution fail to take into consideration the assessed valuation of the property of the town or district. Consequently it often happens that the communities which are most able to support schools are aided as much, in many cases more, than poorer dis- tricts. Again, these methods of apportionment place no premium upon local taxation. Under them a community that taxes itself for schools just enough to satisfy the requirements of the law may receive proportionately more than the community which taxes itself in excess of the law.* Certain states, appreciating not only the possibility of making a more just and equitable distribution, but also the possibility of making the basis of apportionment pro- mote certain definite ends, have developed complex bases upon which the income of their permanent common school funds is apportioned. Scarcely any fund shows so rapid an evolution and such ready adaptability to changed conditions, from whatever point it may be History of Massa- viewed, as the Massachusetts School Fund. Dur- chusetts Basis. jj^g ^^^ ^^^^^ course of its history the basis of apportionment appears to have been changed, to a greater or less ♦ An excellent discussion of this subject will be found in School Funds and Their Apportionment, by Ellwood P. Cubberley. **9 N. J. School Law, 1903, Sec. 183. 1 84 PERMANENT COMMON SCHOOL FUNDS extent, not less than thirteen times. The bases upon which its revenue has been distributed may be summarized here as follows: In 1835 the income was halved; one-half was apportioned among the cities, towns, and districts on the basis of population, the other half in proportion to the local school tax.'*^" In 1839 school popu- lation was made the basis; '^^ in 1840, total population.^^ In 1841 school population was restored as the basis."*^^ In 1845, 1849, and 1854 certain unimportant changes were made. Since 1854 the income of the Massachusetts School Fund has been halved, one-half has been used for paying all appropriations for general educational expenses not otherwise provided for; the other half has been distributed to the towns.'*^^ In 1866 the method of distribution underwent a radical change. Seventy-five dollars were to be apportioned to every town and city. The remainder was to be apportioned upon the basis of school census among the towns in which the district system did not exist, upon the basis of their school census (5-15 years). No noteworthy change oc- curred until 1874, when the assessed valuation of towns was made the basis. Towns were divided into four classes for annual appor- tionment. One-half of the income was distributed to towns whose valuation did not exceed ten million dollars. Each town whose valuation did not exceed one million dollars received two hundred dollars per annum; each town whose valuation exceeded one million and did not exceed three million dollars, received one hundred fifty dollars; each town whose valuation was between three and five million dollars received one hundred dollars. The remainder of this half of the income was distributed among the towns whose valuation did not exceed ten million dollars, including the three classes of towns already mentioned, in proportion to their school population (5-15 years) .^^^ Since 1874 the tendency has been to limit the income of the fund 450 Fiftieth Report of the Board of Education of Mass., p. 91. 451 Laws of Mass., 1839, Chap. 56. 452 Laws of Mass., 1840, Chap. 7. 453 Laws of Mass., 1841, Chap. 17. 464 Laws of Mass., 1854, Chap. 300, Sees. 2, 3. 455 Acts of 1874, Chap. 248, Sec. i. PURPOSE AND EFFECTS OF SCHOOL FUNDS 185 to towns of less and less value and to apportion to these towns an increasing sum. In 1891 the income of the fund was limited to towns whose valuation did not exceed three million dollars. The portion of the income remaining after the distribution of it among the towns on the basis of their value, was divided among those towns whose tax for the support of schools was not less than one- sixth of their whole yalue/^^ In 1893 the amount distributed to towns whose valuation did not exceed five hundred thousand dollars was increased from two hundred seventy-five dollars to three hundred dollars. In 1903 the income of the fund was limited to towns whose valuation did not exceed two and one-half million dollars.* Among other states which have employed a complex method of apportionment may be mentioned California, New Jersey, New York, Rhode Island, and Wyoming. In some of these states we find a fixed amount paid to every district, town, or city for each teacher employed, or for each school maintained, or for each dis- trict, or for each superintendent or supervising principal. The remainder is distributed upon one of the several bases, viz., total population, school population, school attendance, number of dis- tricts. The following table presents a statement of some of the bases of apportionment and indicates the states which have employed them at one time or another. The effort has been made to make this table show the bases at present employed by the states, but this has not been possible in all cases owing to the fact that the last compilations of school laws have in some cases been inacces- sible. Idaho, Oregon, and Nebraska, which are here given as apportioning their funds upon the basis of school population have recently passed laws providing that each district receive a fixed sum according to a method similar to that employed by Wyoming. * For criticism of the present method of apportionment employed by Massa- chusetts, consult E. P. Cubberley, School Funds and their Apportionment^ pp. 212 fit. **" Acts of Mass., 1891, Chap. 177, Sec. i. i86 PERMANENT COMMON SCHOOL FUNDS Table XXIII.* Bases of Apportionment of Income of Public Permanent Common School Funds 1. simple bases Bases States I. To townships in accordance with amount of principal standing to their credit Miss. Chickasaw revenue among Chicka- saw counties on basis of their area 2. According to share in original capital According to number of teachers Ohio 3- School population Ala., Ark., Cal.,ffl Colo., Conn., Ida., Ind., la., Kan., Ky., La., Me., Md., Mich., Mo., Mont., Nev., Okla., Ore., R. I.,f S. Dak., Tex., Utah, Va., W. Va., Wis., 111., Wyo. (in part.) 4- Average attendance Fla., Minn., N. J.,<= N. Dak., Wash. 2. COMPLEX bases * Bases States Fixed amount to each District Wyo., $150 School R. I., $100 Teacher Cal., $250; N. J., $200; N. Y., $100 (for each additional teacher) Superintendent N. J., $600 Assessed valuation Mass., N. Y. School taxation Mass. School census R. I. School attendance Cal. (average), N. J. (total) Number of districts N.J. Total population N. Y. a California School Laws, 1903, p. 102, Sec. 1858. « New Jersey School Law, 1903, Sees. 182-183, as amended by Law of New Jersey, 1906, Chap. 241. f Rhode Island School Law, 1896, Chap. 53, Sec. 2. , * Data in this table taken from separate accounts for each state in Part II. PURPOSE AND EFFECTS OF SCHOOL FUNDS 3. DESCRIPTION OF COMPLEX BASES * 187 Cal.« $250 for each teacher in every county, or in every city and county. Twofold basis: (a) Number of teachers. (b) Average attendance for remainder. Del. All the income, except $300, which is given to Sussex county, is divided into three equal parts, — one part to each of the three counties. County's share is equally apportioned to districts within said county, according to the number of districts. Mass. * To towns, by Commissioners of Massachusetts School Fund. 1. Assessed valuation. 2. Rate of school taxation — the higher the rate the larger the quota. Twofold basis: I. None to any town valued over $2,500,000. Towns whose assessed valuation is, Receive A nniially Not over $500,000 $500 If rate of tax is $18 or more on $1,000, receives $75 more Between $500,000 & 1,000,000 300 (< 1,000,000 & 2,000,000 150 " 2,000,000 & 2,500,000 75 N.J. . Remainder of income is distributed to towns whose assessed valuation is less than $2,500,000 and whose annual school tax is not less than one-sixth of entire tax, in a proportion determined by the ratio of school tax to total tax. Fourfold basis: 1. Number of teachers employed. $200 for each teacher employed one year. $180 for each teacher employed less than one year and not less than four months. 2. $600 to each district which has employed a superintendent or super- vising principal devoting his entire time to supervision. 3. Total school attendance. 4. Number of districts. " California School Laws, 1903, p. 102, Sec. 1858. * Massachusetts Acts, 1903, Chap. 456. '^ New Jersey School Law, 1903, Sees. 182-183, as amended by Law of New Jersey, 1906, Chap. 241. * Data in this table taken from separate accounts for each state in Part IL i88 PERMANENT COMMON SCHOOL FUNDS N. y." By commissioner of education among districts and cities. Threefold basis: I. Assessed valuation of district. Each district whose assessed valuation is not more than Receives Between $20,000 !>20,000 & 40,000 40,000 & 60,000 t)200 ISO To each Indian reservation for every teacher employed thirty-two weeks or more, $150. $125 to all remaining districts and each city of state. 2. Number of teachers employed. To each district, Indian reservation, and city, $100 for every addi- tional duly licensed teacher. 3. Population. The remainder to counties in proportion to their population. N. C.« Uses her fund exclusively as a loan fund to districts for building school-houses. R. I./ To towns. 1. Number of schools, $100 to each school — not more than fifteen schools in one town. 2. School population (five to fifteen years). Vt.ff $15,000 of income is annually divided among towns and cities and unorganized towns and gores in same manner as the $45,000 Reserve Fund is divided. The remainder of the income is divided by the State Treasurer among towns, cities, and unorganized towns and gores according to number of legal schools maintained the preceding year. Legal schools are schools maintained at least twenty-eight weeks, taught by qualified teachers, reporting and returning registers as required by law. Wyo. $150 to each school district in county. Residue on basis of school population. The more important provisions regarding the lawful use of the ^ Laws of New York, igo6. Chap. 698, Sec. i. « Act passed Jan., 1903. 'Rhode Island School Law, 1896, Chap. 53, Sec. 2. P Acts of Vermont, 1906, Sec. 13, approved Dec. 14, 1906. PURPOSE AND EFFECTS OF SCHOOL FUNDS 189 revenue of the permanent common school funds, requirements for their share in it and the methods and bases of apportionment have Aims Revealed been described. Thus far there has been little in Lawful Uses direct consideration of the aims sought through these provisions nor of the results obtained. In general two classes of aims and of results have been sought and secured : first, assistance in school support, and second, the education of public sentiment respecting free schools. With the exception of those estates which provide the lawful uses of the permanent school funds revenue in general terms, and except- ing also states, such as Georgia and Montana, where the revenue is not kept separate from state taxes, the objects provided by law fall into the following groups: (i) teachers' wages and training; (2) school-houses, equipment, and care; (3) tuition and supplies; (4) supervision; (5) all school expenditures except purchasing lots and furniture and building and repairing school-houses; (6) apparently all expenditures for schools. The first four groups show definite ends which states have aimed to accomplish through their perma- nent common school funds. To secure good teachers, to make their wages certain and to increase their efficiency is the aim under- lying the objects named in the first group; to provide good, sanitary, well-equiped school-houses is the aim of the second group; to give to every child in every part of the state the best opportunities of education is the aim discernible in the provisions of the third group; to give unity through organization and to raise the standard of supervision and method are the aims underlying the fourth group. The conditions that the states have provided which must be fulfilled by local units in order to receive their share of the income of the permanent common school fund revenue Aims Revealed in Conditions of reveal aims similar in many respects to the aims Participation 1 1 • r • • • i ^ 1 revealed m the provisions respecting lawful uses of this revenue. The earlier provisions regarding the lawful use of the revenue resulted in supplying stable means of support to the most important and heaviest items of school expenditure. In these provisions there was an opportunity of educating public I90 PERMANENT COMMON SCHOOL FUNDS sentiment. Nevertheless, in the conditions of participation the states have found the largest opportunity for educating public sentiment in the matter of supporting schools. Through the sub- mission of returns to the state department, the states have sought to establish a bond of union between the local communities and the state school authorities. As soon as a certain tax is required, or the maintenance of a school for a legal term in order to share in the public revenue, the sentiment of the communities throughout the state will tend to approach a certain standard. The earlier methods of apportionment, total population and school population, were adopted simply as means of distributing the school revenue equally, as it was supposed, Aims Revealed ^ jy ff> in Methods of among the different communities of the state. Apportionment There was little opportunity through them to develop public sentiment. The more complex methods of appor- tionment which have been described have aimed directly to equalize the cost of maintaining schools and to equalize also the oppor- tunities of education throughout the state. This is done by giv- ing to the smaller and poorer districts a fixed sum as large as shall be received by the largest districts, as in Wyoming, or by giving to the towns of the lowest valuation the largest sum, as in Massachu- setts. The second aim revealed in the more complex methods of apportionment is to encourage local communities to employ super- visors, more teachers, to increase the average attendance, to in- crease taxation for schools and the number of schools. A comparison of the educational conditions described in the opening paragraphs of this chapter v/ith those of the present readily shows to what an extent the aims mentioned in this chapter have been realized. How far the existence and support of free schools are results of the iniluence of the permanent common school funds will perhaps be evident from a description of the effects of these funds upon the different aspects of the school system which they have been employed especially to promote. Nine states have made teachers' wages the sole object to which the income of the permanent common school fund might be law- fully applied. A number of others have made it a chief ob- PURPOSE AND EFFECTS OF SCHOOL FUNDS 191 |ect.* In states such as New York where local tax was required for participation in the revenue of the Permanent Common School Effect of Permanent ^^^^' ^^f ^^^^ ""^^^^^^ ^'^ supplying twO SOUrcCS School Funds on from which monev for teachers' wages was de- Teachers' Wages • J rm rr rived. The effect of such provisions was not limited simply to assuring the teacher his wages. By it public at- tention was turned to the importance of the teacher's wage. A fur- ther result was that districts were compelled to raise money for erect- ing, repairing, and equiping school-houses and for school supplies. The wages of teachers have been increased, indirectly, through the permanent common school funds by the part these funds have Effect on played in increasing the efficiency of teachers. Teachers' The provision that districts in order to share in EfBciency the revenue of the permanent common school fund must employ teachers duly qualified, has resulted in raising the standard of qualifications. New York made this a condition from the very first.^^ Connecticut as early as 1841 provided that no school districts should be entitled to any portion of the public money unless the school had been taught by a teacher or teachers duly qualified.'^^ Over one-fifth of the states in the Union have made this a requirement for participation in the revenue of the permanent common school fund. In 1896 Massachusetts provided that "With the approval of the state board of education, there may be paid from the income of ^ ,^ the school fund to any town having a valuation Massachusetts -^ " School Fund of less than $2 c;o,ooo (amended so as to read Devoted to , , * Advancing $350,000 by chapter 498, Acts of 1897) a sum not exceeding two dollars per week for the actual time of service of each teacher approved by the school committee of said town, after special examination as to exceptional ability, employed in public schools of said town: which same shall be added to the salary of such teacher." '^^^ Massachusetts has employed * See Table XXII, Lawful Objects, p. 181. *S7 Report N. Y. State Supt. of Public Instruction, 1833, pp. 12-13. 458 Laws of Conn., 1S41, Title IV, Sec. 32. «9 Acts of Mass., 1896, Chap. 408. 192 PERMANENT COMMON SCHOOL FUNDS the revenue of her School Fund for increasing the efficiency of teachers further by using it to support normal schools. Prior to 1854, certain moneys devoted to the principal of the Massachusetts School Fund were used to support normal schools. Since 1854 a portion of the income of the fund has been devoted to this cause.^^" The income of the permanent common school fund has been em- ployed in some of the public land states in a similar manner. For example, Wisconsin provided that the income of the School Fund shall be applied exclusively to the following objects: (i) The sup- port and maintenance of common schools in each school district, and the purchase of suitable libraries and apparatus therefor; (2) the residue shall be appropriated to the support and maintenance of academies and normal schools and suitable libraries and appara- tus therefor.^^i The increase in the wages of teachers during the last half of the nineteenth century in New York, Massachusetts, Maine, Indiana, and Connecticut is shown by the following table: Table XXIV. Increase in Teachers' Wages in Typical States, 1847-1907 Average Monthly Wage, Male and Female Year New York ^ ,<' Mass. ^ Maine ^, * IndJ Conn.^ 183 1 1S37 1839 Male Female Male Female Male Female $8.42 « 12.00 « $25.48 11.38 « Male and female not reported separately. s Data taken from Table XXXI; see Index to Tables. * Not including board. ?' Data taken from Table XLVII; see Index to Tables. «: Data taken from Table XXXIX; see Index to Tables. ' Data taken from Table LVI; see Index to Tables. »« Data taken from Table XXVIII; see Index to Tables. 480 Laws of Mass., 1854, Chap. 300, Sees. 2, 3. ^1 Constitution of Wis., 1848, Art. X, Sec. 2; Hinsdale's Educational Documents, P- 1333- PURPOSE AND EFFECTS OF SCHOOL FUNDS Table XXIV — continued 193 Year New York 0, " Mass. i Maine *, * IndJ ConnJ"' 1845 Male Female $10.00 « $32.11 '' 7.50 « 1847 '^ Male 14.96 24.51 $15-40 $12.00 $16.00 Female 6.69 8.07 4.80 6.00 6.50 1851 Male Female 16.66 5-92 1855 Male 43-05 ^'' 20.57 23.76 Female 18.52 ^0 7.60 16.84 1865 Male 31.00 « 54.77 27.76 31.00 52.05 P Female 21.82 9.96 20.50 24.91 P 187s Male 50.78 « 88.37 36.96 42.40 71.48 Female 35-35 17-36 38.20 36.67 1885 Male 48.57 ' III. 23 32.07 44.60 69.17 Female 43-97 15.84 36.80 37-21 189s Male 53-00 « 128.5s 35-11 47.60 ? 85.87 Female 48.38 24.04 41.20 ? 41.48 1905 r Male 83-56 « 149.05 38.22 58.08 108.34 Female 57-22 29.48 52.00 47.66 1847 « Mass. Penn. Conn. Maine N. Y. N.H. Mich. Ind. VI. Ohio Male $24.51 $17.02 $16.00 $15.40 $14.96 $13.50 $12.71 $12.00 $12.00 $15.42 Female 8.07 10.09 6.50 4.80 6.69 5-65 S.36 6.00 4-75 8.73 1907 * Male 149.02 <^ 54.49 103.92 39-98 88.88 « 52.63/ 63.01 c 60.80 42.78 45.00"^ Female 57.07 c 39-38 45-83 29.56 35-21/ 43-03*^ 53-60 30.45 40.00** ^ Data for 1847 taken from Eleventh Annual Report of Mass. Board of Educa- tion, 1847, PP- 96-97. * Report of U. S. Commissioner of Education, 1907, p. 556. ' For 1905-06. '^ For 1902-03. ^ Male and female not reported separately. f High School teachers' wages not included. » Data taken from Table XXXI; see Index to Tables. ^ Including board. * Not including board. 'Data taken from Table XLVII; see Index to Tables. ^ Data taken from Table XXXIX; see Index to Tables. ' Data taken from Table LVI; see Index to Tables. *" Data taken from Table XXVIII; see Index to Tables. o For 1856. P For 1868. 5 For 1893-94, Report U. S. Commissioner of Education, 1894-95, p. XLVI. ^ Ibid., 1905, p. 409. 194 PERMANENT COMMON SCHOOL FUNDS In New York, Maine, Massachusetts, and Indiana, schools were at first to a large extent, individual and isolated institutions. There Effects of were almost no standards of maintenance and Funds mTschoof^ procedure. State supervision was regarded in Organization many instances as state interference. As has been pointed out earlier in this chapter, efforts made in these states to secure reports from the towns upon which to base legislation or apportion public moneys were ineffectual. The first important result then upon school supervision and organization wrought by the permanent common school funds is to be seen in their influence upon school returns. Massachusetts, as early as 1826, had endeavored to secure returns from the towns concerning their schools. A law was passed Massachusetts' requiring each town to report to the Secretary toSTu^e^Sc^oof ^ of State on ten matters of school affairs as previ- Returns ously Stated in this chapter, but the law imposed no penalty for neglect and offered no reward for obedience. Out of a total of three hundred and five towns, two hundred and fourteen replied; twenty-one were silent. This interest, however, was only temporary, for five years later only eighty-six towns made returns. In 1832, looking forward to the establishing of the School Fund, a report of the Committee on Education upon this topic was printed in all the newspapers which publish the laws of the commonwealth. As a result of this extraordinary effort, ninety-six towns out of three hundred and five replied.^^^ The conditions in Maine were no better despite the fact that a large number of townships possessed township funds to aid in the support of their schools, and that the sources of Maine's Ineffectual . 1 i 1 • 1 Efforts to Secure these funds in many mstances were lands which had been received originally from the state. In 1827 an act was passed by the Maine legislature requiring the select- men of towns to make returns once in three years to the Secretary of State in four blanks furnished by him. The returns secured were so imperfect that no apportionment of school money was made on returns prior to 1833.^^^ In 1837 an act was passed providing *62 Me. School Report, 1901, pp. 48-49. PURPOSE AND EFFECTS OF SCHOOL FUNDS 195 for returns from town selectmen and plantation overseers to serve as a basis of distribution of the proceeds of bank taxes.^^^ The returns received proved so unreliable that the act was repealed in 1842. The first rehable school returns were received in 1847, nineteen years after the establishment of the Permanent School Fund, and four years prior to the first distribution of its revenue.^^^ In New York, in 1815, the first year of the appropriation of the common school fund revenue, only four and one-half per cent of Influence of New the schools failed to make returns. Prior to this School F^^°on time it had been practically impossible to secure School Returns ^^y j-gtm-^s. Here as in Massachusetts the inter- est aroused by the prospect of the state permanent school fund was only temporary, for in 181 6 twenty-two per cent of the towns failed to send returns. The influence of the Common School Fund was soon evident, for after a second distribution of its revenue there was a rapid decrease in the number of districts failing to make returns. The following table shows the decrease in the number of towns failing to make returns in Maine, Massa- chusetts, and New York after the establishment of their respective state-controlled permanent common school funds: Table XXV. Submission of School Returns Increase in Three Typical States, Showing Influence of PubHc Permanent Com- mon School Fund New York "■ Massachusetts * Maine '^ Permanent common school fund created First annual distribution of revenue 180S iSrs 1834 1835 1828 1851 °- Data taken from Table XXXIV unless otherwise stated; see Index to Tables. * Data taken from Table XLV unless otherwise stated; see Index to Tables. •-" Data taken from Table XXXVIII unless otherwise stated; see Index to Tables. <«3 Ibid., pp. 52-53. 577^ 6,3293 5.8253 Total Surplus Revenue Fund $2,162,209 * 669,0863 $129,731* 26,7633 Total $2,831,295 * $156,494 * It has seemed better to give the total fund excluding and then including the Surplus Revenue Fund in view of the fact that this fund, as explained in Part I of the present work, is, technically speaking, not a state permanent fund, but rather a loan from the United States made to the states in 1837. The total principal of p. 7; Turner, * Computed. 1 Report State Supt. of Education, 1897-98, pp. 58-59; Ibid., li J. O., Public School Laws of the State of Ala., 1895, pp. 6-7. 3 Data furnished, Jan. 8, 1907, by I. W. Hill, Ala. State Supt. of Education. 207 2o8 PERMANENT COMMON SCHOOL FUNDS permanent funds reported in 1903 was $2,135,313, yielding an income of $155,882^ (1904), approximately equal to twelve and forty-five hundredths per cent " of the common school revenue derived from all sources and to approximately nine and eight- tenths per cent * of $1,588,561,^ the total common school revenue in 1905. These figures represent nominal rather than actual values. The true condition of these funds cannot be positively stated, as questions sent to state officials have been either ignored or else returned unanswered, but it seems safe to say that in reality scarcely any permanent fund exists, except a small amount of six- teenth section school lands which yield but a slight and doubtful revenue. In 1882 the State Superintendent of Education wrote, "It is erroneously supposed by many that the interest accruing on the Sixteenth Sections, valueless Sixteenth Sections and the United States Surplus Revenue funds (are) the result of a prudent investment of the capital of these funds, ... in reality they have no existence except upon the books of the State. . . . The State became the trustee and her debt long since absorbed them." ^ Elsewhere we are told that the capital of the school land fund " may be theoretically placed in 1875 at $2,449,000." The $669,086 surplus revenue was lost in the failure of the state bank in which it was deposited and " in 1848 it was considered doubtful whether the university and school funds and the surplus revenue would ever be realized as the bank had failed." The state recognizes the in- terest due on the surplus revenue at four per cent; also that due on the proceeds of public land sales at six per cent.''' The Vermont Special Commission on Permanent Common School Funds states (see report of the same, p. 5), ''that the six per cent interest on Sixteenth Section Lands and other land funds amounts to $160,000 annually." Alabama originally was a part of the Mississippi Territory. June 16, 1802, the legislature of Georgia ratified articles of agree- * Computed. 6 Ibid., LXXIV. 8 Ibid., LXXV; Ibid., 1906, I, p. 306. "> Ibid., 1896-97, Chap. XII, p. 650. ALABAMA 209 ment entered into April 24, 1802, by the Commissioners of Georgia and the United States by which Georgia ceded to the United States all right, title, and claim to her territory west of the Chattahoochee river.* March 3, 1803, Congress in an act regulating the disposal of the lands acquired from Georgia west of the Chattahoochee river, constituting the Mississippi Territory, reserved from sale section sixteen in each township for school purposes, and thirty-six sections, or one town- ship, for the use of Jefferson College. Alabama was admitted to the Union in 1819. Article VI of the first constitution of Alabama adopted December 14, 1819, provided that " the General Assembly shall take measures to preserve from unnecessary waste or damage such lands as are or hereafter may be granted by the United States for the use of schools within each township in this state, and apply the funds, which may be raised from such lands, in strict con- formity to the object of such grant." ^"'^ Provision for the estab- lishment of a permanent common school fund was not made until over eight years later. By an act approved January 15, 1828, Alabama set aside 901,725 ^ acres of sixteenth section lands granted by Congress, March 3, 1803.^° This was the first definite pro- vision made. Provision was made for the sale of these lands, the proceeds to be paid into the state treasury, the state becoming trustee and liable to pay to the districts and townships interest on the principal at the rate of six per cent.^ On December 16, 1836, Alabama accepted $669,089 from the federal Government, the state's share of United States Surplus Revenue, distributed in accordance with an act passed by Congress, June 23, 1836. The money was deposited in various banks and the interest used for a time to form part of the annual appropriation for supporting schools. It would appear that prior to 1854 the principal had been lost through bank failures or had been used for 2 Laws, 1828, Chap. 26; Aikin's Ala. Digest, 1836, p. 379, Sec. 38. 8 W. G. Clark, History of Education in Ala., U. S. Bureau Education, Circular of Information, 1889, No. 3, p. 218; Land Laws, Vol. I, pp. 588-591. 9 State Grants of Public Lands, Mar. 12, 1896, p. 4, Tables General Land Office. 10 Report U. S. Commissioner of Education, 1892-93, II, p. 1283. 100 Ibid., p. 1321. 2IO PERMANENT COMMON SCHOOL FUNDS state expenses. In 1854, however, it was declared to be a part of the educational fund and since that time the state has paid interest upon the total amount originally received. The interest is all derived from moneys raised by taxation and cannot be regarded as in any way income from surplus revenue deposit.^*^* Prior to 1854 the income from the interest on the proceeds of the sales of the sixteenth section lands was paid to the respective townships in which these lands lay. In 1854 an act was passed (approved by the Governor, Feb. 15, 1854), which provided for an "educational fund" to consist of (i) interest on the surplus revenue loan of 1836; (2) eight per cent on the proceeds of the sales of public lands granted in lieu of certain valueless school lands in 1848; (3) six per cent on the proceeds of the sales of sixteenth section lands; (4) $100,000 paid by the state; (5) several minor appropriations.^" "^ The educational fund in 1855 ^^^ composed as follows: ^^^ Interest on the Sixteenth Section Fund (value of lands sold and pro- ceeds paid into the state treasury, $1,244,793.36) $ 74,687.60 Interest on valueless Sixteenth Section Fund 7,767.30 Interest on United States Deposit Fund 53,526.94 Direct appropriation from treasury 100,000.00 Special taxes 1,300.00 Escheated property 233.55 Total $237,515.39 At the end of the year 1869 the state had diverted $187,872.^^ At the end of the year 1873 " the state had diverted $1,260,511. In 1873 the total state apportionment for educational purposes was $522,810. The total amount actu- ally paid out of the state treasury, i. e., the amount not diverted, was $68,313." Every dollar of the educational fund, except the annual receipts from the sale of school lands, is now directly derived from the revenue of the state.^ Both the Sixteenth Section 10& Bourne, E. G., History of the Surplus Revenue of iSj^, pp. 44-47. See also Part I, Chap. III. 10 « Report State Supt. of Education, 1899-1900, I, p. 488. lod w. G. Clark, History of Education in Ala. (Cf. foot-note 8), p. 240. 11 Report U. S. Commissioner of Education, 1874, p. 5. ALABAMA 211 Fund and the Surplus Revenue Fund have been lost or misappro- priated. The interest which the state continues to pay on the lost Sixteenth Section and Surplus Revenue Funds really amounts to nothing more or less than paying a tax."« Many notes given for school lands, 1837 to 1874, inclusive, remained unpaid. In some cases the sixteenth section lands were surrendered to the townships, and have been occu- Causes of Loss , ^ pied and cultivated for years, without having ever been paid for. In both of these cases the loss was due to the lack of proper legislation.^^ The loss has frequently been due to the failure of properly recording the sale and title of the school lands. "Much of the time of this department is consumed in investigat- ing . . . records relating to the sixteenth section lands. Little evidence can be found regarding the sale of school lands. It is impossible to tell in many cases what sub-divisions were sold, be- cause trustees reported by lots instead of sub-divisions of sections, and frequently no date of purchase is recorded. Parties who claim to have purchased these lands before the war from the state or from those who originally purchased the same, are continually applying for patents, and in order to issue the same secondary evidence has to be relied on. "^^ The only present means by which the principal of the perma- nent school fund may be increased are the proceeds of sales of six- Present Sources teenth section lands remaining unsold after the of Increase (-j^jj ^^j. 14 ^he principal of the sixteenth sec- tion funds was increased, 1870-84, by $66,562 derived from the sales of sixteenth section lands.^^ The proceeds of sixteenth section lands are held in trust by the state, which pays to the district or township from which such proceeds were received six per cent interest on the money thus held in trust.^^ The state school revenue is distributed among ii<* Report Ala. State Supt. of Education, 1882, p. 7, taken from Bourne, E. G. 12 Report State Supt. of Education, 1879, p. 9. 13 Ibid., 1891, p. 7. " Report State Supt. of Education, 1884, p. 13. 16 Ala. School Laws, 1895, Chap. 4, Sec. 1007. 212 PERMANENT COMMON SCHOOL FUNDS the districts on the basis of school population, the school age being seven to twenty-one years.^^ The constitution provides that " not more than four per cent of all moneys Management, raised or appropriated for the support of public Present Basis rr r rr r of Apportionment, schools shall be expended otherwise than for Present Objects , i , . i i , i ^ n a teachers wages; provided that the General As- sembly may by two-thirds vote suspend the operation of this section." ^^ No conditions which need to be fulfilled by the districts in order to participate in the educational fund are stated in the School Present Conditions Laws compiled in 1895. When township or dis- for Participation ^j.j^^ trustees fail to make a return of the census enumeration required by law, the state superintendent is required to make the apportionment according to the returns last received.^^ 16 Ibid., Sec. 1008, and Const., Art. XIII, Sec. i. 17 Constitution, 1875, Art. XIII, Sec. 6; Turner, O. J., Public School Laws of the State of Ala., iSgj, p. 4. 18 Turner, O. J., School Laws, iSgs, Sec. 1008. CHAPTER IX ALASKA In 1885 provision was made for the establishment of public schools in Alaska.^^ Alaska possesses no permanent common school fund nor has Congress ever set aside any school lands,^° but has made annual appropriations for the support of public schools as follows: 1886, $15,000; 1901, $30,000;^^ 1905? $50,000.^^ 19 U. S. Bureau of Education, Circular of Information, 1887, No. 3, p. 194. 20 Private letter received from E. E. Brovs^n, U. S. Commissioner of Education, Aug. 9, 1906. 21 Report U. S. Commissioner of Education, 1902, II, p. 1237. (Gives table of appropriations, 1886-1901.) 22 Statement of the U. S. Commissioner of Education for the year ending June 30, 1905, pp. 16, 27, 32. 213 CHAPTER X ARIZONA On May 26, 1861, Congress reserved in each township of Ari- zona for the support of common schools sections numbered six- teen and thirty-six to be granted to Arizona whenever she shall become a state.^'' The estimated area of these lands amounts to 4,050,347 acres.^" Arizona thus possesses the foundation of what promises to be some day a vast permanent common school fund. Congress made no provision for the sale of these school lands and none of them can be sold until Arizona becomes a state without some special provision by Congress.^^ Some school lands are rented, however, but the amount they contribute annually to the support of schools is relatively small, being $5,800.56'^ for the year 1905-06, approximately one and two-tenths per cent (.0118) t of $489,709.20,1 the total common school revenue derived as fol- lows r^'' Sources of School Revenue, 1905-1906 Territorial taxes, $ 41,006.00 County taxes, 255,237.92 School (Poll) taxes, 74,818.78 Gambhng licenses, 67,867.08 Fines, forfeitures, 14,362.68 Special taxes for maintaining schools, . 19,747.39 Miscellaneous sources, 16,669.35 Total, $489,709.20 t Computed. 23 Report U. S. Commissioner of Education, 1875, p. 468; Ibid., 18S6-87, p. 112. 2* Data furnished Sept. i, 1906, by R. L. Long, Arizona Territorial Supt. 214 ARIZONA 215 The terms territorial school fund and county school fund have been used from earliest times to denote the total sums raised for school purposes by taxes upon the territorial and several county treasuries.^^ The rate of county school tax differs in different counties. The rate of territorial school tax, 1905, was three cents on the hundred dollars.^'* 26 Report U. S. Commissioner of Education, 1882-83, P* 283. CHAPTER XI ARKANSAS PERMANENT SCHOOL FUND Permanent School Fund ^^ is the official title of the Permanent Common School Fund of Arkansas. The term "common school rfjtie_ fund" is applied officially to a fluctuating sum Condition 1905 composed as follows: (i) interest on the Perma- nent School Fund; (2) ten per cent on the sales of all state lands; (3) future sales of sixteenth section lands; (4) two mill state school tax; (5) various small items. This amounts to nearly $500,000 annually .^^ This is a loose use of the term "common school fund." The principal of the Permanent School Fund is chiefly " invested" in, or it would be better to say represented by, three per cent state bonds. "The state uses the money making it (the fund) practically a state debt." ^'^ The final payment of the bonds is "dependent upon the will of the state." ^^ In 1905 the principal of the Permanent School Fund amounted to $1,128,500.^^ The report of the United States Commissioner of Education (see report 1903, also 1905, p. 410) gives the income from the perma- nent fund as zero, an obvious error. The annual interest on the Permanent School Fund in 1905 was $32,855 ^'^ which is approxi- mately one and six-tenths per cent (.0160) * of $2,041,935,^^" the total annual common school revenue, excluding balances on hand and proceeds of bond sale.^'''* Upon her admission into the Union in 1836, Arkansas received from the United States the sixteenth section in each township, the same being granted for the use of common schools. The total * Computed. 26 Report Ark. State Supt. of Public Instruction, 1899-1900, p. 28. 27 Statement, Sept. 7, 1906, from J. H. Hinemon, Ark. State Supt. of Public Instruction. 270 Report U. S. Commissioner of Education, 1905, I, p. /40. 216 ARKANSAS 217 area of these sixteenth section lands amounted to 928,057 acres.^ No provision was made by the state's first constitution for the es- tablishment of a permanent fund from the proceeds Origin ^ ^ of the sales of these lands or from any other source, but on October 18, 1836, Arkansas accepted by terms of an act known as the "Ordinance and Acceptance Compact" proposi- tions offered by Congress on June 23, 1836, which devoted the sixteenth section lands to common schools^^ On February 3, 1843, ^^ ^ct was passed providing for the sale of the sixteenth sec- tion lands, thus completing the provisions establishing the six- teenth section fund. As the result of the Act passed by Congress on June 23, 1836, providing for the distribution of the surplus revenue remaining in the treasury January i, 1837, Arkansas received from the federal government $286,751.48. The entire sum was used to furnish about one-half the capital of the Bank of the State of Arkan- sas. The law provided that the interest should be devoted to sup- port schools. But the law remained a dead letter and the principal was exhausted in general appropriations.^'^* The fund one time known officially as the Common School Fund 2^ was first established by constitution, 1868, article IX, sec- tion 4,^" supplemented by section I of an act passed July 23, 1868, entitled "An Act to Establish and Maintain a System of Free Schools." The original capital consisted of 46,080 acres of land, "seventy-two sections originally granted by Congress for a state seminary of learning," but devoted by the legislature in 1846 to the support of free schools.^^ It was further provided that the capital should consist of all lands that have been or may be granted by the United States to this state and not otherwise appro- priated, all moneys, stocks, bonds, lands and other property belonging to any fund for the purpose of education. The present Permanent (common) School Fund was established by an act 276 Bourne, E. G., History of the Surplus Revenue of iS^y, pp. 47-50, 122. See also Part I, Chap. III. 28 Report Ark. State Supt. of Public Instruction, 1S88, pp. 43, 44. 29 Act Mar. 15, 1897; ^^k. Digest School Laws, 1905, p. 3. 30 Report U. S. Commissioner of Education, 1892-93, II, p. 1361. 2i8 PERMANENT COMMON SCHOOL FUNDS passed May 8, 1899, which provided that the Permanent School Fund should consist of all of the Arkansas six per cent bonds with the accrued interest thereon, both in the Permanent School Fund and in the Sixteenth Section Fund. "These were reissued in Ar- kansas three per cent bonds July i, 1899, all amounts in the treas- ury to the credit of the Sixteenth Section Fund have been trans- ferred to the Permanent School Fund.^^ The total fund thus cre- ated in 1899 amounted to $1,118,709.25 of which $1,113,500 was in bonds drawing three per cent annual interest and the remainder, $5,209.25, in currency .^^ On the one hand it would appear that this act practically merged the sixteenth section county funds and the state Common School Fund. On the other hand, the law provides that the net proceeds of sales of sixteenth section lands be forwarded to the State Treasurer " who shall place the amount to the credit of the county's sixteenth section fund to which it rightfully belongs." ^^ In the Common School Fund provided for by the constitution of 1868 was included the state's share of the United States distri- bution of the surplus revenue of 1836, amount- ing to $286,751.49. But this sum was used up in general appropriations and so lost to the school fund.^^ One of the first causes of loss of the principal of the school fund was loaning the proceeds of school lands on insufiicient security. These proceeds, except those of sixteenth section lands, were intrusted to three county trustees, who received them from a county land commissioner. The trustees loaned these proceeds in many cases on worthless security. The claims of the state in the form of practically worthless notes and bonds for school lands amounted as early as 1870, to about three-quarters of a million doUars.^^ The second cause of loss of the school fund was the diversion of revenue which should have increased the principal of the Common School Fund. " After May, 1861, the state diverted from their proper purposes and used for general expenditures $7,260 of the Seminary Funds and $4,633 of the Saline Fund." ^^ 31 Ark. School Laws, 1905, p. 76, Sec. 7703. 32 Bourne, E. G., The History of the Surplus Revenue of 1837, p. 122. 33 Report U. S. Commissioner of Education, 187 1, p. 73; Ibid., 1901, I, p. 393. ARKANSAS 219 Insufficient legislation was the third cause. Act of December 7, 1875, provided that ten per cent of the net proceeds of the sales of all state lands should be added to the principal of the Perma- nent School Fund, but failed to state who should have charge of it, whether the land commissioner or state treasurer. Probably through the neglect of this statute there was lost to the Common School Fund, 1875 to 1895, $50,000.^^ In the years 1874 and 1879 something over $179,000 belonging to the permanent school fund was destroyed by fire.^^ " So complete (has) been the ruin of the orig- inal land grants to the nation, that in 1870 the permanent income from this source was but $35,192 while a careful administration of this patrimony would probably have yielded a state school fund of two or possibly three million dollars (with interest of $180,000)." ^^ The principal of the Permanent School Fund may be increased from seven sources: (i) the proceeds of all lands granted by the Present Sources United States not Otherwise appropriated. Arkan- of Increase g^g received 500,000 acres of lands for internal improvement, two or three million acres for reclaiming swamp lands and 50,000 acres of saline lands. None of these except the saline lands have been devoted to increasing the principal of the Permanent School Fund; ^^ (2) all moneys, stocks, bonds, lands and other property now belonging to any fund for the purpose of edu- cation; (3) the net proceeds of all sales of lands and other prop- erty escheating to the state; (4) the proceeds from sales of estrays; (5) proceeds of income dividends or shares in intestate estates; (6) ten per cent of the net proceeds of sales of all state lands; the fol- lowing when not otherwise appropriated: (7) grants; (8) gifts, (9) or devises.^^ The Permanent School Fund is managed by a Board of Commis- Present sioners consisting of the Secretary of State, the Management ^^^^^ Auditor, and the State Superintendent of Public Instruction.^'' 3* Report Ark. State Supt. of Public Instruction, 1895-96, p. 171. 35 Ibid., 1883-1884, p. 39. 3' Report of the U. S. Commissioner of Education, 1901, I, p. 390. ^ Ark. School Laws, 1905, p. 6, Sees. 749S, 7498. 220 PERMANENT COMMON SCHOOL FUNDS The revenue of the Permanent School Fund is distributed by Present Basis of ^^^ ^^^^^^ Superintendent of Public Instruction to Apportiomnent ^j^g counties upon the basis of their school popu- lation.^^ The revenue of the Permanent School Fund is combined with the state school mill tax and various other revenues.^^ The objects to which this combined revenue may be applied Present Objects .^1,1 -r • 1 • 1 i are not specified by law. It is merely provided that "it shall be faithfully appropriated for maintaining a system of free schools for this state and (for) no other purpose whatever." It may not be used for building or purchasing a school-house,^^ " All school districts are entitled to a pro rata distribution of the Present Conditions Common School Fund whether they have a three for Participation months' school or not." 27 38 Ibid., p. II, Sec. 7521. 39 Ark. School Laws, 1901, Sec. 6936. CHAPTER XII CALIFORNIA STATE SCHOOL FUND The constitution and laws of California fail to provide specifi- cally a title for the permanent common school fund, but both in rf j^jg^ referring to it call it the State School Fund.^° The Condition 1906 g^^^g Treasurer and State Controller regularly apply this same term to " the total current annual school revenue derived from all sources." ^^ The term "fund" is employed officially by the State Department of Finance to designate a legally established division of moneys in the state treasury and not an invested sum of money .^^ The bond securities held by the State Treasurer constitute the invested portion of the school fund, and the moneys in the State School Land Fund are the portion await- ing investment. By adding the two amounts we ascertain the correct sum of the "perpetual fund" referred to in the constitution, the proceeds of which fund "shall be inviolably appropriated to the support of common schools throughout the State." ^^ There are at present (1906) in California, about 400,000 acres of unsold school lands which belong to the Perpetual School Fund, the pro- ceeds of the sale of which eventually will be added to the principal. The value of these lands cannot be estimated "but it is doubtful whether anyone would buy these lands as a whole at $1.25 per acre." ^ Almost all these lands are "in the mountains, inacces- sible, and of little value." '^^ In 1906 the total principal of the fund amounted to $5,263,834.42, of which $526,834.42 was unin- *" Cal. School Laws, 1903, employ this as title to Art. IX, Sec. 4, of the constitu- tion. See also Report State Supt. of Public Instruction, 1864-65, p. 249. ^ Statement received from A. B. Nye, Cal. Controller, in letter dated Dec. 15, 1906. *2 Ibid., letter Feb. 16, 1907. *3 Controller Report, 1905-06, p. 24. ** Answers given in question are by A. B. Nye, Dec. 15, 1906. 221 222 PERMANENT COMMON SCHOOL FUNDS vested, the remaining $4,737,000 was invested in state, county, and municipal bonds. Of this, $1,526,500 invested in six per cent State Funded Debt Bonds of 1873, is a debt owed by the state to itself, on which the state pays the interest out of state taxes."*^ As a result, this portion of the Perpetual School Fund, instead of decreasing the burden of the state tax, actually makes it heavier. Moreover, $500,000 of the principal has been transferred to another fund for the purpose of erecting a state building in San Francisco. This sum is an indefinite loan on which the state pays four per cent. The annual income of the Perpetual School Fund for the year 1906 amounted to $250,570.87,*^ which is approximately six per cent (.06) * of $4,142,914.50,'^^ the total receipts for common schools that year.f By the first constitution which California adopted and which became effective upon her admission into the Union, 1850, pro- vision was made for a permanent or perpetual common school fund, whose interest should be devoted to the support of common schools.^ The nucleus of this fund as provided for by the constitution of 1850 was 500,000 acres of land granted by act of Congress in 1841.'*^ At the same time 5,610,702 acres ^ of sixteenth and thirty-sixth section lands were to a slight extent sources of school revenue, but these lands were at first regarded as belonging to the townships, and not until 1861 were they made a part of the State Perpetual School Fund.^^ Prior to the consolidation of the sixteenth and thirty-sixth sec- tion township funds with the state fund, the towns sold some 50,000 acres of these lands, which, es- timated at $2.00 per acre should have added to the school fund $100,000, but this money has never been heard of.'*^ The report * Computed. t The report of the United States Commissioner of Education for 1905, p. 410, gives the total school revenue as $9,270,859. This amount may include sums not devoted to common schools or else the amount given by the controller is in- correct. 45 Cal. Constitution, Art. IX, Sec. 2. 48 U. S. Statutes at Large, Vol. V, p. 455, Chap. 16, Sees. 8, 9. 47 Cal. State Supt. of Public Instruction Report, 1864-65, p. 249. 48 Ibid., p. 241, CALIFORNIA 223 of the Superintendent of Public Instruction for 1858 estimates that of the 5,525,760 acres to which the schools are entitled by law, only 114,880 acres had survived loss or diversion, "to such pigmy pro- portions has our magnificent domain dwindled." ^* If we estimate the 7,219,324 acres originally set aside for common schools at $1.25 per acre, a low estimate, it would give a capital of $9,024,155. Comparing this with the present capital, we see that the lowest esti- mate of the loss would be over $6,000,000 and with proper manage- ment the fund would have without doubt yielded $20,000,000. The constitution provides five sources from which the principal of the State School Fund may be increased: proceeds of (i) the Sources of unsold portions of the 500,000 acres of land Increase granted by Congress, 1841; (2) sales of sixteenth and thirty-sixth section lands; (3) intestate estates; (4) rental of un- sold school lands; (5) such per cent (five) as may be or has been granted by Congress on the sale of public lands lying within the state.^^ An act of Congress approved June 27, 1906, provided that California should receive payment of five per cent of the proceeds of public land sales extending over a score of years. "The exact amount involved is not yet known, but it is believed that it will approach one million dollars, and the entire sum, under the require- ments of our Constitution must be added to the permanent fund which is invested for the support of the common schools. Within two months after the approval of the act warrants amounting to $428,271.61 had been drawn to the credit of the state.^^*^ Upon the completion of the payment there should be a perpetual fund of over $6,00000.^^* The State Controller keeps a separate account of the School Fund and of its revenue, and twice a year reports it to the Super- Present intendent of Public Instruction. The Controller Management draws his warrant on the State Treasurer, which must be indorsed by the Superintendent of Public Instruction.^" *8Cal. Constitution, 1879, Art. IX, Sec. 4. 490 Controller's Report, 1905-06, pp. 28-29. «» Ibid., p. 24. *• Cal. School Laws, 1901, Sec. 435. 224 PERMANENT COMMON SCHOOL FUNDS The revenue is apportioned by the Superintendent of Public Instruction among the several counties upon the basis of school population, but according to a somewhat complex ppor lonm n method of procedure. The State Superintendent of Public Instruction "shall apportion to every county and to every city and county two hundred fifty dollars ($250.00) for every teacher determined and assigned to it on school census by the county or city and county school superintendent for the next pre- ceding school year, as required by the county or city and county school superintendent by the provisions of section 1858 of this code, and after thus apportioning two hundred fifty dollars on teacher or census basis he shall apportion the balance of the state school fund to the several counties or cities and counties according to their average daily attendance as shown by the report of the county or city and county school superintendents for the next preceding school year." ^^' ^^" The county or city and county superintendent estimates the number of teachers in each district by calculating one for every district having seventy or less than sev- enty census children (five to seventeen years) and one additional teacher for every additional seventy children or fraction of seventy not less than twenty. "And in cities or districts wherein separate classes are established for the instruction of the deaf ... an addi- tional teacher for each nine deaf children, or fraction of such num- ber not less than five, actually attending such classes (children in asylums and not attending public schools cannot be counted in making the estimate of the number of teachers to which the dis- trict in which asylum is located is entitled); the county superin- tendent must then report the number of teachers thus estimated to the Superintendent of Public Instruction." The total county and state school revenue derived from all sources is apportioned as follows : $500 is apportioned to every dis- trict for every teacher so allowed to it, except that to districts hav- ing over seventy or a multiple of seventy school census children 51 Ibid., 1903, p. 102, Sec. 1858. 5io Laws Cal., Chap. 185, Mar. 18, 1905, amending Sec. 1532, Political Code, 1903; E. C. Elliot, Bu. Ed., Bulletin No. 3, 1906, p. 47. CALIFORNIA 225 and a fraction of less than twenty census children there shall be apportioned $25.00 for each census child in said fraction. "All school moneys remaining on hand after apportioning to the dis- tricts the moneys provided for in subdivision three of this section, must be apportioned to the several districts in proportion to the average daily attendance in each district during the preceding school year." (Here follows special mode of estimating average daily at- tendance for newly formed school districts.) " Census children . . . shall be construed to mean those between the ages of five and seventeen years." ^^* All state school moneys, except the ten per cent reserved (in rural districts) for school library purposes, must be applied exclu- sively to the payment of teachers of primary and Objects , 1 rr., ,-, r ^ . , , grammar schools. The library fund m rural dis- tricts consists of not less than five nor more than ten per cent of the county school fund annually apportioned to the districts.^^ In order to share in the revenue of the State School Fund, a dis- Present Conditions trict must maintain for not less than six months a for Participation ^^^i'^ g^j^^^l ^^^^^^ ^^ ^ tcachcr holding a legal certificate.^^ 51* Laws Cal., Chap. 64, Mar. 6, 1905, amending Sec. 1858, Political Code, 1903, pp. 46-47; E. C. Elliot, Bu. Ed., Bulletin No. 3, 1906. 52 Cal. School Laws, 1903, p. 83, Sec. 1713. 53 Ibid., p. 104, Sees. 1859, 1S60. CHAPTER XIII COLORADO PUBLIC SCHOOL FUND * The permanent common school fund of Colorado, officially known as the Public School Fund ^'^ consists (January i, 1906) of Title. $1,408,322.50; the annual revenue of which added Condition 1906 tQ ^jjg j-gjji- Qjj unsold school lands belonging to this fund amounts to $220,896.44, which is approximately four and ninety-seven hundredths per cent (.0497) of $4,438,030, the total common school revenue derived from all sources.^^* The invested fund represents not more than one-twelfth of the prospec- tive capital: — 1,568,530.42 acres of unleased land of an estimated value of $5,487,856.47 and 1,993,041.40 acres of leased land with an estimated value of $9,965,207 to make a total of $15,453,063.47 to be added to the present capital. The total invested and esti- mated capital ($1,408,322.50 plus $15,453,063.47) amounts to $16,861,385.97. Upon her admission into the Union, Colorado received from the United States for the support of common schools the sixteenth and thirty-sixth sections in each township, amounting in all to 3,650,000 acres.^^ The first constitution, adopted August i, 1876, upon her admission as a state, and which has remained unchanged, provided that "The Public School Fund of the state shall consist of the proceeds of such lands as have * For this account I am indebted to Katherine L. Craig, State Supt. of Public Instruction of Colorado, who is authority for all data unless otherwise stated. ^ Colo. Constitution, 1876, Art. IX, Sees. 3, 5; Report U. S. Commissioner of Education, 1S92-93, II, p. 1383. 64a Report U. S. Commissioner of Education, 1906, I, p. 306. 55 The U. S. General Land Office (for reference see note 9) makes this 3,7iS,555, but this is evidently an estimate, not an exact measurement. In many cases the acreage reported in these tables is too large; 3,650,000 acres is the area invariably given in Colorado reports (see Report State Supt. of Public Instruction, 1901-02, p. 18). Superintendent Craig wrote 3,561,572, but this is the present total unsold acreage. 226 COLORADO 227 heretofore or may hereafter be granted to the state by the general government for educational purposes." ^'^ Four hundred eighty-eight thousand, six hundred thirty-three dollars and forty-four cents of the School Fund derived from the sale of school lands was invested in the so-called "excess warrants" of 1887, 1888, and 1889, which, with interest, would now (1906) amount to over $1,000,000, Since that time the state has redeemed about $25,000 of these warrants, and the investment without interest now represents v$463,765.77. The state has twice repudiated this indebtedness, and the warrants cannot be paid until some time in the future when a constitutional amendment shall be adopted. The constitution of 1876 in the section already referred to, pro- vided five possible sources of increasing the principal:^'* (i) All Sources of estates escheating to the state; (2) all grants. Increase ^^-j gj£|.g^ qj. ^^^ devises made to the state for edu- cational purposes; (5) proceeds of all lands granted to the state for educational purposes by the United States. The only sources that have actually contributed anything up to the present time are the proceeds of the sales of sixteenth and thirty-sixth section lands. The State Treasurer is the custodian of this fund.^^ The revenue is apportioned by the Superintendent of Public Instruction among Management. the counties on the basis of the total school popu- Apportionment j^^j^j^ ^^^^ ^^ twenty-one years) .5« The Public School Fund revenue must be used for the main- tenance of the schools of the state.^^ The law permits its use for all objects of school expenditure except erecting, repairing, and furnishing school-houses and the purchasing of school lots.^' This of course leaves the greater part of it for teachers' wages. The only requirement which a school district must fulfil in order Requisitions for ^o receive its quota of the Public School Fund articipation revenue is that it maintain a public school for at least three months during the school year.^^ 8* Colo. School Laws, 1897, p. 16, Sec. 11. " Ibid., p. 57, Sec. 71. 58 ibid., 1900, Sec. 75. CHAPTER XIV HISTORY OF THE SCHOOL FUND OF CONNECTICUT No state permanent school fund has a more interesting history or is more worthy of study than that of Connecticut. Peculiar interest must always be attached to this fund in view of the fact that Connecticut was the first state to establish a permanent state fund for the benefit of common schools. New York had taken the first step towards the estab- lishment of her Literary Fund in 1786, but this fund was devoted to secondary not elementary schools, and it was not until 1805 that she established her Common School Fund. Maine did not create her Permanent School Fund until 1828; New Hampshire her Common School Fund until 1867, Massachusetts her School Fund until 1834. Furthermore, Connecticut began distributing the income from her School Fund in 1799 whereas the first distribution of New York's Common School Fund was not made until 1815. By the Ordinance of 1785 and the resulting contracts of sale of public lands made in 1787, the federal Government had reserved for schools in its western lands one section out of every thirty-six, yet it was years before any permanent funds were established from the proceeds of these reservations. Those who established the Connecticut School Fund planned that its income would be suffi- cient to support the common schools of the state. From 1821 to 1854, all taxation for schools was practically discontinued. The result was a decline of the school system as soon as the School Fund began to contribute its revenue. The experience for which Connecticut paid dearly, guided and warned others, at the same time that her example inspired them. The Connecticut permanent common school fund, officially known as the School Fund,^" consists in 1905 of a permanent S9 Conn. Constitution, Art. VIII, Sec. 2. 228 CONNECTICUT 229 invested inviolable principal of $2,022,502.23,*'" yielding an annual revenue of $109,579.*" In 1902 approximately three and two- Titie. tenths per cent (.032) *^ of $3,443,944, the total Condition 1905 g^^te public school revenue, was derived from the income of the School Fund. The charter of Connecticut given by Charles II, King of England, in 1662, "conveyed to the 'Governour and Company of the Eng- connecticut School l^sh Collony of Connecticut, in New England in Fund Origin* America' " land which included parts of Rhode Island, New York, New Jersey, and all west of New Jersey be- tween north latitude 41° and 42° and 2' to the Pacific Ocean.^^'^ Original Extent By Virtue of this charter, Connecticut in 1663-64 ciaiSeTS ^^""^^ claimed jurisdiction over the towns of Wickford, Conn., 1662 Rhode Island, and Westchester, New York, to the Hudson river, and most of Long Island, but these claims were soon given up, and the Pawcatuck river was agreed upon with Rhode Island as a boundary line. The parts Claims in New r xt 1 i York and Hew of Ncw York and New Jersey included by the Jersey Ceded , r ^ ^ 1 ^ 1 • ■, charter of 1662 had been previously granted under Plymouth Charter, 1620, and therefore could not be claimed by Connecticut. All lands west of the Delaware river had never been granted to any one, and therefore belonged to Con- necticut. In 1 681 Charles II gave to William Perm the charter of Pennsyl- vania, covering the present state of Pennsylvania. The northern part of this had been already given to Connecticut. Connecticut asserted her claim to this land. " Settlers from Windham County, Conn., began to migrate to the Wyoming Valley while the French and Indian War was in progress, but permanent settlements were not effected until about 1769. These operations were conducted principally under the auspices of the Susquehanna Company, * For an account of the sources from which moneys for schools were derived prior to the creation of the School Fund and for a description of the evolution of policy which brought about the creation of this fund consult Chapter II. *> Conn. School Fund Commissioner's Report, 1905, pp. 12-13. '^ Report Conn. Board of Education, 1903, p. 47. 'i« Report Conn. Board of Education, 1S76, p. 108. 230 PERMANENT COMMON SCHOOL FUNDS which was at first a private affair, but was afterwards incorporated and protected by the State." ^^* From 1774 to 1782, "the settlers on the Susquehanna sent their representatives to the Connecticut legislature, received ofl&cers Connecticut's appointed by that body, established schools and ^ven "to Penn- P^-id taxcs precisely like other citizens in Connecti- syivania, 1782 ^^^,^ 61 c j^ j^gs a Court of Commissioners ap- pointed by Congress to arbitrate the Connecticut-Pennsylvania land case rendered the following decision: "We are unanimously of opinion, that the state of Connecticut has no right to the lands in controversy. We are also unanimously of opinion, that the jurisdiction and pre-emption of all the territory lying within the charter boundary of Pennsylvania, and now claimed by the state of Connecticut, do of right belong to the state of Pennsylvania." ^^'^ Connecticut still owned the land west of Pennsylvania, a narrow strip seventy miles wide but extending through forty-four degrees of longitude or nearly one-eighth of the circumference of the earth. But in May, 1786, acting upon the repeated suggestions of Congress to the colonies owning western lands, the General Assembly of Connecticut authorized her delegates in Congress, "or any two of them to convey to the United States all (of Connecticut's) lands lying west a line parallel to and 120 miles distant from the western line of the State of Pennsylvania." ^^"^ Connecticut reserved for her own use the lands lying between ,. ^ the western boundary line of Pennsylvania and Connecticut •' •' Reserves for the Ceded territory. The area of the section of Herself Western Reserve.— Area of land thus reserved was about three million three "W^cstBni Rcscirvc hundred thousand acres.^^ It was known vari- ously as the "Western Reserve," "Connecticut Western Reserve," and " New Connecticut." ^^ ' It lay in what is now the northeastern 81* Hinsdale, B. A., Documents Illustrative of Educational History, Report U. S. Commissioner of Education, 1892-93, p. 1265. 61 c Report Conn. Board of Education, 1876, p. 108. 6i<* Journals of Congress, VIII, pp. 83-84. 61/ Report Conn. Board of Education, 1876, p. 106. 63 Report Conn. Board of Education, 1853, p. 69. ^ - ' ; CONNECTIC^^' 231 corner of Ohio and was bounded on the north by the niternational boundary (Lake Erie); on the east by Pennsylvania; on the south by parallel 41° north latitude; on the west by a line parallel to the western boundary of Pennsylvania and one hundred and twenty miles from it.^^^ In October, 1786, an act was passed authorizing the sale of a Efforts to Sell portion of this land, with the result that 24,000 Connecticut Reserve j^(,j.gS ^gj.g ^^i^ ^^ Qg^. S. H. ParsonS-^^s By the conditions of this act, 500 acres of good land were given in every town five miles square to the public for Acres, 1786. the support of the gospel ministry, t;oo acres Ministerial and 1 r 1 i School for the support of schools, and 240 acres in fee Reservations . , ^ r 1 • • simple to the first gospel minister who should settle in the town.^^* This reserving of township lands for schools and the ministry was not without precedent in Con- necticut. In 1792 Connecticut made her second disposition of Western Reserve lands; 500,000 acres of land now lying chiefly in the counties of Erie and Huron, Ohio, were given to Second Disposi- ... ... t ^ tion of Western the Citizens of eight enumerated Connecticut RcsCfX^C 1*702 towns, who had suffered loss from the depreda- tions of the British during the Revolution.^^ ^ In 1793 the General Assembly appointed a committee of First Effort to eight persons whom it empowered to sell the nent State remainder of the Western Reserve on certain «n ' ^^^^ specified terms.® ^'* The act passed in 1793 reads as follows: "An Act establishing funds for the support of the ministry and schools of education. "1 « Hinsdale, B. A., Documents Illustrative of American Educational History, Report U. S. Commisssioner of Education, 1892-93, p. 1256. 6i(? Hinsdale, B. A., Documents Illustrative of American Educational History, Report U. S. Commissioner of Education, 1892-93, p. 1257; citation taken from Hist. Coll. Mahoning Valley, Vol. I, pp. 149-151. 01^ Id. 81* Report Conn. Board of Education, 1876, p. 109. 232 PERMANENT COMMON SCHOOL FUNDS "Be it enacted, etc., That the monies arising from the sale of the territory belonging to this State, lying west of the State of Pennsylvania, be, and the same is hereby, established a perpetual fund, the interest whereof is granted and shall be appropriated to the use and benefit of the several ecclesiastical societies, churches, or congregations of all denominations in this State, to be by them applied to the support of their respective ministers or preachers of the gospel and schools of education, under such rules and regulations as shall be adopted by this or some future session of the general assembly." "This act was not passed without strong opposition in the assembly. Its passage led at once to a widespread, spirited, A t Att k d ^^^ even acrimonious discussion, in which the press, the pulpit, the platform, the town meet- ing, and the legislature all participated." *^^^ All controversy over the Act of 1793 was closed by an act passed by the Connecticut General Assembly May, Created by Act 170=;, entitled, "An Act appropriating the monies of the General '"•^' ' . ff f f Assembly of which shall arise from the sale of Western lands, belonging to this State." It reads as follows:**^* "Be it enacted by the Governor and Council attd House of Representatives, in General Court assembled, That the Principal Sum, which shall be received Principal Sum *^^ ^he sale of the lands belonging to this State lying West to Remain a of Pennsylvania, shall be, and remain a Perpetual Fund, Perpetual Fund r , t^ , r ■ ^ ■ , ■ ^ for the Support lor the Purposes hereatter mentioned m this Act, to be of Schools loaned or otherwise improved for such Purposes as the General Assembly shall direct; and the interest arising therefrom shall be and hereby is appropriated to the Support of Schools in the several Societies constituted, or which may be constituted by Law, within certain Local Bounds, within this State, to be kept according to the Provisions of Law, which shall from Time to Time be made, and to no other Use or Purpose, whatsoever, except in the Case, and under the Circumstances hereafter mentioned in this Act." 2. "Be it further enacted. That the said Interest as it shall become Due 61 J Hinsdale, B. A., Documents Illustrative of American Educational History, Report U. S. Commissioner of Education, 1892-93, pp. 1257-59. 61* Quoted from Hudson and Goodwin, Digest of Acts and Laws of Conn., 1805, PP- 31-33- CONNECTICUT 233 from Time to Time, shall be paid over to the said Societies, in their Capacity Interest When of School Societies, according to the List of Polls and Paid Over to Ratable Estate of such Societies respectively; who shall. School Societies when such Payment shall be made, have been last per- fected." 3. "Provided nevertheless, and he it further enacted, That whenever such Society shall, pursuant to a vote of such Society, passed in a legal Meeting It May Be Ap- named for that Purpose only, in which Vote two-thirds of o/Ministry^^°'^ the legal voters present in such Meeting shall concur, and Churches apply to the General Assembly requesting Liberty to im- prove their Proportion of said Interest, or any Part thereof, for the Support of the Christian Ministry or the Public Worship of God, the General Assembly shall have full Power to grant such request during their Pleasure; and in case of any such grant, the School Society shall pay over the Amount so granted, to the Religious Societies, Churches or Congregations of all Denominations of Christians within its Limits, to be proportioned to such Societies, Churches or Congregations, according to the List of their respective Inhabitants or Members, who shall, when such Payment shall from Time to Time be made, have been last perfected; and in Case there shall be in such School Societies any Individuals composing a Part only of any such Religious Society, Church or Congregation, then the Proportion for such Individuals shall be paid to the Order of the Body to which they belong, by the rule aforesaid, and the monies for such individuals shall be discounted from their Ministerial Taxes, or Contributions, and in that way inure to their exclusive Benefit, and the Monies so paid over, shall be applied to the Purposes of the Grant, and to no other whatsoever."* 4. "Be it further enacted. That if any Society, Church or Congregation shall apply any of the aforesaid Monies to any other Use or Purpose than those to To Be Forfeited which they shall or may have a right to apply them pursuant if Misapplied ^q ^l^jg ^d-^ such Society, Church or Congregation, shall forfeit and pay a Sum equal to that so misapplied, to the public Treasury of this State." 5. "Be it further enacted, That all Inhabitants living within the Limits of School Meetings the located Societies, who by Law have or may have a right to Be Holden m |-q Vote in Town Meetings, shall meet some time in the October Annually " in the Located Month of October annually, m the way and manner pre- Societies scribed in the Statute, entitled 'An Act for forming, order- ing and Regulating Societies' and being so met shall exercise the Power given in and by said Act, in organizing themselves, and in appointing the necessary * Towns were permitted to levy a general tax "on their several inhabitants according to their respective list" for the support of the ministry, pp. 315-319, Conn. Digest, 1805. 234 PERMANENT COMMON SCHOOL FUNDS Ofi&cers, as therein directed for the Year ensuing; and may transact any other Business on the Subject of SchooHng in general, and touching the monies hereby appropriated to their use, in particular according to Law; and shall have power to adjourn from Time to Time as they shall think proper." 6. ^'Be it further enacted, That the Inhabitants or Members of the several Religious Societies, Churches or Congregations aforesaid, who have right by ^ . -_ . Law to Vote in their respective Meetings, on the Subject in December of the Ministry and the Public Worship of God, shall Annually assemble themselves some time in the Month of December annually, or at such other time as they shall judge convenient, and may organize themselves and appoint the necessary Officers, as in said Act is directed, 'all in the way and manner therein prescribed, with Power to adjourn from Time to Time as they may think proper; and in any of their said Meetings they shall have Power to transact any Business relating to the Ministry and the Public Worship of God, according to Law; but shall have no Power to Act on the Subject of Schooling; any Law, Usage, or Custom to the contrary notwith- standing.' " 7. "Be it further enacted, That an act passed October, 1793, entitled, 'An Act for the establishing a fund for the support of the gospel ministry and schools of education' be, and the same is hereby, repealed." The three provisions of this act which most concern us may be summarized as follows: I. The principal arising from the sale of western lands to remain a perpetual fund, its interest to be appropriated to the support of schools in the several school societies. ■ 2. The interest to be paid over to the said societies, in their capacity of school societies, according to the last perfected list of polls and ratable estate of such societies respectively. 3. Any society by a two-thirds vote could apply to the General Assembly to expend all or any part of its share of the School Fund revenue for the support of the Gospel ministry, and the Assembly could grant such permission. "Managers of the funds arising in the sales of the Western Reserve" were appointed. The report of the managers presented to the legislature October, 1800, showed that the Management 6U *= , . r condition of the fund was very unsatisfactory. "A large amount of interest was unpaid and the collateral 61' Hinsdale, B. A., The Common School Fund 0/ Conn. Report U. S. Commis- sioner of Education, 1892-93, p. 1260. CONNECTICUT 235 securities of the original debts were not safe."^^' Upon a recommendation of a committee of the legislature it was de- cided to put the fund in the care of one man, and in 18 10, Hon. Jas. H. Hillhouse, for sixteen years a United States senator, was appointed " Commissioner of the School Fund." This office has continued from that time until the present. Mr. Hill- house immediately resigned his position in the senate and entered upon the duties of his new office. He found that the capital consisted chiefly of the debts due from the original purchasers of the Western Reserve and the substituted securities which had been accepted in their stead. These securities had in the course of fifteen years, by death, insolvency, and otherwise, become involved in complicated difficulties. The interest had fallen greatly in arrears, and in many cases nearly equaled the principal. The debtors were dispersed in different states. Without a single liti- gated suit, or a dollar paid for counsel, he reduced the disordered management to an efficient system, disentangled its affairs from loose and embarrassed connections with personal securities and indebted estates, rendered it productive of a large, regular, and increasing dividend, and converted its doubtful claims into well- secured and solid capital. During the fifteen years of his adminis- tration the annual dividend averaged $52,061.35, and the capital was augmented to $1,719,434.24. The amount of the interest that he divided was $780,920.24, which, added to the sum of $456,757.44, previously divided, made an aggregate of $1,237,677.68. The policy thus inaugurated by Mr. Hillhouse was continued by his successor, Hon. Seth P. Beers, who was appointed commissioner in 1825, and held the office till May, 1849, when he resigned. During his administration, by judicious sales and management of lands which came into his possession as forfeited securities, the cap- ital of the fund was increased from $1,719,434.24 to $2,049,482.32; and the income from $72,418.30 to $133,366.50, being an average of $97,815.15 per annum. From 1849 to 1859 there were six dif- ferent commissioners, but no change followed in the manage- ment or prosperity of the fund — the productive capital of which, according to the report of Hon. Albert Sedgwick, dated April 16, 236 PERMANENT COMMON SCHOOL FUNDS 1859, amounted to $2,043,372.01, yielding an income for the year of $142,303.42, or $1.30 for the benefit of each child in the state between the ages of four and sixteen. The entire income of the fund from 1799 to 1859 amounted to $4,940,988.29, besides paying the expense of its management. "We know not in the whole history of public funds or trust estates," says Dr. Barnard, " another instance so creditable to the economy, fidelity, and prac- tical judgment of the persons intrusted with its management for a period of sixty years." The early changes in the custodianship of the School Fund bear witness to the recognition of the fact that it suffered severely from mismanagement made during the first years of its history.^'* As stated in the preced- ing paragraph, Hon. Jas. Hillhouse, appointed in 1810 the first Commissioner of the School Fund, found that the capital of the fund consisted chiefly of debts due from the original pur- chasers of the Western Reserve and the substituted securities which had been acepted in lieu of them. The debtors had scattered and were in different states, nevertheless Mr. Hillhouse succeeded in placing the fund in qxcellent condition. In 1820 the principal was reported to be $1,858,074.33; ""^ in 1825, $1,719,434.24:^" amount lost, $138,640.09. Since 1828 the principal has gone on increasing gradually but steadily, and the management appears to have been not only above reproach, but eminently judicious.'^'* No sources for increasing the principal of the J^ggrig of IllCrC3.SC tjj J. J. School Fund are provided at present, other than wise investment. The revenue of the School Fund is apportioned (1896) by the State Controller among the towns upon the basis Apportionment of their school population ^^ (4-16 years). Teachers' wages are the only legitimate object to which towns may apply their quota of the income of the School ^'^^'^'^ Fund.«« 64 Report Conn. Board of Education, 1876, p. in; Report U. S. Commissioner of Education, 1892-93, p. 1260. ^ Conn. School Laws, 1896, p. 69, Sec. 182. 66 Ibid., Sees. 48, 182. CONNECTICUT 237 For participation in the school fund revenue, five conditions must be fulfilled: ^^ (i) returns must be previously submitted;*"^" Requisitions for (2) ^ public school must have been maintained Participation £qj. ^^^ jggg ^lyg^Yi thirty-six wceks during the year ; ^^ * (3) all moneys drawn from the public treasury must have been ex- pended for teachers' wages only; ^^'^ (4) the school must be taught by a duly examined and approved teacher; ^^^ (5) schools must be visited according to law.^^ *= Connecticut Town Deposit Fund Connecticut received $764,670.60 ^^ of the United States Surplus Revenue of 1837. In 1837 $763,661.83 '^^ was deposited by Con- necticut with the towns to be loaned by them and became known as the Town Deposit Fund. Until 1855 three-fourths, and since 1855 the whole of the income of this fund was devoted to aid com- mon schools.^^ The principal was reported in 1902 and 1905 ^^^ to be $754,972.34,^^ a decrease of $8,698.26. The interest of the Town Deposit Fund for 1902 was $28,086.35,^^ but "in most cases this interest exists on paper only and is not a sub- stantial contribution to the support of schools." '^^ Connecticut possesses many local permanent school funds, the aggregate prin- cipal of which in 1905 amounted to $282,451.03,^^° but these funds are entirely outside the scope of this present work. **<^ Conn. Common School Laws, 1892, Chap. 12, Sec. 162. 686 Ibid., 1896, Sees. 48, 182. 68« Foot-notes 66« and 66*. 87 Bourne, Edward G., History of the Surplus Revenue of 1837, PP- 5°) 122. 87o Statement received Sept. 12, 1906, from Chas. D. Hine, Secretary Connecticut State Board of Education. **s Report Conn. Board of Education, 1903, p. 43. The same principal of the Town Deposit Fund is reported for 1905 as for 1902; it is safe to assume that the interest for the two years is the same. CHAPTER XV DELAWARE PUBLIC SCHOOL FUND The permanent common school fund of Delaware, oJB&cially known as the Public School Fund ^^ has (1905-06) an invested prin- cipal of $938,097 ™ yielding an annual revenue Condition, of $54,303,^^ which is approximately ten and nine- tenths per cent of $498,524, the total common school revenue for 19057^'' Of the principal, $759,312 are invested in bank stock,''^ and the remainder, $178,850,^^ in state bonds which are practically a permanent state debt upon which the state pays interest at six per cent7^ Formerly this fund was known by the title of the School Fund,'''^ but the term school fund is used to-day to include annual appropriations by the legislature for schools as well as the income of the Public School Fund7^ The Public School Fund was established by an act of legislature passed February 9, 1796. This act provided, "That the money paid into the State Treasury on account of mar- ' riage and tavern licenses between February 9, 1796, and January i, 1806, be and is hereafter to be applied under the direction of the Legislature, for establishing schools in the state." The money thus accruing was directed to be put into shares of the Bank of Delaware, United States Bank, Pennsylvania Bank, or 69 Constitution of Del., Art. X, Sec. 2; Hughes, J. H., School Laws for the Free Public Schools of Delaware, 1898, p. 3. ™ Del. Treasurer's Report, 1905, p. 20. 71 Ibid., p. 23. ''i'^ Report U. S. Commissioner of Education, 1906, I, pp. 306-307. 72 Del. Treasurer's Report, 1905, p. 27. 73 Ibid., pp. 6, 8, and personal letter, Nov. 28, 1906, from Thos. N. Rawlins, Treasurer. 74 Report U. S. Commissioner of Education, 1885-86, p. 71. 75 Hughes, School Law, 1898, p. 38, Sec. 27. See footnote 6g. 238 DELAWARE 239 the North American Bank. "Subsequently the same (act) was modified by putting the residue arising from the sale of licenses, after paying the salaries of the judges and Chancellor, into the School Fund. A supplement was passed in 1806 to continue in full force the modified Act of 1796 until January i, 1820." '^^ Boone states that "no definite results came of" the legislation of 1796, and that "the present fund dates from 1837."" On the contrary, I find that by 181 7 the School Fund had increased to an amount sufficient to permit the legislature to appropriate from its income, February, 181 7, $1,000 to each of the three counties of the state,'^ and in 1829 the principal amounted to $158,160,157* After 1829 the interest of this fund was annually distributed to the free schools of the state.^* Delaware accepted, January 16, 1837, $286,751.49 as her share of the United States Surplus Revenue distributed in 1837.'^^ This was invested by the state in much the same securities as those in which the principal of the Public School Fund had been invested. It was subsequently enacted that the revenue of this Surplus Revenue Fund should be equally divided among the three counties for the aid of free schools,^^ thus making it by investment and use practically a part of the Public School Fund. Delaware, in the matter of preserving her Public School Fund, presents a bright contrast with many of the states. No accessible record bears evidence that any of the principal has been either diverted or lost, with the excep- tion noted above of the early diverting of a portion of the income to pay the salaries of the judges and the Chancellor. Bourne estimates in 1885 the value of the securities Delaware purchased with her share of the Surplus Revenue Fund as $337,708,''^ show- ing a gain of $50,959. If to the amount of Surplus Revenue 78 Report Del. Supt. Free Schools, 1880, p. 45. 77 Boone, Education in United States, p. 86. 78 U. S. Bureau of Education, Circular of Information, No. 3, 1893, p. 161. Report U. S. Commissioner of Education, 1895-96, I, p. 280, places the principal at $151, 643 with annual income of $9,255. 79 Bourne, Edward G., History of the Surplus Revenue of 1837, pp. 52-53. See also Part I, Chap. III. 240 PERMANENT COMMON SCHOOL FUNDS received we add $158,160, the value of the principal in 1829 " prior to the receipt of the Surplus Revenue, we get a total of $444,911, which subtracted from $938,097,'^*^ the value of the prin- cipal, 1905, gives $493,186 * as the total increase over the amount originally invested. No sources are provided at present for increasing the principal of the Public School Fund. The proceeds of about nineteen Present Sources different kinds of licenses at one time dedicated of Increase ^^ ^j^g School Fund were later added annually to the revenue of the Public School Fund.'^'-''' To-day the revenue from such hcenses, amounting in 1901 to $559.25,^^ are placed to the credit of the general fund '^^'^ out of which the legislature pays the expenses of the state, including (1901) $120,000,^^ (iQOS)? $132,000,'^ annual appropriation for free schools and special school appropriations.*'' The annual state free public school appropria- tion in 1905 was $132,000.'^^ The State Treasurer is, by virtue of and dur- Management . . mg the continuance of his office, the Trustee of the School Fund.«2 The revenue of the Public School Fund is apportioned by the State Treasurer upon the following twofold basis: First, the rev- enue of the total fund, except $300 annual six per Apportionment . ,* i / cent mterest on a Sussex county $5,000 bond, is divided into three equal shares for the three counties of the state, New Castle, Kent, and Sussex. In addition to its third of the Pub- lic School Fund revenue, Sussex receives the above $300 interest. Second, the revenue falling to each county is again divided equally according to the number of districts in each county, among all districts, white and colored.*^ The Constitution (Art. X, Sec. 2) permits the revenue of the * Computed. 79 ^P- Consult Part I, Chap. Ill, for an account of the U. S. Surplus Revenue Fund. 2^0 Report U. S. Commissioner of Education, 1S95-96, I, p. 312. 241 Ibid., 1894-95, II, p. 1304. 2^ Ibid., II, p. 1303. 2^ Constitution of La., 1879, Art. 233. 282 PERMANENT COMMON SCHOOL FUNDS to the townships) ; (2) the proceeds of all lands heretofore granted or bequeathed to the state when no other purpose is stated in grant or Sources of bequest; (3) ten per cent of the net proceeds of sales Increase -^* ^f public lands accruing to this state under act of Congress approved September 4, 1841; (4) proceeds of intestate es- tates escheating to the state; (5) gifts; (6) appropriations by legisla- ture; (7) inheritance tax;^"^^" (8) proceeds of Dried Lake Lands. " ^^^^ To this revenue of the Free School Fund is added that of (i) the Trust Fund (United States Surplus Revenue Deposit of 1837); (2) rent of all unsold school lands except that of sixteenth section land. The Free School Fund is borrowed by the state which pays an annual interest on itof fourper cent.-'^ The townships control the sixteenth section lands belonging to each. They Management may lease or sell them. In the latter case the proceeds may be paid into the State Treasury and the state will, according as the township votes, either pay to the township an annual interest or add the interest as an accumulated fund to the credit of the township until called for.^^^ The revenue of the funds appropriated by the General Assembly for the support of the public schools of the state is apportioned by the Superintendent of Public Education in Apportionment February, June, and November among the parishes of the state upon the basis of school population (six to eighteen years "^^). No provision is made by the laws regarding the objects to which the revenue of the Free School Fund Objects. Conditions of shall be applied, nor regarding any conditions Participation i r i -n i i that must be fulfilled by the parishes in order to receive their respective share.* * See Idaho, foot-note 122". 243a Data furnished Sept. 6, 1906, by J. B. Aswell, State Supt. of Public Educa- tion. Cf. Compilation of Laws of La. Relating to Free Public Schools, 1904, p. 61, Art. 45. 244 Revised Statutes of La., 1904, Sec. 2957; Compilation of Laws of La. Re- lating to Free Public Schools, 1904, p. 60. 2-»5 Ibid., Sec. 2936; Compilation of Laws of La. Relating to Free Public Schools, 1904, p. 56. 240 Compilation of Laws of La. Relating to Free Public Schools, 1904, p. 49. CHAPTER XXVII MAINE PERMANENT SCHOOL FUND The official title of the permanent common school fund of Maine is Permanent School Fund.^'^^ It is sometimes called the State School Fund to distinguish it from "the Importance. School Fund proper," the latter term being used Condition, iQOS ^ . i , ^, ^ • j r to mclude the aggregate revenue received from (i) local funds, (2) the Permanent School Fund, and (3) town taxation.^"^^ The Permanent School Fund has never yielded any considerable portion of the total of Maine's annual school revenue. Between 185 1, the first year of its distribution, and 1902, the per cent it contributed toward the total expenditure ranged from .052 (i85i)^''^^ to .014+ (i902),^'^^ with an average of .045.^^^ In 1905 the principal of the fund amounted to $442,757 ^^ and the annual interest therefrom to $26,565,^'''^ approximately one and two hun- dredths per cent (.oioiS)^'^^ of $2,607,783. 87,2'*» the total public school revenue for 1905, derived from all sources. The Perma- nent School Fund of Maine may be termed a credit fund, for "the state used the money received for the credit of the Permanent School Fund and pays six per cent for its use." ^^^ The importance of this fund, therefore, lies not in the largeness of its contribution in the past nor in the present, but rather in the unifying effect it has had on the Maine school system as a whole. It interests us as a 247 Laws of Me. Relating to Public Schools, compiled 1905, p. 39, Sec. 122. 24S Me. School Report, 1903, App. p. 62. 24" Statement received Nov. 8, 1906, from Edward Wiggin, Secretary Dept. of Public Instruction. 2*> Extract from personal letter from State Treasurer, Oct. 28, 1904. 252 Computed from data taken from state and federal school reports and from statements received from Maine officials. 283 284 PERMANENT COMMON SCHOOL FUNDS typical school fund for the same reason that the Massachusetts School Fund interests us. In view of the fact that Maine was originally a district of Massachusetts, the earliest history of her school support is merely one chapter of that of the mother state. Both present many of the same typical conditions. Both afford excellent studies of states that attempted to support common schools without establishing any state permanent common school fund. Both eventually came to recognize the necessity of having such a fund for the purpose of centralizing and making effective the al- ready existing system of schools. Still further, both represent ex- treme democratic and individualistic tendencies which gradually yielded to republican and cooperative tendencies and principles. The support of free public schools by the towns was required from the date of Maine's admission to the Union, 1820. This was eight years before the Permanent School Fund was estab- lished, and thirty-one years before the first distribution of its revenue. Four sources of local school support existed in Maine prior to the estabhshment of the Permanent School Fund, as follows: (i) town Sources of Local funds, provided for by the Act of Massachusetts, Pr?o°r°to^p^e?mL ^7^^' ^^^ Continued by the Massachusetts-Maine nent School Fund Articles of Separation, 1820; (2) compulsory town tax, 1821;'^"'' (3) voluntary town tax, 1821;^^^* (4) contri- butions and gifts. To these four local means of common school support must be added the form of state aid that first contributed a revenue to common schools, namely, the bank tax established 1833. To encourage the settlement of the district, Maine, then divided into the three counties of York, Cumberland, and Lincoln, together Town Funds. commonly known as the "Eastern" lands, the *^"sin legislature of Massachusetts in 1788 provided that in the disposition of all towns thereafter, whether granted or sold, four lots of 320 acres each, making a total of 1,280 acres, should be reserved for certain purposes in each and every township, as 252a Act of 182I, Sec. I. 2526 Ibid., Sees. 9, 10. MAINE 285 follows: lot one, the "Minister's" lot for the first settled minister; lot two, the "Ministerial" lot for the use of the ministry; lot three, the school lot for the support of common schools in that township; lot four, the " State lot for the future disposition Minister and School Lots of the State." ^^"'^ When Maine became a state in Sequestered „. -tiiia-i the year 1820, it was provided by the Articles of Separation, that Maine should carry out these provisions of 1788. By the law of 1828, the area of lots to be reserved in the township was changed from 1,280 acres to 1,000 acres.^^^*^ In 18^2^^^ it was provided that except in cases where Ministerial Lots t Devoted to the title had already become invested, the min- ister's claim should be ignored, and all the lots, that is, 1,000 acres reserved in each township should be used for the support of schools in that township.^^^* The fund created by the sale of grass and timber on these lots, together with the money received for the land itself, was to be invested as a permanent fund for the benefit of the schools.^^^ '^ In some towns these funds are still preserved intact; in others the funds have been loaned to the town and the town pays a small sum equivalent to the interest of Present Condition ^^^ fund; in Still Others the school fund has been of Tovm Funds ^gg^ ^^^ general town purposes. In 1898 there were three hundred and fifty-five towns that should have had town funds; seventy-three of these had misappropriated these funds.^^^' Edward Wiggin, Secretary of the State Educational Department of Maine, writes, "When I came to this Department twelve years ago I found that many towns had no lands nor fund ' in sight. ' . . . I found, in no instance, evidence that the fund had been stolen or embezzled. In many instances it had been dis- posed of long before the memory of any living citizen, in other cases it had been used by the vote of the town, as per records in possession of the town clerk, to build a school house, make repairs, 251 Statement received Nov. 8, 1906, from Edward Wiggin, Esq., Secretary Educational Department of Maine. 252 c Me. School Report, 1898, pp. 49, 50. 252£i Ibid., 1901, p. 49. 252e Laws, 1832, Chap. 39; also Me. School Report, 1901, p. 50. 252/ Me. School Report, 1898, p. 52. 286 PERMANENT COMMON SCHOOL FUNDS or for some such purpose. Many towns had given a note bearing interest at six per cent to the school boards, and had raised the amount of interest each year, in addition to the other amounts, required by law to be raised for the support of common schools. I secured the passage of a law some eight years ago, (I don't recall the exact year) requiring every town that could not account for its school lands or the proceeds thereof, to raise annually forty-five dollars for the support of common schools, in addition to the amounts required by law to be raised and expended for that pur- pose." ^^^ Compulsory local tax, known as the town or municipal tax, assessed at a fixed rate by legislature, was provided for, as _ already stated, by section i, Act of 1821. This 1. Compulsory. -was a per capita tax. The rate of tax from the 2. Voluntary , . . time of its establishment through the year 1872 was as follows in the years cited: Maine Local Tax Rate 1S21-1872 I82I 1853 1854 1865 1868 1872 $0.40 251a $0.50 251 » $0.60=516 $0.75 251 » $1.00 2516 $0.80 2516 This tax by the law of 182 1 was divided among school districts in proportion to the number of children, four to twenty-one years of age."''^'^ By the law of 1821, sections 9 and 10, towns Voluntary Were allowcd to levy upon themselves voluntary Town Tax taxes foi buying land for school-houses, and erect- ing and repairing school buildings. The last local source of school support which we shall mention is that of gifts and contributions. Gifts and ^^ ii^ the case of many other States, we have Contributions ^^^^ ^^^^ ^^ ^^^^^^ ^^ reliable data of the amounts given by these means. The only means of state aid to schools prior to the distribu- 251'J Act January, 1821, Sec. i; Shidy of the History of Education in Maine, by Supt. of Public Schools, p. 18. 2516 Me. School Report, 1872, p. 28. 251 '^ Act January, 1821, Sec. V, MAINE 287 tion of the Permanent School Fund revenue was the bank tax. On January 23, 182 1, the legislature passed an act imposing a M f St te semiannual tax of one-half of one per cent upon Support Prior to all bauks of the State. From 182 1 to March, Permanent . ' School Fund 1 83 3, this money was used for the expenses of the State.^^^*^ The total amount paid during these twenty-two years was $194,809. An act was passed March 4, 1833, providing that subsequently the bank tax be distributed by the State Treasurer to the towns and planta- tions of the state according to their number of pupils. ^^^'^ The amount of bank tax so distributed as a result of this act varied greatly in the different years, as will be seen by the following table: Maine School Bank Tax (Only form of State aid antedating distribution of income of Permanent School Fund) Year Ami. Bank Tax Contributed to Schools 1833 $18,389 25i/« 1837 49,41s '''^' 1863 79,830251/ 1864 39,385 '''" 1867 4,475 ^''^ 1868 4,473 '^'^ 1869 ceased 251^ The income for schools from the bank tax was greatly diminished by the Act of 1863, passed under the pressure of local and national taxation.^^^* By this act there was remitted to the banks one- half the tax; in view of the levying of a United States bank tax.^"'' 2"<« Me. School Report, 1857, p. 15. 25i«Ibid., 1855, p. 14. 261/ Ibid., 1866, p. 43. 26iff Ibid., 1864, p. 56. 251^ Ibid., 1867, p. 44. 25inbid., 1868, p. 72. 26inbid., 1869, p. 156. 251* Ibid., 1863, p. 28, quotes act. 288 PERMANENT COMMON SCHOOL FUNDS The bank tax was further and chiefly diminished by the sur- render of their charters on the part of many banks which went into the national banking system. This tax ceased in 1869.^^^'' It was succeeded by the savings bank tax created in 1872. It was not until five years after the passage of the act estabhshing the Permanent School Fund, that the bank tax had been de- voted to the support of public schools, but during the eighteen years prior to the first distribution of the revenue of the Perma- nent School Fund the bank tax continued to be the chief source of state school support. An Act passed by the legislature, February 23, 1828, entitled, " An Act Providing for the Promotion of Education" ^^-^ author- ized the land agent under the advice and direction Permanent ° School Fund of the govemor and council to sell any number of Created by '^ , "^ Legislature townships of land not exceeding twenty, already surveyed and not otherwise appropriated. The land agent was required to pay into the treasury of the state all sums received from the proceeds of these lands, and to keep a separate account of them and of all notes received in Keu of pay- ment, the same to constitute a Permanent School Fund, to be re- served for the benefit of primary schools. -^-'^ This act further provided that "the excess over and above what the State may then owe" of all moneys received by Maine from Massachusetts on account of war claims against the United States for services rendered in the War of 181 2, should constitute a second source of the original principal of this fund. However, the Permanent School Fund was deprived of this latter source by a repeal act passed March 11, 1835.^^^* On the date of the passage of the act creating the Permanent School Fund, February 23, 1828, thirteen townships were reserved, seven less than the maximum number the law allowed.^^-^ August 24, 1850, twenty-two years 252? Laws 1828, Chap. 403. Citation taken from Maine Revised Statutes, 1840, p. 170, marginal reference. 2Sih ]^g School Report, 1855, p. 15. 252 i ibid_^ 1901, p. 52. 252 J Computed from data given in Me. School Report, 1857, p. 17. 252fc Me. School Report, 1S55, p. 16. MAINE 289 after the creation of this fund and one year before the first dis- First Sale tribution of its revenue, provision was made of Lands ^-^^^ twelve more townships should be reserved. This resolve was carried into effect in 1856 (see below, " Lands Reserved, 1856"). The total amount of land thus set aside was 726,625 acres.^^^* No moneys were received into the treasury for the Permanent School Fund, by virtue of this act until 1838. In that year $2,813.66 was paid into the treasury.^^^'* No distribution of the revenue was made until 1851, when $6,255 was appropriated to the towns for the benefit of the elementary schools. It is evident that although thirteen townships had First Distribution been reserved in 1828, they were not selected of Revenue, 1851 ^^ ^j^^^^ ^-jj^-^e^ fo^^ j^ 1834, the land agent was directed to make a selection of the said townships, sell them, and pay the proceeds into the State Treasury. The proceeds of the lands sold up to 1855 amounted to $238,239, and the estimated value of the unsold land was $40,000, making the total value of original fund $278,239.^^^*^ From what has been said it appears that while the town funds arose out of the original provisions of the Articles of Separation No Constitutional ^".^ the Constitution of the state of Maine, the Provisions Permanent School Fund owes its origin solely to an act of legislature of Maine. No provisions concerning it have ever been made by any subsequent constitution or amendment thereto. The management of the Permanent School Fund is intrusted to the legislature; the State Treasurer keeps account of it. "The , ^ State used the money received for the credit of Growth * " the Permanent School Fund and pays six per cent interest for its use." '^^' The rate of interest was fixed at six * Maine received $955,838.25 as her share of the United States Surplus Revenue, distributed in 1837. This sum was given to the cities, towns, and planta- tions, some of which it devoted to schools; none of it was added to the State Perma- nent School Fund. J. Eaton, National Aid to Education, U. S. Bureau of Education, Circular of Information, No. 2, 1879. *^ ^ E.\tract from personal letter from State Treasurer, Oct. 28, 1904. 290 PERMANENT COMMON SCHOOL FUNDS per cent by an act passed in 1849 ^.nd by subsequent acts.^^^™ The sources which have contributed to the growth of the Common School Fund other than those provided for by the act which created it, are (i) lands reserved, 1856; and (2) twenty per cent of future sales of public lands, 1857. In 1850 the legislature passed a Resolve authorizing the land agent to set apart and reserve under the advice Lands Reserved ^^^ direction of the governor and council twenty- '^s6 fQ^j- i^oii townships of undivided state lands as a permanent fund, for the benefit of common schools."^^" No steps were taken up to 1855 to carry out the provisions of this resolve.^^'*^ April 9, 1856, the legislature carried into effect the Resolve of 1850 by authorizing the land agent to select and set apart these twenty-four half townships, and to select not more than one town- ship of such reserve lands during each year/'^^" It was provided 1857 ^^^P that twenty per cent of all money hereafter accruing from Increased by the sale of public lands shall be paid over to the Public "Land ^^^ Treasurer of State, and said proceeds shall be ^^'^^ appropriated as a Permanent School Fund for the benefit of common schools, the interest of which shall be paid over annually for their use, in the same manner as the interest on the school fund is now paid.'^'«' No such sales were made until 1863, in which year the treasurer's account shows that $29,796.75 were received from the land oJB&ce for general sales/^^'' March 21, 1864, an act was approved which appropriated the timber and lumber on ten townships of wild land for the term of ten years, to increase the School Fund, In 1866 the legislature resolved "that the residuary interest of the State in the public lands shall be apphed in aid of the Permanent 252m Laws, 1854, Chap. 104, Sec. 6; 1833, Revised Statutes, Chap. 11, Sec. 117; School Law, 1901, Sec. 117. 252n Me. Resolves, 185c, Chap. 282, p. 245; Me. Law, 1850, approved Aug. 24, 1850. 2520 Resolves of the State of Me., Ch. 380, p. 355; Me. Laws, 1856; also Me. School Report, 1S57, p. 16. 252P Act, 1S57, Apr. 13. 252? Me. School Report, 1857, p, 17. ZMr Ibid,, 1863, p. 175. MAINE 291 School Fund of the State." Two years later the ten townships Principal In- whose timber and lumber had been devoted to orximbe/an/ school purposes in 1864, were now themselves Lumber added to the Permanent School Fund by a Re- solve ^^^* which directed the land agent within six months of the passage of the Resolve to set apart the ten townships devoted to school fund purposes, by the Resolve of March 21, 1864. The last attempt to increase the principal of the school fund was made in the year 1872 when the law establishing the school mill fund provided that all portions of said fund not distributed or expended should at the close of the financial year be added to the Permanent School Fund.^^^ ' As has already been stated, the first distribution of the revenue of the Maine Permanent School Fund took place in 1851, when $6,2 i;c; were distributed among the towns for the Participation ^ ^ od , , , in Interest benefit of common schools. The law did not pro- Voluntary 1-1 vide any way to compel the towns to share in the School Fund revenue. The first condition required by law to be fulfilled in order to receive a share of the Perma- Requirements nent School Fund revenue v/as that the towns should submit school returns. The law of 1850 provided that towns from which no returns are received by the Secretary of the State by the tenth of April shall receive no portion of the Permanent School Fund.'^-'' The law of 1869 provided that returns should be submitted to the State Superintendent by the school superintend- ing committee or supervisors. These returns must state the num- ber of scholars to serve as a basis of apportioning the School Fund revenue.^-'^-" In 1873 it was provided that the School Fund revenue should be withheld from any town neglecting to raise and expend the school money required by law, or faithfully to expend the school money received from the state.^^''" In 1899 the first four of the following requirements were laid upon the town as condition- 252S Resolves, 1868. ^'^f Laws, 1872, Chap. 43. 252« Acts, 1850, Chap. 123, Art. X, Sec. 6. 262W Laws, 1869, Chap. 13. 252W Me. School Report, 1901, p. 88. 292 PERMANENT COMMON SCHOOL FUNDS ing their participation. By the law of 1901/^^^ the governor and council were authorized to withhold the State School Fund from towns neglecting to (i) raise and expend the school money required by law; (2) to examine teachers as prescribed by law; (3) to have instruction given in the subjects prescribed by law; (4) to furnish suitable text-books (free text-book law passed 1889); (5) to faith- fully expend school money received from the state; (6) to maintain all of the town schools not less than twenty weeks annually. The law of 1905 required the fulfilment of these six conditions and added two others; (7) to submit to the Superintendent of Public Schools the returns required by law; (8) to pay any state tax assessed upon such town, and to comply with all laws prescribing the duties of towns in relation to public schools.^^^ From 1851 to 1901 the interest of the Permanent School Fund was apportioned among the towns upon the basis of the number Apportionment of persons therein between the ages of four and of Interest twenty-one. This mode of apportionment con- tinues except that the school age at present is five to twenty-one years.^^^^ The purpose of the Permanent School Fund was to aid in the support of schools. There was no thought that it should ever sup- Purpose and port the schools of the state. The law was very Objects g]Q^ ^Q state the specific objects to which the fund might be applied. It has rather followed the democratic tendencies of New England and left it largely to the towns to decide. The law of 1876, chapter 68, required municipal ofiicers to make sworn returns of all amounts received or expended for school purposes, but did not call upon them to specify the objects to which the moneys had been applied.^^^^ The laws in general have merely stated that the revenue was to be applied for the support of public schools, and does not seem to have interpreted the term "support," but has rather left the interpretation to the State Superintend- 2523; ivie. School Law, 1901, p. 6, Sec. 7. 252^ Revised Statutes, 1840, Chap. 11, Sec. 50; Ibid., 1S83, Chap. 11, Sec. 118; Me. School Law, 1901, Sec. 117; Ibid., 1905, p. 39, Sec. 122. 2522/ Me. School Report, 1901, p. 89. 253 Ibid., 1905, p. 35; Sec. lo, pp. 7, 8, Sees. 16, 17. MAINE 293 ent of Schools, or to other school authorities. The present law, however, names seven objects as the only ones to which the income of the Permanent School Fund shall be devoted: (i and 2) wages and board of teachers; (3) fuel; (4) janitor's service; (5) conveyance of pupils; (6) board of pupils; (7) tuition. From this it will be seen that this revenue cannot be applied to (i) the erecting or (2) repairing of buildings, or the purchase of (3) school property, (4) apparatus, or (5) text-books, (6) or insurance. Moneys for these purposes must be raised by town tSLxP^' We are unable to enter here into any lengthy discussion of the effects of the Maine Permanent School Fund. In general its , „ . effects can be classed in two groups: first, the Effect of Maine . . . b r j Permanent increase in the requirements which it has been School Fund -i i r i i possible for the state to place upon the towns, and second, the increase in the number of objects to which towns may apply their portion of the school fund. Regarding the first it is noteworthy that starting with the simple requirements of towns submitting annual returns, we find an increase in the exactions until it may be said to govern nearly every important phase of organization. We can better understand what the effect of the school fund has been upon the school system if we pause long enough to trace the Effects upon history of school returns. No returns were re- Schooi Returns q^j^.^^ I^y ^^^ ^^^^ g^l^^^j j^^^ of 1821. The law of 1827 required that selectmen of towns make returns once in three years to the Secretary of State on blanks furnished by him. The returns thus secured were very imperfect, and no apportion- ment of school money was made on returns from the towns prior to 1833.^^^-'^ In 1837 an act was passed providing for annual returns from town selectmen, and plantation * overseers to serve as a basis of distribution of bank taxes.^^*^' The same act provided that the Secretary of State should make an abstract of returns, but * Plantation is a term applied to a town prior to its becoming incorporated as a town. 2522 Me. School Law, 1905, p. S, Sec. 19. 252-^ Me. School Report, 1901, pp. 4S-49. 252<^Ibid., pp. 52-53. 294 PERMANENT COMMON SCHOOL FUNDS the returns proved so unreliable, that the Resolve of 1838 was repealed 1842. In 1840 school returns were made the basis of distribution of the school ixindP-^ The first reliable school re- turns were made in 1847 at the second session of the Board of Education by its secretary .^^^-^ What has been said is sufi&cient to show the broad sphere of influ- ences which the Permanent School Fund has exerted. In our para- graph upon the importance of the School Fund, Relation to , . , , , . , • , Present Means we have pomted out the relative amount which it has contributed toward total expenditure. This is one way of indicating its relation to other means of support. The means of support since the establishment of the Permanent School Fund have included all the local means which existed prior to its establishment. The bank tax existed until 1869, the savings bank tax was estabhshed in 1872, and the mill or state tax was estab- lished also in 1872. We have already given the history of the state bank tax. The savings bank tax or fund established by the legis- Savings Bank lature, 1872, Succeeded the state bank tax. It Tax, 1872 ^g^g ^ semiannual tax of one-fourth of one per cent on the total amount of deposits in all the savings banks of the state as returned to the State Treasurer the first of May and of November in each year, and payable to the treasurer within ten days therea^herP^^ This is apportioned by the State Treasurer in the same manner as the School Fund interest. In 1872 only one-half of the revenue was available. The amount as returned in May and apportioned July, 1872, was $57,334.'''"'^ In July, 1873, the first following year, the revenue was apportioned for November, 1872, and May, 1873.2^2^ The school mill fund was a tax estabhshed by legislature 1872, of one mill per dollar upon all property in the state levied for the School support of common schools. The school mill Mill Fund f^j^^ fQj. jg^^^ ^j^g gj.g^ yg^j. ^f^gj. j^g establish- ment was $224,530. The savings bank fund for that year was 252^ Ibid., p. 53. 252^ Ibid., p. 60. 262-'^ Me. School Report, 1872, p. 10. MAINE 295 $120,000. The Permanent School Fund revenue for that same year was $19,000. The history of the Maine Permanent School Fund has been traced and some of its effects upon the school system have been suggested. It might be said in closing that it would seem that in view of the rural nature of the population of Maine, and the diffi- culty of her present educational situation, some means of increas- ing this fund and thereby increasing the leverage which can be exerted by state authority upon local communities, would be very desirable. Maine has no need to be ashamed of her history of school support; on the contrary, she has much to be proud of, and it is safe to say that the effectiveness of her present system is largely due to the centralizing, though unobtrusive influence exerted dur- ing the last half century by the Permanent School Fund. Three sources are at present provided by law for increasing the principal of the Maine Permanent School Fund: (i) the proceeds Present Sources of the sales of public school lands; ^^^ (2) moneys of Increase appropriated by legislature for this purpose; ^^^ (3) any balance of the school mill fund remaining at the close of the financial year.^^^ Both principal and revenue of the fund remained stationary from 1885 to 1906, but in this year the principal was increased to $445,625 by adding to the former amount ($442,754) certain balances unexpended that had accumulated during a few years previous.^'*^- ^^'^ The investment of the fund is under the direc- Management tion of the state legislature. The State Treasurer keeps the account of it.^"*^ Apportionment ^^^ revenue is apportioned annually by the Treasurer among the towns upon the basis of school population 2^^ (five to twenty-one years 2^^). 254 Ibid., p. 40, Sec. 127. 255 Laws of Maine Relating to Public Schools, compiled 1905, p. 39, Sec. 122. CHAPTER XXVIII MARYLAND FREE SCHOOL FUND The official titles of the Maryland permanent common school fund are Free School Fund and Common Free School Fund.^^^ Title. In 1906 the principal amounted to $458,037.70'" Condition, 1906 ^j^^ ^^le annual revenue derived therefrom to $50,980.14^" which is approximately one and five-tenths (.0146 *) per cent of $3,486,235.86,'" the total common school revenue from all sources for that year. The principal is invested chiefly in state bonds, national bank and railroad bonds and stocks carried at face value, though in reality worth more.-" The worth of these secu- rities depends upon their intrinsic value and not upon the will of the state as do those of many other states.'^^ Maryland made her first effort to provide for a permanent com- mon school fund by certain legislation in 1812. "The charters of the banks in the State were extended to the Origin year 1835 and they were required to pay annually $20,000, which was 'pledged as a fund for the purpose of support- ing county schools.' " ^^* The fund was finally established in the year 1813 by an act which levied a twenty cent tax on every $100 of the capital stock of the banks of the state.^^^ The proceeds of this bank tax were invested in bank stock, a small portion of which was placed to the credit of the fund itself, but most of which was placed to the credit of the several counties.^^° In 1837 Mary- * Computed. 257 Statement received Mar. 20, 1907, from B. K. Purdum, Asst. State Supt. of Education. 258 B. C. Steiner, History of Edncatio7i in Maryland, U. S. Bureau of Education, Circular of Information, No. 2, 1894, p. 55. 259 Laws of Maryland, 1813, Chap. 122. 200 Laws of Md., 1820, Chap. 182. See also Controller's Reports for 1853 and following years. 296 MARYLAND 297 land received from the United States $955,838.25, as her share of the Surplus Revenue distributed as the result of the act of Congress, passed June 2^, 1836.* By Acts of 1836 and 1837 Maryland devoted annually to the support of free schools $34,069/°^ the interest on $681,387.'*^- This practically amounted to reserving this sum as a permanent common school fund or deposit; for, as explained in Part I, Chapter III, though this money was a loan to the states it has never been recalled and probably never will be. Section i. Chap. 295, Laws of 1858, directed the State Treasurer to invest $169,979.26 (interest received as due on Maryland's loan to the U. S. in the late war) in safe stocks and bonds and to distribute the revenue among counties and cities in the same manner "as the Free School Fund is now or may hereafter be distributed." In 1840 the principal from which the $34,069 was derived was appropriated to pay state debt interest. The State Controller states that it can scarcely be said that this fund Loss -^ was lost as it was directed that the above $34,069 be paid from the annual revenue of the Baltimore & Washington Railroad, Acts, 1839, Chap. So^^'^^ but Bourne considers the fund practically lost and writes that the interest is really raised by taxa- tion.^*"' A second loss was occasioned by the changing of state banks to national banks and their refusal thereafter to pay the twenty cent tax.^^^ Present Sources The present constitution and laws of the state of Increase make no provision for increasing the principal of the Free School Fund. The revenue is apportioned by the State Controller among the counties of the state and the city of Baltimore Apportionment , ■' upon the basis of total (school) population (five to twenty years of age) .^^"^ * See Part I, Chap. III. 281 Md. Controller's Report, 1877-78, p. VII. 282 Bourne, E. G., History 0/ the Surplus Revenue of 1S37, pp. 73 and 122. 283 Md. Controller's Report, 1869, p. vi. 2*1 Public School Laws of Maryland, 1892, p. 28, Sees. loi, 102. 298 PERMANENT COMMON SCHOOL FUNDS The decision of the State Board of Education is that " the state school tax and free school fund are permanently Lawful Objects intended to pay the salaries of teachers . . . and to provide school books and stationary for the children of the state." 265 265 Public School Laws of Md., 1892, p. 8, Sec. 22. CHAPTER XXIX MASSACHUSETTS MASSACHUSETTS SCHOOL FUND Massachusetts School Fund is the ofl&cial title of the permanent common school fund of Massachusetts.^^' In 1905 the principal Title. Con- o^ the fund amounted to $4,880,110.66 and its dition, 1905 annual income $219,881.54, approximately, one and two-tenths per cent (.0121)* of $18,131,529.01, the total com- mon school revenue from all sources for that year. The principal is kept as a distinct and separate fund, invested in negotiable securities, chiefly city and town bonds and notes and $275,000 of railroad bonds.^^*^ Peculiar interest is attached to the history of this fund for sev- eral reasons. In the first place, in many states, a state perma- Features of ^^^^ school fund has preceded and has been the Interest chief lever for securing local taxation. In Massa- chusetts local taxation, previously permissive, was made compul- sory in 1827, seven years before the establishment of the school fund.^^^ Second, the establishment of the Massachusetts School Fund was the recognition on the part of a state which had succeeded Explanation of abbreviations used in foot-notes in Chapter XXIX: Rept. = Annual Report of the Board of Education (Bd. Ed.) of Mass. Sec. Rept.= Report of the Secretary in Annual Report of the Board of Educa- tion of Mass. In the earlier reports, the reports of the Sec. and the Bd. are paged separately, though bound in one volume. 29th Rept., p. 2, or 29th Rept., 1864-65, p. 2=Bd. Ed. 29th Rept. for the year 1864-65, p. 2. * Computed. 266 Statements received Sept. 5, 1906, from Geo. H. Martin, Sec. Mass. State Board of Education, and from the Mass. State Treasurer. 267 Mass. Revised Laws, Chap. 41, Sec. i. 268 Laws, 1827, Chap. 143, Sec. 4. 299 30O PERMANENT COMMON SCHOOL FUNDS in securing free schools, that without a state permanent school fund no effective school system was possible. Third, scarcely any other fund shows so rapid an evolution and such ready adaptive- ness to changing conditions, from whatever point it may be viewed. These last two statements are supported by many facts among which might be noted here, the increase of the limit of the principal, originally fixed at one million and increased until it is now five million dollars. Fourth, it was never the aim of those endeavor- ing to establish or increase the fund to secure a fund of such proportions that its revenue would relieve the local community of the larger part of the burden of supporting their schools. This is shown both by the limit placed upon the principal of the fund and by the provision of the law of 1834 which forbade any town to receive from the income of the Massachusetts School Fund an amount greater than that which it raised by local taxation. Four means of support of public schools were employed in Massachusetts prior to 1834, the year of the establishment of the School Fund, as follows: (i) gifts; (2) tuition; (2) Public School ' . . Support Prior local or town funds, including rents of school to (School Fund , , . x , , . _ . „ . , lands; (4) local taxation. It is suincient here to note that these forms of school support had all existed from colonial days, and that they were all local, as opposed to state, in origin.* It has been asserted some times that the schools of Massachu- setts were universal and free from 1647, but there was no pre- vailing or uniform system of supporting schools prior to 1827. Local taxation, prior to 1827 was permissive only, and before this time each town or district was left to work out its own salvation according to its own peculiar will and plan. The year 1827 marks for Massachusetts what the year 1867 marks for New York and 1868 for Connecticut, the legal abolishment of support of schools by tuition (rate bills). In that year the towns were authorized and empowered, as before, but for the first time directed to raise by town tax the money necessary for the support and maintenance of such schools as the law required.^®^ * For a discussion of early sources of school support consult Part I, Chapter II. MASSACHUSETTS 301 All provisions (up to 1895) relative to this fund have been statu- tory rather than constitutional. In January, 1828, '' the Committee on Education, of the House of Representatives, Steps Leading . ^ to Establishment in a report made by the Hon. W. B. Calhoun declared 'that means should be devised for the establishment of a fund having in view not the support but the encouragement of the common schools and the instruction of school teachers.'" ^^^ In February, 1828, the same committee specifically states that a fund sufficient to support common schools and normal schools would injure the school system and decrease the public interest in it and cites Connecticut as an example of this, but that a fund suflacient to give the towns about one-third the amount they themselves raised would be an incentive to interest and effort. A bill for the establishment of the Massachusetts Literary Fund accompanied this report. This bill dealt, among other things with the proportionate amount of the income of the fund to be distributed to the several towns. This bill failed to become a law. In January, 1833, Mr. Marsh of Dalton, introduced an order into the House of Representatives. The House appointed a committee " ' to consider the expediency of investing a portion of the proceeds of the sales of the lands of this Commonwealth, in a permanent fund, the interest of which should be annually applied, as the legislature should from time to time direct, for the encouragement of common schools.'" ^^^ This order was adopted and was the "incipient measure that led to the estabhshment of the Massa- chusetts School Fund." ^^^ January 23, 1833, Mr. Marsh sub- mitted the report of the committee. The committee had expected that " all moneys then in the treasury derived from the proceeds of the sales of public lands and the entire proceeds of all subsequent sales" were to be devoted to this fund.^^® They expected that the fund would amount to $1,634,418.32 and its annual income to $98,065.09, or about seventy cents to each child, five to fifteen years, in the state. This estimate was made as follows : ^^^ 2«9G. S. Boutwell, "Mass. School Fund, Its Origin and History," in Board of Education of Mass. Report, 1859, pp. 38-47. 302 PERMANENT COMMON SCHOOL FUNDS Cash and notes on hand, $ 234,418.32 Avails of 3,500,000 acres of land at 40c. an acre, 1,400,000.00 11,634,418.32 After the above bill had been read twice, Mr. Marsh made a motion which was carried that the bill be referred to the next legis- lature. "In 1834 the bill from the files of the last general court, to estab- lish the Massachusetts School Fund . . . was referred to a Com- mittee on Education. The chairman of the committee, Hon. A. D. Foster of Worcester, made a report in February and submitted a bill which was the basis of the law" by which the Massachusetts School Fund was finally established.'^^ Massachusetts ^n March 31, 1834, was passed the law which School Fund estabHshed the fund and which reads: Established "Sec. I. Be it enacted by the Senate and House of Representatives in the General Court assembled, and by the authority of the same. That from and after the first day of January next (1835) all monies in the treasury derived from the sale of lands in the State of Maine and from the claim of the State on the government of the United States for mili- tary services, and not othei-wise appropriated, together vi^ith fifty per centum of all monies thereafter to be received from the sale of lands in Maine, shall be appropriated to constitute a permanent fund for the aid and encourage- ment of common schools; provided, that said fund shall never exceed one million of dollars. "Sec. 2. Be it further enacted, That the investment of the monies hereby appropriated shall be made by the treasurer and receiver general with the approval of the governor and council first obtained. "Sec. 3. Be it ftirther enacted, That the income only of said fund shall be appropriated to the aid and encouragement of common schools, and that a first and equal distribution thereof shall be made to the City of Boston and the several towns and districts in the Commonwealth, in such manner as the legislature shall hereafter appoint; provided, that there shall never be paid to any city, town or district a greater sum than is raised therein respectively for the support of common schools." Approved by the Governor, March 31, 1834.270 The original sources of the principal of the Massachusetts 270 Mass. Laws, 1834, Chap. CLXIX. MASSACHUSETTS 303 School Fund are thus seen to be all moneys in the state treasury Original January i, 1835, derived from (i) claims on the Capital national government for military services; (2) proceeds of the sales of state lands in Maine. The origin of these Maine lands may be stated briefly: Chapter 287, Acts of Massachusetts 1820, provided that Maine, then a district of Massachusetts, be erected and organized into a separate state. The joint title of Massachusetts and Maine covered about 6,000,000 acres of land, lying in Maine. By the terms of the original Act of Separation one-half of this land went to Massa- chusetts.^''''' ^ As stated above, it had been expected that the proceeds of the sales of Massachusetts' Maine lands would amount to $1,400,000. Growth of -^t the close of the first year after its establish- the Fund ment, 1835, the principal of the fund derived from the sale of Maine lands, was $514,906, a little more than half the First Source amount permitted by law. The fund's revenue MaSeTands, for 1835 was $i6,33i.270a In 1850, fifteen years 1834-1853 later, the School Fund amounted to $958,921, 2™ & almost the limit fixed by the act of 1834. Its revenue for 1850 was about $45,000."°^ In 1851 "in contemplation of a large sale ^. . , „ , of lands" the limit of the principal of the fund Limit of Fund ^ ^ Increased to was changed from $1,000,000 to $i,c;oo,ooo."*'^ $1,500,000, 1851 ^ } > ^ }j > The Maine lands were exhausted at the close of 1853, at which time the principal of the School Fund amounted to $1,244,284.2™' In 1854 provision was made for the increase of the fund by the transfer of "such a number of the shares held by the common- „ „ „, wealth in the Western Railroad Corporation as R. R. Shares. . ^ Second Source of will, at the rate of One hundred dollars a share Increase, 1854 , . . . . , . , _ , increase the prmcipal of the said Fund to the amount of one million five hundred thousand dollars." ^^"'^ The 27oA Mass. Laws, 1819, Chap. 161, Sec. i. 2'Oa Sec. Report, 1845, P- 22; Report, 1851, pp. 12-14. 2706 Thirty-ninth Report, 1874-75, pp. 7, 137; for full account see also Sec. 20, Report, 1857, p. 70. 270 c Laws of 1854, Chap. 300; Fifty-fifth Report, 1890-91, p. 189. 304 PERMANENT COMMON SCHOOL FUNDS law of 1854 further provided for increasing the School Fund capital from the revenue itself. Previous to this time the entire Third Source annual Incomc of the fund was distributed among Fund^^Own ^he citics and towns for the direct "aid and Income, 1854 encouragement of common schools," while appro- priations for general educational purposes * were paid out of the moiety of the proceeds of sales of public lands, and if these were not sufficient, the deficiency was made up by a payment from the invested principal of the School Fund.^^"^ Briefly stated then, these general educational expenses were paid, 1846 to 1854, out of proceeds which in some cases should have contributed to the prin- cipal, or out of the principal itself. The law of 1854 met both of these conditions, and so provided for a double means of increasing the fund. It provided that the annual income of the School Fund should be divided into two halves. The first half to be paid to towns and cities for the use and support of common schools. The second half was devoted to two uses: (i) it should be used to pay all general educational expenses not otherwise specially provided for by law; (2) any balance of this half was to be added to the principal of the fund until the principal should amount to $2,000,000.'^'^'' As a result of these different provisions for its in- crease, the fund amounted in 1856 to $1,627,467.-™^ This was nearly a million dollars increase since 1845 when its principal was only $789,389"'"' and its annual income was $28,966, while in 1855-56 its income was $90,566.-^'^^ In 1859 it was provided that "all the avails of the moiety of the sales of certain Back Bay lands (made land)""^' be added to the * General educational expenses included chiefly 270£? (j) salary Sec. Bd. Ed.; (2) salaries agents Bd. Ed.; (3) support of three normal schools and four nor- mal art schools; (4) teachers' institutions; (5) printing reports; (6) building and repairing normal school-houses and boarding-houses; (7) incidental expenses, Board of Education, whose members act without salary. 270d Thirty-ninth Report, 1874-75, p. 7. 2706 Laws, 1819, Chap. 219, Sec. 2. 270/ Laws, 1854, Chap. 300, Sec. 3. 270(7 Sec. 20, Report 1857, P- 7°- 270/! Secretary's Report, 1845, P- 33- 2/0? Mass. Resolves, 1852, Chap. 79, 2d Resolve. MASSACHUSETTS 305 Massachusetts School Fund." ^'"* The sum added to the princi- pal of the fund from the proceeds of the sales of these lands Fourth Source 1859-64 was $456,930.^'^°' This was"lessthan Back*^BTy^Lands, fifteen per cent of the estimated profits of the 1859-1864 ' enterprise." 270 J xhe entire profits of this land, with the exception of $505,000 was originally pledged to the School Fund by the legislation of 1859.^^°"' The School Fund amounted to $2,087,107.01, January i, 1882."°" During this year about $624,000 was added to the principal ^''^ ' Fifth Source ^^ " ^"^ exchange of Boston & Albany Railroad of Increase. stock for bonds of the same corporation at a pre- $024,000 from ^ ^ Stock Exchanged mium." '"^° December ^1,1882, the principal had for Bonds, 1882 ^ ' . ^ ^ reached $2,711,263 and its net income for that year was $137,465.34. Chapter 335, Section i, Acts of 1890, pro- General Provision vidcd that " Any moneys which may hereafter be/ for Increase, 1890 j-gceJved into the treasury of the commonwealth from the general government, the disposition of which is not other- Seventh and wise provided for, shall be paid into the Massa- of^in?rease.'"' chusctts School Fund." In 1891 the principal u^^s. Dir™t' °^ ^^ ^^^"^ ^^^ increased " by the United States Tax, 1891 -y^aj. claims collected, amounting to $12,043.73 and by $696,407.88 from United States direct tax of 1861, re- cently refunded," a total of $708,451.61,""' making the principal of the fund $3,665,761.88 in 1891, and its income $138,625.2'^°° An important means of increasing the principal of the School Fund was provided for in 1894 by Chapter 90, Resolves of 1894, which ^'Resolved, That there shall be paid into Ninth Source. ^ Annual Increase the Massachusetts School Fund out of the treas- of $100,000, 1894 , . , r u ury of the commonwealth, the sum of one hun- dred thousand dollars annually, until the principal of said fund shall amount to the sum of five million dollars." This annual amount was first added to the principal in the school year, 1893-94, 270fc Acts, 1859, Chap. 154; Sixty-fourth Report, 1899-1900, p. 266. 270 J Fifty-seventh Report, 1892-93, p. 102. 270TO Secretary's Report, 1866, p. 66, gives full account. z'O'z Sec. 46, Report, 1881-82, p. 58. 2700 Sixtieth Report, 1895-96, p. 214. 3o6 PERMANENT COMMON SCHOOL FUNDS when the principal amounted to $3,770,548.11 and its annual in- come to $167,210.11.2^°^ In 1893 a chain of action was begun^^°«' ^^^^ by which the income of the School Fund was supplemented in 1901 from the excess Income of income of the Fitchburg Railroad Securities InS!a!ei'l5,ooo Loan Sinking Fund^^o^ by $150,000, and which Annually ^Qj Continue to add $25,000 annually to the in- come of the School Fund until 1937 provided this legislation re- mains undisturbed.2^° ' In 1893 it became necessary for the state to take some action for the proper disposal of the securities in several sinking funds pledged for the redemption of state bonds, which would become due in 1894. Among these securities were bonds of the Fitchburg Railroad Company, amounting to $5,000,000. Owing to the financial condition of the country at this time, it did not seem best to offer these bonds for sale. Therefore under the authority of the legislature, the treasurer and receiver-general issued scrip known as the Fitchburg Railroad Securities Loan, to the amount of $5,000,000.^^"^ For the redemption of this scrip there was established a sinking fund, known as the Fitchburg Railroad Securities Loan Sinking Fund, into which were put the $5,000,000 worth of Fitchburg Railroad Company bonds, and also 50,000 shares of Fitchburg Railroad common stock nominally worth $5,000,000, but regarded as almost if not entirely value- less."o« Provision was made in 1893 that the excess of the income of the aforesaid sinking fund be assigned not to the principal, but to the income of the Massachusetts School Fund.^"^*^* By the sale, as provided for by Chapter 426, Acts of 1900, of the 50,000 "previously unproductive shares of common stock of the Fitchburg Railroad Company to the Boston & Maine Railroad Company, this sinking fund acquired $5,000,000 worth of gold bonds bearing three per cent interest. The productive securities of the fund were thus 270P Fifty-eighth Report, 1893-94, pp. 126 and 436. 2'09 Acts of 1893, Chap. 408. 2'0'' Acts of 1901, Chap. 223. 270 « Sixty-fifth Report, 1900-01, pp. 126-128, MASSACHUSETTS 307 raised to $10,000,000, double the amount required for the fund. The legislature, on April 2, 1901, authorized the transfer of these Boston and Maine gold bonds from the Fitchburg Railroad Securi- ties Loan Sinking Fund to such other sinking funds as might be directed by the governor and council.^'^" *■ The transfer was not made until the bonds had remained a year in the Fitchburg Railroad Securities Loan Sinking Fund, and not until the excess of the in- come payable to the income of the School Fund had risen to $175,000. Since the annual amount derived from this excess and added to the School Fund income was about $25,000 for several years the additional sum received, 1901, from the excess for 1901, amounted to $150,000. One-half of this $150,000 was paid to the School Fund towns January, 1902, in addition to the half of the income of the School Fund. As already noted the entire profits of the sales of the Back Bay lands with the exception of $505,000 were originally pledged to Loss and the School Fund by the legislation of 1859.^'"* Diversion « jj^^^j ^j^jg legislation been permitted to stand, the School Fund would have been increased to five million dollars," but after 1864 nothing was added to it from this source.^'^^'^ The amount added 1859-64 was $456,930,^'°* "less than fifteen per cent of $3,066,652, the estimated profits of the enterprise." ^^o i in 1861 a diversion from the fund was made "when $232,790 was given in the form of (Back Bay) land to the Massachusetts Institute of Technology and the Boston Society of Natural History." 2™* Other diversions were made.^^*^ ™ Finally, from 1864 on, all profits of Back Bay lands were diverted from the School Fund to a sinking fund created for the payment of scrip issued by the state in 1864 Effect of Civil to meet its Civil War claims and debts. The ar on Fund necessity of providing means for the payment of the large sums spent by the state during the late Civil War for re- cruiting and transporting soldiers, led the legislature to provide for the creation of a fund by the issue of state scrip, not to exceed ten million dollars, called the Massachusetts Bounty Fund.^^"" The legislature also created a sinking fund for the payment. Provision 27o« Sec. Forty-sixth Report, 1S81-S2, p. 58. 3o8 PERMANENT COMMON SCHOOL FUNDS was made that all further profits of the Back Bay lands should be diverted to this sinking fund as soon as the School Fund shall have reached the amount of $2,000,000^™" and after 1864 the School Fund was not further increased from this source, although it was not until January i, 1866, that the fund amounted to $2,000,000/^""' the limit set by the law of 1854. Massachusetts received $1,338,173.58 as her share of the Surplus Revenue distributed by the federal government as a loan to the United States States in 1 83 7. Massachusetts distributed two- f,"7ot''ed?r^°"^ thirds (except $2,500) of her share among the Local Funds 271 towns, authorizing them to " apply the money so deposited with them or the interest upon the same, to those objects of public expenditure for which they may now lawfully raise and appropriate money, and to no other purpose." ^^^ "Many of the towns bestowed the Surplus Revenue Fund or its income on the public schools, but, the records of town grants being inacces- sible, it is impossible to show the entire amount expended in that way." Because these are local funds and because the scope of this work includes only permanent state funds it is suflScient to say here that in 1902 the aggregate principal of Massachusetts local school funds amounted to $1,121,987.55, and the annual income from the same to $55,172.21.^^^ The act creating the School Fund directed that it be invested by the Treasurer and receiver-general of the commonwealth, subject to the approval of the governor.^™ This Management of . Massachusetts form of management continued from 1834 to School Fund o^^t r-^^ ^ <• ^ \ ^ 1 1 1866. in 1866, as the fund had accumulated to $2,000,000 and the duties of the treasurer had greatly increased, it was deemed wise to associate with him an executive ofl&cer of the Board of Education to aid in the investing and management of the fund. Consequently, in this year, the management was trans- 270U Mass. Acts, 1864, Chap. 313, Sec. 3. ^^OJ* Sec. Thirtieth Report, 1866, p. 69. 2^^ J. Eaton, National Aid to Education, U. S. Bureau of Education, Circular of Information, No. 2, 1879, P- 22. -^2 Mass. Laws, 1837, Chap. 85. 2'^ Report, 1900-01, p. 127. MASSACHUSETTS 309 ferred into the hands of special commissioners, the secretary of the Board of Education and the treasurer and receiver-general.^^"* This is the present (1905) form of management.^^^ "The secretary of the Board of Education and the treasurer and receiver general shall be commissioners, who shall invest and manage the fund and report annually to the general court the condition and income thereof. The premiums on any securities purchased for said fund, to an amount not exceed- ing in any one year fifty thousand dollars, may be paid from any money in the treasury of the commonwealth, not otherwise appropriated. All invest- ments shall be made with the approval of the governor and council." ^^^ Four sources are at present provided by law to increase the principal of the School Fund: (i) portions of School Fund revenue Present Sources forfeited by towns ovi^ing to their failure to fulfil of Increase conditions of participation; "^ (2) moneys received into the state treasury, disposition of which is not otherwise pro- vided for (provided, 1890) ; ^^^ (3) annual appropriation of $100,000 to be continued until the principal of the School Fund amounts to $5,000,000 (provided, 1894);^''^ (4) $25,000 to be added annually until 1937, to the income of the School Fund (not the principal) from the excess income of the Fitchburg Railroad Securities Loan Sinking Fund.^""^ ,„, Chapter 456 of the Acts of 190^ provides as fol- Apportionment 281 r -+0 y o i- lows: "Sec. I. The annual income of the Massachusetts School Fund shall, without specific appropriation, be apportioned and distributed for the support of the public schools in the following manner: I. Every town which complies with all laws relative to the distribution of said income and whose valuation of real and personal property, as shown by the last preceding assessors' valuation thereof, does not exceed one-half million dollars, shall annually receive five "*Acts, 1866, Chap. 53, Sec. i. -'^ Rev. Laws, Chap. 41, Sec. 3. 27S Pub. Stats, of Mass. relating to Public Instruction, Including Laws in Force, 1892, p. 55, Chap. 46, Sec. 11; Abbreviated Stats., P. I., 1892. ^" Mass. Acts, 1890, Chap. 335, Sec. i. "^Mass. Resolves, 1894, Chap. 90. ^'^ Report Mass. Board of Education, 1S99-1900, pp. 19, 264 ff. 2" Mass. Acts, 1903, Chap. 456. 310 PERMANENT COMMON SCHOOL FUNDS hundred dollars; but if its rate of taxation for any year shall be eighteen dollars or more on a thousand dollars it shall receive seventy-five dollars additional. II. Every such town whose valuation is more than one-half million dollars and does not exceed one million dollars shall receive three hundred dollars; III. and every such town whose valuation is more than one million dollars and does not exceed two million dollars shall receive one hundred and fifty dollars; IV. and every town whose valuation is more than two million dollars and does not ex- ceed two and one-half million dollars shall receive seventy-five dollars. The re- mainder of said income shall be distributed to towns whose valuation does not exceed two and one-half million dollars, and whose annual tax for the support of public schools is not less than one-sixth of their whole tax for the year, as follows: Every town whose school tax is not less than one-third of its whole tax shall receive a proportion of said remainder, expressed by one-third; every town whose school tax is not less than one-fourth of its whole tax shall receive a proportion expressed by one-fourth; every town whose school lax is not less than one-fifth of'its whole tax shall receive a proportion expressed by one-fifth; and every town whose school tax is not less than one-sixth of its whole tax shall receive a proportion expressed by one-sixth. All money ap- propriated for other educational purposes, unless otherwise provided for, shall be paid from the treasury of the commonwealth. "Sec. 2. The income of said fund which has accrued on the thirty -first day of December in each year shall be apportioned by the commissioners of the Massachusetts School Fund in the manner provided for by section one of this act, and shall be paid to the several towns on the twenty-fifth day of January thereafter." 281 The law permits a city or town school committee to expend not more than twenty-five per cent (.25) of their share of School Fund revenue to purchase books of reference, maps, Objects , ^ , . , 1 1. 1 and apparatus; the remamder must be applied to the support of public schools.^^^ The term "support of public schools" is defined by law to include the following eight classes of expenditure:^*^ (i) teachers' wages; (2) transportation of school children; (3) fuel; (4) care of school premises; (5) clerks, truant officer, etc.; (6) superintendents of schools; (7) text-books and supplies; (8) school sundries. No part of the income of the Massachusetts School Fund shall be used for payment of the com- pensation or expenses of members of school committees.^^'* 282 Mass. Stats., P. I., Chap. 43 (1892), Sec. 6, p. 26; see note 276. 283 Mass. Acts, 1900, Chap. 175, p. iii. 28* Mass. Acts, 1904, Chap. 107, Sec. 2. MASSACHUSETTS 311 No apportionment of School Fund revenue can be made to any town or city which fails: (i) to raise a local school tax of at least Conditions of $3-oo for each inhabitant, five to fifteen years of Participation ^^gg. ^g) to submit the school returns required by law; (3) to comply with the laws regarding truancy; (4) to maintain the public schools required by law.^*^ Chapter 107 of the Acts of 1904, provides as follows: Section i. No town shall receive any part of the income of the Massachusetts School Fund unless it shall have complied, to the satisfaction of the Board of Education with all laws relating to the public schools.^^^ ii85 Ibid., Sec. I. 286 Stats., P. I., 1892 (cf. note 276), p. 27, Chap. 43, Sec. 5. CHAPTER XXX MICHIGAN PRIMARY SCHOOL FUND. SWAMP LAND FUND Michigan has two "accounts" of permanent common school funds, known respectively as the Primary School Fund,^®^ and the Titles. Swamp Land Fund.^^* "The Primary School Condition Fund is the account of the proceeds received from the sales of primary school lands. The state pays seven per cent annually upon this account, whence it is often called the Seven Per Cent Fund, The constitution provides that this fund be kept a permanent fund which can never be decreased; nevertheless, the Primary School Fund contains no money. All moneys received by the state in whole or in part payment upon school lands sold are used by the state for general purposes." ^^^ These statements apply equally to the Swamp Land Fund, concerning which the law pro- vides that "all moneys received on such sales (sales of lands belong- ing to school swamp land fund) . . . after deducting the expenses as aforesaid, shall be used and applied to the payment of the out- standing indebtedness of the state." ^^" The state pays five per cent annually on this "account," ^^° whence the fund is commonly called the Five Per Cent Fund. The Primary School Fund is a perpetual fund fixed by constitution, whereas the swamp land fund is a statutory fund, and can be changed by the legislature.-^^ The condition of these two funds in 1903 was reported as follows :^^^ Primary School Fund: Proceeds paid in $4,193,642.40 Due from purchasers 77)377-45 Total amount of fund available for interest $4,271,019.85 287 Constitution of Michigan, Art. XIII, Sec. 5. 28S Report Supt. of Public Instruction, of Michigan, 1903, p. 24. 289 Ibid., pp. 22, 23. 290 Acts of Mich., 1887, No. 142, Sec. 5. 291 Report Mich. Supt. of Public Instruction, 1903, pp. 27, 31. 312 MICHIGAN 313 Unsold lands, 46,975.33 acres estimated at $5 per acre . . . $234,876.65 Total prospective proceeds $4,505,896.50 Swamp Land Fund: Proceeds paid in 919,365.70 Due from purchasers 15,466.82 Total amount of fund available for interest $934,832.52 Unsold lands, 35,625.60 acres estimated at $5 per acre .... 178,128.00 Total prospective proceeds $1,112,960.52 The total interest-bearing proceeds (principal?) of these two funds combined is therefore $5,201,852.37, and the total prospective proceeds (principal?) $5,614,856. The income derived from these two funds for the same year was as follows: Interest on Primary School Fund (Seven Per Cent Fund) . . . $345,447.91 Interest on Swamp Land Fund (Five Per Cent Fund) .... 52,366.62 Interest from purchasers 6,061.39 Received from trespassers 2,243.90 Total Income $406,119.82 Total annual receipts for common schools, this same year, derived from all sources : $8,871,294.56292 Per cent of total revenue derived from "permanent funds" ac- counts, approximately (.0457)* four and six-tenths per cent. In 1804 when Michigan was yet a district of the territory of Indi- ana, Congress reserved for the use of the public schools, section numbered sixteen in each township. The total Origin ^o^ '- area of the lands thus reserved amounted to 1,067,397 acres.^*' This grant was recognized when Michigan was organized into a separate territory (1805). Provision was made for the establishment of the Primary School Fund by section 2, arti- cle X, of the constitution adopted by the constitutional convention, 1835,^^^ and this provision became effective and the fund established * Computed. 292 Ibid., p. 167. 293 For account of origin of these funds see Report Mich. Supt. of Public In- struction, 1903, pp. 18-24; also Report 1899, p. 22. 291 Roberts, Mich. Rev. Stats., 1S38, p. 42. 314 PERMANENT COMMON SCHOOL FUNDS upon the state's admission into the Union, 1837. The Swamp Land Fund was established by an act of legislature, 1858, which provided that after deducting the expenses of sales, fifty per cent of all pro- ceeds of all former and all future sales of swamp lands should constitute a fund to be "denominated a primary school fund" and the annual interest thereof at five per cent should be appropri- ated and distributed in like manner as the Primary School Fund interest.^^^ The history of these swamp lands may be briefly told: In 1812 Congress set aside two million acres of land in Michigan as bounty land to non-commissioned officers and soldiers who would enlist in the war between the United States and Great Britain.^^^ Sur- veyors declared these lands swamps and worthless. Other lands in Illinois and Missouri were given to the soldiers, and in 1850 Congress gave back to Michigan the worthless lands; 5,838,775 acres of swamp land were patented to the state prior to 1899, and of the proceeds, $846,778, were devoted to the Five Per Cent Fund.^^^ The minimum price originally fixed by the legislature in 1837 upon primary school lands was eight dollars per acre. "Owing to the hard times following the financial panic of 1837, many who purchased the lands appealed to the state legislature for a reduction of the minimum price. As a result, the minimum price (of primary school lands) . . . was thanged in 1840 ... to five dollars per acre. In 1842 a still further reduction was made, so that in December, 1842, the fund had shrunk from $739,638.01 to $359,809.41." ^^^ When we con- sider that the moneys belonging to the Primary School Fund and the Swamp Land Fund have been used for general expenditures and payment of state debts we see that these funds instead of lessening the taxation for the support of schools actually increase it, but Michigan has escaped the full weight of the burden that would be felt if the interest on these funds were paid out of a direct state tax. 295 Laws of Mich., 1858 (No. 31), Sec. 5, p. 171; Report Supt. of Public Instruc- tion, 1889, p. 22, gives a full account. 298 Statutes at Large, Vol. II, p. 669; Act of Dec. 24, 1811, Chap. 10, Sec. 2; and p. 728, Act of May 6, 1812, Chap. LXXVII, Sec. i. MICHIGAN 315 Section I of article XIV of the constitution provides that " all specific taxes except those received from mining companies of the upper peninsula, shall be apphed in paying the interest of the primary school, university and other educational funds, and the interest and principal of the state debt in the order herein recited, until the ex- tinguishment of the state debt, other than the amount due to edu- cational funds, when such specific taxes shall be added to and con- stitute a part of the Primary School Interest Fund (i. e., be added to the interest derived from all permanent primary school funds)." The constitution provides for the increasing of the principal of the Primary School Fund from three sources c^^'' the proceeds (i) Present Sources ^f sales of all lands that have been or may here- of Increase g^f^-gj. ^^ granted to the state for educational pur- poses; (2) of all lands or other property given by individuals or appropriated by the state for like purposes; (3) of intestate lands escheating to the state. All educational funds in Michigan are managed by the legis- lature. The Superintendent of Public Instruction transmits plans for the management to the Governor, who in turn transmits them to the legislature.^^^ The interest of the Primary School Fund is apportioned semi- annually by the Superintendent of Public Instruction among the towns and cities of the state in proportion to Apportionment ^ ^ r r their school population (five to twenty years) .^^^ The combined interest of the Seven Per Cent Fund and the Five Per Cent Fund is known as the Primary School Fund interest. It _ can be applied to only one object; — the payment of the wages of teachers in public schools.^*^" In order to share in the Primary School Fund interest, a district Conditions of must have been maintained for at least five Participation months the preceding year, a school taught by a legally qualified teacher.^^^ 297 Constitution of Michigan, 1850, Art. XIII, Sees. 2, 3. 298 Mich. Gen. School Laws, 1903, Sec. 17. 299 Ibid., Sec. 20. 300 Ibid., Sec. 54. 301 Report Supt. of Public Instruction, of Mich. 1903, p. 29. Management CHAPTER XXXI MINNESOTA PERMANENT SCHOOL FUND. SWAMP LAND FUND Minnesota possesses two public permanent funds devoted to the support of common schools, the oflScial titles of which are Perma- Tities. iisnit School Fund"^^ and Swamp Land Fund.^*^^ Condition, 1908 Of the Swamp Land Fund only one-half is a com- mon school fund; the other half is devoted to the support of other state educational and charitable institutions.^"^ The condition of these funds in the year ending July 31, 1908, is reported as follows: Invested principal of half Swamp Land Fund $ 621,636.17304 Invested principal of Permanent School Fund 19,709,383.91305 Total invested principal $ 20,331,020.08 Estimated surface value of 1,015,187.46 acres of unsold Perma- nent School Fund lands 307 5jS4S!954-32 Estimated value of ore products of sameSoe , 100,000,000.00 Total prospective value of Permanent Common School Fund and Half Swamp Land Fund, excluding value of unsold swamp lands $125,876,974.40 The principal of the Permanent School Fund is invested in or secured by state bonds and certificates of indebtedness, municipal bonds, and bonds of foreign states.^°^ The rent of unsold school 302 Laws of Minn. Relating to the Public School System, edited by J. W. Olsen, 1901, p. 43, Title 9. 303 Minn. Gen. Laws, 1907, Chap. 385. 304 Advance Kept. Minn. State Aud., Biennial Report, 1907-08, p. ix. 305 Ibid., p. vii. 306 Ibid., p. xxxvi. 307 Data from records of State Auditor furnished F. H. Swift by Dept., Dec. 28, 1908. 308 Data furnished F. H. Swift, Sept. 27, 1906, by J. W. Olsen, Minn. State Supt. of Public Instruction. 316 MINNESOTA 317 lands is added to the principal of the fund ^^^ and is not, therefore, distributed annually as in some other states. Income of Permanent School Fund 1907-08 $686,432.55307 Income of Half Swamp Land Fund 1907-08 18,637.16307 Total income of public permanent common school funds $705,069.71807 The total receipts for common schools for the year 1907-08, includ- ing the balance on hand at the beginning of the year, amounted to $14,919,015.^°^ Of this, therefore, approximately four and seven- tenths per cent (.047)* was derived from the income of the Perma- nent School Fund and Swamp Land Fund. Section 18 of the Congressional Act passed March 3, 1849, ^o establish the territorial government of Minnesota reserved sections sixteen and thirty-six in each township for the use Origin of ^ Permanent of common schools.^^" The amount of land thus School Fund , , ^ m ^ reserved amounted to 2,969,990 acres,^" or (.055) five and five-tenths per cent of the area of the state. The Perma- nent School Fund was provided for by the first constitution adopted by the state, that of May 11, 1858, which became effective upon the admission of the state into the Union.^^^ The origin of the federal grant of swamp lands to the states of the Union has been described in Chapter III. The area and esti- Origin of Minn, niated value of the swamp lands thus far granted Swamp Land Fund ^q Minnesota could not be ascertained at the state department. As stated in Chapter III, the Swamp Land Grant is an indefinite grant covering " all the swamp and overflowed lands rendered thereby unfit for cultivation and remaining unsold at the date of the grant." The last published federal tables, those of 1896, reported that prior to January i, 1896, there had been granted to Minnesota 4,738,549.78 acres of swamp lands. An amendment to the constitution, article VIII, section 2, adopted 1881, * Computed. 309 Data furnished F. H. Swift, Dec. 28, 1908, by Minn. State Dept. of Public Instruction. 310 Organic Act of Minn., Gen. Stats, of Minn., 1866, pp. 14-21; also Report Minn., Dept. Public Instruction, 1S78, p. 6. su Constitution of Minn., 1858, Art. VIII, Sec. 2. 3i8 PERMANENT COMMON SCHOOL FUNDS provided that of all the swamp lands then held or which might thereafter accrue to the state one-half shall be appropriated to the " Common School Fund" and one-half to the educational and char- itable institutions of the state, the principal of the funds derived from the sale of such swamp lands to be forever preserved inviolate and undiminished. It will be seen that the provisions of this amendment set apart one-half of the Swamp Land Fund as a second permanent public common school fund. Despite this amendment the Swamp Land Fund was not divided and nothing was derived from it for the sup- port of common schools until the passage of an act in March, 1907.^°^ As the result of this act, since 1907 one-half the income from the Swamp Land Fund has been devoted to the support of common schools ^^'^ and one-half credited "to the appropriation for the support of the several state educational and charitable in- stitutions." In Minnesota the swamp lands were devoted originally to state institutions, not to the schools. In 1865 a law was passed direct- ing tha|s525,ooo acres of swamp lands be reserved One-half Swamp for the benefit of the following state institutions: Lands Devoted " to Common 100,000 acres each for the Insane Asylum, School for Deaf, Dumb and Blind, State Prison; 75,000 acres for each of the three normal schools, Winona, Mankato, and St. Cloud.^^^ Subsequently it was provided that after the swamp lands appropriated to other purposes shall be selected, the Commissioner shall select and set apart the remainder of such lands for the support of a Soldiers' Orphan Asylum. In 1878 the Super- intendent of Public Instruction suggested that in view of the fact that the Soldiers' Orphan Asylum had been closed, the lands set apart for it be in the future given to the normal schools.^^^ Minnesota "has never lost a dollar of her permanent school fund." ^°* The state had borrowed (prior to 1906) $6,657,479.96,^°* over one-third of the principal. The interest on this is paid out of state taxes.^°* As pointed 312 Minn. Gen. Laws, 1865, Chap. 5. 313 Report Minn. Supt. of Public Instruction, 1878, p. 75. MINNESOTA 319 out in Chapter V and elsewhere this is a poHcy pursued by other states. For many reasons state bonds are one of the safest forms of investments, and when the school land moneys accumulate in the treasury the matter of investing such large sums becomes exceedingly difficult. Yet to use the moneys derived from the pro- ceeds of the sales of school lands and to substitute for them certifi- cates of indebtedness or even state bonds has resulted in transform- ing the permanent school fund of many a state into a burden rather than an aid. The purpose of these funds was clearly to lessen the taxation. The moneys are used up for internal improvements or other state purposes and then the people are taxed to pay the interest on the substituted or purchased securities. Such a policy has frequently resulted in extravagance and reckless expenditure on the one hand and increasing burdens of taxation for coming generations on the other hand.* In conclusion it should be stated that Minnesota's management of her Permanent School Fund has been universally regarded as wise, efficient, and exemplary. Its method of caring for and selling its lands and of creating one state instead of many township funds were epoch-making policies in the history of pubhc permanent school funds in the United States.! The sources at present provided for increasing the principal of the fund are the proceeds from (i) the sale (2) or rent of school Present Sources lands, (3) the sale of grass or timber on such of Increase lands,^^'* (4) royalties on iron ore taken from school lands, (5) profits on sales of bonds.^°^ The investment of the fund is in the hands of a " Board of Invest- Present ment consisting of the governor, state auditor Management ^^^ g^^^g treasurer." ^^^ The revenue is apportioned by the State Superintendent of Public * On this point compare the accounts of credit funds in Chapters I and V. ■]• For an account of the importance of Minnesota's policies consult Manage- ment, Chapter V. 31* Report Dept. of Public Instruction of Minn., 1878, p. 37; Laws of 1901 pro- vide no other means. 315 Minn. School Laws, 1901, sees. 101-105. 320 PERMANENT COMMON SCHOOL FUNDS Instruction among the counties ''in proportion to the number of scholars in each township five to twenty-one years Apportionment of age,^^^ who have been enrolled in attendance forty days.^^^ The objects for which the revenue of the Permanent School Fund may be expended are not specified by law, but it cannot be used for sectarian schools ^^^ and in the expenditure of Objects ^ it, teachers' wages have the preference.^^^ The conditions which must be fulfilled in order to share in the revenue of the Permanent School Fund are four in number, and _ may be summarized as follows: (i) maintenance Present ^ ^ ' Conditions of of a school at least five months; ^"^ (2) the school Participation ^^ r -\ i ion must be taught by a legally quahlied teacher;"*'^" (3) submission of returns required by law;^"° (4) provision of regular and systematic instruction in physiology and hygiene.^^^ 316 Constitution of Minn., Art. VIII, Sec. 2. 317 Minn. School Laws, 1901, Sec. 164. 318 Constitution of Minn., Art. VIII, Sec. 3. 319 Minn. School Laws, 1901, Sec. 72. 320 Ibid., Sec. 164. 321 Ibid., Sec. 367. CHAPTER XXXII MISSOURI PUBLIC SCHOOL FUND, TOWNSHIP FUND, COUNTY PUBLIC SCHOOL FUND, SPECIAL DISTRICT FUND Missouri has four permanent common school funds or classes of funds known respectively as the Public School Fund; ^^^ County Title. Public School Fund; ^^^ Township School Fund; ^24 Condition, 1902 g^^^ Special District Fund.^^^ The principal of these funds is as follows: ^^'^ Pubhc School Fund, $3,159,123; County P.ublic School Fund, $6,002,426; ^^^ Township School Fund, $2,301,622; Special District Fund, $92,385. The total principal of the permanent common school funds amounts, therefore, to $11,566,556; the annual income reported to be derived from the same in 1902 is $638,833,^^^ approximately seven and nine-tenths per cent of $8,113,509,"^ the total pubhc school revenue that year. It would be difficult to state in what year the first permanent Origin Special District Fund was established. These District Funds funds are local funds which have been created at different times by gifts, devises, bequests, special grants or leg- islation. In 1812, while Missouri was yet a territory, "Congress ordered that all lands not of private ownership be reserved for school pur- poses in a dozen of the larger villages. Missouri became a state in 1821." ^^^ In 1839 an act was passed for the estabhshment of a system of common schools. One provision of this act declared 322 Revised School Laws of Mo., 1903, p. 56, Sec. 9819. 323 Ibid., p. 58, Sec. 9824. 324 Ibid., p. 59, Sec. 9828. 325 Report Mo. Supt. of Public Schools, 1884, p. 15. 326 Ibid., 1902, p. 28. 327 A. D. Mayo, The American Common School in the Southern States, 1790- 1840; Report U. S. Commissioner of Education, 1895-96, I, p. 330. 321 322 PERMANENT COMMON SCHOOL FUNDS that all towns and neighborhoods to which the United States Gov- ernment had granted special donations of school lands in 1812 might be incorporated for school purposes.^^* Upon admission into the Union, section numbered sixteen was granted and reserved in each township of the state for the support of .. ^ , schools, the asgresrate area being I 208,120 acres.^^^ Township Funds > ho & o > j In 1834-35 the legislature provided for the survey of these school lands and for the regulation of the sale of the same.^^'^ In 1839 supplementary provisions were made respecting the sale.^^^ The Revised Statutes of 1845 contain no provision requiring that the proceeds be invested permanently. This provision appears, however, in the Revised Statutes of 1866, Chapter 46, section 66. The Public School Fund was established by legislative act February 6, 1837.^^*' The original capital consisted of the pro- Origin Public ceeds of seventy-two sections (46,080 acres) of School Fund g^ijj^g i^j^^g ^^^ $382,355, Missouri's share of the surplus revenue distributed by United States in 1837.^^^'* On February 9, 1839, it was provided that the proceeds of fines, forfeitures, etc., collected within the county, should be paid into County the county treasury for the County School Fund,^^^ School Fund j^^^. j^- ^Q^ld appear that no provision was made for constituting the proceeds of these sources of revenue a perma- nent fund until 1868. The County School Fund was established as a permanent fund by section 18 of an act approved March 27, 1868. The original principal consisted of the proceeds of fines, penalties, and forfeitures,^^^ and the proceeds of 3,185,479 acres of swamp land granted by Congress under an Act of 1850. It would be impossible in the case of Missouri, as with many other states, to ascertain definitely the amount of Loss the permanent school fund which has been lost. The report of the Superintendent of Public Schools for 1870, * See Part I, Chapter III, for an account of the Surplus Revenue Fund. 328 Ibid., Report U. S. Commissioner of Education, 1900-01, I, p. 376. 329 Report Mo. Supt. of Public Schools, 1903, p. 94. 330 Ibid., 1869, p. 38. 331 Bourne, Edward G., History of the Surplus Revenue of 1837. 332 Mo. Law, Feb. 9, 1839. MISSOURI 323 Chapters XII and XIII, attempts to give an account of the amount of the Township School Fund which has been lost. The report shows that at that time over a hundred thousand dollars of this one fund alone was reported lost, but as in the case of many town- ships the amount lost could not be ascertained, the total loss exceeded that reported. Among the various reasons given are: burning of the court-house, parties running away; parties insolvent; default of county treasurer; notes outlawed; stolen; carelessness; the war; insufficient security; parties absconding; robbery; records imperfectly kept; townships having no fund being too disloyal to organize; records burned; carelessness of officers; worthless notes. R. D. Shannon, State Superintendent of Pubhc Schools in 1876, points out that the county funds were sometimes invested in direct and flagrant violation of the law, and that the moneys due the principal were not always added. He writes as follows: "The township, swamp land and county school funds are under the control of the various county courts and, as a rule, have been badly managed. They have to a shameful extent been lost, squandered and stolen. This was more particularly true in the war period of our history. . . . There is still, however, in some cases, a loose- ness of management that amounts to culpable neglect. In some cases county courts have invested their township and county school funds in school bonds and otherwise in direct and flagrant violation of the law. . . . Fines, forfeitures, and penalties have not always been faithfully accounted for nor applied to the funds to which the law directs their application." ^^^'^ The State Public School Fund may be increased by grant, gift, devise, appropriation by the General Assembly, proceeds of estates Sources of escheating to the state. The County Public Increase School Fund may be increased by the net proceeds of fines collected for breaches of military or penal laws of the state; penalties, forfeitures, estrays; sale of swamp lands; military exemp- tion moneys. The Township School Fund may be increased by 332a Report, Mo. Supt. Public Schools, 1876, pp. 13-14. 333 Report Mo. Supt. of Public Schools, 1900, p. 43; Revised School Laws of Mo., Sec. 9824, p. 58. 324 PERMANENT COMMON SCHOOL FUNDS the sale of such parts of sixteenth section lands as remain unsold. The Special District Funds may be increased by grant, gift, devise, or special legislation. The Public School Fund is managed by the State Board of Education.^^"* The County and Township Funds are managed by the county courts of their respective counties.^^^ Management . The Special District Funds are managed for the district by the District Board of Directors.^^^ The revenue of the State Public School Fund is apportioned by the State Superintendent of Public Instruction upon the basis of school enumeration, that is, school population, Apportionment (six to twenty years) .^^^ The revenue of the State, County, Township, and District Funds , „ may be legally expended for no other object than Lawful Objects J b J t' J the payment of teachers' wages.^^^ In order to receive its share of the State Public School Fund in- come, the district must: (i) maintain a free public school during the Conditions of Y^^^ ^^r wliicli the distribution is made for at least Participation three months,^^'' for six months if a tax of forty cents on $ioo assessed valuation within a district, together with the public funds, will maintain the school for that length of time; ^^° (2) must send returns as to the enumeration of pupils required by law.^^^ 334 Revised School Laws of Mo., 1903, p. 57, Sec. 9822. 335 Ibid., p. 59, Sec. 9829. 336 Ibid., p. 22, Sec. 9763. 337 Ibid., p. 29, Sec. 9770. 338 Ibid., pp. 44, 45, Sec. 9788. 339 Constitution 1875, Art. XI, Sec. 3. 340 Revised School Laws of Mo., 1903, Sec. 9840. 341 Ibid., p. 64. CHAPTER XXXIII MISSISSIPPI LITERARY, CHOCKTAW, OR SIXTEENTH SECTION FUND. CHICKASAW FUND It would appear that Sixteenth Section Fund is the title applied officially to-day to what was originally known as the Literary Present Fund. It would be more clear to call this fund Condition |.]^g Chocktaw Fund. It is impossible to state the actual condition of this fund, as two years of constant effort to obtain information from the state authorities has brought no appreciable results. The reports of the United States Commis- sioner of Education 1903 ^^^ and 1905 ^^^ give data for 1903 as fol- lows: * Permanent common school funds (state and local), principal $3,466,667,^ income, $187,746, approximately ten and one-tenth per cent (.101) t of $15858,990,^^^ the total receipts for common schools. The " Chickasaw School Fund" is a "non-payable debt, " amounting in 1902 to $949,022.58 ^^^ and in 1905 to $1,002,023.36.^^^ How much, if any, of the remainder of these funds, approximately two and a half million dollars, actually exists as productive capital I am unable to state. Presumably the remaining two and a half millions is also a non-payable debt representing the lost Literary or Chocktaw Fund. The northern counties of Mississippi were originally occupied ^ . . ,,, by the Chickasaw Indians and the southern Origin ^*^ by the Chocktaw Indians.^'^^ The Chickasaw Fund and the Chocktaw Fund might well be considered as * The same report, 1906, gives no more recent data. t Computed. 3*2 Report U. S. Commissioner of Education, 1905, I, p. 419. ^'•s Report State Treasurer. 3** Report U. S. Commissioner of Education, 1905, I, p. 410. 345 Report Miss. State Supt. of Education, 187 1, p. 39. 3^^ Britiannica Encyclopedia, article on "Mississippi." 325 326 PERMANENT COMMON SCHOOL FUNDS one, for both owe their origin to Congressional land grants of section numbered sixteen in each township. These lands were granted 1803/° 1852,^° 1857.^" The total amount of lands granted was 838,329 acres.^'' The Chocktaw counties received from the general government approximately 663,000 acres (663,774 acres) of sixteenth section lands.^'*^ In the first constitution, adopted 1817, Chocktaw Fund, no mention was made concerning the establish- or Sixteenth Section Fund, ment of a fund. Four years later, however, a fund known as the Literary Fund was established by an act of legislature passed November 26, 1821,^^ for the edu- cation of poor white children and for the general support of schools. The sources provided for contributing to this fund were, all escheats, confiscations, forfeitures, and personal property accruing to the state, and penal fines and forfeitures. It was provided that neither the principal nor interest should be apportioned until the principal shall amount to $50,000 (sec. 9). By an act approved March 2, 1833, provision was made for the distribution of the revenue of the Literary Fund (on the ground that the fund now amounted to over $50,000) and for the permanent investment of its principal in the Planter's Bank of the state of Mississippi, the interest or dividends on which should alone be distributed, the shares of stock being placed to the credit of the various counties of the state. This Literary Fund was lost through mismanagement and bad notes.^^^ Some of the Choctaw lands were sold outright prior to 1833, and the proceeds eventually lost as just described; others were leased for a term of ninety-nine years.^"^ The title of some are (1895) still in process of litigation.^^^ Records of the sales of others have been lost. Under an act of Congress passed February 23, 1843, the Chick- „, . , „ , asaw counties were entitled to receive 174,51^5 Chickasaw Fund . . . z'+'JJJ acres of land granted in lieu of sixteenth sec- tions. From the sale of these lands arose the Chickasaw Fund. 3*7 A Digest of the Laws of Miss., iS^g, by T. J. Fox Alden and J. A. Van Holsen, pp. 364-371, Chap. LI, Sees. 1-24. 3^ Ibid., pp. 383, 384, Sees. 79-83. 349 Report Miss. State Supt. of Education, 1894-95, p. 31. MISSISSIPPI 327 The state holds this fund in trust for these counties, on which it pays annual interest to these counties at the rate of six and one- half per cent.^^*^ The Literary Fund established in 182 1 was "largely squandered through the same craze for a rapid increase of population that in so many states has wasted this patrimony of the children." ^^^ In 1833 by an act of legislature, February 27, there was introduced a system of leasing these lands at public auction to the highest bidder for a term of ninety-nine years. The securities accepted were insufl&cient in many cases. The rents frequently went unpaid and the fund dwindled away through the decrease in value of the notes given. What remained of it was invested in stock of the Planters' Bank, established 1830 to 1833. The money so invested was subsequently lost when the bank failed. No means for increasing either of the funds is provided by the Sources of l^"^s or the constitution except the sale of sixteenth Increase section lands. We find two forms of management, state and county. The Sixteenth Section Fund is managed for the township by the county to which it belongs, the Board of County Super- Management ... visors being the managing body.^^^ The Chick- asaw Fund is held in trust and managed by the state.^^^ Funds derived from sixteenth section lands are credited to the proper township, and each treasurer keeps a separate account with each township. ^^^ From this it would appear that the revenue is apportioned to the townships in accordance with the amount of principal standing to their credit. The Chickasaw Fund revenue Apportionment is apportioned among the Chickasaw counties upon the basis of their area. 350 Ibid., p. 24. 351 School Laws of Miss., 1S96, p. 39, Sec. 4144; p. 41, Sec. 4150. 352 Ibid., p. 41, Sec. 4150. 353 A. D. Mayo, Common Schools in the South, Report U. S. Commissioner of Education, 1899-1900, p. 493. 328 PERMANENT COMMON SCHOOL FUNDS The County Board of Supervisors is required by law to appoint annually three trustees for the townships which have or ought to have school lands or funds. These trustees shall Objects recommend to the Board of Supervisors the lawful purpose for which the available funds in their townships ought to be appropriated and the same shall be appropriated accordingly.^^ The objects to which the Sixteenth Section Fund revenue may be applied are enumerated as follows: (i) building and repairing school-houses; (2) the purchase of school furniture; (3) water and fuel; (4) payment of teachers after the common school term shall expire.^^^ No conditions are stated which must be fulfilled in order for Conditions of the Chocktaw townships to participate in the Six- Participation teenth Section Fund revenue, nor for the Chick- asaw counties to participate in the Chickasaw Fund revenue. 354 School Laws of Miss., 1896, p. 42, Sees. 4152, 4153. CHAPTER XXXIV MONTANA PUBLIC SCHOOL FUND The permanent common school fund of Montana has two official titles; the laws name it the State School Fund,^^^ but in the consti- Xitie. tution it is called the Public School Fund.^^'' In Condition, 1905 jg^^ the principal of the fund amounted to $871,802.62.^" This principal is invested chiefly in state, county, municipal, and school district bonds;'''" 2,781,181.49^^^ acres of common school land (valued at about $4,000,000^'*^) belonging to the State School Fund remain unsold, the proceeds of which added to the present principal will give a principal of nearly five mil- lion dollars.^^^ The annual revenue (1905) consisted of $27,032.36, interest on the principal,^" and $172,375.06, annual rent of common school lands,^" making the total annual revenue $199,407.42, or approximately three and six-tenths per cent (.0362) * of $5,506,127, the total public school moneys received that year, excluding bal- ances on hand and proceeds of bond sales.^^ A Congressional act, February 28, 1851, reserved in each town- ship of the territory, for the use of public schools, sections num- . . bered sixteen and thirty-six, amounting in all to 5,112,035 acres.^"^ The " Enabling Act" approved by Congress February 22, 1889, proposed the establishment of a per- manent school fund to be derived from the proceeds of these lands and from five per cent of the proceeds of the sales of public lands granted to the state, and also that none of these lands should be * Computed. 355 School Laws of Montana, compiled at the office of the Supt. of Public In- struction, 1903, p. 94, Sec. 1940. 356 Constitution of Montana, Art. XI, Sec. 2. 357 Statement received Nov. 26, 1906, from Montana State Treasurer, J. H. Rice. 358 Mont. State Treasurer's Report, 1905-06, p. 8. 329 330 PERMANENT COMMON SCHOOL FUNDS sold at less than ten dollars per acre.^^^ These propositions were accepted by Constitutional Ordinance No. i adopted August 17, 1889, and became effective upon the state's admission into the Union, November 8, 1889. The following sources for increasing the State School Fund are provided by law: (i) appropriations and donations by the state to Sources of the State School Fund; (2) bequests and donations Increase ^^o ^^ individuals to the state or common schools; (3) proceeds of land and other property escheating or forfeited to the state; (4) proceeds of all property granted to the state when the purpose is not specified or is uncertain; (5) funds accumulated in the treasury of the state for the disbursement of which provision has not been made by law; (6) proceeds of the sale of timber, stone, material or other property from school lands other than those granted for specific purposes; (7) all moneys other than rent recovered from persons trespassing on state lands; (8) five per cent of the proceeds of the sales of lands within the state belonging to the United States; (9) the principal of all funds arising from the sale of lands and other property which have been or may hereafter be granted to the state for common schools; (10) the principal of such other funds as may be provided for by law. The State School Fund is managed by the State Board of Land Commissioners composed of the Governor, President of the Board, Superintendent of Public Instruction, Secretary Management 361 '■ of the Board, and the Attorney-General. This Board has direction, control, and power to lease or sell any of the school lands of the state. The revenue of the State School Fund is apportioned by the State Superintendent of Public Instruction among the Apportionment 362 ^ " several counties in the state m proportion to the number of children of school age in each (six to twenty-one years) .^^^ 359 Sees. 10, II, 13, Enabling Act, (p. Ixxii, Montana Civil Codes, annotated, 189s, Vol. i). 360 Ibid., p. cxxxiii. 361 Civil Code of Montana, 1895, Part III, Title VIII, Art. I, Sees. 3470, 3472. 362 School Laws of Montana, 1903, Chap. VI, Art. I, Sec. 1714. 363 Constitution of Mont., 1889, Art. XI, Sec. 5. MONTANA 331 The State Treasurer pays the district quota to the county treas- urer. No distinction is provided for by law between the money thus paid in and money derived from taxes. The dis- Objects ^ ^ .... trict trustees may devote money lymg m the county treasury and credited to the district to the following objects of school expenditure : ^^^ (i) furniture; (2) repairs; (3) rent; (4) insurance; (5) text-books for indigent children; (6) transportation of pupils. No district shall be entitled to a share of the State School Fund revenue which does not maintain a free public school for at least Conditions of three months during the year, for which distri- Participation butions shall be made.^^^ No sectarian, partisan, nor denominational doctrine may be taught, nor any publication of such a character be used or distributed in any school or made a part of its library .^^^ 364 School Laws of Mont., 1903, Chap. VI, Art. 5, Sees. 1797-1818. 365 Ibid., p. 14, Constitution of Mont., 1889, Art. XI, Sec. 5. 366 Ibid.,p. 77, Sec. 1863. CHAPTER XXXV NEBRASKA PERMANENT SCHOOL FUND The permanent common school fund of Nebraska, officially known as the Permanent School Fund^*^^ consisted in 1905 of Tjtig $6,238,381.27 ^^^ and of 1,920,955 acres ^'^ of com- Condition, 1905 jnon school lands, estimated at $12,002,000,^^ making the total estimated value of the fund $18,240,381.27.* Of the unsold school lands only 497 acres, estimated at $2,000, are not leased.^'^ The Permanent School Fund is invested chiefly in state bonds of other states, Nebraska general fund warrants, county bonds, and some United States bonds.^*^^ Nebraska has borrowed from the Permanent School Fund $1,477,070.78, on which the state pays four per cent interest, deriving the money from "the same sources as all general expenses." ^^* The rent of common school lands is added to the annual revenue of the Permanent School Fund;^^^ in 1905 this rent amounted to $176,043.99,^^^ and revenue derived from principal to $476,871.84.^*^^ The total Permanent School Fund revenue was therefore $652,915.83,* approximately eleven and nine-tenths per cent (.119)* of $5,447,362.21, the total receipts for common schools from all sources in 1905.^*^^ On April 19, 1864, Congress reserved for the use of public schools, sections numbered sixteen and thirty-six in every township in Nebraska.^" The total area of the lands thus Origin granted amounted to 2,702,044 acres,^" and these lands became the property of the state three years later upon her admission into the Union. The establishment of the Permanent School Fund was provided for by the first constitution adopted by * Computed. 367 Report Neb. Dept. of Public Instruction, 1S87-S8, p. 16; Index to School Law. 368 Data furnished Sept. i, 1906, by Neb. State Supt. of Public Instruction. 332 NEBRASKA ^^^ the state.^^^ The constitution of 1867 provided that none of these lands should be sold at less than $5.00 per acre (the constitution of 1875 raised the price to I7.00), thus fixing the minimum value of the original capital at $13,510,220. Four sources are provided by law and by the constitution for increasing the principal of the Permanent School Fund: (i) five Sources of P^^ cent of the proceeds of sales of United States Increase public lands lying within the state; ^^^ (2) estates escheating to the state; ^'^^ (3) the proceeds of the sales of sixteenth and thirty-sixth section lands; ^'^^ (4) proceeds of the sales of saline lands (Laws of 1893).^*^^ The first investments of the moneys belonging to the Permanent School Fund were made at a loss of $1,547.04. Investments made in the year 1868 resulted in an aggregate loss of $3,439.67.^'^^ In the year 1897 the Perma- nent School Fund lost $259,842.87 through embezzlement.^^* It may well be added that sums borrowed by the state and on which the interest is paid out of taxation thwart one of the most impor- tant purposes for which the fund was established, namely, to lessen taxation; to borrow the principal and tax the people for the interest is a direct violation of the spirit if not of the letter.* The Permanent School Fund is managed by a " Board of Edu- cational Lands and Funds" under the direction of the legislature. The Board consists of the Governor, Secretary Management ■' of State, Treasurer, Attorney-General, and Com- missioner of Public Lands and Buildings.^"^ The revenue is apportioned amono; the counties Apportionment ^ ^ *^ upon the basis of school population.^'^^ * For a full discussion of this matter see Part I, also the other states, e. g., Minnesota. 369 Report U. S. Commissioner of Education, 1892-93, II, 1355, Art. II, Sees, i, 2. 370 School Land Laws of Neb. as revised in 1899, and the School Laws, p. 127, Sec. 30. 371 Constitution of Neb., Art. VIII, Sec. 3. 372 Report Neb. State Supt. Pub. Instruction, 1869-70, pp. 70-73. 373 Constitution of Neb., Art. VIII, Sec. i, and p. 118, Sec. i. Neb. School Laws, 1899, P- 9- 374 Ibid., p. 48, Sec. 9. 334 PERMANENT COMMON SCHOOL FUNDS The state common school fund can be apphed to the payment Objects of teachers' wages only.^^^ In order to participate in the revenue of the Permanent School Fund, the district (i) must have a school taught by a legally Conditions of qualified teacher; (2) for the term established by Participation jg^^. ^^^ j^gg ^^lan three months in a district having less than twenty pupils; not less than six months in a district having from twenty to seventy-five pupils; not less than nine months in a district having more than seventy-five pupils.^^* CHAPTER XXXVI NEVADA STATE SCHOOL FUND The permanent common school fund of Nevada is known offi- cially as the State School Fund.^'^ The principal of the fund, Title. December i, 1906, consisted of $1,651,078.81; of Condition, 1906 ^^i^^ $20,678.81 was awaiting investment, and $1,630,400 was invested as follows: state irredeemable five per cent bonds $380,000; state four per cent bonds $155,400; United States four per cent bonds $215,000; Massachusetts three per cent bonds $626,000; Massachusetts three and one-half per cent bonds $254,000.^" About 1,250,000 acres of school lands belonging to the permanent school fund are under contract for sale.^^^ No rent is derived from school lands,^'* so this limits the annual income to (i) the interest on bonds which in 1906 amounted to $61,486, and (2) interest on about " 1,250,000 acres of land under contract, the deferred payments on which, amounting to $1,250,000, draw interest at six per cent per annum, amounting to $75,000, all of which, except ($5,400) the interest on contract lands selected under the 90,000 acre university grant, goes into the general school fund and is distributed semiannually among the public schools of the state." ^'^^ The total common school revenue for 1906 derived from all sources amounted to $275,388,^*" forty-nine and two-tenths per cent of which (.4919),* namely, $135,486* was derived from the interest on the State School Fund. Article XI, section 3 of the first constitution of Nevada, which * Computed. 375 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. i. 377 Report Nev. State Land Register, 1905-06, p. 13. 378 Data furnished Jan. 10, 1906, by Nev. State Treasurer. 379 Report Nev. State Land Register, 1905-06, p. 14. 380 Report U. S. Commissioner of Education, 1906, 1, p. 306. 335 2,s6 PERMANENT COMMON SCHOOL FUNDS became effective upon the state's admission into the Union, 1864, solemnly pledged for educational purposes moneys derived from the . . following sources: (i) the proceeds of sixteenth and thirty-sixth section lands; (2) the Agricul- tural College lands granted by an act of Congress approved July 2, 1862; (3) 500,000 acres internal improvement lands (Con- gressional grant, 1841); (4) "and all proceeds of lands that have been or may hereafter be granted or appropriated by the United States to this state;" (5) estates escheating to the state; (6) such per cent (five) as may be granted by Congress on the sale of public lands; (7) penal fines; (8) property given to the state for educational purposes.^^^ Section 8 of the same article set aside the agricultural lands as a separate fund. Two million (2,000,000) acres to be selected by the state were accepted by the legislature in lieu of the sixteenth and thirty-sixth sections in each township. The six- teenth and thirty-sixth sections would have aggregated 3,992,000 acres, so that by accepting the two million acres grant the state lost 1,992,000 acres, "but it had the advantage of selecting any unappropriated public lands whether in the sixteenth or thirty- sixth sections or not." ^^^ The following means of increasing the principal are at present provided for by constitution or by law: (i) proceeds of the sales Sources of of public lands; ^^^ (2) proceeds of escheated Increase 382 estates; ^^' (3) a certain per cent of the sales of United States lands lying within the state; ^^^ (4) proceeds of property given or bequeathed to the state for purposes of edu- cation; (5) fines for penal offenses; ^^' (6) two per cent of the proceeds of all toll rates and bridges.^^^ " The $380,000 irredeemable bond was placed in the treasury in 1879 in lieu of an equal amount in cash borrowed Loss from the State School Fund to pay the territorial indebtedness, which was assumed by the state when the Consti- 381 Report Nev. State Land R.egister, 1905-06, p. 8. 332 Constitution of Nev., 1864, Art. XI, Sec. 3 (PvCport U. S. Commissioner of Education, 1892-93, II, p. 1348). 383 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. i. NEVADA 337 tution was adopted." ^^^ The constitution of 1864, art. XI, sec. 3, expressly declares that "all proceeds derived from any or all of said sources shall be, and the same are hereby solemnly pledged for educational purposes, and shall not be transferred to any other fund for any other uses." The state has borrowed also $233,000.^^* The four per cent interest on this loan as well as the five per cent interest on the irredeemable bond is paid out of state taxes.^'^* To use the moneys belonging to the principal of the permanent school fund and then tax the people for the interest is a direct violation of one of the purposes for which the permanent school fund was established, namely, the lessening of taxation. * The State School Fund is managed by the state Management ^ ■' treasurer.^^^ The revenue is apportioned among the counties Apportionment ^ ^ ° on the basis of school population (six to eighteen years) .^^^' ^^^ The revenue of the State School Fund may be expended only for the wages of teachers duly qualified by the State Board of Edu- Q^-^^^^ cation.3^3 No portion of the fund shall be paid for the erection of school buildings, the use of school-rooms, furniture, or any other contingent expense.^®^ In order to share in the State School Fund revenue the district must (i) maintain a school at least six months;^^^ (2) must not Conditions of permit sectarian instruction; ^^ (3) the school must Participation ^^ ^^^^-^^ ^^ ^ ^^j^ qualified teacher; ^86 (4) the teacher must submit the report required by law.^^' * For a further discussion of this matter, see Part I, also Part II, Minnesota and Nebraska. 384 State of Nev. School Laws, 1897, p. 35, Art. XIX, Sec. 12. 385 Report U. S. Commissioner of Education, II, 1892-93, p. 1347; Constitution of Nev., 1864, Art. XI, Sec. 2. 386 State of Nev. School Laws, 1897, p. 33, Art. XIX, Sec. 3. 387 Ibid., p. 27, Art. XI, Sec. I. CHAPTER XXXVII NEW HAMPSHIRE INSTITUTE FUND For many years federal reports and other accounts dealing with permanent common school funds have credited New Hampshire Title. Present ^^^h no permanent school fund.^^* On the con- Condition trary, such a fund has been in existence ever since 1867, and has been slowly but steadily increasing, though it was not used for schools. Prior to 1883 it was known as the " Common School Fund." Since 1883 it has been known as the "Institute Fund." ^^* In 1905 the principal of the Institute Fund amounted to $59,470.37,^^^ and its annual interest to $2,372.66,^*^ the latter sum being approximately two-tenths of one per cent (.0017) * of $1,359,181.26, the total common school revenue derived from all sources that same year.^^^ The "Institute Fund" has been bor- rowed by the state and constitutes a permanent debt on which the state pays four per cent annual interest, paying the same out of state taxes.^^ The principal is growing at present though slowly, through the addition to it (on account) of unexpended balance of its annual interest, no other source of increase being provided for by law.^*^ The Institute Fund is managed by the governor and council.^*^ Its interest can be used for no other purpose than for supporting teachers' institutes.^^^ The interest is apportioned upon the order of the State Superintendent of Public Instruction.^*^ The Institute Fund, like the permanent common school funds in many other states, is not to-day an invested productive fund but merely an account or debt which the state acknowledges. The * Computed. 388 Report U. S. Commissioner of Education, 1896-97, p. 642, and other reports. 389 From statement received July 17, 1907, from H. C. Morrison, N. H. State Supt. of Public Instruction. 338 NEW HAMPSHIRE 339 state used the principal as it was paid into the treasury and now pays the annual interest out of state taxes.^^^ We have here then a permanent state debt for which the commonwealth must be taxed instead of a productive fund lessening taxation. The so-called Literary Fund of New Hampshire is not in any sense a permanent fund. The law defines it as follows: "All taxes collected by the state upon the deposits, stock, Literary Fund •' ^ r » j and attending accumulations of depositors and stockholders of saving banks, trust companies, loan and trust com- panies, loan and banking companies, building and loan associations, and other similar corporations, who do not reside in this state or whose residence is unknown, shall be known as the ' Literary Fund. ' The state treasurer shall assign and distribute in November of each year the Literary Fund among the towns and places in proportion to the number of scholars not less than five years of age, who shall by the last reports of the school boards returned to the State Su- perintendent of Public Instruction, appear to have attended the public schools in such towns and places not less than two weeks within that year.^^" "In other words, the term Literary Fund is applied to an annual revenue resulting from the proceeds of "a non-resident savings bank tax." The proceeds of this tax in the year 1902 amounted to $33,774.02.^^^ The United States apportioned to New Hampshire $669,086.79 in the distribution of the Surplus Revenue Loan of 1837. No state permanent fund was established with this Surplus money. On the contrary, the total sum received Revenue Loan .. ... . . , except that murmg to communities not then incorporated into towns" was divided among the several towns — with the privilege of devoting the whole or a part to the support of public schools. By an act passed December 18, 1842, the towns were empowered to make any disposition of it as should be deemed equitable and expedient. In Portsmouth, New Hampshire, the inhabitants voted to divide the revenue which fell to the town, per capita : — the sum due to every man, woman, and child being between 390 Laws of N. H., 1901. 381 N. H. State Treasurer's Annual Report, p. 316. 340 PERMANENT COMMON SCHOOL FUNDS two and three dollars. An agent was appointed to receive and distribute the money; about 200 suits were almost immediately commenced against him as trustee of individuals owing small sums, and he was thus placed in rather an embarrassing position.^^' As near as can be estimated, about fifty towns used their money, about $30,000, to establish permanent local school funds, yielding an- nually about $1,800. Nevertheless most of what might have be- come the basis of a great state permanent fund vanished. The Literary Fund was provided for by an act passed June 29, 1 82 1, which required that all banking corporations should either Origin. Literary ^^6 paper Stamped by some suitable stamp for Fund, 182 1 bills, notes, or obligations put in circulation; the stamp to be paid for by the banks at the rate of $50 on the thousand of the circulation; or instead thereof to pay annually one-half of one per cent of their capital stock.^^^ The proceeds arising from the second provision, that of the tax of one-half of one per cent of the capital of the bank, eventually became the Literary Fund. The original purpose in establishing this fund was to aid an insti- tution of higher learning, but by 1828 this purpose was given up and the fund which had accumulated up to that time and amounting then to $64,000 was distributed to the towns to be used for common schools. After that the fund was distributed annually .^^^ In 1867, the governor was authorized to sell public lands, "wild lands," with the advice of the council, the proceeds to be placed in the state treasury, and "to constitute a part Origin Common School or of the Literary Fund to be divided among the Institute Fund 1 • • i i i i t i several cities and towns and by them applied to the maintenance of common schools or to other purposes of edu- cation." ^^^ A law passed the following year provided that the pro- ceeds of the sale of the state lands affected under the authority of a joint resolution approved June 28, 1867, "shall be and the same 392 Bourne, Edward G., History of the Surplus Revenue of iSjy, p. S3, and note. 393 N. H. Compiled Laws, 1815-24, p. no. 394 N. H. Revised Statutes, 1842, Chap. 75, p. 154; N. H. School Report, 1872, p. 163; U. S. Bureau of Education, Circular of Information, 1S98, No. 3, p. 15. 395 Laws of N. H., 1867, Chap. XLII, Sec. i. NEW HAMPSHIRE 341 hereby are set apart as a school fund. The annual income of the said fund shall be applied to the purposes of a common school education in such way and manner as the legislature may from time to time determine," ^^^ "The New Hampshire fund derived from the sale of public lands in the White Mountain region is known as the Institute Fund. The income, which is about, $2,300 a year is used for the purpose of maintaining teachers institutes." ^^' "These wild lands were a part of the ungranted public domain which had come down as such from colonial times. From the sale of these lands $25,000 was realized. This money was paid into the state treasury; and it is provided by law that the same shall be reserved for the use of common schools, and that the state shall pay interest thereon at the rate of six per cent. The fund never seems to have been appropriated as a common school fund to any purpose, but was used by the state as other moneys, being counted, together with its accumulated interest, as a part of the state debt. In 1883, largely through the interest of Hon. J. W. Patterson, at that time the Superintendent of Public Instruction, the teachers' institute system was established; and the income from this fund, together with its accumulated interest, v/as set apart to pay for the institutes.^^^ The account when opened as an institute fund on June I, 1884, amounted to $47,918.75. Since that time the insti- tute system has been continuously in operation. The amount left unexpended each year has been added to the principal, so that at the close of the last fiscal year the amount was $59,529.17. The annual income is now nearly $2,400. In 1895, the General Court reduced the rate of interest from six per cent to four per cent, presumably for the purpose of bringing the state's annual obliga- tion down to something like the current rate of interest." ^^* 396 Ibid., 1868, Chap. XXI, Sees, i, 2. 397 Extract from letter dated Aug. 30, 1906, received from H. C. Morrison, State Supt. of Public Instruction. 398 Ibid., dated July 15, 1907. 399 Laws of N. H., 1883, Chap. 73; Rev. Stats., Chap. 94, Sees. 4-8. CHAPTER XXXVIII NEW JERSEY THE NEW JERSEY PERMANENT SCHOOL FUND The of3&cial title of the New Jersey permanent common school fund is Permanent School Fund.'^'^° The reports and laws also Title— Condition ^^c the terms "State School Fund" and "School 1902 and 1905 Fund." In 1902 this fund amounted to $3,839,- 692^*'^ and its annual revenue to $196,824'*'^' which was approxi- mately two and eight-tenths per cent (.0277) of $7,118,248, the total common school revenue for that year. In 1906 the principal of the Permanent School Fund amounted to $4,523,916.92.'**^^ It is impossible to state the acreage or value of the lands belonging to the fund as the law sets aside for it all lands that are or have been under water. The state apportions $200,000 * a year as the fund's income, which is two and five-hundredths per cent of $9,773,562, the total receipts for common schools in 1905.^°* The Permanent School Fund was estabhshed February 12, 1817, by an act of legislature.'*^^ The date 181 6 sometimes given appears . to be incorrect as no mention is made concerning any permanent school fund in the act of that year relating to schools.'^"^- ^'^^ The capital set aside by the Act of 181 7 * Actual income not equal to this. ^oo New Jersey School Law, 1903, p. 63, Sec. 16S. 401 Controller's Report, 1902, p. 90. 402 Controller's Report, 1902, pp. 92, 93, the difference between this amount and that stated in Report U. S. Commissioner is due perhaps to the fact that the latter includes the revenue of local funds and land rents, or else it may include the $180,000 loaned by the state to the school fund. The total of the school fund loan and balance, 1901, was $385,889. 403 Data furnished by C. J. Baxter, State Supt. of Public Instruction, Mar. 15, 1907. Superintendent Baxter failed to state income of Permanent School Fund. 404 Report U. S. Commissioner of Education, 1906, I, pp. 306, 307. 405 U. S. Bureau of Education, Circular of Information, 1899, No. i, p. 29, gives 1816. 408 N. J. Laws of 1799-1820, p. 612. 342 NEW JERSEY 343 consisted of $15,000, derived ''from the payment to the state of the principal and interest of the funded debt of the U. S. due this state, and from the dividends on the shares belonging to this state in the capital stock of the Trenton Banking Company," and which the previous year by the order of legislature had been invested in six per cent bonds.^^'^ In addition to this realized principal several sources of increase were provided as follows: (i) "all dividends which may hereafter be received on the shares of this state in the capital stock of the Cumberland Bank, and (2) on the shares of the state in the Newark Turnpike Company, (3) all moneys to be received on the sale of the house and lot belonging to this state in the city of New Jersey ,^°^ (4) and one-tenth part of all moneys hereafter to be raised by tax for the use of the state." '^^^ By an act passed February 14, 181 8, additional stocks belonging to the state were added to the fund, making the total estimated value at this time $87,076.34'^"^ as follows: Estimated Value U. S. six per cent bonds $15,000.00 Newark Turnpike Road shares 12,500.00 Balance due on old U. S. six per cent bonds 10,654.78 U. S. three per cent stock 5,071.90 Cash received for old U. S. six per cent stock 5,849.66 Trenton Banking Company shares 36,000.00 Cumberland Bank shares 2,000.00 Total $87,076.34 New Jersey received from the United States in 1837, $764,670.60 of the surplus revenue distributed as a loan among the states by the Congressional act, passed June 23, 1836. In 1837 the state divided the entire sum among the counties which were directed to loan their respective shares and pay the interest to the several town- ships. Probably the townships devoted much of this interest to schools from the first. The counties appear to have exhausted the principal in erecting buildings and paying debts, but they have 407 Ibid., p. 600. *08 Ibid., pp. 649-650, 652. 344 PERMANENT COMMON SCHOOL FUNDS continued to pay the townships the interest due them. In 1867 an act was passed directing townships to devote to schools the interest of the surplus revenue received by them.^°^ Since this time the interest on approximately four-fifths of the surplus revenue has been used for supporting public schools/^" In view of the fact that the fund has been practically exhausted and that what is nominally interest is really raised by taxation, this fund must be regarded as a credit fund or an account and not a permanent fund.* The present law (1903) provides two sources for increasing the principal of the Permanent School Fund: (i) the proceeds of ripa- Present Sources ^'^^^ lands, i. c., all lands belonging to the state of Increase ^^^ qj. formerly lying under water; ''^^ (2) the pro- ceeds of the leases of riparian lands.'*^^ The law requires that $200,000 be annually apportioned from the income of the Perma- nent School Fund. If the revenue of the fund itself does not equal this amount the deficiency shall be drawn from the state treasury, the same to be replaced from the Permanent School Fund income as soon as the latter has been received.'*^^ The Permanent School Fund is in the hands of a board of man- agers known as "the trustees for the support Manageaient . of public schools," composed of the Governor, Attorney-General, Secretary of State, State Controller, State Treasurer.^^^ The revenue of the Permanent School Fund is apportioned upon a twofold basis : first, depending upon the length of time a teacher has been employed; second, depending upon the Apportionment f J > ^ . & ^ school attendance; first, $200 is apportioned to each district for each teacher throughout the preceding school * For an account of the United States Surplus Revenue Loan, consult Part I, Chap. III. For an account of the Credit Funds, see Part I, Chap. I. 409 N. J. Laws, 1867, 378. 410 These statements are taken chiefly from E. G. Bourne, History of the Surplus Revenue of i8jy, pp. 84-86, 122. 411 N. J. School Laws, 1903, Sees. 168, 169. 412 Ibid., Sec. 176. «8 Ibid., 1903, p. 62, Art. XVI, Sec. 166. NEW JERSEY 345 year; $80 for each teacher employed less than the school year, but not less than four months; $600 to each district which has employed a supervising principal or special superintendent of schools devot- ing his whole time to supervision of schools of such district; ^^'* second, the total school attendance of the preceding year serves as the basis for apportionment of public moneys remaining after the apportionment upon the above basis of number of teachers and supervisors employed; third, any balance remaining in the hands of the district is returned to the county collector and reappor- tioned by the county superintendent among all the districts of the county .'^^^ The objects to which the revenue may be applied by the dis- tricts are not carefully nor clearly defined. The law states that it may be used for (i) the support of public schools; (2) the payment of the salaries of county superintendents; (3) payment of premiums and accrued interest on bonds purchased by the trustees for the support of public schools, and for no other purpose whatsoever .'^^^ The term "sup- port of public schools" is not defined, so it would seem to be left largely to the discretion of the district to apply the money to such objects of expenditure for schools as it sees fit.* The conditions which must be fulfilled by a district in order to share in the revenue of the Permanent School Fund may be sum- Conditions of marized as follows: (i) maintenance of a public Participation school for not less than nine months; (2) in case a board of education, legal voters of a district, any board or officers of the same or any teacher shall neglect and refuse to perform any duty required by law, the quota of the school fund revenue belong- ing to the same shall be withheld until compliance has been ob- tained; ^^^ (3) provision by a district of suitable school facihties and * See Idaho, foot-note 122". *i* Ibid., Sec. 182, amended by laws of 1906, Chap. 241, May 17, which makes several important changes. See Bureau of Education Bulletin, No. 3, 1906, p. 50, Sec. 230. «5 Ibid., Sec. 183. *i6 Ibid., Sec. 170. *17 Ibid., Sees. 14, 15. 346 PERMANENT COMMON SCHOOL FUNDS accommodations for children residing in the district and desiring to attend the school therein; ^^^ (4) plans for school buildings must be submitted to the State Board of Education for suggestions and criticism,^^^ certain architectural requirements being specified by law. 418 Ibid., Sec. 126. 419 Ibid., Sees. 129, 130. CHAPTER XXXIX NEW MEXICO PERMANENT FUND "The only permanent common school fund New Mexico has is derived from the Congressional grant of five per cent of the sales of public lands lying within the territory .^° The moneys which had accumulated from this source up to June 30, 1905 amounted to $19,675.73.'^" June 21, 1898, Congress passed an act entitled, "An Act to make certain grants of land to the Terri- tory of New Mexico, and for other purposes." Section 4 of this act provided " that five per centum of the proceeds of the sales of pubhc lands lying within said territory which shall be sold by the United States subsequent to the passage of this act, after deduct- ing all expenses incident to the same, shall be paid to the said territory, to be used as a permanent fund, the interest of which only shall be used for the support of common schools within said territory." Section i of the same act granted to the territory for the support of common schools sections numbered sixteen and thirty- six in each township. New Mexico has reserved for the support of common schools the sixteenth and thirty-sixth sections in each township as provided for by section 15 of the Organic Act approved September 9, 1850^^ and by subsequent territorial or congres- sional enactments.^^ As a result New Mexico possesses 1,147,117 acres of common school lands ^° which are under lease and so yield a revenue. In addition to these it possesses 2,280,1 17 acres '^^ of common school lands not under lease, and yielding no revenue, *20 Data furnished Oct. 20, 1906, by Hiram Hadley, New Mexico Territorial Supt. of Schools. ^1 The General Laws of New Mexico, 1860-80, compiled under the direction of L. Bradford Prince, p. 576. *22 Ibid., Sec. 4, p. 425. 348 PERMANENT COMMON SCHOOL FUNDS making a total of 3,427,234 acres. The value of all these lands estimated at $1.25 per acre is $4,284,042.50. Unless Congress shall make some special provision granting New Mexico the right to dispose of her school lands while a territory, no lands can be sold until the territory l^ecomes a state. The total common school revenue in 1905 derived from all sources was $527,473.59:^^° of this $39,046.49,^° or approximately seven and four-tenths per cent (.074) t was derived from the rent of common school lands. f Computed. CHAPTER XL NEW YORK I — LITERATURE FUND. II — COMMON SCHOOL FUND. HI — UNITED STATES DEPOSIT FUND New York possesses three state permanent common school funds known officially and respectively as follows : the Literature Fund,'*^^ Title. the Common School Fund,'^^ and the United Condition, 1905 States Deposit Fund.^^ The last of these funds, though technically a loan to the state by the federal Government, has long been, and rightly from a purely practical point of view, regarded as a permanent common school fund.* The condition of these three funds in the year 1905 was as follows :^^ Literature Fund, principal, $284,201.30, income, $9,987.50; Common School Fund, principal, $4,673,140.77, income, $169,889.06; United States Deposit Fund, principal, $4,014,520.71, income, $155,648.06. Total principal, $8,971,862.78; total income, $335,524.62. The state appropriates from the revenues of these funds three hundred forty-nine thousand five hundred dollars ($349,500) toward the support of schools. (Laws of N. Y., Chap. 683, enacted May 31, 1906.) The total annual public school revenue derived from all sources amounts (1905) to $47,803,172.33,'^^ of which approxi- mately seven- tenths per cent (.007)! was contributed by permanent state funds. "The capital of these funds is kept inviolate and if there are any losses they are made good from the General Fund." ^^ In the part it has played in the past in developing a system of free schools lies the importance of the New York Common School * For full explanation of this, see U. S. Surplus Revenue Fund, Part I. ■j- Computed. *23 Laws of New York 1Q05, Chap. 587. 424 New York Controller's Report, 1905-06. 425 Statement received Sept. 10, 1906, from Hiram C. Case, Chief of Statistics Division, N. Y. Dept. of Education. 420 Extract from letter from Wm. C. Wilson, N. Y. State Controller, Dec. 17, 1906. Cf. this with later statement regarding loss. 349 350 PERMANENT COMMON SCHOOL FUNDS Fund. To-day it contributes but a small per cent of the total school revenue. It was not the first means of support of schools, in fact, seven others antedate it; namely: (i) rate bills; (2) Literature Fund, 1786; (3) local or town funds, 1789; (4) town tax, 1795; (5) annual appropriation of $100,000, 1795-1800; (6) htera- ture lotteries, 1801-21; (7) gifts. Rate bills, tuition fees, were charged in New York state from time immemorial until 1867. In 1867 they were abolished whereupon the schools which had been public became •free.^^- '^^^ Town funds arose from an act of legislature, 1786,'*^^ which provided that the unappropriated land of the state should be laid Town Funds, out in townships of 64,000 acres.^^° In every 1786 and 1789 township two lots were to be reserved, the first marked "gospel and schools," the second known as the "state lot." The "gospel and school lot" was to be applied to promote the gospel and schools within the said township. An act was passed in 1789 which provided for the sale of the "gospel and school lot."^^"* This Act of 1789 required the Surveyor- General to set apart two lots for gospel and school purposes in each township of public land, thereafter to be surveyed.'*^'* The principal tracts of land thus reserved included about 47,380 acres."*^^ In time most of this land came to be used for the support of schools. Many of the funds thus estabhshed continue to the present. The "state lot" set aside by the Act of 1786 to be used for Literature Fund "promoting literature," was reserved to the state Established 1786 ^^ ^^ hereafter applied by the legislature for pro- moting literature in the state."^^^ The fund created by the sales 427 For an account of Rate Bills consult Chap. II. ■128 It is frequently stated that this fund was established in 1790, e. g., N. Y. State Supt. of Public Instruction Report, 1905, p. 61. 429 Report N. Y. State Supt. of Public Instruction, 1S4S, p. 41 ff. 430 Laws of New York, 1786, Chap. 67. 431 For a full history of this fund see Hough, F. B., Historical and Statistical Record of the University of the State of New York, Chap. 4, p. 80. 434 Laws of New York, 1789, Chaps. 32, 44. 435 Report N. Y. State Supt. of Public Instruction, 1833, P- ^^' NEW YORK 351 of these state lots was the first permanent school fund created for an entire state, being nine years older than the Connecticut School Fund established 1795. Its purpose was not to aid com- mon schools, but to promote academical departments to prepare teachers. In the year 1819, $26,690 arrears of quit rents were added to this fund, and by an Act passed April 13, 1827, $150,000 worth of securities belonging to the canal fund were transferred to it.^^^ The Act of 1819 directed that "one-half of all quit rents and commutations for quit-rents, received by the state, should be appropriated to increase the Literature Fund and the remaining half to the further increase of the (Common) School Fund." ^^^ The control of the Literature Fund rested with the regents of the state "until 1832 when it was transferred to the custody of the Comp- troller." ^^2 By an Act passed April 27, 1829, the overseers of the poor in any town were permitted under certain conditions to appro- priate poor funds for the use of common schools, the funds so appropriated to be denominated the Common School Fund of such town, and to be under the care and superintendence of the town superintendent of common schools of such town.^^^" The legislature in 1795 enacted that ;^2o,ooo or about $100,000 be annually appropriated for "encouraging and maintaining schools ... in this state in which children shall Annual . , . t-. t 1 1 t-. i- 1 Appropriation be mstructcd m English language, Enghsh gram- mar, arithmetic, mathematics." "^^^^ This was the first appropriation by the state for common schools. Together with the creation of Town Funds it forms the beginning of efforts which were expressions of the principle that produced the Com- mon School Fund. It was the first recognition of the principle that the state is responsible for the education of her future citizens. These appropriations expired 1800.^^^" *32 Report N. Y. State Supt. of Public Instruction, 1905, p. 62. 433 Type-written account, six pages, received from N. Y. State Dept. of Finance, Dec. 23, 1906. 435a Laws of New York, 1829, Chap. 287. 4356 Laws of New York, 1795, Chap. 75. 435C Randall, S. S., History of the Common School System of the State of New York (ed. 1871), p. 96. 352 PERMANENT COMMON SCHOOL FUNDS A condition made necessary by the Act of 1795 for participation „ ^ in the annual appropriation was that each town Town tax, 1795 . ^^ ^ raise by tax a sum equal to one-half the amount of public money it received.^^^* With the expiration of the annual appropriation, it became necessary to provide other means of aiding the schools. Resource was had to a method then much in vogue for rais- Literature ° Lotteries ing money for state and philanthropic purposes, I8OI-I82I 1 • o /I 1 T • 1 and m 1801 an Act was passed directmg that $100,000 be raised by means of four successive lotteries of $25,000 each; $12,500, or one-eighth of the entire amount, to be paid to the regents for distribution as they saw fit among the academies, the remaining seven-eighths, $82,500, ''to be paid into the Treasury for the encouragement of common schools as the legislature might thereafter direct." ^^^^ These " Literature Lotteries" did not cease until prohibited by the state constitution of 1821, which forbade all lotteries.^^^ ** The one-eighth was eventually added to the prin- cipal of the Literature Fund, the seven-eighths to that of the Com- mon School Fund.'*^^ f In view of the fact that -seven-eighths, namely, $82,500, of the avails of the Literature Lotteries were eventually added to the capital of the Common School Fund it is some- Common School Fund Established times Stated that this fund originated in 1801.^^^ This is hardly correct as there was no provision in the Literature Lottery Act of 1801 for establishing its proceeds as a permanent fund. It was on April 2, 1805, that the legislature finally provided for the estabhshment of the Common School Fund by an act which provided that the net proceeds of 500,000 acres of unappropriated state lands, the first to be sold after the passing of the act, should be appropriated as a permanent fund for the sup- port of common schools.^^^^ The act provided that the proceeds should be invested until the income should amount to $50,000 when 435^ Ibid., p. II. 435 6 Laws of New York, 1801, Chap. 126. 435/ Hough, F. B., Historical and Statistical Record, etc. (see foot-note 431). 435<; Laws of New York, 1S05, Chap. 66. NEW YORK 353 that sum should be annually divided among the school districts of the state. The act reads: "An Act to Raise a Fund for the Encouragement of Common Schools. . . . "Be it enacted by the people of the State of New York represented in senate and assembly, That the net proceeds of five hundred thousand acres of the vacant and unappropriated lands of the people of this State, which shall be first sold by the surveyor general after the passing of this Act, shall be and hereby are appropriated as a permanent fund for the support of common schools. "And be it further enacted. That it shall and may be lawful for the comp- troller from time to time, to loan all the monies which may come into the treasury by virtue of this Act, for a term not exceeding three years, to any person or body corporate, for Kterary purposes, on security to be given to the comptroller, in the name of the people of this State, by mortgage on improved lands within this State, then in the actual possession of the borrower, and of double the sum so to be boriiDwed, exclusive of any buildings thereon, which paid monies are to be loaned at' the rate of six per centum per annum. "And be it further enacted. That it shall and may be lawful for the comp- troller to loan on the terms above mentioned, the interest arising from said fund, or any part thereof, until the whole interest annually arising from the same shall amount to $50,000, after which the interest annually arising shall be distributed and applied for the support of the common schools in such manner as the legislature shall direct." ^^s? When these lands were sold, one-fourth of the purchase money was required to be paid down and the balance was allowed to Provisions for remain on interest at six per cent, the purchasers Sale of Lands ^^ ^^^ ^jj^g q£ ^Yiq sale executing a bond to the state for the amount remaining unpaid, payable in six annual instalments. ^^^^ The money was loaned to persons or bodies corporate for literary purposes, safely secured, until the income should reach the distribution limit. The constitution of 1777 and the amendment of 1801 contained no provision for the support of common schools. Constitutional . . , . . Provisions, 1821, The first constitutional provision concerning the Common School Fund was made by the constitu- tion of 1 82 1, sixteen years after the fund had been created by ^s'i Report N. Y. State Supt. of Public Instruction, 1857, P- 18. 354 PERMANENT COMMON SCHOOL FUNDS the act of legislature. The constitution of 1821, article VII, section 10, reads : ^^^ * "The proceeds of all lands belonging to this State except such parts thereof as may be reserved or appropriated to public use or ceded to the United States, which shall hereafter be sold or disposed of, together with the fund denominated the Common School Fund shall be and remain a perpetual fund, the interest of which shall be inviolably appropriated and applied to the support of Com- mon Schools throughout the State." Article IX, section i, constitution of New York, amendment, 1846, reads i*^'^ J' "The capital of the Common School Fund, the capital of the Literature Fund, and the capital of the United States Deposit Fund, shall be respectively preserved inviolate. "The revenues of the said Common School Fund shall be applied to the sup- port of common schools; the revenues of the Literature Fund shall be applied to the support of Academies, and the sum of twenty-five thousand dollars of the revenues of the United States Deposit Fund shall each year be appropriated to and made a part of the capital of the said Common School Fund." The constitution of 1894, article IX, section 3, repeats verbatim the provision made in the amendment of 1846. The Common School Fund continues to-day to be managed by the State Controller as provided for in the Management , i. , . i r , a-,^, act establishmg the fund. "*^*^ The two most important sources of increasing the capital of the Common School Fund have been (i) state lands; (2) the revenue Growth of Com- of the United States Deposit Fund; besides these Eieven'^sCurc^s'^'^' two, many Icss productive sources have been em- of Increase ployed: (3) bank stock purchased with accruing interest of the school fund;^^^' (4) $949,076 due on loans of 1792 and 1808^^^™ in exchange for capital of Common School Fund by Act of the legislature in 1819;'*^^' (5) $31,624.38 due on loan of 1786 added to Common School Fund in 1827; ^^5; (5^ $84,358.15 435i u. S. Commissioner of Education, Report, 1892-93, II, p. 1322. 435/ Ibid., p. 1330. 43BA Laws of New York, 1805, Chap. 66, and 1903, Chap. 350. 435' Report N. Y. State Supt. of Public Instruction, 1857, p. 19. i35m Ibid., pp. 20, 21, gives a complete history of these three loans. NEW York: 355 added to Common School Fund in 1845 by Act of Congress in 1845, from the United States Treasury surplus; (7) lands escheating to the state in the military tract, 1819 (8) receipts from quit rents,^^^ 1819, $26,690; (9) arrearages of interest 1819^^^ ';(io) net proceeds of Supreme Court fees, 1819;''^^' (11) $82,500 from Literature Lotteries proceeds already referred to. The chief source of increase prior to 1851 was state lands. The original 500,000 acres were exhausted in 1818.^^^ ^ The avails up to that date from this source were about $400,000, the total capital of the fund being $1,044,889.09.'*^^* The constitution of 1821, article VII, section 10, devoted all unappropriated state lands amounting to 991,559 acres '^^^ to the Common School Fund. The gross receipts from the sale of state lands from 1805 to 1855 amounted to about $2,500,000, or about three-fourths of the total receipts.^^^'* All other sources of increase, quit rents, court fees, etc., during the same period had contributed less than $1, 000,000.'*^^'* Aside from state lands the most important contributions to the Common School Fund have come from the United States Deposit United States Fund. The United States Deposit Fund had its Deposit Fund origin in New York's acceptance under the provi- sions of Chapter 2 of the Laws of 1837 of its share of the surplus money of the Treasury of the United States distributed among the states of the Union under the 13th section of the act of Congress en- titled, "An Act to regulate the deposits of public money," passed June 23, 1836,^^^" upon the terms, conditions, and provisions in said act contained. By the terms of the act the faith of the state was in- violably pledged for the safe-keeping and repayment without inter- est of all sums of money received, whenever the same should be required by the Secretary of the Treasury of the United States. The amount paid in under the above act was $4,014,520.71. ^^^^ The legislature of New York accepted the deposit on the terms prescribed and made laws as to the character and disposition of the fund and its revenue.'*^^ 435?! Ibid., p. 22. 4350 Vol. Y, p. 55, Public Statutes at Large, 24th Congress, Session I, Chap. 115. 435P jsiew York Historical Records, 1885, p. 91. 356 PERMANENT COMMON SCHOOL FUNDS It was provided b}^ an Act passed April 4, 1837, that the money should be divided among the counties according to population and be loaned by county commissioners appointed Investment of Principal of by the govcmor and confirmed by the senate. The money must be loaned on improved real estate, double the value of the loan, exclusive of buildings and of the value of rent in perpetuity, if any were charged thereon. As pointed out in Chapter III, Part I, the United States had planned to dis- tribute the surplus revenue in four instalments, but the fourth instalment was never paid. New York, however, loaned the fourth instalment in anticipation of its appearance."*^-^' Provisions concerning the disposal of the interest of the Surplus Revenue Fund were made by an act passed April 17, 1837. The first apportionment was to be made in 1839; Method of ^ i - i n r • i Apportionment $iio,ooo was to be appropriated annually tor aid- ing common schools (joined with the income of the Common School Fund), to be apportioned among the districts in the manner other school moneys were apportioned. In order to receive its share, a district must maintain a school taught by a duly qualified teacher, four months, instead of three. In the same manner $55,000 was to be annually apportioned among the districts for three years to be used for purchasing libraries, thereafter for the same object or for teachers' wages according as the district might decide ;'*^^« $28,000 was to be annually joined with the Literature Fund income to aid academies under the visitation of the regents.^^^ The remainder of the income was to be added to the principal of the Common School Fund.'^^* The statutes providing the mode of distribution have been modi- fied frequently. In 1846 it was provided by the constitution that thereafter $25,000 should be added annually to the principal of the Common School Fund.^"^ '' Omitting certain minor educational appropriations the statutes in force at the present time provide the following annual disbursements: $25,000 to the principal of the 435? Report N. Y. State Supt. Public of Instruction, 1S48, p. 89; E. G. Bourne, History of the Surplus Revenue of iSj^, pp- 86-91. ^' Constitution of New York, 1846, Art. IV, Sec. i. ^ NEW YORK 357 Common School Fund; $75,000 joined with the income of the Com- mon School Fund; $34,000 added to the income of the Literature Fund.^33 In 1897 some important changes were made regarding the school finances* of New York. In that year it was enacted that "the Merging Revenues Common School Fund, the Literature Fund, the Fund*^Common United States Deposit Fund shall continue to and°Fre^"°^' consist of all moneys, securities, or other property School Fund jj^ ^}-jg treasury of the State, or under the control of any State officer, and all debts due the State, or real property owned by it belonging to such fund. The proceeds of all land which belonged to the State on January i, 1823, except parts thereof reserved or appropriated to public use, or ceded to the United States, shall belong to the Common School Fund. Of the income of the United States Deposit Fund, $25,000 shall annually be added to the capital of the Common School Fund; the remainder of such income, together with the income of the Common School Fund and of the Literature Fund, and also such amounts as may be raised or received by taxation or otherwise, or by transfer from any other fund, shall constitute the educational fund, and appropriations made therefrom may be made only for the support of the educa- tional system, to be distributed by the superintendent of public instruction, and the University of the State of New York in the manner provided for by the law. It shall be the duty of the comp- troller to transfer from the general fund at the close of each fiscal year such an amount to the revenue of the Common School Fund, United States Deposit Fund, and Literature Fund as may be neces- sary to reimburse the revenue of said funds by reason of the excess of appropriation from the revenue derived from the investment of the capital thereof. The moneys so transferred shall become and be a part of the educational fund, and be included in the amount raised by taxation for the next fiscal year." ^^^^ This law in effect combines the revenue derived from the Common School Fund, the Literature Fund, and the United States Deposit Fund into one annual income devoted to common schools. 435S Laws of 1897, Art. IV, Chap. 413, Sec. 80. 358 PERMANENT COMMON SCHOOL FUNDS It is impossible to determine how much of the Surplus Revenue Deposit Fund that is reported in New York annually, actually exists. F. P. Alcott, wrote on assuming the duties of controller: "In 1877, 1 determined to look into the condition of the fund. . . . So far as the investigation instituted has gone, it demonstrates the utter insecurity of the fund. . . . Money is loaned upon property not worth double the amount of the mortgage (as required by law). Second and third mortgages are taken; searches are not made; minutes are not kept . . . forged and fictitious mort- gages have been taken, and during the past two years commissioners . . . have absconded! . . . The State has to-day thousands of dollars invested in farms, the result of foreclosed loans that will not sell for a third of the prin- cipal and interest due."^352: The difficulty of obtaining correct data is shown by the follow- ing conflicting statements: " The United States Deposit Fund is in- vested in municipal securities and in mortgages. . . . The fund has been kept inviolably intact." ^^^2/ "A liberal estimate of the present worth of the $1,442,837.91 held by loan commissioners (of the United States Deposit Fund) of the entire state will not exceed $1,000,000 of sure assets." ^^sz The losses suffered by the principal of the United States Deposit Fund from April 4, 1837, to September 30, 1905, amount to $333,862.17 as follows: ^^s^ $199,035.44 lost on resale of lands; $56,046.75 lost on foreclosure sale of lands; $33,975-63 lost by failure of title; $44,804.38 lost by defalcation of Loan Commissioners. The Common School Fund is managed by the Management „ State Controller.^36 The present (1906) method of apportionment of the revenue of the state school moneys rests upon a threefold Apportionment , , ^ basis: first, the assessed valuation of the district; second, the number of teachers employed; third, population. 435 1 Ibid., p. 280. 435X Controller's Report, 1877, p. 28, taken from Bourne, Surplus Revenue, pp. 89, 91. *35z/ Six-page type-written account furnished by N. Y. State Dept. of Finance, Dec. 23, 1906. 4353 Controller's Report, 1906, p. Ixii. 436 Laws of New York, 1903, Chap. 350. NEW YORK 359 The money received on the first basis is called the district quota. I. "To each district having an assessed valuation* of twenty thousand dollars or less, as appears by the report of the trustees upon which such apportionment is based, two hundred dollars. II. " To each district having an assessed valuation of forty thou- sand dollars or less, but exceeding twenty thousand dollars, one hun- dred and seventy-five dollars; III. to each district having an assessed valuation of sixty thousand dollars or less, but exceeding forty thousand dollars, one hundred and fifty dollars; to each Indian reservation for each teacher employed therein for a period of thirty-two weeks or more, one hundred and fifty dollars; and to each of the remaining districts, and to each of the cities in the state, one hundred and twenty-five dollars." The amount apportioned to a district on the second basis is known as the teachers' quota. For every additional teacher duly licensed, the district, city or Indian reservation receives $ioo. The remainder of the state school moneys left after the apportionment of the district and teachers' quotas, and the library moneys, is divided by the State Superintendent of Public Instruction among the counties of the state in proportion to their population. In counties in which there are cities, each city receives its share, and the remainder of the county the portion to which such part of the county shall be entitled. New York City is considered one county. All moneys apportioned from the income of the United States Deposit Fund, from the income of the Common School Fund, or from school funds, except the library moneys, shall be applied exclusively to teachers' wages,'*^'' but in view of the fact that "the legislature since 1897 has placed the appropriation from the income of the Common School Fund and the income from the United States Deposit Fund with the free school fund, school taxes, and made them all one * "The valuation of the several districts in this state as affected by this appor- tionment shall be determined by the commissioner of education from the abstracts of the reports of the trustees as filed in his office by the several school commis- sioners of the state." Laws of New York, 1906, Chap. 698, Sec. i. ^ Consolidated School Laws of New York, amended 1903, Title II, Art. I, Sec. 4. 360 PERMANENT COMMON SCHOOL FUNDS fund, it is impossible to say for just what purposes the income of the Common School Fund is now used." ^^* In order to receive an apportionment from state school moneys, (i) counties must have furnished the controller with evidence "that Conditions of ^^^ moneys required by law to be raised by taxes Participation upon such county for the support of schools throughout the state have been collected and paid, or accounted for to the state treasurer; ^^^ (2) no district shall be entitled to any portion of school moneys unless a common school was supported in the district and taught by a qualified teacher for at least 160 days;^° (3) "The Comrpissioner of Education may withhold one-half of all public school moneys from any city or district which wilfully omits and refuses to enforce the provisions," relative to compulsory education; ^^ (4) "The State Superintendent of Pubhc Instruction may withhold its share of public school moneys from any city or district which uses school library moneys for any other purpose than that for which they are provided;'*^" (5) the public school moneys may be withheld from any district or city which fails to comply with the legal requirements concerning the teach- ing of physiology; ^"^^ or which (6) wilfully disobeys any decision, order or regulation pertaining to common schools." ^^ 438 Extract from letter from Hiram C. Case, Chief of N. Y. Ed. Dept. of Statistics> dated Sept. 6, 1904. «9 N. Y. Consolidated School Law, 1905, Title II, Art. I, Sec. 3. «o Ibid., Art. II, p. 13, Sec. 6, and p. 17, Sec. 15. 441 Ibid., p. 126, Title XVI, Sec. 10. 442 Ibid., p. loi. Title XIII, Sec. 8. 443 Ibid., p. 109, Title XV, Sec. 20. 444 Ibid., p. II, Title I, Sec, 13. CHAPTER XLI NORTH CAROLINA LITERARY FUND * The permanent school fund of North Carolina, officially known as the State Literary Fund,^^ now (December, 1906) has a principal Present Title of about $300,000.^'' This fund has been derived and status chiefly from the sale of swamp lands, together with a small amount, less than $50,000, saved from the ruins of the Civil War and Reconstruction days. In 1906 it was estimated that 700,000 acres ^'^^ of swamp lands remained unsold valued at about $250,000. These were considered the only important avail- able source of increase among those enumerated in section 4, article IX, of the constitution of 1868, but subsequent decisions of the Supreme Court deprived the Literary Fund of more than 600,000 acres which had been claimed for it. The following letter from the present State Forester, Mr. W. W. Ashe, presents the matter concisely : "Raleigh, N. C, November 12, 1908. "Prof. F. H. Swift, "Dear Sir: In further reply to your letter of October 5th to Mr. Charles L. Coon. "The lands of the State Board of Education at present do not amount^tOv^ more than 110,000 acres. Other holdings which the board claimed have been alienated through decisions of the Supreme Court of North Carolina, which invalidated tax sales which took place more than eighty years ago. Through these decisions the title to the land was held to be still vested in the heirs or assigns of the original owners. Since the State Board's claim to most of this * For this account I am greatly indebted to data furnished Dec. i8, 1906, by Charles L. Coon, Supt. Colored State Normal Schools. Foot-notes 446-447 are copied from his statement. **5 Public School Laws of N. Car., 1905, Sec. 4093 (p. 13). 448 Records, OfiSce State Supt. 447 Ibid. 361 362 PERMANENT COMMON SCHOOL FUNDS land was based on such tax sales, this decision affects more than 600,000 acres which the State Board claimed. "The lands which the State Board at present claims consist of one large tract of 40,000 acres, which is now held at $4.00 per acre. It can be drained and made valuable for farming purposes, there being required an expenditure of about $4.00 per acre for main drains and probably $5.00 per acre for minor drains and tiling. "In addition to this large tract, there are many small tracts, some of which will probably be found to be of very little value, while others can probably be readily sold at from $3.00 to $5.00 an acre. "The Board's holdings have proven so far to be of small value as sources of revenue, and since the larger portion of the timbered land was included in lands the title to which was invahdated by imperfect tax sales, the future in- come of the Board from its remaining lands will be gotten largely by their sales for farming. "This, I think, covers pretty thoroughly all the questions contained in your letter. If there are any others that you wish to ask, I will be very glad to try to answer them. "Very truly yours, "W. W. Ashe, "State Forester.^' The Literary Fund by an act of the General Assembly, Janu- ary, 1903, is now used exclusively for the purpose of building public school-houses, under rules and regulations prescribed by the State Board of Education, The fund can never be decreased. By the Act of 1903, school districts may borrow from the fund an amount equal to one-half the cost of a new school building, the amount borrowed to be repaid in ten equal annual instalments, together with four per cent interest. North Carolina first established a permanent common school fund known as the Literary Fund in 1825 by Act of General Assembly.^* This fund as originally provided for was to consist of: (i) dividends from state bank and other state stock; (2) taxes on liquor licenses; (3) auction taxes; (4) unexpended balance on agricultural fund; (5) all moneys 4^ No. Car. Rev. Stats., 1836-37, Chap. 66, pp. 378, 379, quotes this law; see also Report State Supt. of Public Instruction, 1887-88, p. xxxiii; U. S. Bureau of Education, Circular of Information, 1888, No. 2, pp. 166-168. NORTH CAROLINA 363 paid to the state for entries of vacant lands; (6) all the vacant and unappropriated swamp lands in the state. In 1827, this permanent fund amounted to $12,725. It was increased from time to time from the sources indicated above. In 1837 North Carolina re- ceived from the federal Government $1,433,727 ^^ as her share of the surplus revenue distributed that year. Of this vast sum $300,000 was at once added to the Literary Fund '^^ and it would appear that eventually all of it except $100,000 devoted to state ex- penses, became a part of the school fund.^^^ This large increase in the permanent fund enabled the legislature of 1838-39 to undertake the establishment of public schools, the whole permanent fund then amounting to $1,732,485. In i860 the Literary Fund amounted to over $2,000,000. The failure of banks in whose stock part of the capital was in- vested reduced the fund to less than $1,000,000 in 1869. This diminished fund consisted in depreciated rail- Loss ^ road and navigation stock which was sold at from ten to thirty-seven cents on the dollar. The money thus realized was invested in the fraudulent North Carolina special tax bonds bought at a discount, which were repudiated by the state in 1870. The whole school fund was then lost except a few thousand dollars. The total loss sustained by the Literary Fund from the time of its establishment until the present (1905) may be considered to be about $2,525,000 besides interest losses caused by troubles of the Civil War and reconstruction periods 1861-70. From 1870 to 1903 the sources for increasing the Literary Fund have been only those provided by the constitution,'^^^ and are as Sources of follows: (i) the proceeds of all sales of federal Increase ^sind grants not otherwise appropriated by the state or the United States: (2) proceeds of all sales of swamp lands; (3) grants; (4) gifts, or (5) devises made to the state and not otherwise **9 E. G. Bourne, History of the Surplus Revenue of J'Sj^, P- 91. 450 Ibid., p. 92. *5i Ibid., p. 93. 452 Constitution of No. Car., 1S68, Art. IX, Sec. 4; Ibid., 1S76, Art. IX, Sec. 4; Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1364. 364 PERMANENT COMMON SCHOOL FUNDS appropriated. During this period the interest on the funds derived from these sources was distributed every few years to the several counties for general school purposes, the distribution being based on school population. By 1903 the fund thus derived amounted to $194,159.18, and was set apart for the definite purpose of aiding in building school-houses, under the general conditions set forth above. CHAPTER XLII NORTH DAKOTA PERMANENT SCHOOL FUND Permanent School Fund ^^ is the official title of the permanent common school fund of North Dakota. The term Tuition Fund Title. is used to include the revenue of the Permanent Condition, 1905 School Fund, net proceeds of fines and penalties for violation of state laws, rents of school lands, school poll tax and school poll state tax. The provisions regarding revenue of the Permanent School Fund are provided for under the heading of Tuition Fund.^^^ In 1905 the Permanent School Fund con- sisted of, first, a reservation of 2,000,000 acres "^^^ of unsold school lands, estimated at $20,000,000, the proceeds of which when sold will be added to the principal of the fund; and second, $8,263,154.80, of which $5,488,170.54 is invested in land contracts bearing six per cent interest, and the remainder in first mortgages on real estates, state, district and insti- tution bonds.^^^ The state has borrowed from the Permanent School Fund $711,700, which amount is not necessarily a perma- nent debt.^^^ This loan is secured by four per cent state bonds, the interest on which, like that on all bonded indebtedness of the state, is drawn from a special tax levied upon the property of the state for this purpose.'^^ The total income derived from the Perma- nent School Fund in 1905 was $337,353/^^ approximately twelve and six-tenths percent (.126)* of $2,674,838.75 ^^^ the total receipts for * Computed. 453 The General School Laws of N. Dak., compiled 1897, by Supt. of Public In- struction, p. 10, Sec. II. 454 Ibid., p. 45- 455 Data furnished by W. L. Stockwell, State Supt. of Public Instruction of N. Dak., Sept. 12, 1906. 365 366 PERMANENT COMMON SCHOOL FUNDS common schools from all sources for that year. Of this annual revenue $70,483.46"^^ was derived from the rent of school lands. For the benefit of common schools North Dakota was granted by the United States Government sections numbered sixteen and thirty-six in each Congressional township. "Un- der this grant the state will acquire title to ap- proximately 2,500,000 acres, . . . the exact acreage cannot be determined at this time, as some of the lands in the western part of the state have not been surveyed." ^^® Provision was made in 1889 by the Congressional Enabling Act and the state constitu- tion adopted that^^''' year, for the estabHshment of a permanent common school fund from the proceeds of these lands. The sources provided for increasing the principal of the Perma- nent School Fund are at present as follows: (i) proceeds of sales Sources of ^f sixteenth and thirty-sixth section lands; ^^^ (2) Increase ^^y proportion of the interest or income of the school fund not expended during any year; "^^^ (3) five per cent of the proceeds of the sales of United States lands lying within the state.^^^ The School Fund is managed by the " board of university and school lands," composed of the Governor, Super- intendent of Public Instruction, Attorney- General, Secretary of State, and State Auditor. The revenue is apportioned among the counties in proportion to their school attendance. The apportionment is based upon the number of children between the ages of six Apportionment ° and twenty who have attended school sixty days, "exclusive of those who have attended educational institutions maintained strictly by the state." ^^^ Objects The state Tuition Fund can be expended for teachers' wages only, 460 456 Commissioner of University and School Lands of N. Dak., Report, 1902-04, p. 10. 4B7 Constitution of N. Dak., 1889, Art. IX, Sec. 153. «8 Ibid., Sec. 154. 459 Enabling Act, Sec. 13, p. 10; The General School Laws of N. Dak., compiled 1897. 480 The General School Laws of N. Dak., compiled 1897, Sec. 712. Cf. Sec. 710. I NORTH DAKOTA 367 The district to be entitled to receive any portion of the Perma- nent School Fund revenue must make a report of the enumeration Conditions of ^^ children of school age. Further, the county Participation treasurer must have given a bond and oath as required by law before the district can receive its quota."*^^ *6i Ibid., p. 47, Sec. 714. CHAPTER XLIII OHIO IRREDUCIBLE STATE DEBT Ohio, "instead of creating a permanent fund to be loaned . . . as was done in Massachusetts (and) Kansas (and) elsewhere, Title. early . . . provided that the sales arising from Condition, 1905 sixteenth section and other school lands should be constituted into a great irreducible debt held forever by the state with an annual interest of six per cent to be paid thereon to the dis- tricts from which the moneys were originally derived." ^^^ "The money derived from the sale of school lands was used for other purposes (than schools). As such moneys came into the state treasury they were credited to the original township in which the lands lay, and deposited in a so-called sinking fund. The interest on that amount then goes annually to the school districts located all or partly in the original township. The interest is raised by state levy. The rent of unsold school lands is added to the annual revenue." ^^^ The term State Common School Fund is applied to the proceeds of the state tax for schools. (School Law, 1898, section 3951.) In 1905 the principal of the irreducible debt amounts to $4,902,109.72,^'''* on which the state pays $322,185.70 annual interest,'*^^ approximately one and six-tenths per cent (.0159),* of $20,290,251.26,^'''* the total annual common school revenue.f * Computed. "t" Annual revenue, including balance on hand at beginning of school year, is $29,169,670.65. *82 Ohio School Report, 1901, p. 9. 483 School Laws, compiled by State Commissioner of Common Schools, 18 Sec. 3953. *6* Data furnished by Edmund A. Jones, Ohio State Commissioner of Common Schools, Oct. 30, 1906. 368 OHIO 369 The funds constituting the irreducible debt were derived chiefly from the proceeds of the sales of the following lands: ^^^ (j) section sixteen; (2) United States mihtary lands; (3) Virginia military lands; (4) Western Reserve lands; (5) swamplands; (6) salt lands ;^^^ (7) section twenty-nine, or ministerial lands; and from a part of Ohio's share of the United States Surplus Revenue distributed in The moneys derived from lands represented to-day by the "irre- ducible debt" include the proceeds of the following sales: ^^^ Q^. . I. Section sixteen in (i) lands purchased by the Ohio Company in 1787; (2) lands purchased by John Cleve Symmes in 1787; (3) every congressional township granted by Congress in 1803, upon the admission of Ohio into the Union; (4) lands originally granted to the Moravians, but reconveyed by them to the United States in 1824.'*^^ II. Lands granted in heu of section sixteen ^^"^ in (i) U. S. Mili- tary Reserve; (2) Connecticut Western Reserve; (3) Virginia Mili- tary Reserve, III. Ministerial Lands,^^^ i. e., sections numbered twenty-nine in the lands purchased by the Ohio Company and by John Symmes. IV. (i) Swamp lands; ^^^ (2) salt lands.^^^ In Chapter III an account has been given of the origin of the claims of Virginia and Connecticut to lands in Ohio, and of the reservation of sections sixteen for schools and sections twenty-nine for the ministry in the Ohio Company and Symmes purchases. It will be well here, however, to describe in somewhat greater detail the more important areas for which the Ohio Enabling Act of 1802 made no provision and the subsequent land grants made for them.* These areas may be named as follows : ^®^ * The following description is chiefly a summary of the article referred to m foot-note 466. 465 Ohio School Laws, compiled by State Commissioner of Common Schools, 1898, Sec. 3952. 466 "Educational Land Policy of the United States," Barnard's American Journal of Education, Vol. 28, pp. 929-938. 370 PERMANENT COMMON SCHOOL FUNDS 1. Virginia Military Reservation, reserved by Virginia, 1783 . 3,710,000^ 2. Western Reserve, reserved by Connecticut, 1784 .... 3,300,000 3. Ohio Purchase, bought of U. S. by the Ohio Company, 1787 964,285 4. Symmes Purchase, bought of U. S. by John Cleve Symmes 1787 311,682 5. U. S. Military Reservation, reserved by U. S. Government 1796 2,560,000 6. Miscellaneous Grants: (i) Rupee Grant, east of Scioto River, "granted to certain individuals v^ho left British provinces to espouse the cause of freedom" 100,000 (2) Moravian Grant, granted to Moravians for use of Chris- tian Indians, three tracts, 4,000 acres each .... 12,000 (3) Trent Grant, to individuals who had lost lands near Gillipolis because of invalid titles 25,000 (4) Dohmrore's Grant (to a Portuguese merchant for Revolu- tionary services), one township 23,040 (5) Zane's Grant, six sections 3)840 Total, exclusive of (6), (7) and (8) 11,009,847 6) Maumee Lands, granted for a government road. 7) Turnpike Lands, granted to the Columbus and Sandusky Turnpike. Ohio Canal Lands, granted to the state of Ohio to aid in the construction of canals. Virginia had promised bounties of lands to her troops which had served during the Revolutionary War, Lands which she had reserved for this purpose between the Green and Tennessee rivers in the present state of Kentucky proved inadequate. Therefore when she ceded to the federal Government her territory north- west of the Ohio, she reserved to satisfy these bounties the land lying in Ohio between the Scioto and Little Miami rivers."*^* The origin and location of Connecticut's Western Reserve have been described at length elsewhere.'*^^ The Ohio Company's purchase was located near and chiefly below the mouth of the Muskingum. The first white settlement in Ohio was made on this tract at Marietta."*^^ *^ Eticyclopedia Britannica, Vol. XVII, p. 758. 468 "Educational Land Policy of the United States," Barnard's American Journal of Education, Vol. 28, pp. 930-932. *89 Consult Part I, Chap. Ill; also History of Connecticut School Fund, p. 230. OHIO 371 The Symme's purchase lay between the Great and Little Miami rivers.^^^ The United States military tract was set aside by an Act of Con- gress, 1796, to satisfy certain claims of the officers and soldiers of the Revolutionary Army."*^^ The location of the remaining grants has been described in the tabular statement above, or is not of sufficient importance to be described in the present summary account. Ohio was the first state to receive for schools from the United States the grant of the section numbered sixteen in each congres- sional township. But the grant of section sixteen, as provided for in the original form of the Ohio Enabling Act * did not apply to any of these reservations, sales, and grants. The tract purchased by the Ohio Company and that purchased by John Cleve Symmes, to- gether amounting to 1,275,967 acres, were the only tracts in which section sixteen or lands in lieu of section sixteen had been reserved for schools. This left more than 9,000,000 acres — over one-third of the state — in which no lands had been granted or reserved for schools. The situation was rendered more difficult owing to the fact that, except in the case of lands surveyed or yet to be surveyed accord- ing to the system adopted by Congress, there had been no uniform- ity in the system of platting the lands. The first reservation, that of Virginia, was not surveyed according to any definite mode. Warrants for from 1,000 to 5,000 acres were given to an individual, who then located his warrant where he chose, had the land surveyed, and then recorded the plat in the Virginia office.468 The Western Reserve was surveyed by Connecticut in townships each five miles square. Some of these, known as "Fire Lands," were subdivided into quarters of 4,000 acres, and the quarters were subdivided according to the choice of their owners.'*^^ The United States Military Reservation, like the Western Re- serve, was surveyed in townships five miles square. These were subdivided into quarters of 4,000 acres, and the quarters into 100- * For copy of this Act see Chap. Ill, p. 51. 372 PERMANENT COMMON SCHOOL FUNDS acre tracts, to enable them to be distributed among soldiers having loo-acre claims.^''* If Congress expected that Ohio would be satisfied with having one-third of the state receive no appropriation of federal lands for schools, while two-thirds of the state was given one thirty-sixth (section sixteen in each township) of its area, it soon learned the error of its expectations. The constitutional convention of Ohio, in an ordinance passed November 29, 1802, proposed as the conditions upon which they were willing to accept the propositions previously offered by Con- gress, modifications of and additions to the original enabling act of such a character as would provide for practically the entire state one thirty-sixth of its entire area as a school grant. An Act of Congress passed March 3, 1803, accepted the modifi- cations and additions.^^*^ Under this and subsequent acts the fol- lowing grants were made to Ohio for the use of common schools, in lieu of sections numbered sixteen: ACRES 1. In the United States Military Reservation, eighteen quarter town- ships, 4,000 acres each* 72,000 2. In the Connecticut Western Reserve, fourteen quarter townships, 56,000 acres, granted 1803; 37,758 acres, act of Congress, June, 1834, to complete the grant of one-thirty-sixth of the Western Reserve 93j7S8 3. For the Virginia Military Reservation, granted 1807, eighteen quarter townships and three sections 103,680 4. One thirty-sixth of Moravian Grant ^^'^ 333 Total 269,771 One thirty-sixth of the Ohio Company's and of Symmes' pur- chases had been reserved for schools through the grant of section sixteen. With the exception, then, of a few small tracts which were granted to individuals, one thirty-sixth of the lands of Ohio * This area is explained above. *'"> Statutes at Large, Vol. II, p. 225. 471 The Moravian Grant for Christian Indians was reconveyed to the United States in 1824, " in consideration of certain benefits to the society and the remnant of Indians." OHIO 373 were granted by the United States to Ohio for the use of schools. "As there was a small excess granted to the United States Military- district, it is probable the deficiency in the private tracts was made up." ^^2 The origin of the grant of saline lands and swamp lands, the proceeds of which are represented in Ohio's irreducible debt, has been explained previously.* The area of the lands the proceeds of the sales of which are repre- sented by the irreducible debt may be represented as follows : ACRES Sixteenth Section Lands 704,488 Lands in Lieu of Section Sixteen 269,771 Ministerial Lands area unknown .... Saline Lands 24,216*73 Swamp Lands 117,931.28*^3 Total area (not including Ministerial Lands) . . . . . 1,116,406.28 No provision was made in the first constitution of Ohio for the establishment of a permanent common school fund. Much uncer- tainty existed in the new state as to the owner- Establishment of Common School ship of the school lands. The Act of Congress Fund, 1827 1 -n r 1 o /i-rn i • • i passed March 3, 1803,^^'^ vested m trust m the legislature all lands appropriated by the United States for the sup- port of schools. On the other hand, section sixteen was clearly stated to belong to the inhabitants of the township. The legisla- ture doubted its right to sell the school lands, and passed at least two acts providing for leasing them. In 1803 an act was passed to lease the school lands for fifteen years. This act yielded no results. Consequently a second act was passed to lease them for ninety-nine years, t The legislature then applied to Congress for permission to sell * Consult Chap. Ill, pp. 58-64. t For disastrous effects of this system of long lease, see below, paragraph on "Loss." 472 "Educational Land Policy of the United States," Barnard, American Journal of Education, Vol. 28, p. 934. *'3 Tables, State Land Grants of Public Lands, p. 8, General Land OflSce, Mar. 12, 1896. Consult also Chap. Ill, p. 66, 374 PERMANENT COMMON SCHOOL FUNDS the school lands. Congress made no reply to this request. " The legislature felt the necessity of doing something, and accordingly in January, 1827, passed an act for the sale of the school lands, with such conditions as avoided any question of right as regards the people for whose benefit the lands were held. It was provided, first, that the sale of section 16, in the original surveys, should be voted on by the people of the township, and the sale made if they decided so; second, the lands were to be appraised and not sold below the appraisement; third, on full payment of the money, a deed in fee simple was to be made by the State. The same policy was adopted in reference to all the school lands." '^'^ In 1827 the first permanent common school fund was established by the same legislature, by an act which provided that the proceeds of the sales of all school lands and salt lands, together with such gifts, donations, devises, etc., as might hereafter accrue should be funded by the state at six per cent interest."*^^ Ohio received $2,007,260.36 from the United States surplus revenue distributed in 1837.^'^^ It is impossible as will appear later, to state how much of this has been credited United States Surplus Revenue, to the irreducible debt. An Act passed March 28, 1837, provided for loaning the principal to the counties, to the state, or to the Canal Fund. In each instance the loan was to bear interest at six per cent, and five per cent must be devoted to the support of schools.^^^ The sums loaned to the counties were later recalled. The money which the state succeeded in recovering was used largely to redeem turnpike bonds due in 1846, to purchase state bonds and to pay the state debt.^'^^ March 7, 1838, an act was passed by the general assembly which did not establish a permanent fund, but merely guaranteed from certain sources an annual revenue of $200,000 for the common schools. The act reads : *74 "Educational Land Policy of the United States," Barnard, American Journal of Education, Vol. 28, pp. 936-937. 475 E. G. Bourne, History of the Surplus Revenue of 1837 ■, pp. 95-99, 122. (For an account of the Surplus Revenue Fund, consult Chap. Ill, pp. 70-78. 476 E. G. Bourne, History of the Surplus Revenue of 1837, pp. 95, 96. OHIO 375 "Be it enacted by the General Assembly of the State of Ohio, "Sec. 3. That there shall be a state common school fund established, consisting of the interest on the surplus revenue at five per cent, the interest on the proceeds of the sales of lands; the revenue from banks, insurance, and bridge companies, and other funds to be annually provided by the state to the amount of $200,000 per annum." The basis of distribution was school population (4 to 20 years). An Act passed March 24, 1851, provided that "the balance of the Surplus Revenue Fund shall be added to the common school fund.""*" Respecting this, Bourne writes as follows: "This last phrase it has been impossible to interpret exactly, for in the school reports the Surplus (Revenue Fund) is not mentioned, as the com- mon school fund of which it is a part is reported as a unit. It may mean the surplus left after paying the turnpike bonds and seven per cent bonds of 1851." ^^^ It would be difficult to form even an approximate estimate of the amount the state school fund has lost through Loss , ° various causes. The first report of the State Su- perintendent of Schools (p. 41) contains the following statement: " (School) land has been taken at six dollars per acre worth at the time fifty dollars. School lands have been sold at less than a dollar and in some cases at less than fifty cents an acre." ^'^^ Writes Mayo : "There is no more melancholy, and certainly no more confusing, chapter in American history than the record of the amazing waste of this great national gift to the people of Ohio, as related in the report of Superintendent (Samuel) Lewis (first State Superintendent of Public Schools, 1837-1840) and condensed in the statement of President E. F. Tappan, of Kenyon College, in his contri- bution to the valuable centennial volume of 1875, entitled 'Education in Ohio.' 480 "It is impossible to estimate the amount lost by what would seem to be, at the best, the most careless handling of a precious trust. One of the causes *''7 The American Almanac, 1S53, p. 297. Repeated in succeeding issues. Refer- ence taken from Bourne, as above, foot-notes, p. 98. 478 E. G. Bourne, History of the Surplus Revenue of iSjy, p. 98. 479 Quoted from Orth, S. P., The Centralization of Administration in Ohio, p. 32. 480 Mayo, A. D., The Development of the Common School in the Western States from i8jo to 186^, Report U. S. Commissioner of Education, 1898-99, pp. 360, 363. 376 PERMANENT COMMON SCHOOL FUNDS of this was that the mass of the people who through the first generation flowed into Ohio were poor, and depended greatly on the low price of pubHc lands for a start in life. . . . They were chiefly interested at first in getting the lands at a nominal rate and in sending members to the legislature who would resist every attempt to wrest the children's patrimony from the hands of their hard-working and anxious parents. Much of the land was leased between 1810 and 1820 at a very low figure for ninety-nine years, with privilege of re- newal, though subject to revaluation every twenty or thirty years, with an increase of interest. But by the law of 1827, which the superintendent de- nounces as 'plunder,' tenants . . . were permitted to surrender their leases and, on the payment of the amount of the original appraisement, obtain deeds in fee simple. In many cases lands worth $40 and $50 per acre were sold for $4 and $6. "480 This statement should be compared with one made above. There it was pointed out that the legislature of Ohio at first doubted its right to sell the school lands. When this right had been assumed and assured there was something to be said in favor of the law of 1827, for the increase in the value of the lands was undoubtedly due largely to their improvement by those who had leased them; and should these men be made to pay for improvements they themselves had made ? The entire policy of the state of using up the proceeds of school lands and establishing a state irreducible debt is open to serious question. This topic is fully discussed in Part I of this work. Here it is sufficient to say that an evident purpose of granting school lands to the state by the federal Government was to lessen the bur- den of taxation necessary to support the schools. Ohio, like many other states, by using up the principal, compels the people to be taxed for the interest, thus making the fund a means of increasing rather that of decreasing taxation for schools. The present sources for increasing the principal are the proceeds of sales of the lands granted by Congress. It is impossible to state Sources of ^he acreage of the common school lands remaining Increase unsold. "These lands belong to the townships, and since the state has no concern except to receive the money when the lands are sold, there is no record (kept by the state) of the acreage." "^^^ OHIO 377 The revenue is apportioned among the townships and other dis- tricts of the country in proportion to their share of the original Apportionment. Capital.'**^ The purpose of the fund is stated in Objects general terms: "for the support of common schools." ^^^ In view of the fact that the revenue is regarded as interest paid Conditions of upon a debt due to the districts, no conditions Participation ^^.^ named which must be fulfilled in order for a district to receive its share.* * See Idaho, foot-note 122". 481 School Laws, compiled by the State Commissioner of Common Schools, 1898, Sec. 3954. CHAPTER XLIV OKLAHOMA * The prospective permanent common school fund of Oklahoma is (1905) estimated at $22,000,000, composed as follows: $5,000,000 on deposit to the credit of Oklahoma in the United States Treasury; $17,000,000, the estimated value of unsold common school lands. Congress, by Act organizing the territory of Oklahoma in 1890, appropriated $50,000 in the aid of public schools.^^^ The following year Congress authorized the government of Oklahoma to lease the lands granted to the Territory for not more than three years, the rents from the leases of these lands to constitute a revenue for public schools. Oklahoma possesses 1,413,803 acres of common school lands under lease,^^^ estimated as worth approximately $17,000,000. The rent yielded by these lands in 1905 amounted to $301,026.81,^^^ approximately twenty and one-tenth per cent (.2oi6)t of $1,492,862.34,'^^^ the total common school revenue derived from all sources. Copy "Guthrie, Okla., September 13, 1906. "Fletcher Harper Swlft, Esq., "Dear Sir: Your letter of recent date addressed to the Honorable L. W. Baxter, Superintendent of Public Instruction, has been referred by him to me. "There is at present to the credit of the state of Oklahoma in the United States Treasury the sum of five million dollars with interest at the rate of 3% from June 16, 1906 (granted for Indian Territory J). This five million dollars is granted the state under the statehood bill as a part of the permanent school fund, no portion of the principal ever to be used but to be invested as a perma- * See also Indian Territory and notes, t Computed. X See also Indian Territory and notes. 4S2 Report Supt. of Public Instruction, Okla., 1891-93, p. 5. *83 Data furnished Sept. 13, 1906, by Fred L. Wenner, Sec. of Board for Leasing School Land. 378 OKLAHOMA 379 nent common school fund. Under the provisions of this same bill the state also receives 5% of the receipts from the sale of all public lands vi^ithin the territory or state from June 16, 1906, to be also added to the permanent com- mon school fund. In addition to this the state has 1,413,803 acres of lands reserved for common school purposes, the same being sections 16 and 36 in every township, and also some indemnity land granted in lieu of such sections where they are lost. "The present appraised value of this land is seventeen million dollars in round numbers. Under the provisions of the Enabling Act, this land can be sold, the proceeds to form a part of the permanent common school fund or it can be retained and leased. The Territory has leased its lands for some years, the total receipts to date from the leasing of the common school lands having been $1,970,702.91. Of this amount $301,026.81 was received during the past year, the same being distributed to the various school districts of the Territory per capita of school population, the amount per capita for the year being $1.60. "In addition to the common school lands, the Territory has 1,372,007 acres of lands reserved for the benefit of the higher institutions of learning of the Territory. Much of this land is of a poorer character located in the grazing districts in the extreme western portion of the Territory, the appraised value of the total amount at this time being eight million dollars. "I return herewith the sheet of questions and the advance sheet from your book with certain notations and corrections thereon. If this does not give you what information you desire I will be glad to furnish anything additional. "Very respectfully, "Feed L. Wenner, "Secretary of the Board." Copy "Ofl&ce of Superintendent of Public Instruction of Oklahoma. "Guthrie. "Mr. Fletcher Harper Swift, "Dear Sir: Yours of July 26th came to hand during my absence from the city. Up to this time there is no established school fund except the school land fund now owned and controlled by the Territory. I have no copy of the Constitution as finally finished by the Constitutional Convention, and cannot send you a copy of the section deaUng with the establishment of a school fund. The sale of these school lands under the Constitution is checked up to the legislature. "Very truly yours, "J. E. Dyche. "8-6'o7. "R." CHAPTER XLV OREGON COMMON SCHOOL FUND The state permanent common school fund of Oregon is officially- known as the Common School Fund.'*^'* In 1906 the Common -ji^jg^ School Fund consisted of $4,599,460.39,^®^ and Condition, 1906 ^^ reservation of five hundred thousand acres (500,000) (1905) of school lands estimated to be worth $1,000,000,^®*^ the proceeds of which when sold will be added to the principal of the fund. Of the $4,599,460.39 named above, $4,120,747.60 is invested chiefly in first mortgage loans and school district bonds; the remaining $478,712.70 is made up as follows: $305,794.37 cer- tificates of sale of school lands; $154,418.33 certificates of sale of land acquired by deed or foreclosure, unsold farms acquired by deed or foreclosure $18,500.^®^ The annual revenue amounts (1906) to $281,060.86.^®'^ In 1905 the revenue derived from the Common School Fund was $272,352.74 which is approximately thirteen and five-tenths per cent (.1353) of the total common school revenue for that year, $2,012,718.'*®® The Common School Fund was established by the first constitu- tion adopted by the state and which became effective upon her admission into the Union in 1859.'*®'' The original capital of the fund consisted of 3,829,706 acres of school lands granted by the United States Government, of which 3,329,706 acres were the sixteenth and thirty-sixth sections in each township, and the remaining 500,000 acres ^®'* were lands received under the 1841 Act of Congress.^®** *84 Constitution of Oregon, Art. VIII, Sec. 2. 485 Oregon State Treasurer's Report, 1905-06, p. 106. 488 Data furnished Nov. i6, 1906, by C. S. Moore, Oregon State Treasurer. 487 Oregon State Treasurer's Report, 1905-06, p. 32. 488 Report U. S. Commissioner of Education, 1905, Vol. I, p. 306. 489 Report of State Supt. of Public Instruction of Oregon, iSSo, p. 64, gives the 380 OREGON 381 The sources from which the principal of the Common School Fund may be increased are as follows: (i) the proceeds of the sale Sources of o^ the sixteenth and thirty-sixth sections of every Increase township in the state, or of any lands selected in lieu thereof; ^^^ (2) the proceeds of the sale of the five hundred thousand acres of land to which the state is entitled by the pro- visions of an act of Congress, approved September 4, 1841;'*^^ (3) proceeds of property escheating or forfeited to the state; ^^^ (4) moneys paid as exemption for military duty; ""^ (5) proceeds of gifts, devises, bequests made by any person to the state for common school purposes; ^^^ (6) proceeds of all property granted to the state when purposes are not stated; ^^^ (7) five per cent of the net pro- ceeds of the sales ^^"^ of all federal public lands; (8) ten per cent of all proceeds of swamp lands; ^^° (9) the proceeds of the sale of tide-lands or sand islands within the state; ^^^ (10) fines imposed for violation of laws regulating the practice of medicine,^^® Whether the five per cent derived from proceeds of sales of public lands and the ten per cent of the proceeds of the sales of swamp lands are added to the principal of the Common School Fund as provided for by the constitution, I have been unable to determine. The State Treasurer, in naming the sources from which this fund is derived, omits these two,^^^ and in the same report states that the proceeds of these lands are devoted to other objects; but he may have considered it unnecessary to speak of these per cent funds. The State Treasurer estimates that the total loss sustained by the Common School Fund from the time of its establishment to the present does not exceed $20,000. This has been Loss caused chiefly by unwise loans on farm property and the depreciation in value of security during the depression of 1893-98. One instance of such loss might be cited. $10,000 was total area of school lands originally devoted to the Common School Fund as 3>377.777 acres. 490 School Laws of Oregon, compiled by Supt. of Public Instruction, 1897, p. 47, Title XIII, Sec. 21. 49B Oregon State Treasurer's Report, 1905-06, p. 31. 382 PERMANENT COMMON SCHOOL FUNDS loaned to Baker City Academy, This property was taken up and disposed of for $1,500 to Baker City School District making a total loss of $8,500.^^'^ The Common School Fund is managed by a board of commis- sioners of school and university lands, composed of the Governor, Secretary of State, and State Treasurer. It is Management , , / , , , , ,01 loaned by them at not less than seven per cent. -^^ The revenue is distributed by the board of commissioners among the counties upon the basis of the total county Apportionment school population (four to twenty years) .'^^^ The revenue of the Common School Fund cannot be used to pay for school supplies or buildings or completing or seating school- houses ready for occupancy.'*'''- The objects to which it may be applied are not specified: "Inter- est of the Common School Fund shall be so exclusively applied to the support and maintenance of common scliools ... for the pur- chase of suitable libraries and apparatus." * In order to share in the revenue of the Common School Fund, a district must annually report to the county superintendent •^'^^ and Conditions of maintain a school one-fourth of the school year Participation ^gj,,^y ^^^^g ^j. t^^glve school wecks '^^•*) . The direct- ors of a district must require a bond of district clerk not less than double the probable amount of all school moneys which shall come to his hand.^^^ ♦Compare, Idaho, foot-note 122". 491 School Laws of Oregon, compiled by Supt. of Public Instruction, 1897, p. 49, Sec. 2. 492 Ibid., p. 43, Title IV, Sec. 42. 493 Ibid., p. 33. 494 Ibid., p. 39, Title V, Sec. 61. 485 Ibid., p. 25, Sees. 37, 38. CHAPTER XL VI PENNSYLVANIA COMMON SCHOOL FUND Pennsylvania possesses no state permanent common school fund. The legislature provided for the establishment of such a fund in Present Condi- 1831,^^'^ three years before it provided for a state tion, Lost system of public schools. Mayo states that in 1834 the fund amounted to over one and one-half million dollars ($1,550,000),^^^ but the entire fund appears to have been lost in less than forty years, for the school reports in 1870 and 1872 state that Pennsylvania has no school fund like many of her sister states, but derives all her moneys for public schools from taxation.^^^ Section 44 of Pennsylvania's constitution of 1776 provided that "a school or schools shall be established in each Establishment of Free county by the legislature for the convenient in- Public Schools . 1 • 1 1 i • struction of youth, with such salaries to the mas- ters paid by the public as may enable them to instruct youth at low prices." ^^^ Despite this early constitutional provision, not until 1834 was an act providing for a general system of common schools passed.^''^ Plowever, this law was largely ineffective, and the real foundation of the state system of schools is a law passed in 1836.^°^ The laws of 1834 and 1836 left the estabhshment of public schools to the 497 Act passed Apr. 2, 1831, quoted in full by James Pyle Wickersham, History of Education in Pennsylvania, pp. 292-293. 498 A. D. Mayo, The American Common School, etc., Report U. S. Commissioner of Education, 1895-96, pp. 261, 262. 499 Report U. S. Commissioner of Education, 1870, p. 270; 1872, p. 288. 500 B. A. Hinsdale, Educational Documents, Report U. S. Commissioner of Edu- cation, 1892-93, p. 13 14. ^1 J. P. Wickersham, History of Education in Pennsylvania, pp. 290-316. ^2 Ibid., p. 343. 383 384 PERMANENT COMMON SCHOOL FUNDS option of the district, but in 1848 a law was enacted making the maintenance of free public schools compulsory for the entire state.^°2 As early as 1786 Pennsylvania took steps toward establishing a permanent common school fund. On April 7th of that year an Origin and act was approved entitled, "An Act for the present o/commr°* relief and future endowment of Dickinson College School Fund i^ ^j^g Borough of Carlisle and County of Cumber- land in this State, a7id for reserving part of the imappropriated lands belonging to the State, as a fund for the endowment of public schools agreeably to the forty-fourth section of the Constitution of this Commonwealth^'' ^°^ Section VII of this act reads as follows: "Sec. VII. It is therefore enacted, etc., that sixty thousand acres of land, part of the unappropriated lands belonging to the State, be and they are hereby reserved and appropriated for the sole and express purpose of endow- ing pubHc schools in the different counties of this State, agreeably to the said forty-fourth section of the Constitution." sos Sections VIII, IX, and X made further provisions relative to surveying the lands and setting apart the proceeds of the sales as a permanent fund.^°'* But the public schools never received any benefit from the land set apart by this act in their behalf; it was probably given subse- quently to county academies.^"^ In 1 82 1 Governor Hiester in his message urged the legislature to consider the question of uniting with others of the original states in demanding of the federal Government an equitable proportion of the pubhc lands for the support of schools.^"^ In 1824 Governor Schulze spoke as follows: "I would respectfully suggest whether an annual sum specially appropriated for that purpose, would not in a few years raise a fund equal to the diffusion of the elements of education among the children of the repubhc," ^^^ In 1827 a bill "to provide a fund in support of a General System of Education in Pennsylvania" was passed by the state senate but 503 Ibid., p. 257. 504 Ibid., pp. 257, 258. 505 Ibid., p. 268. PENNSYLVANIA 385 was defeated in the house.^°^ " But/' in the words of Wickersham, "the bread thus cast upon the waters returned in a few years in the following Act, passed on the second of April, 1831." The pro- visions of this Act may be summarized briefly by saying that it provided that the proceeds of the sales of certain public lands be set apart as a permanent common school fund, to be managed by a board of commissioners, the fund to accumulate until its annual income should amount to $100,000, after which the interest was to be distributed among the school units of the state. The Act reads as follows: ^°® "Sec. I. That there shall be and there hereby is established a fund, to be denominated a Common School Fund, and the Secretary of the Common- wealth, the Auditor General and the Secretary of the Land Ofi&ce shall be commissioners thereof, who, or a majority of them, in addition to the duties they now perform, shall receive and manage such moneys and other things as shall pertain to such fund, in the most advantageous manner, and shall receive and hold to the use of said fund, all such gifts, grants and donations as may be made; and that said commissioners shall keep a correct record of their proceedings, which, together with all papers and docimients relative to said fund, shall be kept and presei-ved in the office of the Auditor General. "Sec. II. That from and after the passage of this Act, all moneys due and owing this Commonwealth by the holders of all unpatented lands; also all moneys secured to the Commonv/ealth by mortgages or liens on land for the purchase money of the same; also all moneys paid to the State Treasurer on any application hereafter entered, or any warrant hereafter granted for land, as also fees received in the land office, as well as all moneys received in pursu- ance of the provisions of the fourth section of an Act entitled 'An Act to in- crease the county rates and levies for the use of the Commonwealth,' approved the twenty-fifth day of March, 1831, be and the same are hereby transferred and assigned to the Common School Fund; and that at the expiration of twelve months after the passage of this Act, and regularly at the expiration of every twelve months thereafter, the State Treasurer shall report to the said commissioners the amount of money thus received by him during the twelve months last preceding, together with a certificate of the amount thereof, and that the same is held by the Commonwealth for the use of the Common School Fund, at an interest of five per cent. "Sec. III. That the interest of the moneys belonging to said fund shall be added to the principal as it becomes due, and the whole amount thereof shall be held by the Commonwealth, and remain subject to the provisions of an 506 Ibid., pp. 292, 293. 386 PERMANENT COMMON SCHOOL FUNDS Act entitled, 'An Act relative to the Pennsylvania canal and railroad,' ap- proved the twenty-second of April, 1829, until the interest thereof shall amount to the sum of $100,000 annually, after which the interest shall be annually distributed and applied to the support of common schools throughout this commonwealth, in such a manner as shall hereafter be provided by law." It was estimated that the Common School Fund would amount to $2,000,000 in ten years. The preamble of "An Act to establish a general system of education by common schools" states that on April 4, 1835, the School Fund will amount to $546,563.72." ^°^ Mayo asserts, as was stated in the opening paragraph of this account, that in 1834 the fund amounted to $1,550,000.^^* The Act of 1834 (section nineteen), provided that $75,000 be appropriated annually for public schools from the income of the Common School Fund until the income should amount to $100,000, as provided by the Act of 1831.^'^^ Pennsylvania received $2,867,514.78 from the United States Governments*'^ as this state's share of the surplus revenue dis- tribution of 18^7.* Bourne estimates that about United States „ r ^■ 1 n i • i Surplus $800,000 of this amount was devoted to the aid evenue, 13 ^^ pubhc schools; ^^^ $500,000 of this sum was set apart as a fund "to be applied by the several districts either for buildings, repairing or purchasing school-houses, or for educa- tion, as they may deem best." ^^^ It does not appear that this sum was set apart as a permanent fund, but rather that the principal was expended prior to 1840.^^" * For a full account of the surplus revenue distribution consult Part I, Chap. III. 507 Ibid., p. 313. 508 Ibid., p. 316. 509 E. G. Bourne, History of the Surplus Revenue of J^Sjy, p. 99,, 510 Ibid., p. 102. 511 Ibid., p. 100. CHAPTER XL VII RHODE ISLAND PERMANENT SCHOOL FUND The state permanent common school fund of Rhode Island, officially known as the Permanent School Fund ^^^ is invested as a Title. distinct and separate fund,^^^ chiefly in town and Condition, 1905 (,j^y bonds.^^^ In 1905 the principal amounted to $257,414''^^ and the annual interest or income from the same to $9,131^^^ approximately forty-five hundredths per cent (.0045)* of $2,014,821, the total common school revenue derived from all sources in 1905.^^^ The Permanent School Fund was established in 1828, by an act which appropriated $5,000 as the basis of a permanent fund ^ . to be increased by revenues from lotteries (lot- Origin •' ^ teries were abolished 1843), and auctions when a balance remained from these two sources after having paid the annual appropriations provided for by section i of the same act.^^^ Rhode Island received $382,335 ^° as its share of the United States Surplus Revenue Loan of 1837. By an Act passed November 5, 1836, this entire amount was originally devoted to education ^^^ and to it was added $4,276 received in 1858 from the federal Govern- ment from the proceeds of the sales of federal lands. The principal * Computed. 512 Laws Pertaining to Education, compiled by Commissioner of Public Schools, 1896, Chap. 30, Sec. i. 513 Data furnished Dec. 4, 1906, by L. M. Coggeshall, Clerk to the Rhode Island State Commissioner of Public Schools. 514 Rhode Island State Treasurer's Report, 1903, p. 66; Report U. S. Commis- sioner of Education gives revenue of state and local funds and rent of school lands as $15,223; $9,121 of this is interest on the permanent school fund, $6,102 is revenue from local funds and gifts. 515 Stockwell, Thos. P., History of Public Education, R. I., p. 45. 616 Public Laws of R. I., passed since 1835, pp. 913, 914. 387 388 TERjMANENT COI^IMON SCHOOL FUNDS was in part loaned to the towns and in part deposited in banks whicli were to pay five per cent interest.^**'" " The state by the close of the year 1857 had borrowed all but $155,541 and in January, 1859, transferred that amount to the Permanent School Fund. To this it subsequently added $11,192 surplus state revenue in 1S60," making the total amount added to the fund, $166,733.^''^ The state appears not to recognize her indebtedness, i. e., she makes no payment of annual interest on the United States Surplus Revenue but the annual state appropriation for common schools, $120,000, exceeds and perhaps may be considered to include, such interest/''^ The present sources provided to increase the principal of this Sources of ^^^^"^ ''^^'^ ^''^'^'- taxes on auctioneers' fees,^*^ and Increase quotas of State school revcnuc forfeited by towns.*^^ The fund is managed by the general treasurer Management . , , , . - , "" ^o. With the advice ot the governor/'-^ To the income of the Permanent School Fund must be added from the state treasury an amount sufficient to make the total, a sum lixed bv law ($120,000, 1905). This total Apportionment IS denominated ''teachers money and is appor- tioned on a twofold basis as follows: (i) $100 to each school in every town not to exceed more than fifteen in any one town; (20) the remainder on the basis of town school population (^iive to fifteen years.)^^ ''Teachers' money including the revenue of the Permanent School Fund can be used solelv for the pay- ment of teachers wages. ""-^ In order to participate in the revenue, the town must raise by Conditions of local tax an amount equal to the share it receives Participation ^^.^^^ ^hc state.^'""* 517 E. G. Bourne, History of Surplus Revenue of iSjy, pp. 103-106. 51S Report U. S. Commissioner of Education, 1S06-07, p. 642; also E. G. Bourne, History of the Surplus Rn'cnue of J'Sjy, p. 105. 619 School Law, p. 15, Chap. 30, Sec. 2. sao Ibid., p. 30, Chap. 53, Sec. 5, also p. 15, Chap. 30, Sec. 3. 521 Ibid., p. 15, Chap. 30, Sec. i. 5^' Ibid., p. 3S, Chap. 53, Sec. 2. 523 Ibid., Sec. 3. 52* Ibid., Sec. 4. CHAPTER XL VIII SOUTH CAROLINA PERMANENT SCHOOL FUND The permanent state common school fund of South Carolina is known officially as the Permanent School Fund/'^'^ This title Title. appears to be based on usage and not on any Condition, 1906 legislative provision. "Our ^jcrmanent fund is practically nothing and is not regarded as a part of the public school fund in making up our statistics." ^'''^''' The principal of this fund in 1906 amounted to about $46,000-'''^^ yielding $2,251.74 annual interest at four per ccnt/'^^ which is approximately sixteen hundredths per cent f.ooi6j"-'' of $1,372,063, the total common school revenue derived from all sourccs.''^^ "This interest is now used only for Teachers' Objects ' •' Institutes."-'-^ South Carolina appears to have established a permanent school fund in 181 r, but little, if any, reliable information concerning it has been available. Section 11, article X, of the Origin constitution adopted in 1868 ^''^'^ provided that "The proceeds of all lands that have been or hereafter may be given by the United States to this state for educational purposes, and not otherwise appropriated by this state or the United States, and of all lands or other property given by individuals, or appro- priated by the state for like purposes, and of all estates of deceased persons who have died without leaving will or heir, shall be securely * Computed. 5*2^ Report S. Car. State Supt. of Education, 1903, p. 185. 528 Extract from personal letter written Dec. ii, igo6, by W. H. Barton, Chief Clerk, S. Car. Department of Education. 527 Data furnished by S. Car. State Treasurer, R. H. Jennings, Dec. 19, 1906. 528 Report U. S. Commissioner of Education, igo6. Vol. I, p. 306. 529 Report U. S. Commissioner of Education, 1892-93, p. 1359. 389 390 PERMANENT COMMON SCHOOL FUNDS invested and sacredly preserved as a state school fund, and the annual interest and income of said fund, together with such other means as the general assembly may provide, shall be faithfully appropriated for the purpose of establishing and maintaining free public schools and for no other purposes or uses whatever." ^^^ The Permanent School Fund is managed by Management ^ ^ the State Treasurer.^^° The principal may be increased by moneys derived from the following sources :^^^ (i) grants of land or gifts of money made to Sources of the State for educational purposes; (2) all gifts to Increase ^]^g g^g^^-g ^y];jei-e ^he purpose is not designated; (3) all escheated property; (4) net assets or funds of estates or copart- nerships in the hands of the court of the state where there has been no claimants for the same within the last seventy years; (5) money resulting from the refunding of the direct-tax Act of Congress 1891; (6) liquor licenses except so much as is allotted to counties and mu- nicipal corporations. 530 School Law of S. Car., 1896, p. 9, Sec. 5. 531 School Law of S. Car., 1896; Constitution of 1895, Report U. S. Commis- sioner Claims Fund, from every standpoint, considering like endow- 1904 ments already established in sister states, the sources from whence such an endowment may be best derived, the most satisfactory methods of its investment and the wisest plan of the distribution of its revenue, and who shall report their findings and conclusions in full detail to the general assembly in October of 1906, accompanying the said report with a proper Public School bill for the consideration of said general as- Fund, 1906 sembly." ^"^ This commission, known as the Special Commission on Permanent Common School Fund, was composed of the following persons: Joseph A. DeBoer, Charles Vermont Special H. Stearns, Justus Dartt, Nelson W. Fisk, Her- Perm^nelrcom- "lan P. Simpson, John A. Mead. Their report mon School Fund presented to the Vermont legislature of 1906 recommended the merging of the United States Deposit Fund, the Huntington Fund and the Spanish War Claims Fund. The bill they presented was slightly modified, then passed by the legislature as No. 54 of the Acts of 1906. It will be seen by a study of this act, quoted in full at the close of this account, that it " diverts the payment of interest, at five per cent, on each town's portion of the United States Deposit fund from the town treasury to the State Treasury and segregates v/ith this interest the income from the Huntington Fund and the War Claims Fund, the aggregate income of which is divided among the towns. . . . In case a town has not loaned its portion of the United States Deposit Fund to itself it is required to collect and pay the same into the State Treasury on or before December 31, 1907." "^"^ It has been noted above that the state borrowed $240,000 of the Permanent School Fund established in 1825, and then in 1845 607 Act Approved Dec. 9, 1904, Sec. 2. 608 Vt. Dept. of Education, Circular of Information, 1906, No. 44, p. 20, 414 PERMANENT COMMON SCHOOL FUNDS appropriated the fund to pay this debt.* The weakness of the Act passed November 3, 1842, was that it permitted towns to borrow their portions of the United States Deposit Fund of themselves for themselves. "If the money had been loaned agreeable to the provisions of the first Act * then each town would have to-day an investment from which would accrue a revenue for the support of schools. But those towns that have borrowed the funds of themselves and used such in the build- ing of town houses, construction of bridges, repair of roads, and paying of debts, — expenses which should have been met at the time by direct taxation,— have entailed upon the present generation a tax for the payment of interest on the fund." ^"^ An investigation carried on by the State Department of Education of Vermont in 1906 revealed the fact that eighty per cent of the towns of the state have absorbed their portion of the United States Deposit Fund;^^^ if we take this as representing roughly eighty per cent of the United States Deposit Fund we may consider the amount thus diverted to approximate $535,269.39. "In all cases where the town has appropriated the money for town purposes, the town pays interest on its portion of the fund at the rate of six per cent and such revenue is covered into the school funds of the town." ^^^ As long as the state and towns continue to pay interest on the principal of the permanent school funds which they have borrowed, these funds cannot, strictly speaking, be called lost; for they continue to be fixed sources of school revenue. Nevertheless, such income is to a large extent derived from taxation, so that a tax has been entailed upon future generations to pay interest upon funds orig- inally created to lessen this tax and to stand as an impregnable foundation in periods of critical financial conditions. The impor- tance of this fact is recognized in the Act of 1906 creating the perma- nent Public School Fund which provides that "whenever at the end of any fiscal year there is a surplus in the state treasury over and above the liabilities of the State, then such part of said surplus shall be paid over to the trustees of permanent school fund as the trustees of said fund may determine at a meeting to be called for * See above, topic "Origin." VERMONT 415 that purpose until an amount equal to that part of the Huntington fund heretofore converted into cash by the state treasurer shall have been transferred." *^'^^ The total amount of the Vermont Permanent School Fund di- verted or lost from 182 5-1905 may be estimated as follows: Fund of 1825 $240,000 U. S. Deposit Fund, absorbed by towns 500,000 Huntington Fund 211,269 (?) Total $951,269 The management and investment of the permanent school fund rests with a committee of three organized by a board of seven Management and persous known as " Trustees of Permanent School Investment Fund" consisting of the Governor, Lieutenant- Governor, State Treasurer and Superintendent of Education ex officio, and three persons appointed biennially by the Governor/^^ " Said trustees shall invest the permanent public school fund in the following named securities only: United States bonds, state bonds, bonds of cities and school districts located in the United States, excluding territories, and having a population of over twenty thou- sand, and bonds of towns, cities and villages in this state whose total indebtedness does not exceed five times the amount of the grand list." ^^^ (i) "Beginning with April i, 1907, a legal school must have an average daily attendance of not less than six for twenty-eight consecutive weeks in Conditions of order that the town may receive state aid thereon, ^lo Participation (2) If in any town the trustees of public money fail to collect and pay over to the state treasurer for the trustees of permanent school fund such town's share of the United States deposit money as is not already loaned to the town to which it has been apportioned within the time limited therefor, or (3) if in any town where its share of United States deposit money is already loaned to it the trustees of public money fail to pay over, within the time limited therefor annually, the five per cent income derived there- from, then, in either such event, the income from permanent public school fund and the state school tax which would otherwise thereafter be payable to such town shall be forfeited to the state and added to the principal of the 609 Acts of Vt., 1906, No. 54, Sec. 7. 610 School Laws, Vt. Dept. of Education, Circular of Information, 1906, No. 44, p. 19; Acts of 1906, No. 53, Sec. 4. 4i6 PERMANENT COMMON SCHOOL FUNDS permanent public school fund, and such forfeiture shall thereafter be made from year to }'car until such town has j^aid over to the state treasurer for the trustees of permanent school fund all sums in arrears, with interest thereon at the rate of six per cent per annum." "n The Permanent Public School Fund may be increased from the following sources: (i) forfeitures by towns (as just ex- Sourcesof plained) ; ''^^ (2) gifts; ^^^^ (3) bequests; ^'■'^ surplus Increase jj^ state treasury at close of fiscal year (cf. para- graph on Loss). '^^^^ The income of the Permanent Public School Fund shall be used "solely for the support of Lawful Uses •^ , r i public 'schools." ''^- The law providmg for the creation of the Vermont Permanent Public School Fund was framed after a careful study of the modes of administering funds in the various states. It was enacted one hundred and one years after New York and one hundred and sixteen years after Connecti- cut had established a permanent common school fund, at a time when the relative importance of permanent funds is rapidly de- creasing in many states. This act has so many features of interest that it seems well w'orth quoting even in an account wdiich pretends to be merely a brief summary. "It is hereby enacted by the General Assembly of the State of Vermont: "Section i. The sum of two hundred fort)' thousand dollars returned by the national government to the state in settlement of the civil war claims, the Huntington fund, the United States deposit mone}', and such other additions as may hereafter be made to the fund hereby established shall be forever held intact and in reserve as a permanent public school fund. "Sec. 2. A board to be known as trustees of permanent school fund is hereby constituted, consisting of the governor, lieutenant governor, state treasurer, and superintendent of education, ex officio, and three persons to be appointed biennially by the governor, whose term of office shall continue until the first day of November of the next biennial 3'ear and until their successors are appointed and qualified unless sooner removed by the governor. Said trustees shall invest the permanent public school fund in the following named securities only: United States bonds, state bonds, bonds of cities and school districts located in the United States, excluding territories, and having a population of over twenty thousand, and bonds of towns, cities and villages 6" Vt., Acts of 1906, No. 54, Sec. 11. 612 ibid., Sec. 13. VERMONT 417 in this state vidiose total indebtedness does not exceed five times the amount of the grand list. Said board of trustees is empowered to receive gifts, be- quests or additions to such permanent public school fund, and all purchase and sales of securities shall be made by, and all securities shall be taken in the name of, and so far as possible made payable to the trustees of permanent school fund. "Sec. 3. Said trustees shall organize by the election of a chairman, secretary and a committee on finance of three members, of which the secretary shall be one, at a meeting to be held in the executive chamber of the state capitol at two o'clock in the afternoon on the second Tuesday of November in each biennial year, or at an adjournment thereof, or at a special meeting duly called if the organization is not then completed. Regular meetings of the board shall be held at such times and places as the members by vote determine. On the request of any two members of the board, the secretary shall call a special meeting thereof by notice in writing mailed to each member at least three days before such meeting, but the board may act without notice of a special meet- ing when all are present. "Sec. 4. The committee on finance shall by unanimous action make all investments of the permanent public school fund and designate depositories therefor, and in the name of the trustees shall execute all checks, transfers or releases of securities and do all things necessary to the proper management of the assets and income of said fund. "Sec. 5. The trustees shall receive no compensation for their services, but shall be paid their necessary expenses incurred in the performance of their duties. "Sec. 6. Vacancies among the trustees appointed shall be filled by the governor and vacancies in the officers of the board shall be filled by the mem- bers at a regular meeting or at a special meeting called for the purpose. The secretary shall keep a record of the proceedings of the board and of the com- mittee on finance, recording in detail the proceedings of said committee re- lating to investments, income and disbursements and the management of the permanent public school fund. "Sec. 7. Such securities as the state treasurer now holds belonging to the Huntington fund shall at once be turned over to the trustees of permanent school fund as a part of the pennanent public school fund. On such part of the remainder of said fund heretofore converted to the use of the state as shall not have been, at the time of the distribution of the income from the permanent public school fund in each year, paid over to the trustees of permanent school fund as hereinafter provided, six per cent interest shall annually be segregated by the state treasurer as a part of the income of the permanent public school fund, and such interest shall be distributed like the other income from such fund; and, whenever at the end of any fiscal year there is a surplus in the state 4i8 PERMANENT COMMON SCHOOL FUNDS treasury over and above the liabilities of the state, then such part of said surplus shall be paid over to the trustees of permanent school fund as the trustees of said fund may determine at a meeting to be called for that purpose until an amount equal to that part of the Huntington fund heretofore con- verted into cash by the state treasurer shall have been so transferred. "Sec. 8. The United States deposit money held in the state treasury for towns which have not elected trustees of public money and for unorganized towns and gores, together with three per cent interest thereon since the last distribution, shall be turned over to the trustees of permanent school fund at their request and before the distribution of the state school tax in 1907, the principal sum for investment as a part of the permanent pubUc school fund, and the amount of three per cent interest for distribution with the other income from the permanent public school fund. "Sec. 9. The trustees of public money of each town shall, on or before December 31, 1907, collect and pay over to the United States deposit money heretofore apportioned to it to the state treasurer for the trustees of permanent school fund, except where such money is at the time of the passage of this act loaned to the town to which it was apportioned, in which case the trustees of public money may continue annually to loan said money to such town, with interest at five per cent per annum, until such time as said trustees see fit to collect the same, when it shall immediately be turned over to the state treasurer for the trustees of permanent school fund. "Sec. 10. The income from the United States deposit money, in those towns where such fund is loaned to the town to which it has been apportioned, shall annually on or before the tenth day of June, so long as said loan remains uncollected, be paid over by the trustees of public money to the state treasurer for the trustees of permanent school fund for distribution with the other income from said permanent pubHc school fund. "Sec. II. If in any town the trustees of pubHc money fail to collect and pay over to the state treasurer for the trustees of permanent school fund such town's share of the United States deposit money as is not already loaned to the town to which it has been apportioned within the time hmited therefor, or if in any town where its share of United States deposit money is already loaned to it the trustees of public money fail to pay over, within the time limited therefor annually, the five per cent income derived therefrom, then, in either such event, the income from permanent public school fund and the state school tax which would otherwise thereafter be payable to such town shall be forfeited to the state and added to the principal of the permanent public school fund, and such forfeiture shall thereafter be made from year to year until such town has paid over to the state treasurer for the tnistees of permanent school fund all sums in arrears, with interest thereon at the rate of six per cent per annum. VERMONT 419 "Sec. 12. The trustees of permanent school fund shall be accountable for such part of the United States deposit money as is held by them when required by the state treasurer on requisition of the United States. "Sec. 13. The income only from said permanent school fund shall be covered into the state treasury, fifteen thousand dollars of which shall annually be divided among the towns, cities and unorganized towns and gores entitled thereto, in the same manner as the forty-five thousand dollar reserve fund is divided, and the remaining portion of the income shall be divided, by the state treasurer, among the towns, cities, and unorganized towns and gores according to the number of legal schools maintained the preceding year, and such division shall be made at the same time the monies derived from the state school tax are now divided. The income thus distributed shall be used solely for the support of public schools, and shall, in unorganized towns and gores, be divided equally between the several school districts which have maintained a legal school the preceding year, and in towns having a district incorporated by a special act of the general assembly, as is provided for the division in such towns of money received from the state school tax. "Sec. 14. The trustees of permanent school fund shall present to the gen- eral assembly on the first day of each biennial session a report of their official acts, showing the amount and condition of such fund and the securities in which it is invested and the amount and distribution of its income. "Sec. 15. The auditor of accounts and inspector of finance shall annually audit the accounts of the trustees of permanent school fund and the accounts of the state treasurer in connection with such fund, examine the securities on hand and certify to the correctness of their transactions and the condition of the fund, which certificate shall be included in the report of the state treasurer. "Sec. 16. The town treasurer shall give credit in his account of the school fund for sums received by the town from the income of the permanent public school fund. "Sec. 17. Section 740 of the Vermont statutes is hereby amended to read as follows: "Section 740. Said trustees shall manage such money and report the con- dition of the same at each annual town meeting. "Sec. 18. Sections 737, 738, 741, 742, 743, 744, 749, 750, 751 and 753 of the Vermont statutes, and all amendments thereto, No. 42 of the acts of 1904 and all acts and parts of acts inconsistent with this act are hereby repealed. "Sec. 19. This act shall take effect from its passage." Approved December 14, 1906. (Quoted from School Laws, Acts of 1906, State of Vermont, Dept. of Ed., Circular of Information, No. 44, pp. 21-25.) CHAPTER LIV VIRGINIA LITERARY FUND The Virginia permanent common school fund is known officially as the Literary Fund.^^^ In 1905 the annual interest on this fund rpitig^ amounted to $56,430.82,*^^^ approximately two Condition, 190S and three-tenths per cent (.023)* of $2,432,102,^^^ the total school revenue derived from all sources for that year. In 1905 the principal of the Literary Fund amounted to $1,881,027.28, and in 1906 to $2,021, 788.60.*^^^ The principal is intact, being invested chiefly in Virginia state bonds bearing annual interest at three per cent. The Literary Fund became established February 2, 1810, by an act of legislature, which provided that (i) all escheats, (2) conliscations, (3) fines, (4) penalties, (5) forfeit- ures, (6) rights and personal property accruing to the state as derelict and having no rightful proprietor should constitute a permanent fund for the use of common schools.^^^ In 181 8 the Literary Fund had reached the sum of $1,000,000.^^^ The Literary Fund suffered severe losses from i860 to 1886. In 1861 the principal amounted to $1,877,364.68.*^^^ Judge John G. Dew, second Auditor of Virginia, reports the Loss losses as follows : ^^^ diverted during the Civil War, $216,000; lost on bank stock during Civil War, $300,000; lost on bank stock since Civil War, $50,000; paid to West Virginia * Computed. 613 Va. School Laws, compiled by Board of Education, 1S92, p. 57, Sec. 51. 61* Statement received Dec. 12, 1906, from Judge John G. Dew, Second Auditor of Virginia. Judge Dew has the immediate care of this fund. 615 A. D. Mayo, Common Schools in the South, 1S30-60; Report U. S. Commis- sioner of Education, 1899-1900, Vol. I, p. 432. 616 Miller, Thos. C, History of Education in West Virginia, p. 29. 617 Va. School Report, 187 1, p. 199. 420 VIRGINIA 421 as her share of Literary Fund, $719,022.62, 1871, 1886; discount in funding, $541,494.10; total amount of lost or diverted principal, $1,826,516.72.'^^^ The fund is suffering also because of insufficient legislation in respect to the sources of revenue devoted to its increase. Joseph W. Southall, State Superintendent of Public Instruction, writes in his report for 1904-05 as follows: "This fund would be increased far more rapidly if some more stringent plan were adopted for the collection of fines imposed for offences against the Commonwealth, and the proceeds arising from es- cheated property and all waste and unappropriated lands. It is safe to say that thousands of dollars are lost every year to this fund for lack of a better system of collecting fines and escheating derelict property." ^'^ The following sources are provided by law to increase the prin- cipal of the Literary Fund.''^^ The proceeds of (i) lands granted Sources of ^y Congress for public schools; (2) all escheated Increase property; (3) all waste or unappropriated lands; (4) all property forfeited to the state; (5) fines not otherwise appro- priated; (6) donations; (7) such other sums as the general assembly may appropriate. Of these seven sources the second, fourth and fifth at present contribute most.^^^ The Literary Fund is managed by the State Board of Educa- tion,^^^ composed of the Governor, Superintendent of Public In- struction, Attorney- General, three members of the Management ■' faculties of the various state educational institu- tions and a county and city superintendent.^^^ The second auditor, Judge John G. Dew, invests the fund for the Board of Education.^^* The revenue is apportioned among the cities and counties on the basis of school population (seven to Apportionment ^ ^ ^ twenty years) .^^^•''2'' 618 Extract from personal letter dated Sept. 12, 1906, received from J. D. Eg- gleston, Jr., Va. State Supt. of Public Instruction. 619 Va. School Laws, compiled by Board of Education, 1892, p. 36, Sec. 12, Subd. 9. 620 Ibid., p. 70, Sec. 88. 622 Va. School Report, 1871, App. p. 198; Va. School Report, 1904-05, Part I, p. xxxi. 422 PERMANENT COMMON SCHOOL FUNDS The Literary Fund constitutes one of the most valuable assets of the commonwealth, as it furnishes the means of the financial support of (i) the State Board of Education; (2) Objects ^^ ^ ^ , , ' ^ ; for the payment of the salaries and expenses of the State Board of Examiners; (3) the salaries of the division superintendents of schools; (4) the expenses of the summer normal schools; and (5) no inconsiderable share of the wages of teachers.^" The following conditions must be fulfilled in order to share in it: (r) school must be kept in operation five months during the current Conditions of year; ^^^ (2) school-houses, furniture, apparatus, Participation text-books for indigent children, and all other means and appliances for the successful operation of the schools must be provided. 821 Ibid., p. 52, Sec. 44. CHAPTER LV WASHINGTON COMMON SCHOOL FUND "Permanent School Fund" is a title frequently given to the permanent common school fund of Washington in the state reports, Title. but Common School Fund is the title provided Condition, 1906 ^iji^g i^y ^i^g constitution and laws."^--' The fund consists (October i, 1906) of $1,477,244.07,*^^ besides about two and a quarter million acres of unsold school lands.^^ $1,345,000 of the above amount has been borrowed by the state which pays interest on the same at the rate of three and one-half per cent (.035).^^ This interest is paid out of state taxes,^^^ in other words, the state uses the moneys derived from lands originally donated to relieve the people from taxation for the support of schools, and then taxes the people to pay the interest. This is a policy followed in many other states — the wisdom of it cannot be discussed here.* As the surveys of common school lands are not yet completed it is impossible to state positively the total acreage.^^® The 1905 report of the United States Commissioner of Education gives the following data for Washington : ^''^ unsold common school lands, leased, 888,651 acres, estimated value, $8,000,000; unleased, 1,362,000 acres. The average price per acre of lands sold thus far is stated to be $18.70 ^^^ and as the act enabling Washington to become a state (Enabling Act, section 11) forbids any lands to be sold for less than ten dollars per acre, it would seem that with * On this point read the account of the Minnesota fund, also consult Part I. 623 Constitution of Wash., 1889, Art. IX, Sees. 2, 3; Sch. Law of State of Wash., 1901, p. 61, Chap. 6. 824 State Treasurer's Report, 1904-06, p. 9. 625 Statement received from R. B. Bryan, Wash. State Supt. of Public Instruction, Dec. 21, 1906. 626 Northwest Journal of Education, Mar., 1906, p. 21. 423 424 PERMANENT COMMON SCHOOL FUNDS proper management the principal of the fund may eventually amount to over twenty-five million dollars. Washington's total common school revenue in 1905 derived from all sources was $3,648,369 ^^ of which $293,312,^^^ approximately eight per cent,^^' was derived from Common School Fund interest and land rent. Washington upon her admission into the Union received from the United States Government the sixteenth and thirty-sixth sec- tions in each township for the use of common Origin schools. It is estimated this land grant will amount to 2,488,675 acres.^" The first constitution adopted 1889 provided for the estabHsh- ment of the Common School Fund from the proceeds of these lands Sources of ^^^ ^^^ proceeds of several other sources as fol- increase lows: ^^' (i) appropriations and donations by the state to this fund; (2) donations and bequests by individuals to the state or public for common schools; (3) proceeds of lands or other property reverting to the state by escheat or forfeit- ure; (4) proceeds of all property granted to the state when the purpose is not specified or is not certain; (5) funds accumulated in the state treasury for the disbursement of which provision has not been made by law; (6) proceeds of timber, stone, minerals or other property from school and state lands other than those granted for specific purposes; (7) all moneys other than rent recovered from trespasses on said lands; (8) five per cent of proceeds of sales of United States Public Lands lying within the state; (9) the principal of all funds arising from the sale of lands and other property which have been granted and hereafter may be granted to the state for common schools; (10) such other funds as the legislature may pro- vide. The Common School Fund is managed by the State Board of Land Commissioners, composed of the Superin- Management tendent of Public Instruction, Secretary of State, and Commissioner of Public Lands.^^^ «27 Constitution of Wash., 1889, Art. IX, Sec. 3. 628 Report Supt. of Public Instruction, Wash., 1902, p. 180; Northwest Journal of Education, Jan., 1904. WASHINGTON 425 The revenue is apportioned by the State Superintendent of Pubhc Instruction among the counties in propor- Apportionment . , ^ i r 1 «9a tion to the total number of days of attendance.**^^ The objects for which the revenue of the Common School Fund shall be used are not specified by law other than Objects R, that it shall be used for current expenses.^^" In order to share in the revenue, the following conditions must be fulfilled by the districts: A school must be maintained for at Conditions of ItSist five months during the preceding year.^^^ A Participation district forfeits twenty-five per cent of its share of the school fund revenue if it (i) uses text-books other than those prescribed by the proper authorities; ®^^ or (2) fails to comply with the prescribed course of study; or (3) issues warrants to a teacher not legally qualified.^^^ (4) After June 30, 1906, districts must levy a three-mill local tax in order to receive their apportionment of school moneys.^^^ 629 Wash. School Law, 1901, p. 25, Title II, Chap. I, Sec. 22. 630 Ibid., p. 62, Chap. 6, Sec. no. 631 Ibid., p. 92, Sec. 174; Laws of Wash., 1905, Chap. 56, Sec. 5. CHAPTER LVI WEST VIRGINIA SCHOOL FUND The correct title of the permanent common school fund of West Virginia is School Fund,^^^ though it is often called the " irreducible Title. fund." ^^^ The principal of the fund is intact. Condition, 1905 rj^^Q g|.^^g ]^a^s never borrowed any of the principal and cannot do so "because the Constitution forbids the creation of any state debt whatever." ^^^ The principal is invested chiefly in district, county, and municipal bonds.^^^ In 1902 the principal of the School Fund amounted to $1,104,412.69.^^^ "At the general election that year an amendment to [the] Constitution was adopted which limited the permanent school fund to one million dollars and the sources by which it had from time to time been augmented were all to be turned into the general school fund (annual school revenue). The amount in excess of a million dollars — about $104,000 — was distributed as a part of the general school fund in three annual instalments, 1903-04-05. (The School Fund now) produces a revenue of about $51,000," ^^^ approximately two per cent (.0185)* of $2,744,334, the total common school revenue in 1905 derived from all sources.^^ The following is a copy of the amendment above referred to : Amending section four of Article XII. "The accumulation of the School Fund provided for in section four of Article XII, of the Constitution of this State, shall cease upon the adoption * Computed. 632 Constitution, Art. X, Sec. i; Report U. S. Commissioner of Education, 1892- 93, Vol. II, p. 1334. 633 Report State Supt. of Free Schools, West Virginia, 1906, p. 39. 834 Statement received from T. C. Miller, W. Va. State Supt. of Free Schools, Feb. 18, 1907. "36 Report State Supt. of Free Schools, W. Va., 1906, pp. 40-43, table of invest- ment securities. 636 Ibid., p. 38. 426 WEST VIRGINIA 427 of this amendment, and all money to the credit of said Fund over one million of dollars, together with the interest on said Fund, shall be used for the support of the Free Schools of this State. All money and taxes heretofore payable into the Treasury, under the provisions of the said section four, to the credit of the School Fund, shall be hereafter paid into the treasury to the credit of the general school fund for the support of the free schools of the State." (Adopted at general election in West Virginia, 1902.) In the year 1863, West Virginia, up to that time a part of Vir- ginia, adopted a constitution and was admitted into the Union as a separate state. The new state in her first con- Ongm * ... stitution provided for the creation of a permanent fund to be known as the School Fund, the interest of which was to be annually applied to the support of free schools throughout the state. The sources from which the fund was to be derived and increased as provided by the constitution were as follows: (i) West Virginia's share of Virginia's Literary Fund and any money, stocks or property which could be rightfully claimed from Virginia for educational purposes; * (2) proceeds of delinquent waste and unappropriated lands; (3) proceeds of lands heretofore sold for taxes or purchased by Virginia if hereafter redeemed or sold to others than the state; (4) grants, devises or bequests made to the state for the purposes of education where the purpose is not specified; (5) proceeds of intestate estates; (6) proceeds of escheated lands; (7) proceeds of taxes levied on revenue of corporations; (8) military exemption moneys; (9) appropriations by legislature; (10) any interest of School Fund remaining unexpended at the close of the fiscal year. "This fund (the School Fund) was started when this state (West Virginia) was organized by laying claim to about $120,000 of the Literary Fund of Virginia which was within the bounds of the new state as stock in certain banks. This stock has been quite remunerative, one bank having paid ten per cent dividends for a number of years." July i, 1871, Virginia trans- ferred to West Virginia $552,079.29 and again on September 27, 1886, $166,943.33 as the latter state's share of the Virginia Literary Fund.^i^ * See, above, Virginia Literary Fund, "Origin," pp. 420, 421. 428 PERMANENT COMMON SCHOOL FUNDS The School Fund is managed by a board composed of the Governor, Superintendent of free schools, Auditor Management and Treasurer." ^^^ "Not a penny has been lost for a great many years." ^^^ Some time prior to 1875 about $6,000 was lost through the depreciation of bank stock. ^^'* The revenue of the School Fund is appor- tioned among the districts on the basis of school Loss Apportionment population.^^^ Objects The income can be used for teachers' wages In order to receive its share of the revenue, a district (i) must Conditions of maintain a school at least five months; (2) must Participation j^^y ^ j^^^l ^^^ Sufficient with the School Fund revenue to support a school.^^^ *37 School Law of W. Va., revised by State Supt. of Free Schools, 1903, p. 73, Sec. 61. ^^ Ibid., p. 50, Sec. 40. 63» Ibid., p. 52, Sec. 42, and p. 50, Sec. 40. CHAPTER LVII WISCONSIN SCHOOL FUND The titles "irreducible school fund," and "school trust fund" are sometimes applied to the permanent common school fund of Title. Wisconsin. The title provided by the constitu- Condition, 1904 tion, and, therefore, the correct title is the School Fund.^^'' "No printed report (concerning the School Fund) has been available since June 30, 1904." ^^^ At that time the fund consisted of $3,609,212.96 and 25,148.27 acres of unsold lands estimated to be vi^orth $99,000,^^^ making the total estimated value of the fund $3,708,212.96.* During the Civil War the state bor- rowed $1,563,700 from the School Fund; this sum has never been returned and is practically a permanent debt, secured by certifi- cates of indebtedness on which the state pays seven per cent interest. This interest is derived from state taxes whenever the income from other sources is insufficient.^^^ The remainder of the fund is invested chiefly in "loans to school districts for two pur- poses only: building school-houses or refunding district indebted- ness and loans to counties and cities for public buildings. The real estate of each of these is pledged to the state as security for the loan." ^^ No school lands are at present rented.^^ Wisconsin's total receipts from all sources for common schools in the year 1903-4 amounted to $8,019,230.08.^'^^ Of this $210,419.51, ^ i. e., approximately two and sixty-two hundredths per cent (.02624-)* was derived from the income of the School Fund. It is, perhaps, * Computed. •s^o Constitution of Wis., 1848, Art. X, Sec. 2; Report U. S. Commissioner of Education, 1892-93, Vol. II, p. 1332. ^1 Statement received from Wis. Dept. of Public Instruction, Sept. 12, 1906. 642 Biennial Report, Wis. Dept. of Public Instruction, 1902-04, Vol. I. p, 130. 6^ Ibid., p. 125. 429 430 PERMANENT COMMON SCHOOL FUNDS because so much of this nominal income is in reality derived from taxation that the reports for 1905 include it in state taxes.^^ Wisconsin provided for the establishment of her School Fund by her first constitution, which became effective upon her admission . . into the Union, 1848.^^" The original capital con- sisted of 958,649 acres ^^ of sixteenth section lands, and 500,000 acres granted under the Congressional act of 1841,'^'**' making the total amount of land thus originally devoted to the School Fund 1,458,649 acres. The Constitution provides the following sources for increasing the principal of the School Fund: '^■*'^ (i) proceeds of land granted Sources of by the United States; (2) money and proceeds Increase ^j property forfeited or escheated to the state; (3) military duty exemption moneys; (4) penal fines; (5) any grant of the state whose purpose is not specified; (6) five per cent of the proceeds of the sale of federal public lands lying within the state. The losses which the fund has suffered seem to be due chiefly to the following causes: defaulting of state officers; lands sold for less than real value; dishonest bookkeeping; Loss partially-paid-for lands stripped of timber and returned comparatively worthless to the state; investment in poor securities; failure to add to the principal of the fund revenues from the sources devoted to it by law. Through the mismanagement and defaulting of state officers the lands in Wisconsin were sold at nominal prices to speculators and the interests of the state largely sacrificed.^'*^" As early as 1858, ten years after admission as a state, the Superintendent of Public In- struction complains that the School Fund is being lost and wasted. In 1892 these complaints continue (cf. Report 1858, p. 23, and Report 1891-92, p. 141). Lyman C. Draper, Superintendent of Public Instruction, in his Report, 1859, pages 10-12, complains that exorbitant taxation leads many who have purchased school lands on mortgage to forfeit lands to state, and so throw them back upon the state, and deprive the state of interest. He cites a case in ^^'^ Kiehle, History of Education in Minn., p. 18; III. and Minn. School Lands, Management of. WISCONSIN 431 which it is said $68.48 was charged as interest on the non-payment of $148.65 for one year, and $85.00 for one day.^ "The variation between ledger accounts of Wisconsin and Washington, divergences in various official statements, absence of all original vouchers in one large account, and the disappearance of many others in other accounts whose files are ostensibly complete render any attempt at making a trustworthy statement precarious." ^'^^ "The original grants to our state for school purposes amounted according to earlier reports to 1,474,720 acres. The earlier state superintendents esti- mated that over $5,000,000 would be received from these sales. . . . Double that amount might have been easily received after the sale of all but 60,000 acres. The state can show but about $2,000,000 in its school fund credited to this source." ^^b "It is notorious that state lands covered by valuable timber have been sold and a fraction of their purchase price paid, the timber removed and the land then allowed to lapse to the state." ^^ "The certificates of indebtedness are evidence of the disappearance of nearly one-half of the school fund. The law which directed the investment of the school fund in the purchase of state bonds provided for the cancellation of all bonds and substitution therefor of certificates of indebtedness. The certifi- cates are non-negotiable and non-transferable. No provision whatever is made for their payment. The discretionary authority of the commissioners, who are clothed with constitutional powers over its investment, is thereby destroyed by statutory enactment.^^o The rate of interest on these certificates is 7%; 849 the effect is the creation of a perpetual state debt requiring the levy and collection of an annual state tax to the amount of $157,570 to pay the in- terest thereon. The interest paid . . . thus far amounts to about $4,200,000, and the process seems just begun. Additional burdens of taxation are the only fruits of the school fund, the very result which it was intended to avoid." ^so " Nominal Amount of State School Fund (1892) $3,358,502.50 «48 " Certificates of Indebtedness (1892) 1,563,700.00 6« Actual amount available for investment .... $1,794,802.50 " ^8 644 Report Supt. of Public Instruction, Wis., 1859, p. 11. 645 Report Supt. of Public Instruction, Wis., 1891-92, p. 161. 646 Ibid., p. 143. 647 Ibid., p. 142. 648 Ibid., p. 152. 649 Ibid., p. 153. 650 Ibid., p. 154. 432 PERMANENT COMMON SCHOOL FUNDS " This seems evident that a wise administration of all the provisions relat- ing to the School Fund should have resulted in a permanent endowment of from $15,000,000 to $20,000,000; that we have instead cash and money invested to the amount of $3,401,461.49 and a permanent state debt of $2,251,000; that the application of the available productive funds to the liquidation of the state debts will practically leave the state as though no provision had ever been made for the support of its schools ; that the neces- sity for the disappearance of this money is not apparent; that the laws and records have been witnesses to transactions of more than doubtful pro- priety ; and that the security for the debt is of questionable validity.®^ ^ "Nominal amount of total (1892): Common School Fund $3,358,502.50^8 University Fund 228,629.57 ^^ Agricultural College Fund 290,054.00 *•* Normal School Fund 1,774,375.428*8 Total nominal amount of school fund $5,651,469.49 Total amount represented by certificates of indebtedness 2,251,000.00 Actual amount of productive funds $3,400,461.00" Technically speaking, the money borrowed from the School Fund during the Civil War is not a loss, yet it must cer- tainly be considered a misappropriation, and it is difl&cult to dis- tinguish the difference between being taxed directly and being taxed to pay your own interest on an inherited trust fund.* The fund has suffered seriously from two sources; first, the wasting of the school lands, and, second, insufficient legislation respecting the sources of increase. Vast stretches of school lands were bought by lumber speculators for $2.50 per acre, who, it is said, were required to pay only forty cents on the acre. The timber was cut off and the lands then comparatively worthless reverted to the state. In 1904, $24,391.49 was derived from penal fines, which sum goes to increase the principal of the fund, but evidently the School Fund is not receiving all that it should from this source. It is difficult to understand why a county like Dane should contribute, in 1904, $2,431.10, while Milwaukee County contributed only $35.77. Dane * Many states buy state bonds with proceeds of school lands sales and pay in- terest out of taxes. See Minnesota. 651 Ibid., p. 161. WISCONSIN 433 County has a population of about 75,500 whereas Milwaukee County has a population of nearly 364,000. Dane is the capital city county and may be assumed to be reasonably intelligent and law-abiding and there is no reason for believing that in Milwaukee County there is a vastly greater respect for law than in Dane County. The School Fund is managed by a Board of Commissioners composed of the Secretary of State, Treasurer, Management \ and Attorney-General.^^'^ The revenue is apportioned among the counties, towns, villages, and cities on the basis of the total school popula- ppor onmen ^.^^ ^^ ^^^ Same (f our to twenty years) .^^^ The constitution provides that the revenue of the School Fund may be applied to the following objects: ^^° (i) support and main- tenance of common school in each school district: Objects (2) libraries; (3) apparatus: (4) the residue shall be appropriated to the support and maintenance of academies, normal schools and libraries and apparatus therefor. In order to receive its share of the School Fund revenue the school corporation must fulfil the following conditions: ^^^ (i) it must Conditions of ^^^^^e annually by local tax or by transfer from the Participation general fund to the School Fund of the school corporation, an amount equal to its quota of the School Fund revenue; (2) it must maintain a common school for six months taught by a qualified teacher unless excused for sufficient grounds by the Superintendent of Public Instruction; (3) it must submit the report required by law; (4) the report must contain an actual school census taken under the Board of Education or other super- visory body. 652 Constitution of Wis., Art. X, Sec. 7. 653 Revised Statutes, Wis., Chap. 28, Sec. 2. 654 School Laws of the State of Wis., 1897, XVI, pp. 181, 182. CHAPTER LVIII WYOMING COMMON SCHOOL PERMANENT FUND The laws and constitution of Wyoming fail to provide any oflBcial title for the state's permanent common school fund. The title i>itie_ employed in the reports of the Superintendent of Condition, 1906 Public Instruction is the Common School Perma- nent Fund.^^^ In 1906 this fund consisted of $173,000 ^^^ (invested chiefly in school district and county bonds) and 3,458,010 acres ^^^ of unsold common school lands estimated to be worth approxi- mately $3,000,000.* Of these unsold lands 2,057,000 acres ^^® were leased, leaving 1,401.010 acres unleased. The principal is intact, none of it ever having been borrowed by the state; ^^^ $23,706.76 belonging to the fund was lying in the state treasury uninvested September 30, 1906, because of the lack of opportunity to purchase bonds.^^^ The principal of the fund can be invested in the following bonds only: United States, state, school district, and county .^^^ The annual income in 1906 derived from the prin- cipal amounted to $11,106.60^^^ and the rent of school lands to $100,009.83 ^^^ making the total income from the Common School Permanent Fund $111,116.43. The total income from the Common School Permanent Fund in 1905 was $180,889.11 1 of which $178,875.81 was derived from the rent of lands and $2,013.29 from the invested principal. The total common school revenue * This is Mr. Fuller's estimate. The estimate given, Report U. S. Commissioner of Education, 1905, p. 419, is $5,329,000, for all lands leased and unleased. t Statement of Mr. Fuller, Report U. S. Commissioner of Education, 1905, gives it as $79,279. 655 Report Supt. of Public Instruction, Wyo., 1899-1900, p. 13. 656 Statement received from Robert P. Fuller, Wyoming Commissioner of Public Lands, Dec. 12, 1906. 434 WYOMING 435 in 1905 derived from all sources excluding balances on hand and bond sales was $366,300/^ of which, therefore, approximately forty-nine per cent (493 + )* was income from the Common School Permanent Fund. Wyoming, upon her admission into the Union in 1890, received from the United States by act of Congress, for the use of common ^ . . schools, the sixteenth and thirty-sixth sections in Origin ■' each township, amounting in all to 3,458,010 acres.^^^ The first constitution adopted by Wyoming upon admis- sion into the Union declared the following "to be perpetual funds for school purposes of which the annual income only can be appro- priated, to wit:" ^^^ (i) the proceeds of the sales of sixteenth and thirty-sixth section lands; (2) the proceeds of all lands granted to Sources of the state not otherwise appropriated; (3) the pro- increase ceeds of land and property escheated or forfeited to the state; (4) the proceeds of income dividends; (5) the proceeds of intestate estates; (6) five per cent ^^^ of the proceeds of sales of United States lands lying within the state. The only loss reported occurred in 1893, through the failure of a bank. The Common School Permanent Fund's Loss share of the loss was $5,768.35.*^^'^ The fund is managed by "The State Board of School Land Commissioners" composed of the Governor, Secretary of State, State Treasurer, and Superintendent of Public Management ^ Instruction, who control the leasing and sales of the lands under the direction of the legislature.^^^ The direct management falls chiefly upon the Commissioner of Public Lands who is the Secretary of the State Board of Land Commissioners, his office having been provided for in 1905.^*"^ * Computed. 657 Constitution of Wyo., Art. VII, Sec. 13; Report U. S. Commissioner of Educa- tion, 1892-93, Vol. II, p. 1408. 658 Report Supt. of Public Instruction, Wyo., 1901-02, p. 59. 659 Constitution, Wyo., Art. VII, Sec. 13; Rules of Wyo. State Land Board, 1905, p. 11; Session Laws, 1903, Chap. 78. 660 Wyo. Session Laws, 1905, Chap. 36. 436 PERMANENT COMMON SCHOOL FUNDS The revenue is apportioned by the county superintendent as follows: ^^^ (i) $iqo to each school district in the Apportionment county; (2) the residue is apportioned on the basis of school population. The objects to which the school fund revenue shall be applied appear not to be named nor specified by law.* It is provided, however, that it shall be applied exclusively to the support of free schools.^^^ A district, in order to participate in the revenue of the Common Conditions of School Permanent Fund, must maintain a school Participation f^j. ^^ j^^g^ ^j^j.^^ months.^^^ * See Idaho, foot-note 122". 661 Wyo. School Laws, 1904, p. 98, Sec. 6, p. 361. 6«2 Constitution of Wyo., Art. VII, Sec. 7. APPENDIX A* Tables Relating to the History of Permanent Public Common School Funds, Revenues and Expenditures in Six Typical States: Connecticut, Florida, Indiana, Maine, Massachusetts, New York. Table XXVI. Growth of Principal and Income of Connecticut School Fund, 1799-1905 25 Year Principal Income Year Principal InC0'rl1£ 1799 Not reported $ 60,403.78 i860 $2,050,460.49 $131,825.00 1800 prior to 23,651.10 1865 t 132,018.78 i3os 1820 45,157-39 1866 2,044,035.47 130,658.00 1815 38,878.00 1875 t 148,473.00 1820 $1,858,074.33 58,439.36 1876 2,028,332.81 135,219.00 1825 1,719.434-24 72,418.30 1885 2,030,123.74 120,855.20 1835 2,019,920.89 83,799.00 1895 2,013,102.01 130,832.25 1845 2,070,055.01 117,730.20 1905 2,022,502.23 109,579.27 1855 2,049,953-05 130,054.60 The School Fund is intact as is shown by the following "Abstract of the Schedule of the Securities Constituting the Principal of the Connecticut School Fund, September 30, 1905." 26 Securities Constituting Principal of the Connecticut School Fund September 30, 1905 Bonds, Notes and Mortgages In Connecticut $1,000,067.47 In Ohio 677,772.00 In Indiana 13,600.00 In Massachusetts iS7-oo $1,691,596.47 * These tables were included in that portion of the original manuscript which, as explained in the Preface, it has been necessary to omit. f Not reported. 25 Report Conn. Commissioner of the School Fund, 1905, pp. 7, 12, 13. 437 438 PERMANENT COMMON SCHOOL FUNDS Securities Constituting Principal of the Connecticut School Fund September 30, 1905 — continued Brought forward $1,691,596.47 Real Estate By foreclosure and deeds, cost 178,255.46 Bank Stock In nine banks 115,212.61 Cash In Treasury 37,437.69 $2,022,502.23 The entire income of the fund during the hundred and eight years it has drawn interest, has amounted to $10,639,765.02,25 making the average annual dividend $98,516.34. « « lo 1 ■* OS ro 5a ^ t^ OJ ■* ro "T s CSl 00 so to H fcn "^ fo f- o^ to so O i-T Os so~ 00 t- H ro H "3 m O »^ .^^ -t-a s^ s 8 O CO CO Os ro CO Os O to c^ Or- O 1 o^ q^ s O'co" so" m" ro Oh ^1 ^ CO 'tj S ■« ■« 13 e a '^ 50 a OS OS CO 00 o to f) fJH C) so n ro "* « o y^ M ro H Os ■ ■£>< ^^ (J OD c! dsO '^^so-^^^l C ^ - -so' O 00 -* to cq (J OsoO Os ^ ^ r-^ ^ 00 OO 00 o o^oo" o U O so OS O 2^00 00 o^JJ pH-d 'd tj 'd -d ^ ^' rS ^ kHhHt— IhHI— IhHhHI— ('^'-^ ^ u S-d o a !-l s c3 In ,-H o (D o -r:^ H u t>. ^ t^% Ph tn W O o O CAl U 440 PERMANENT COMMON SCHOOL FUNDS Table XXVIII. Connecticut School Support, 1825-95 Presenting the Total Cost of Public Education, the Number of Persons of School Age, and a Comparison of the Amount Per Child derived from the Income of the School Fund with the Amount derived' from all other sources. Amt. Per Child Amt. Per Child in Total Cost No. Persons Enumerated, Actual Attendance Year Public Education * School Age f> Received from Received from All School All School Sources Fund Sources Fund 1825 84,976 $0.85 3 183s 83,779 1. 00 ff 1845 84,093 1.40 a 1855 1 33i>82i 100,294 % 3-31 ^ 1.25 d 1865 562,241 114,825 4.90 <* i.i5<« 187s 1,552,583 134,976 II.81 e 1. 10 * $23.22 $2.15 « 1885 1,852,221 151,069 10.31 e 0.79 « 19.72 1. 51 " 189s 2,585,109 174,443 13-34 « 0.74 « 23.66 1.31 « * Report Commissioner Conn. School Fund, 1900, p. 15. c Computed. ^ Report Conn. Board of Education, 1868, p. 33. « Ibid., 1898, p. II. Ibid., 1884, p. 19. * Ibid., 1869, p. 14. * For sources cited see Table XXVII, p. 439. Table XXIX. Growth of Teachers' Wages in Connecticut, and Relation OF Same to Total Expenditures for Schools Year Total Amt. Spent for Teachers' Wages Per Cent Which Teachers' Wages Is of Total Expenditures Teachers' Average Wage Per Month Male 1 Female 1S68 1875 1885 1895 1900 $ 557,193" 1,021,714 « 1,130,863 a 1,548,148 a 1,896,915 6 57.8 a 60.1 <^ 63.6 a 58.5 « 60.7 & $52.05 444 9,706 41,433 12,080 49,353 96,845 9S>7S2 6,474 1868 56 187556 1885 55 1895 57 1902 57 1903 57 1905 57 1906 57 55 Boone, R. G., History of Education in Indiana, p. 189. 56 Report State Supt. of Public Instruction, 1878, p. 80. 57 Ibid., 1906, p. 811. Table XXXIV. Growth of Principal of Indiana Common School Fund, 1854-1906 Principal Year Congressional Township Common School Total * Fund Fund 1853 $ 2,278,58862 1854 $1,676,717" $ 882,591 2,559,308 62 1864 2,098,715 61 5,679,640 « 7,778,355^ 1874 2,330,823 11 6,468,368 c 8,799,191 58 1885 2,404,936 59 6,923,85459 9,328,79158 1895 2,501,590^^ 7,645,36959 10,146,95958 190S 2,473,14359 8,168,08259 10,641,22658 1906 2,473.143 ^'^ 8,270,25559 io>743.399 ^^ <= Computed. * Total theoretically should always equal sums of other two; practically it does not, as in some cases unsold lands are included by the state reports in the principal. 11 Boone, R. G., History of Education in Indiana, p. 180. 58 Report Indiana State Supt. of Public Instruction, 1906, p. 810. 59 Ibid., pp. 804, 805. 61 Ibid., 1863-64, p. 19. 62 Cotton, F. A., Education in Indiana, p. 177. 444 PERMANENT COMMON SCHOOL FUNDS Table XXXV. Growth of Income of Indiana Common School Fund Revenue Common Revenue Congressional Tninl School Fund Township Fund Noc lata prior to 1864 1865 63 $ 97.672 $154,632 $252,304 e 1875 63 424,337 167,231 591.568 « , 1885 64 476,841 202,389 679,230 c 189s 60 452,932 153.169 609,101 c 1905 60 485,096 153,271 638,367 1906 60 479.147 147.775 626,922 "^ * Computed. 60 Report Indiana State Supt. of Public Instruction, 1906, pp. 806, 807. 63 Ibid., 1876, p. 67. 64 Ibid., 1885-86, p. 166. Table XXXVI. Average Annual Increase of Principal « of Indiana School Funds Years Congressional Township Fund Common School Fund 1854-1864 1864-1875 1875-1885 1885-1895 1895-1902 $42,199 21,100 7.411 9,665 5,183 (decrease) <> $479,704 71,748 45.548 72,151 47,601 <= Computed. o Data given in reports includes estimated value of unsold lands. Decrease is probably due to overestimate of value of unsold lands. APPENDIX 445 Table XXXVII. Comparison of Indiana School Revenues * Common Congressional Year Total4i5^^ 1863 79,83017 1864 39,38518 1867 4,475 1* 1868 4,47320 1869 Ceased 21 15 Maine School Report, 1855, p. 14. 16 Ibid., 1855, p. 14. 17 Ibid., 1866, p. 43. 18 Ibid., 1864, p. 56. 19 Ibid., 1867, p. 44. 20 Ibid., 1868, p. 72. 21 Ibid., 1869, p. 156. si ■rt « Th 00 rj- >0 ■* « M M u M M M w M lO W ■* <0 ?|h ^^ «i» to « to to to a« g a'1^ t^ M vo « lO t^ >* IN to ^ o q q q 2 J^ 2 ^ )-<•□ |X| S 1 u K V . W o." H l/^ O O N CI IN O „ -a m Ch r^ Oi Oi t^ H 'T ^1" M H to 4 lo 4 v6 CO fc,"o ^^2 S S S ec ■* « a> o to to «) « t- -3 S^ n< 2 tJ- oo o 1-1 r- O <^ O ^•5 S„ >> tv. T+ \0 lo r- a ■* c> oS-d g " « N q t^ tj to q^ »o o" 00 oi O h" o 00 oi ^oS to t^ ** c^ o> lO lO O ■* vO_ tf 't >o ■* VO .~ t« N N to N to ;3 i^ M CI CI to CO m >> ra ^ 111 t* CO CD oo gala •O 00 ^ H to to O r- M oj M c4 a> M '^ °; "O- "3 "0 ^ ■♦^ « CtJ O C~ in M 00 CI Hc^^^ o o q ^ -< - ft tij lO ■* O O. VO pq " -• " " t^ tr- CO CD TS tt f) 00 t- i a S CO ■* H to ■* •" .3 .-1-1 NO rC T? cX c< so to ^ft IIS'S ««■ s oo VD M oo O rt ""S M "iH o.S C4 ■* f~ lo oo CO ffl a> 2 — -O 3 y Pj OJ o* O M %• «o vo O ^n vo M t^ * O c^ "O Oi fO O oo O; ■«t O^ O; »>; 0> W^^« o « « t^ li-J vo o «» _ e rj m" -^ t^ ^ t^ oo CO CO o r- ->• o H Oi to ^ ob vO O lo IT) t-l O (1 lO t- M O "3H to q -^ r; in O O -^ tf to o tC cT T? O M o VO to VO M \0 t^ M m H t>) to rt 6» !>. \0 vO r^ t^ is- t^ \0 Ot O W N ID t^ 3a§ O O 00 O^ lO N O O ■* >o lO 00 ^t cX S M CI C< CO ■* lo r* ^O O u(^ «» s HfiH 1 -*-» <>» ** t^ "* t» oo -^ C3 t- c- eo eo t- > c^ o o» OO OO !>. O C* w o* so O m m -"^ 'cf So'' ts_ s •* ■^ »0 M O^ O Q <^ VO oi Tt lO lO O 00 M « « -^ CO 4) i 5 ft. 4 vo »0 O 00 CO »0 ID »o «J OT3 00 0> V3 VO ^O o. M in lo in VO t^ o 6» " 00 - O CO ro »n OO in Ah o.g O" rC O ci to «' •* -^ -H^ d •O VO M M fo 6 cj^ «>; ^,y S to "t oo -wCO o. «» *-i M >0 >0 « m m m c; rt lO LO VO r^ c- 00 O O .«> 00 00 CO oo 00 00 oo o\ ?« Ht M HI W M W W M a r; a oi O) ID . rt art ft •q u^ "3 "^ O *o o *^ jg 00 ^ CO o M tj "^ Cfl r CO - CO so p rt d<1 o. ji) ^ 00 oi oo *2 U M M la c/1 r r r H oi 12 3 S D 5! -Q -Q rS 5 l«=i M l-H l-H o a < I— I o O O ~ ^ — VO ft Oi ft ft . ft ,< ft< ' u> to ci" . 00 c~ o 00 00 Ol XI -O -O J3 fe -r^ 00 00 m "• " " 9 ^ tT -K 2 g o. a -o O S S vo' " •' 2-S-g"2 ft ft o c« CAJ r r r -2 a; ,; 3 S 3 t; W >^ X ^ ^ O i^i |2i HI M l-H fe t- d r- tn 00 APPENDIX 449 Table XLIII. Maine Teachers' Wages Per Month, Exclusive of Board Unless Stated Otherwise * Year Male Female "■ 1851 $16.66 65 1855 20.57 ^ 1865 27.76 67 1872 33-17*3 1875 36.9664 1885 32.07 68 189s 3S-ii*» 1902 36.05 70 $5.9265 7.60 68 9.96 67 14.00 63 17.3664 15.8468 24.04 69 27.2470 * For foot-notes see those accompanying Table XLII. 450 PERMANENT COMMON SCHOOL FUNDS Table XLIV. Massachusetts Year Total Public School Ex- penditure of Massachu- setts a Limit Placed on Principal of Mass. School Fund by Law Principal of Massachusetts School Fund Total Income From Mass. School Fund Amount of In- come of Mass. School Fund pd. to Towns & Cities for Common Schools e School Age 1835 $1,000,000^8 $ 514,906' $16,1766 $ 16,176 1837 561,6767 20,040 ' 20,040 4-16 184s $ 801,0271,6 1,500,000(1831) 4' 789,389^ 28,966 7 28,966 4-16 1856 2,346,309 2, 6 2,000,000(1854) ■" 1,627,467 s 90,566 8 46,808 13 5-1 S 186s l,940>S96^ 2,000,000 9 121,7868 60,7241* 5-1 S 1875 6,201,614 3, d 2,065,238 10 167,655" 83,82715 S-15 1885 7,020,430'' 2,710,241 11 134,13611 67,97216 s-is 189s io,66i,3s65 5,000,000(1894) 50 3,870,54812 172,72912 79,410 1' 5-15 1902 15,132,133^ 4,570,54812 220,731 12 182,27018 5-iS 190S 13,186,65252 4,880,111 « 219,379*' 5-1 5 Explanation of Foot-notes: — Rept. = Report of the Board of Education of Mass.; Sec. Rapt. = Report of the Secretary in the Annual Report of the Mass. Board of Ed. In the earlier reports, the Sec. Report and the Report of the Board, though bound together, are paged separately. Sec. 29th Rept. p. 53 =Page 53 of the Secretary's Report in the 29th Report of the Mass. Bd. of Ed.; 29th Rept. ^29th Annual Report of the Bd. of Ed. of Mass. Unless year is given Repts. are referred to by number. The following table will assist in determining the year of the Report: 9th Report is for year 1845 39th Report is for year 1874-75 20th " (1857) " " 1855-56 49th " " " " 1884-85 25th " is for " 1860-61 S9th " " " " 1894-95 29th " " " " 1864-65 66th " " " " 1901-02 a Computed from data given in Annual Reports of Mass. Board of Ed. 6 Expenditures for school buildings not called for prior to 1867. Some estimates have been made as follows: For 1845 see Sec. 9th Rept., p. 23; for 1855-56 see Sec. 20th Rept., p. 38. The total given in this table includes these estimates for these two years. The total given for 1856 includes, also, ex- penditures for Normal Schools, Teachers' Institutes, etc. The total given for 1865 does not include expenditures for school buildings. c Computed. 3S3,477-64 + 257,619.16 81,381.90 100,000 232,343-21 « Data for years 1801-50 taken from Report N. Y. State Supt. of Pubh'c In- struction, 1851, p. 38; ibid., 1895, p. 28, gives principal for years 1805-95; data for 1905 taken from Controller's Reports, 1905-06. * The superintendents in reporting data contained in this column did not follow a uniform principle: in the earlier reports, 1806-37, ^^^ increase or decrease is the increase or decrease during the year, opposite which it stands. In the later (1840- 45) reports it is the increase or decrease over the previous year. Increase stated for 1838 and 1839 appears to be incorrect. 454 PERMANENT COMMON SCHOOL FUNDS Table XLVI — continued Year Principal °- Atiiiual In- crease (+) or Decrease ( — ) of Capital Annual In- come or In- terest Annual Appro- priation from State Treasury Amount Received by Dis- tricts 1828 $1,611,096.80 + $73,532.00 % 89,034.96 $100,000 $214,840.14 1829 1,684,628.80 + 35,662.42 94,626.25 100,000 238,611.36 1830 1,661,081.24 — 23,547-56 100,678.60 100,000 244,998.85 183 1 1,696,743.66 + 7,415-74 80,013.86 100,000 305,582.74 1832 1,704,159-40 + 31,015.88 93,755-31 100,080 307,733.08 1833 1,735,175-28 + 18,871.56 109,117.77 100,080 316,153.98 1834 1,475,046.84 + 36,498.46 104,390.78 100,080 312,181.20 1835 1,791,321.77 + 83,869.94 131,006.40 100,000 313,376.90 1836 1,875,191.71 + 42,302.46 118,486.67 100,000 335,895.10 1837 1,917,491-17 + 2,153-51 94,349-93 110,000 335,882.92 1838 1,919,644.68 + 10,059.83 102,991.09 113,793 374,411.61 1839 1,932,421.99 + 2,714.48 117,472.27 275,000 s 633,685-94 1840 2,033,807.95 + 101,385.96 103,400.65 * 275,000 658,951.70 1841 2,036,625.68 + 2,817.73 96,073-85 * 285,080 676,086.07 1842 1,968,290.72 — 68,334-96 90,092.46 * 275,080 660,727.41 1843 1,975,093-15 + 6,802.43 107,370.62 * 265,080 639,606.60 1844 1,992,916.35 + 17,823.20 133,826.51 * 275,080 725,066.19 1845 2,090,632.41 + 97,716.41 113,458.87 * 275,080 772,578.02 1850 2,290,673.23 + 47,109.87 137,524.07 * 285,000 1855 2,457,520.86 * + 32,308.89 <' 143,127.73 ^ * 310,000 ^ i860 2,607,036.68 * + 20,785.52 310,000 * 1865 2,765,760.77 ^ 186,462.20 <^ 310,000 * 1875 3,080,107.68 179,264.66 « 335,000 e 1885 3,880,157.39 1 189,621.22 245,000 * 1895 4,423,140.77 181,579.27 245,000 * 1905 4,673,140.77 169,889.06 " Data for years 1801-50 taken from Report N. Y. State Supt. of Public In- struction 1851, p. 38; ibid., 1895, p. 28, gives principal for years 1805-95; data for 1905 taken from Controller's Reports, 1905-06. * Report N. Y. State Supt. of Public Instruction, 1869, p. 101. "Ibid., 1856, p. 109. '^Ibid., 1S66, p. 14. « Ibid., 1876, p. 26. / Ibid., 1886, p. 101. $110,000 from revenue of Common School Fund; $165,000 from revenue of U. S. Deposit Fund. * $145,000 from revenue of Common School Fund; $165,000 from revenue of U. S. Deposit Fund. * $170,000 from revenue of Common School Fund; $75,000 from revenue of U. S. Deposit Fund. * Including, after 1838, $165,000 from Revenue of U. S. Deposit Fund. g o 00 VO to CO ■* o t>* ^ Oi H o ^ 2* ^ s ■* o" oo ^ to VO ^ tf S 4© ^ G' 't Q „ O. o> t^ •* ^. 'J- w OO M to OiO o 0O_ lo co_ to to H O" lO cf lO ^ •t oo" lO ^ ^ to vo o« Oi 00 o q^ o o" H q ^ H (» ^ 8 'o CO t^ t^ Ov <31 OO M o i^ •H inO 3 VO O. ^ M oo ^ O; t-- q. 00 ooo" lO ■^ CO cT I-^ 't t^ -t M W VQ ^ T3 o> o. Oi ^0 -t t^ g o_ t^ m Xi <> to 00 M «* ^ — o~ J2 8_ < as rO 1 t-^ J? V3 OD Ji « 6; S 6 2 6 M to ^ 't d o. OO P^ oo" CI t^ ««■ ,, o o oo )H O Oi to M in lO^ o to M S' VO ^ o O0_ o o^ OO ^ lO 00 ,4" lO to VD '-' to o >o t^ m ^ to 8 „" to ^ „ r^ t^ o Oi to o o oo 8 »t ■^ o o ^ ^ o" oi o" o" « « ^ o o Oi CO ^ t^ i^ oo to o o cJ" «©: q ^ 1» o O Q ^ t- 00 < Q to O ^ 03 8 ■o o 00 „■• 8 6 o" o" to .s T3 ^ -* ,5^ - /-v to o o> 8 to ^t^ o t^ 00 00 r^ ^ tn o_ ^ t^ O. to O "i oo" d \r,<^ w rt w q; r^ lO^ H " o_ ^ o J5 tlJcSS TO CO rf 3 o c OT s o oo J; oi; u o> O 00 o" o lU H O ^ 00 ^ ■to d qi to 00 oJ 00 ^ o in^ o w H to VO SHI «©■ ■ / ^ t "^ / "^ /"" ^ "g ' -xl u a 2 1 o o S M -a Ph 20-S 3-S « t^ _ri rt t. 5i3 o d a o J2 rt ^1 WPS ■1 rt o s o P^H S l: ft ft HfiiU -) H V3 M < H < J OJOO J^ ft -3 t^d a -sv^gf^o-^ >, ri fl*^ -t? t^OO ) (3^ ecu oj's y ctJt/3 h_ rt . «^ iri >>2 r'-0!>,'!32 H.-io ttl tti 3 3 « fl K .-5' 3 M rpi"" c . U (5 .S T-1 C5 a^ .-.._, -u CI 5 r^ ^ >.^ 3 C*-' ^^ ? ° 3 ^M uS K S af ""cAi ey=aS'^ese■s!S■sy y a-q^^ .2^ <<«<<« w^kSwcoH BIBLIOGRAPHY SOURCES Constitutions of the various states of the Union. Enabling Acts of various states as cited. General Public Acts of Congress Respecting the Sale and Disposition of Public Lands with Instructions Issued from Time to Time by the Secretary of the Treasury and Commissioner of the General Land Office, and Official Opinions of the Attorney-General on Questions Arising under the Land Laws 2 vols. (Washing- ton, 1838, prepared and printed by order of the Senate). Journals of Congress. Organic Acts as cited. Reports of the United States Commissioner of Education. Reports of the Commissioner of the General Land Office. Reports of the State Auditors. Reports of the State Controllers. Reports of the State Land Commissioners, or of the Land Office. Reports of State Land Registers. Reports of State Surveyors. Reports of the State Superintendents of Public Instruction or Reports of State Boards of Education. Reports of State Treasurers. Revised Statutes and Acts. School Laws. Session Laws. United States Statutes at Large. SECONDARY AUTHORITIES— GENERAL Adams, Francis, The Free School System of the United States (Chapman-Hall, London, 1875). Adams, Herbert B., Maryland's Influence upon Land Cessions to the United States (Johns Hopkins University Studies, 3d Series, No. i, Baltimore, 1885). Andrews, Israel W., History of the Ordinance of 1787 (Proceedings of the Na- tional Educational Association, 1887, pp. 120-128). Blackmar, Frank W., History of State and Federal Aid to Higher Education in the United States (Washington; United States Bureau of Education, Circular of Information, No. i, 1890). Blair, Hon. W. H., National Aid to Education. (Proceedings of the Department of Superintendence, 1889, pp. 297-300; Washington; United States Bureau of Education, Circular of Information, No. 2, 1889). 4S7 458 PERMANENT COMMON SCHOOL FUNDS Boone, Richard Gause, Education in the United States; Its History from the Earliest Settlements (D. Appleton Co., New York, 1903). Bourne, Edward G., The History of the Surplus Revenue of 1837 (G. P. Putnam's Sons, New York and London, 18S5). Brown, Elmer Ellsworth, The Making of Our Middle Schools (New York; Longman's, Green & Co., 1903). Bush, Geo. Gary, The First Common Schools of New England (Washington; Report of United States Commissioner of Education, 1896-97, Vol. II, Chap. XXIV, pp. 1165-86.) Clews, E. W., Educational Legislation and Administration of the Colonial Govern- ments (New York, 1899). CuBBERLEY, Elwood P., School Funds and Their Apportionment (New York, 1905)- Dexter, Edwin Grant, History of Education in the United States (New York; The Macmillan Co., 1904). Draper, Andrew S., The General Government and Popular Education (Proceed- ings National Educational Association, 1896, pp. 201-208). Eaton, Hon. John, National Aid to Education (Washington; United States Bureau of Education, Circular of Information, No. 2, 1879). Elliott, Edward C, State School Systems: Legislation and Judicial Decisions Relating to Public Education, October i, 1904, to October i, 1906 (Washington; United States Bureau of Education, Bulletin No. 3, 1906). Fellow, Henry C, A Study in School Supervision and Maintenance (Crane & Co., Topeka, Kansas, 1896). Gasquet, Henry VIII and English Monasteries, 2 vols. (London, 1888). Germann, George B., National Legislation Concerning Education (New York, 1899). Hinsdale, B. A., (i) Educational Influence and Results of the Ordinance of 1787 (Proceedings of the National Educational Association, 1887, pp. 135-140). (2) History of Popular Education on the Western Reserve (Ohio Archcclogical and Historical Society Publications, Vol. VI, 1898, pp. 35-58). (3) Documents Illustrative of American Educational History (Report United States Commissioner of Education, 1892-93, Part III, Chap. I, pp. 1 225-1414). Knight, Geo. W., History and Management of Land Grants for Education in the Northwest Territory (G. P. Putnam's Sons, New York, 1885). Lamoreux, S. W., State Grants of Public Lands — Tables (Department of the Interior, General Land Office, Washington, D. C, 1896). Leach, Arthur F., English Schools at the Reformation (Archibald Constable & Co., Westminster, 1896). Mansfield, E. D., Educational Land Policy of the United States (Barnard Am. Jo. Ed., Vol. 28, pp. 929-938). Mayo, A. D., (i) Public Schools in the United States During the Colonial and Rev- olutionary Periods (Report United States Commissioner of Education, 1893-94, Vol. I, Chap. XVI, pp. 639-738). (2) The American Common School in the Southern States During the First Half Century of the Republic, 1790-1840 (Report of United States Commissioner of Education, 1895-96, Vol. I, Chap. VII, pp. 267-338). BIBLIOGRAPHY 459 (3) The American Common School in New York, New Jersey and Pennsylvania During the First Half Century of the Republic (Ibid., Vol. I, Chap. VI, pp. 219-266). (4) The American Common School in Nezu England from 1790 to 1840 (Report of United States Commissioner of Education, 1894-95, Vol. II, Chap. XXXIX, pp. 1551-1615). (5) Education in the Northwest During the First Half Century of the Republic, 1790-1840 (Ibid., Chap. XXXVIII, pp. 1513-50). (6) Original Establishment of State School Funds (Ibid., Chap. XXXVII, pp. 1505-11)- (7) Organization and Reconstruction of State Systems of Common School Education in the North Atlantic States from 1830-1865 (Report of United States Com- missioner of Education, 1897-98, Vol. I, Chap. XI, pp. 355-486). (8) The Development of the Common Schools in the Western States from 183 0-1865 (Report of United States Commissioner of Education, 1898-99, Vol. I, Chap. VIII, pp. 3 57-450) ■ (9) The Organization and Development of the American Common School in the Atlantic and Central States of the South, 1830-1860 (Report of United States Commissioner of Education, 1899-1900, Vol. I, Chap. VIII, pp. 427- 562), (10) The Common School in the Southern States beyond the Mississippi River from 1830-1860 (Report of United States Commissioner of Education, 1900-01, Vol. I, Chap. X, pp. 357-402). (11) Common School Education in the South from Beginning of Civil War to 1870- 1876 (Ibid., Chap. XI, pp. 403-490). (i 2) The Final Establishment of American Common School System in West Virginia, Maryland, Virginia and Delaware, 1863-1900 (Report of United States Com- missioner of Education, 1903, Vol. I, Chap. IX, pp. 391-462). (13) The Final Establishment of American Commo?t School System in North Caro- lina, South Carolina and Georgia, 1863-1900 (Report of United States Com- missioner of Education, 1904, Vol. I, Chap. XVI, pp. 999-1090). Report of a Special Commission on the Permanent Common School Fund of Vermont to Vermont Legislature (Montpelier, Vermont, 1906). SCHAEFER, Joseph, The Origin of a System of Land Grants for Education (Bulletin No. 63, University of Wisconsin, History Series, Vol. I, No. i, Madison, Wis., 1902). Sheldon, W. F., The Educational Influence and Results of the Ordinance of lySj (Proceedings National Educational Association, 1887, pp. 118-119). Warren, Charles, Illiteracy in the United States, with Appendix on National Aid to Education (Washington, United States Bureau of Education, Circular of Information, No. 3, 1884). Weeks, Stephen B., The Beginnings of the Common School System in the South, or Calvin Henderson and the Organization of the Common Schools of North Carolina (Report of United States Commissioner of Education, 1896-97, Vol. II, Chap. XXIX, pp. 1379-1474). Winterbotham, W., American Schools and Education (Barnard's American Journal of Education, Vol. XXIV, pp. 137-157). 46o PERMANENT COMMON SCHOOL FUNDS SECONDARY AUTHORITIES— LOCAL (Arranged by States) Alabama * Clark, W. G., History of Education in Alabama, 1702-1889 (Washington; United States Bureau of Education, Circular of Information, No. 3, 1889). Perry, W. F., The Genesis of Public Education in Alabama (Alabama Historical Society Translations, Vol. II, pp. 14-27). Alaska Jackson, Sheldon, (i) Neglect of Education in Alaska (Washington; United States Bureau of Education, Circular of Information, No. 2, 1882, pp. 61-75). (2) Education in Alaska (Washington; United States Bureau of Education, Circular of Information No. 3, 1887, pp. igi-200). Arkansas * Shinn, J. H., History of Education in Arkansas (Washington; United States Bureau of Education, Circular of Information, No. i, 1900). California Kellog, Martin, Educational Progress in California (In California University Addresses delivered before the California Teachers Association at Riverside, 1892). Report of Superintendent of Public Instruction, 1864-65, pp. 231-239, 300-339. Sv\^EET, John, History of the Public School System of California (San Francisco, 1876). Colorado Hale, H. M., 1833, Grove, Aaron, 1839, and Shattuck, J. C, 1835, Anon., Education in Colorado, 1861-85 (Denver, 1885). Historical Sketch of Colorado Public Schools (Report Supt. of Public Instruction, 1901-02, pp. 13-20 and 585-586). The School Lands of Colorado (Ibid., pp. 614-624). Connecticut * Hinsdale, B. A., (i) Connecticut Legislation 1642-1799 (Washington; Report of United States Commissioner of Education, 1892-93, Part III, Chap. I, pp. 1240-56). (2) Plymouth Legislation 1658-1677 (Ibid., pp. 1238-39). (3) Common School Fund of Connecticut (Ibid., pp. 1256-61). Steiner, B. C, History of Education in Connecticut (Washington; United States Bureau of Education, Circular of Information No. 2, 1893). * Consult also Mayo, above. BIBLIOGRAPHY 461 The following Reports of the Connecticut Board of Education are especially valuable for historical and statistical material: 1853, 1864-65, 1868, 1876, 1888, 1S90. Delaware * Groves, History of Free Schools of Delaware (Report of Delaware Superintendent of Free Schools, 1880, pp. 43-54)- Powell, Lyman P., History of Education in Delaware (Washington; United States Bureau of Education, Circular of Information, No. 3, Vol. I, 1893). District of Columbia * Wilson, J. Ormond, 1805, Eighty Years of Public Schools of Washington, 1805- 1885 (Report United States Commissioner of Education, 1894-95, Vol. II, Chap XLI, pp. 1673-98). Florida * Bush, George Gary, History of Education in Florida (Washington; United States Bureau of Education, Circular of Information, No. 7, 1888). Sheats, W. N., History of the Origin and Growth of Public Schools in Florida (Biennial Report State Supt. Public Instruction, 1893-94, pp. 5-60). Georgia * Johnston, Richard Malcolm, Early Educational Life in Middle Georgia (Wash- ington; Report United States Commissioner of Education, 1894-95, Vol. II, Chap. XLII, pp. 1699-1734; 1895-96, Vol. I, Chap. XVI, pp. 839-886). Jones, Charles Edgeworth, Education in Georgia (Washington; United States Bureau of Education, Circular of Information, No. 4, 1888). Idaho History of Common Schools (Report of State Supt. of Public Instruction, 1899- 1900, p. 74, gives statistics for years 1869-1900). Illinois * Ellsworth, H. L., Illinois in 1837 (Gregg and Elliott, Philadelphia, 1837). PiLLSBURY, W. L., Permanent School Funds of Illinois (Illinois School Report 1881-82, pp. cxx-cxliii.) WiLLARD, Samuel, Brief History of Early Education in Illinois (Illinois School Report 1883-84, pp. xcviii-cxx). Indiana * Boone, Richard Gause, History of Education in Indiana (New York, 1892). * Consult also Mayo, above. 462 PERMANENT COMMON SCHOOL FUNDS Cotton, F. A., Education in Indiana (An official monograph prepared for the Louisiana Purchase Exposition at St. Louis, 1904; Indianapolis, 1904). Rawles, William A., Centralizing Tendencies in the Administration of Indiana (Studies in History, Economics, and Public Law edited by the faculty of Political Science of Columbia University, Vol. XVII, No. i, Macmillan Co. Agents). Skinner, Herbert M., Hobbs, Barnabas C, and Humphreys, Mary C, Histori- cal Review of Education in Indiana (Report Indiana Supt. of Public Instruc- tion, 1885-86, Part II, pp. 1-47)- Smart, James Henry, Indiana Schools and the Men Who Have Worked in Them (Cincinnati, 1876). WooDBURN, J. A., Higher Education in Indiana (Washington; United States Bureau of Education, Circular of Information, No. i, 1891). A History of the School System of Indiana (School Law of Indiana, 1901, pp. 27-38). Iowa Bowman, Harold M., The Administration of Iowa, A Study in Centralization (New York, 1903). Parker, Leonard F., Higher Education in Iowa (Washington; United States Bureau of Education, Circular of Information, No. 6, 1893). Reports of Superintendent of Public Instruction as follows: 1868, pp. 16-19; 1872-73, pp. 44-48; 1902-03, pp. xii, xiii, xxvi. Kansas Columbian History of Education in Kansas (Compiled by Kansas Educators, Topeka, Kansas, 1903). Blackmar, Frank W., Eligher Education in Kansas (Washington; United States Bureau of Education, Circular of Information, No. 2, 1900). History of the State School System of Kansas, 1861-76 (Report Supt. of Public Instruction, 1878, pp. 37-42). Kentucky * Lewis, A. F., History of Higher Education in Kentucky (Washington; United States Bureau of Education, Circular of Information, No. 3, 1899). History of Permanent School Fund (Report of Supt. of Public Instruction, 1880-81, pp. 218-222; 1891-93, pp. 671-678). Louisiana * Fay, Edwin W., History of Education in Louisiana (Washington; United States Bureau of Education, Circular of Information, No. i, 1898), * Consult also Mayo, above. BIBLIOGRAPHY 463 Maine Champlin, J. T., Educational Institutions in Maine While a District of Massa- chusetts (Maine Historical Society Collections, 1881, Series I, Vol. VIII, pp. 155-180). Hall, Edward W., History of Education in Maine (Washington; United States Bureau of Education, Circular of Information, No. 3, 1903). Hyde, Rev. W. D., Education in Maine (in W. T. Davis, New England States, Vol. Ill, pp. 1154-67). Stetson, W. W., Study of the Rural Schools of Maine by the State Superintendent of Common Schools (Augusta, Me., 1896). State Superintendent of Public Schools, A Study of the History of Education in Maine and the Evolution of Our Present School System (Augusta). Education in Maine, 1642, Including a Copy of Maine's First Educational Law (Maine School Report, 1870, pp. 181-192). Early Schools in Maine (Maine School Report, 1876, pp. 1-56). Maryland * Steiner, B. C, History of Higher Education in Maryland (Washington; United States Bureau of Education, Circular of Information, No. 2, 1894). Massachusetts BouTWELL, George S., Origin and History of Massachusetts School Fund (Annual Report of Board of Education of Massachusetts, 1859, pp. 38-56). Bush, George Gary, History of Higher Education in Massachusetts (Washing- ton; United States Bureau of Education, Circular of Information, No. 6, 1891). Carter, J. G., Schools of Massachusetts in 1824 (Boston). Emerson, G. B., Education in Massachusetts, Early Legislation and History (Boston, 1869). Dickinson, J. W., Massachusetts Public School System (Boston, 1893). Martin, G. H., The Evolution of the Massachusetts Public School System (New- York, 1894). Wightman, Jos. M., Annals of Boston Primary School Committee from Its Estab- lishment, 1818, to Its Dissolution, 1855 (George C. Rand & Avery, Boston, i860). The following reports of Massachusetts Board of Education contain valuable historical material: Twentieth Report, 1856, pp. 35 ff., A Retrospect for Twenty Years, 1837-1857. Fiftieth Report, 1885-86, pp. 88 ff., A History of School Legislation, 1837-1886. Michigan Gregory, J. M., School Funds and School Laws of Michigan (Lansing, 1859). HOYT, C. O., and Ford, R. C, John D. Pearce, Founder of Michigan School System, and Study of Education in the Northwest (Ypsilanti, 1905). * Consult also Mayo, above. 464 PERMANENT COMMON SCHOOL FUNDS McLaughlin, Andrew C, History of Higher Education in Michigan (Washing- ton; United States Bureau of Education, Circular of Information, No. 4, 1891). Putnam, Daniel, (i) Development of Primary and Secondary Public Institutions in Michigan (Ann Arbor, 1904). (2) History of the Origin of Educational Funds of Michigan (Report of Supt. of Public Instruction, 1899, pp. 19-24). Shearman, F. W., System of Public Instruction and Primary School Law of Michi- gan (Lansing, 1852). Smith, W. L., Historical Sketches of Education in Michigan (Lansing, 1881). Primary School Fund of Michigan, Its Origin arid History (Michigan School Report, 1870, pp. 153, 159). Minnesota Greer, John N., History of Educatiott in Minnesota (Washington; United States Bureau of Education, Circular of Information, No. 2, 1902). KiEHLE, David L., Education in Minnesota (H. W. Wilson Co., Minneapolis, 1903). Report of Supt. of Public Instruction, 1878, pp. 6-45, contains valuable brief historical account. Mississippi * Mayes, Edward, History of Education in Mississippi (Washington; United States Bureau of Education, Circular of Information, No. 2, 1S99). Report State Supt. of Public Education, 1871, pp. 22 £f., gives an account of the Origin and History of School Funds. The same Report for the years 1895-96, pp. 31 ff., gives a statement concerning school lands. Missouri Snow, Marshall S., Higher Education in Missouri (Washington; United States Bureau of Education, Circular of Information, No, 2, 189S). Origin of Township Funds (Report State Superintendent of Public Schools, 1869, p. 7). State and Seminary Funds, Origin and Growth (Ibid., 1901, pp. 33-37). Nebraska Caldwell, Howard W., Education in Nebraska (Washington; United States Bureau of Education, Circular of Information, No. 3, 1902), New Hampshire * Bush, George Gary, History of Education in New Hampshire (Washington; United States Bureau of Education, Circular of Information, No. 3, 1898). Common Schools of New Hampshire (N. H. School Report, 1876, pp. 177-301). * Consult also Mayo, above. BIBLIOGRAPHY ' 465 New Jersey * Murray, David, History of Education in New Jersey (Washington; United States Bureau of Education, Circular of Information, No. i, 1889). New York Draper, A. S., Origin and Development of the New York Common School System (Albany, i8go). Fitch, C. E., The Public School (Albany, 1904). Hough, F. B., Historical and Statistical Record of the University of the State of New York (printed by the authority of the legislature, Albany, 1885). Millar, John, School System of the State of New York (Toronto, 1898). Pratt, D. J., Annals of Public Education in the State of New York, 1626-1746 (Albanj, 1872). Randall, S. S., History of the Common School System of the State of New York (New York, 187 1). SCHEPMOES, A. E., Rise and Progress of the School System of the State of New York (Syracuse, 1891). Sherwood, Sidney, The University of the State of New York (Washington; United States Bureau of Education, Circular of Information, No. 3, 1900). North Carolina * Raper, Charles Lee, The Church and Private Schools of North Carolina (Joseph J. Stone, Greensboro, N. C, 1898). Smith, Charles Lee, History of Education in North Carolina (Washington; Bureau of Education, Circular of Information, No. 2, 1888). Wiley, C. H., History of Education in North Carolina (Report Supt. Common Schools, 1896-98, pp. 428-573). North Dakota History of Common Schools from Earliest Times (North Dakota Territorial School Report, 1884, pp. 23-40). Ohio* Burns, J. J., Educational History of Ohio (Columbus, 1905). Hinsdale, B. A., History of Popular Education on the Western Reserve (Ohio Archselogical and Historical Society Publications, Vol. VI, 1898, pp. 35-58.) Hinsdale, Mary L., A Legislative History of the Public School System of the State of Ohio (Report of the United States Commissioner of Education, 1900-01, Vol. I, Chap. II, pp. 129-160). Knight, Geo W., and Commons, John R., History of Higher Education in Ohio (Washington; United States Bureau of Education, Circular of Information, No. 5, 1891). * Consult also Mayo, above. 466 PERMANENT COMMON SCHOOL FUNDS Orth, S. p., Centralization of Administration in Ohio (New York, 1903). Growth of Ohio School System (Report State Commissioner of Common Schools, 1900, pp. 9-1 1). School Legislation in Ohio (Report State Commissioner of Common Schools, 1892, pp. 1-16). Tables Showing Progress of Schools, 1837-1856 (State Commissioner of Common Schools, Report, 1856, pp. 50-51). Pennsylvania * Barnard, Henry, Thomas H. Burrows, with a Sketch of a History of Common Schools in Pennsylvania (American Journal of Education, Vol. VI, pp. 107- 124). Haskins, C. H., and Hull, W. J., History of Higher Education in Pennsylvania (Washington; United States Bureau of Education, Circular of Information, No. 4, 1902). Wickersham, James Pyle, History of Education in Pennsylvania (Inquirer Publishing Company, Lancaster, Pa., 1886). Rhode Island * Stockwell, Thos. B., History of Public Education in Rhode Island, 1636-1876 (Providence, R. I., 1876). Tolman, Wm. H., History of Education in Rhode Island (Washington; United States Bureau of Education, Circular of Information, No. i, 1894). South Carolina * McCrady, Edward, Education in South Carolina Prior to and During the Revolu- tion (in South Carolina Historical Society Collections, Vol. IV, 1887, Charles- town). Merriwether, Colyer, History of Higher Education in South Carolina, with a Sketch of Free School System (Washington; United States Bureau of Education, Circular of Information, No. 3, 1888). Rammage, B. J., Social Government and Free Schools in South Carolina (Johns Hopkins University Studies, Vol. I, No. 12, Baltimore, 1883). Historical Documents Bearing upon Common School Education in Virginia and South Carolina Previous to the Civil War (Report of United States Commis- sioner of Education, 1899-1900, Vol. I, pp. 403-426). Tennessee * Merriam, Lucius S., Higher Education in Tennessee (Washington; United States Bureau of Education, Circular of Information, No. 5, 1893). History of Education in Tennessee (Report Supt. of Public Instruction, 1890-91, pp. 22-60). * Consult also Mayo, above. BIBLIOGRAPHY 467 Texas Lane, J. J., History of Education in Texas (Washington; United States Bureau of Education, Circular of Information, No. 2, 1903). Utah RoYLANCE, Wm. G., History of Education in Utah (Report Supt. of Public In- struction, 1898-1900, pp. 46-56). Vermont * The School Reports for the following years contain valuable material regarding the school funds: 1869, pp. 133 ff.; 1874, pp. 439-440; 1890, p. 296. Bush, George Gary, History of Education in Vermont (Washington; United States Bureau of Education, Circular of Information, No. 4, 1900). Virginia f Adams, Herbert B., Jefferson and the University of Virginia (Washington; United States Bureau of Education, Circular of Information, No. i, 1888). Mayo, A. D., Education in Southwestern Virginia (Report United States Commis- sioner of Education, 1890-91, Chap. 24, pp, 881-921). Neill, Edward D., Virginia Carolorum, The Colony under the Rule of Charles I and II, A. D. 1625 to A. D. 1685, Based upon Manuscripts and Documents of the Period (Joel Munsell's Sons, Albany, N. Y., 1886). The Past Primary School Systems of Virginia (Virginia School Report, 1871, pp. 89-92). History of County and City Schools of Virginia (Report Supt. of Public Instruction, 1885, Part III, pp. 48-296). West Virginia Miller, Thos. C, History of Education in West Virginia (printed separately, and in Report of State Supt. of Free Schools, 1904, Charlestown, West Virginia, 1904). Morgan, Benjamin S., and Cork, J. F., West Virginia Free Schools (printed in Report of the Supt. of Free Schools, 1891-92, pp. 1-20; also published sepa- rately, 1893, Charlestown, West Va.). Whitehill, a. R., History of Education in West Virginia (Washington; United States Bureau of Education, Circular of Information, No. i, 1902). * Consult also Mayo, above. I Cf. Bibliography on South Carolina. 468 PERMANENT COMMON SCHOOL FUNDS Wisconsin Allen, William F., and Spencer, David E., Higher Education in Wisconsin (Washington; United States Bureau of Education, Circular of Information, No. I, 1889). Salisbury, Albert, Historical Sketch of Normal Instruction in Wisconsin (White- water, Wis., 1893). Whitford, W. C, Historical Sketch of Education in Wisconsin (Report Supt. of Public Instruction, 1876, pp. 321-393). INDEX Academies, early prevalence, Mass., 5; land grants for, Ga., 248; Texas, 401; supported by permanent funds, N. Y., 351, 354; Penn., 384; Wis., 433; see also Private schools Accounts, permanent, 7; see 0/50 Credit funds; Debts Act of 1 8 41, see Internal improvement under Lands Acts quoted Connecticut School Fund Acts, 1793, 1795, 231-234 Georgia County Land Grant Act, 36- Kentucky: "Act ... for the burn- ing . . . state bonds," 152-153 Massachusetts School Fund Acts, creation, 302; management, 309; apportionment, 309-310 New Mexico Land Grant Act, 347 New York Common School Fund Act, 353 Ohio Common School Fund Act, 1838, 375 Pennsylvania Common School Fund Act of 17S6, 384; Act of 18 31, 38s Tennessee Permanent School Fund Act, 396 Vermont Permanent Public School Fund Act, 1906, 416-419; see also Constitutions; Ordinances Administration, centralization of, 118 Admission of States, Table XVI, 98-99 Age, school, see Apportionment Agricultural College lands, Nev., 336 Agricultural fund, balance increases permanent funds, N. C, 362 Aims of school funds, 165, 168, 171, 180, 189-190 Alabama ^unds for schools: Educational Fund, 207, 210 Permanent School Funds, 160, 109-110, 132, 153, 158, 207-212 Public School Fund, 207 School Fund, 207 Surplus Revenue Loan, 72, 74, 158, 207, 208, 209, 210, 211 interest, unpaid, on notes, 143 lands for schools, swamp lands, 63- 64; titles in dispute, 132; section sixteen, 207, 208, 209, 2n notes unpaid, 143 Alaska, no school fund, 10; appropri- ations, federal, 24, 25, 213 Animal tax, devoted to public schools, Ga., 247 Apparatus, a lawful expenditure, Ore., 382; _Va., 422; Wis., 433 Apportionment of permanent school funds, 180-185; Table, 186-188; aims, 190; better methods needed, 202- 203; in Ala., 212; Ark., 220; Cal., 224, 225; Col., 227; Conn., 228, 233, 236; Del., 241; Fla., 245; Idaho, 252; 111., 257; Ind., 266; Iowa, 270; Kan., 274; Ky., 277; La., 282; Me., 292, 29s; Md., 297; Mass., 302, 304, 309-310; Mich., 315; Minn., 126- 127, 320; Mo., 324; Miss., 326, 327; Mont., 330; Neb., 333; Nev., 337; N. H., 338; N. J., 342, 344-345; N. Y., 356, 358-359; N. Dak., 366; Ohio, 368, 375, 377; Ore., 382; Penn., 386; R. I., 388; S. Dak., 392; Tenn., 399; Tex., 405; Vt., 412, 418, 419; Va., 421; Wash., 425; W. Va., 428; Wis., 433; Wyo., 436 Appropriations, federal, Alaska, 24, 213; D. C, 25, 80; Indian Ter., 56, 80, 259; Okla., 378; state, Ala., 210; Del., 240; Fla., 243; Ga., 90, 248; La., 24, 282; Me., 295; Mass., 90, 305, 306, 309, Table XLV, 452; Mo., 323; Mont., 330; N. Y., 24, 351; R. I., 90; Texas, 405; town, 24 Architectural requirements, N. J., 346 Area, as apportionment basis, Miss., 327 Area of land grants: sections sixteen and thirty-six, 57-58; internal im- provement, saline, swamp lands, 66; state, 85 Area of unsold school lands. Table VII, 20-21 Arizona funds: County School Fund, 215; 469 470 INDEX Permanent Common School Fund, 214, n.*; Territorial School Fund, 215 lands for schools: denuded, 141; area, 214; rent, 214; sale, 214 and n.* school receipts, 1905, 214 school tax, territorial, 30, 31, 215 Arkansas funds for schools, 100; Common School Fund, 158, 216, 217, 218; Per Centum Fund, 146, 219; Per- manent School Fund, 145, 146, 216-220; see also Credit funds, 8; Saline Fund, 147, 218; Seminary Fund, 147, 218; Sixteenth Section Fund: merged, 112, 218; Surplus Revenue Loan Fund, 74, 100, 158, 217, 218 lands for schools: internal improve- ment lands, 219; salt lands, 219; section sixteen, 216-217,218; swamp lands, 62-63, 219 rate bills: 3; 27 Ashe, W. W., forester, N. Ca., letter quoted, 361-362 Assessed valuation, as apportionment basis: Mass., 309-310; N. Y., 358, 359 Attendance as apportionment basis: minimum, Fla., 178, 246; Neb., 334; advantages, 181-183; states em- ploying, Table, 186-188; attendance increased by influence of permanent school funds, 183 Attorney-General, relation to school funds, in Kan., 273; Mont., 330; Neb., 333; N. J., 344; N. Dak., 366; Va., 421; Wis., 433 Auction fees devoted to school funds, N. C, 86; R. I., 388 Auction of Louisiana Free School Fund, 150-151, 281 Auditor, County, relation to school funds, Ind., 266 Auditor, state, relation to school funds. Ark., 219; Iowa, 269-270; Ky., 275, 277; Minn., 319; W. Va., 428 Back Bay lands, Mass., 304-305, 307, 308, Table XLV, 452 Balances, added to principal, Me., 291, 295; Mass., 91-92, 304, 309, 452; N. H., 338; N. Dak., 366; R. L, 91-92; W. Va., 427 Balances, reapportioned, Cal., 225; N. J., 345 Baltimore & Wash. R. R., income de- voted to schools, 297 Bank failures involving school funds: Ala., 144, 208, 209; Miss., 144, 327; N. C, 144, 363; Tenn., 144, 398- 399; Wyo., 144, 435 Bank moneys devoted to school funds: revenue, Ohio, 375; stock, Ind., Ky., N. C, N. J., Tenn., Vt., 88; Ga., 247-248; Ky., 275, 276; Miss., 326; N. J., 343; N. C, 362; Tenn., 397; Vt., 409 Bank taxes, a source of school revenue: Ind., 31, 70, 89, loi, 262, 263; Me., 31, 287-288, 293, 294, 447, 448; Md., 89, 296; N. H., 340; Vt., 89, 409; see also United States Bank Tax Banks capitalized with school funds. Ark., 217; Ind., 263; Tenn., 144 Bartlett, Robert, bequest, 34 Beers, Seth P., Commissioner of Con- necticut School Fund, 235 Bequests for endowing schools: Simms, 33; Peasley, 34; Mason, 34; Hopkins, 34; Bartlett, 34 Bequests, increase permanent school funds: La., 282; Mont., 330; Nev., 336; Ore., 381; Vt., 416; Wash., 424; W. Va., 427; see also Devises; Gifts Bequests to board of education, Ga., 247 Blind school aided by swamp lands, Minn., 318 Board of Commissioners, School and University Lands: Ark., 219; Kan., 273; Ore., 382; Wis., 433 Board of County Supervisors, Miss., 327 Board of Education, State: manages school funds, 120-121; Fla., 113, 245; Mo., 324; Texas, 405; Va., 421; sup- ported by permanent school fund, Va., 422 Board of Educational Lands and Funds, Neb., 333 Board of Investment, Minn., 319 Board of Land Commissioners, State, 120; Mont., 330; Utah, 407; Wash., 424 Board of School Land Commissioners, Wyo., 120, 435 Board of University and School Lands, N. Dak., 366 Board, teachers', see Teachers' board Boards managing school funds, com- position, 1 20-1 21 Bonds, as securities: county. Ark., 216; Cal., 222; Mont., 329; Neb., 332; S. Dak., 391; Tex., 400; W. Va., 426; Wyo., 434; foreign, Minn., 316; INDEX \ 471 district, Id., 251; N. Dak., 365; Ore., 380; Utah, 406; W. Va., 426; Wis., 429; Wyo., 434; state. Ark., 216; Cal., 222; Del., 238; Fla., 243; Idaho, 251; Ky., 276; Md., 296; Minn., 316; Mont., 329; Neb., 332; Nev., 335; S. Dak., 391; Tex., 400; Vt., 415; Va., 420; town, Mass., 299; S. Dak., 391; Vt., 415; United States, Fla., 243; Neb., 332; Nev., 335; Vt., 415; irredeemable, Nev., 335; municipal, Cal., 222; Mass., 299; Minn., 316; Mont., 329; S. Dak., 391; Utah, 406; Vt., 415; Va., 426; railroad, Mass., 299, 305; school district, Mont., 329; S. Dak., 391; Tex., 400; Utah, 406; Vt., 415; W. Va., 426; Wyo., 434. Bonds, fraudulent, N. C, 1 51-15 2 Bonds, payment of. Ark., 216; Ky., 275; see also Bonds, irredeemable Bonds' profit, increase permanent school funds, Minn., 319 Bonds required of school ofl&cers. 111., 258; Ind., 267; Ore., 382 Bonds, state, given for school fund: Ark., 216; Cal., 222; Iowa, 268; La., 279 Books, free text; 174, Table XXI; Del., 241; Me., 179, 292; Md., 298; Mass., 310; Mont., 331; Va., 422 Books, library, see Library books Boone, R. G., referred to, iii, 239 Boston, school lands reserved, 34 Boston Society of Natural History aided with School Fund, 307 Bourne, E. G., cited, 73, 74-78, 297, 375 Bridge revenues devoted to school fimds: Nev., 336; Ohio, 375 Broadhead, Colonel, 42 Building tax: Me., 30; Minn., 30 Buildings, school, erected with per- manent school fund income, 174, 198-199; Miss., 328; N. C, 362, 364; Wis., 429 California funds for schools, 8, 100; per centum grant, 69, 223; Perpetual School Fund, 221; State School Fund, 7, 8,_5S,_ 61, 131, 147, 221, 225; constitutional provisions, 222-223 lands for schools: internal improve- ment, 61; rents of, reserved, 91; sections sixteen and thirty-six, 55, 61, 113, 118, 158, 221; unsold, 221; value unequal, 117-118 California, superintendent of schools, office created, 197; township manage- ment, losses, 131 Cambridge land grant, 35 Canal lands, Ohio, 370 Cape money, 31 Capital, original, of common school funds, 106; see also Origin Care of school funds, N. Y., 349 Care of school lands, 124-128, 140; see also Constitutional provisions Census, as apportionment basis: school, 180-182; Ala., .211, 212; Ark., 220; Col., 227; Conn., 236; Id., 252; 111., 257; Ind., 266; la., 270; Kan., 274; Ky., 277; La., 282; Me., 291; 292, 29s; Md., 297; Mich., 315; Mo., 324; Mont., 330; Neb., 333; Nev., 337; Ohio, 379; Ore., 382; R. I., 388; S. Dak., 392; Tex., 405; Utah, 407; Va., 421; W. Va., 428; Wis., 433; Wyo., 436 total, 180, 184; N. Y., 359 Census, required, see Returns Census, school, tables:Conn., 1825-1895, Table XXVIII, 440; Me., 1831-1902, Table XLII, 448; Mass., 1837-1905, Table XLIV, 451 Certification, see Teachers must be certified Cessions of western lands, see Land cession by states; Northwest Territory Charitable institutions supported by swamp land fund, Minn., 316, 318 Charity schools, D. C., 32, 242; see also Poor School Fund under Funds Charles II, 40, 229 Charlestown, colonial grant, 35 Church Lands, see Funds, ministerial, under Fund Civil War, disastrous effects upon school funds, 144, 150-153; Fla., 244; Ga., 250; Ky., 276-277; La., 281; Mass., 307; Mo., 151; N. Car., 363; Tenn., 399; Va., 420; Wis., 429, 432 Classification of permanent common school funds, 6 Coahuila, Mexican state of, 401 Colonial records quoted: Hartford, 25; New Haven, 26, 29; Weathers- field, 28 Colonial school, endowments and sources of support, 24-35 Colorado Public School Fund, 22, 154-155, 158, 226-227 sixteenth and thirty-sixth section school lands, 117-118, 226, 227 472 INDEX Co^red scnool monej's, Del., 240, 241 Conmission on Permanent Common ochool Fmid, Vt., 413 Commissioners for managing school funds and lands, 119, 120; Ark., 219; Conn., 23s; Kan., 273; Mass., 308-309; Minn., 319; Mont., 330; Neb., 333; N. Y., 121, 358; Ore., 382; Wash., 424; Wis., 433; Wyo., 435; see also Board of Commission- ers; management, state Common School Acts, Mo., 321; see also Acts quoted Composition of school funds, see In- crease, soiurces; Origin Comptroller, see Controller Compulsory education, principles, 3 ; pen- alty for not enforcing, N. Y., 179, 360; see also Free schools; Taxation, compulsory Condition of permanent school funds: often unknown, 7-10, table showing, 20-21; see also Credit funds; Debts Condition of permanent school funds: jgo2, Mo., 321; N. J., 342 igo2 and 1904, Kan., 271; Utah, 406 1903, Idaho, 251; Miss., 325, 326; Mich.,_ 312, 313 J904, Wis., 429 1905, Ala., 207; Ark., 216; Conn., 228-229, 237; Fla., 243; Ga., 247; 111., 254-255; 256-257; Ind., 260; Iowa, 268; Ky., 275; La., 279, 2S1; Me., 283, 285-2S6, 289; Mass., 299; Mont., 329; Neb., 332; N. H., 338, 341; N. J., 342; N. M., 347, 348 foot-note; N. Y., 349; N. Dak., 365; Ohio, 368; Okla., 378; Penn., 383; R. I., 387; Tenn., 394; Tex., 400; Va., 420; W. Va., 426 1905-1906, Ariz., 214; Del., 23S 1906, Cal., 221-222, 223; Col., 226; Md., 296; Nev., 335; N. J., 342; N. C., 361-362; Ore., 3S0; S. C, 389; S. Dak., 391; Vt., 408-409; Wash., 423-424; Wyo., 434 1908, Minn., 316 Confiscations devoted to permanent school fimds, Miss., 326; Va., 86, 420 Congressional acts quoted Internal improvement land grant, 1841, 60-61; Percentum grant, N. M., 347; Section sixteen grant, Mich., 112; Ohio, 51; lands in heu of, 53; sections sixteen and thirty- sLx, Ore., 54; Swamp land grant, 62- 63; Tenn. grant, 395-396; United States Surplus Revenue Act, 1S36, 71; see also EnabUng Acts; Ordinances; Resolutions Congressional grants, see Federal lands : Grants Connecticut appropriations, colonial, 24; census, school, 1825-1895, Table, 440; charter, 40, 229; Code of 1650, 29; Code of 1700, 30, 167; expenditures, total, for public education, 1855- 1895, 439; free schools, 166-167, 168; sec also Codes of 1650 and lyoo under Connecticut funds for schools classified, 100-106; colonial funds, 34-36; School Fund, 5, 6, 28, 82, 122, 142, 158, 165-168, 171, 175, 176, 180, 191, 198, 228-237, 301, 437-438; Town Deposit Fund, or Siuplus Revenue Fund, 73, 74, 100, 131, 158, 237, 439; town school fimds, 34, 35-36; income, 1855-1895, 439 funds for the ministry, 35-36, 231; gifts, 439; land claims, 40, 42, 43 lands for ministry, 35-36, 231 lands for schools, controversy, 35; origin, area, sale, 35, 229-231; see also Bequests; Funds; Land claims; Western Reserve Pennsylvania Land Case, 230 rate bills, 3, 25-26, 1S56-1S68, 28; abolished, 27 school receipts, total, 1856-1868, Table IX, 28 school returns, 175 ] school society, 232, 233, 234 school support, colonial, 23, 28, 29, 30; compulsory, 29, 30; sources, 1825-1895, 439, 440 Supt. of Common Schools, oflSce created, 197 siu'vey system, colonial, 35, 36 taxes for schools, cease, 228; co- lonial, 29-30; District Tax, 1S56- 1868, Table IX, 28; tea tax, 31; license taxes, 31; liquor tax, teachers, qualification of, 191 teachers' wages, 1847-1907, Table XXIV, 192-193; 1S68-1900, total expenditure for, average. Table XXIX, 440 Western Reserve or New Conn., 43; sale, area, 82, 85; boimdaries, INDEX 473 origin, management, sale, pro- ceeds, basis of School Fund, 229- 234; survey and land reservations, 369-372 Constitutional provisions concerning permanent common schools funds and lands, 124-128; Ala., 209; Ark., 217; Cal., 222-223; Col., 226-227; Fla., 244; Id., 252; 111., 255; Ind., 261; la., 269; Kan., 67, 127, 272; Ky., 276; La., 279, 280, 281; Mich., 125, 312, 313; Miim., 126, 127, 317, 318; Mont., 330; Neb., 127, 332, 333; Nev., 335, 336, 337; N. Y., 353-354, 355; N. Dak., 128, 366; Ohio, 372; Ore., 126; S. C, 389- 390; S. Dak., 128, 392; Tenn., 397; Tex., 402-403; Utah, 407; Wash., 128, 424; W. Va., 426-427; Wis., 430, 433; Wyo., 435 Constitutions quoted: Ala., 209; Col., 226-227; Ga., 1783, 36; Kans., 67; Mich., 125; Minn., 126-127; Nev., 337; N. Y., 354; Ore., 126; S. C, 389-390; Tex., 1845, 402 Controller, relation to permanent school funds: accountant, Cal., 223; ap- portions income. Conn., 236; Md., 297; Tenn., 399; to management, 120; N. J., 344; N. Y., 358; Te.x., 405 Conveyance, see Transportation Convicts, hire, devoted to schools, Ga., 247, 248 Corporation moneys: charter fees de- voted to permanent school funds: Kan., 273; shares or dividends. Id., 252; Utah, 407; see also Bank moneys; Bonds Corporation taxes: devoted to per- manent funds, Ind., 264; W. Va., 427; unpaid, Ind., 147-148, 264-265; see also Bank taxes Coimty Auditor: distributes school revenue, Ind., 266; la., 270; loans school funds, Ind., 266 County boards of supervisors, 115, 269-270, 327, 328 County Superintendent: apportions school moneys, Kan., 274; N. J., 345; estimates census, Cal., 224; fined, 252; manages funds, iii, 257; salary paid from permanent school funds, N. J., 345 Course of study influenced by per- manent school funds, 177; Me., Mich., N. Y., 179, 292; Wash., 425 Creation of permanent common school funds, 93, 95, 97, 98-106; see also Origin Credit funds: defined and classified, 6-7; reported intact, 7; significance, 155-157J 202; States possessing: Ala., 208; Ark., 216; Cal., 7, 222; Conn., 237; Del., 8; La., 7, 154, 279, 281; Me., 7, 283; Mich., 7, 312-313; Miss., 325; Neb., 332; Nev., 336- 337; N. H., 338, 340; N. J., 344; Ohio, 7, 368; Tenn., 7, 394; Vt., 408, 409, 414; Wis., 431; Tables: Table I, 8; Table VII, 20-21; Table XX, 158-159; see also Accounts; Debts Cubberley, E. P., referred to, 180, 202 Cutler, Manasseh; urges school land grant, 45, 46, 47, 50 Data, school, difficulty of securing, iii, iv, 6; unascertainable, 164 Deaf school aided by swamp lands, Minnesota, 318 Deaf, teachers for, California, 224 Debts, states', to permanent school funds: Cal., 147; Col., 227; Fla., 147, 150; Id., 251; 111., 255; Kan., 273; Minn., 318; Miss., 325; Neb., 332; Nev., 336; N. H., 338, 340; N. Dak; 365; R. I., 153, 388; Tenn., 394, 399; Tex., 400; Vt., 413, 414; Wash., 423; Wis., 429, 431; prohibited by constitution, W. Va., 156, 426; repudiated. Col., 155, 227; N. C, 151-152; Vt., 154, 410; see also Credit funds Defalcation of school fund officers: Mo., 133; N. Y., 358; Tenn., 145, 398; Wis., 430 Delaware license moneys: marriage, tavern, et al., 86, 238, 239 Public School Fund, 8, 238-241 rate bills, 27 sanitary requirements, 198, 241 Surplus Revenue Loan Fund, 72, 75, 239 Denominational schools, see Religious and sectarian schools Devises devoted to permanent school funds: Ark., 219; Col., 227; Ky., 277; Mo., 323, 324; Ohio, 374; Ore., 381; W. Va., 427 Devises to State Board of Education, Ga., 247 Dexter, E. G., referred to, iii 474 INDEX Direct tax, 88, 89; devoted to per- manent school funds, Mass., 305; _S. C, 390 Dishonesty of land commissioners, Ind., 265; see also Defalcations; Embezzlement District Board of Directors, Mo., 324 District bonds, see under Bonds District of Columbia: no permanent school fund, 10; federal appropriations for schools, 25, 80; lotteries, 32-33, 242; school fund, 242; school lots, 242 District quota, New York, 358-359 District tax: Conn., 18 56-1 868, Table, 28; la., 268; Mo., 324; Wis., 433 District trustees: Mont., 331 Diversion of funds: Ala., 153; Ky., 153-154. 275, 276; La., 281; Mass., 307-308; N. H., 341; Penn., 384, 386 Diversion of moneys reserved for principal: Mo., 323; Va., 421; Wis., 430, 431, 432 Diversion of principal: Ark., 146, 147, 217, 218; Fla., 147; Ind., 147; Kan., 148; Va., 148; Wis., 148-149 Diversion of school moneys, 147-149; Ala., 210; Ga., 4, 250; see also Loss Division superintendents paid from common school funds, Va., 422 Documents quoted, see Acts; Colonial records; Congressional acts; Constitu- tions; Enabling Acts; Ordinances; Resolutions Dohmrore's grant, Ohio, 370 Donations to permanent school funds: Fla., 24s; Mont., 330; Ohio, 374; S. Dak., 392; Va., 421; Wash., 424; see also Gifts Dorchester: school lands reserved, 34 Draper, Lyman C, on loss of school lands, Wis., 141 "Eastern" lands in Maine and Mas- sachustts, 284 Education, State Department, ex- penses paid from school fund, Ky., 277; Mass., 304 and n.* Effects, see Influence, Embezzlement, 145, 146; Neb., 333; see also Defalcation Enabling Acts: quoted, Ohio, 51; Ore., 54; provisions of, 93; Mont., 329; Ohio, 369; Utah, 407; inequity of land grants, 371; modified, 372 Endowments, see Funds England, land claims, 40 Escheats devoted to permanent com- mon school funds, 86-87; Ark., 219; Col., 227; Fla., 245; Id., 252; la., 269; La., 280, 282; Mich., 315; Miss., 326; Mo., 323; Mont., 330; Neb., 333; Nev., 336; Ore., 381; S. C, 390; S. Dak., 392; Tenn., 397, 399; Utah, 407; Va., 420, 421; Wash., 424; W. Va., 427; Wyo., 435; see also Intestate estates; lost, Ind., 264; reserved but not added, Va., 421 Establishment of school funds, steps, 93; see also Creation; Evolution Estrays, Ark., 219; Ind., 264; Mo., 323 Evolution of permanent common school funds, 33-37, 93-97; see also Increase, sources of Examiners, State, paid from per- manent school funds, Va., 422 Excise moneys, see under Liquor Expenditures, lawful, see Uses, lawful Expenditures, total, for public schools; Conn., 1855-1895, 439; Fla., 1870- 1905, 441; Me., 1851-1902, Table XLII, 448; Mass., 1835-1905, Table XLIV, 450; N. Y., 1831-1900, Table XLVII, 455 Fairfield, town school grant, 35 Farm loans, see Mortgages Federal aid to schools, 39-80, 100- 106, 203 Federal appropriations, see Appropri- ations; Federal money grants Federal lands: grants, 43-66, 100-106; not taxed, 127; see also Congressional acts quoted, and under La^ids, In- ternal improvement lands; Salt lands; Section sixteen; Sections six- teen and thirty-six; Swamp lands Federal money grants, 67-80, 100-106; see also Appropriations, federal Fertilizers, inspection fees, 247-248 Fines: used for current school revenue, Ariz., 214; diverted, Va., 148, 421; Wis., 148-149, 432-433; increase of school funds: Ind., 87-88, 262- 264; Table, 1868-1906, 443; Mo., 322, 323; Miss., 326; Mont., 330; Nev., 336; Ore., 381; Va., 420-421; Wash., 424; Wis., 88, 430 Fire losses, Ark., 145, 219; Mo., 145 Fish licenses, 31 Fitchburg R. R. Securities Loan, 306, 307 Florida, expenditures, total, for public schools, i(?70-i"po5, 441; free schools, indifference to, 4, 162, 163, 164 funds for schools: County School INDEX 475 Fund, 245; Seminary Fund, 150; Sixteenth Section Fund, 4, 244; State School Fund, 63, 11 2-1 13, 114, 152, 158, 163, 182, 199, 243- 246; Table, iSyo-igo^, 441 lands for schools: management, town- ship changed to state, 112; sale of, 4, 244, 245; sixteenth section lands, 150, 243-245; swamp lands, 63; private schools, support, 163; rate bills, 27; rents of school lands, 243; school returns, unascertain- able, 164 Supt. of Schools, office created, 197; taxes: mill, 245; poll, 245; town funds, see Sixteenth Section Fund Forest lands, wasted and denuded, 140-141; Wis., 430, 431, 432 Forfeiture of permanent school fund income: Conn., 233; Fla., 245; Ind., 267; Mass., 91-92; N. J., 34s; N. Y., 360; Rd. Is., 91-92, 388; Vt., 415, 416, 418; Wash., 425 Forfeitures devoted to permanent school funds, 86-88; Mass., 309, Table XLV, 452; Tenn., 399; Utah, 407; Wash., 424; Wis., 430; Wyo., 435 Forged mortgages. New York, 358 France, land claims of, 40 Fraudulent bonds, Kan., 273; N. C, special tax, 363 Free school acts, see Acts quoted Free schools, states maintaining, 3; established: Ark., 217; Conn., 300; Ga., 4, 248; Ky., 278; Me., 284, 288; Mass., 300; Mo., 321; N. Y., 300; Penn., 383-38$; S. C, 390; Tex., 403; fostered by influence of per- manent common school funds, 5, 33-36, 168, 179, 190-201, 248; hos- tility and indifference to, 3, 4, S, 26, 160-165; Fla., 162, 163, 164; Ga., 162, 248, 249; Ind., 161, 162, 163, 199; Miss., 162; N. H., 341; Tenn., 162, 163; Va., 162; see also Rate bills; Returns Fuel, 174, 198, 293, 310, 328 Funds fund defined, 7, 8, 9, 221, 238, 254, 275, 283 Academy, Ga., 249 Agricultural, N. C, 362 Bank Tax, Ind., 262, 263 Bounty, Mass., 307 Chickasaw, Miss., 325-328 Chocktaw, of Miss., 325-328 Common Free School, Md., 296- 298 Common School, current revenue: Ark., 216; Ga., 247; Kan., 9; Neb., 9; Ohio, 368 Common School, Permanent En- dowments, varied use of term, 7, 9, 247; Ark., 216, 217, 218; Fla., 243, 244; Ga., 247; Ind., 260, 261, 266-267; Ky., 276; Miss., 64; N. H., 338, 340-341; N._ Y., 349, 352-355, 356-360; Ohio, 9, 368; Ore., 380-382; Penn., 383-386; Tenn., 9, 11, 144, 151, 163; Vt., 409, 410; Wash., 423- 425; Wis., 432 Common School Permanent, Wyo., 434-436 Congressional Township, Ind., 260- 267 County School, Ariz., 215; Ark., 218; Fla., 245; 111., 100, 254-258; Minn., 30; Mo., 63, 102, 321, 322, 323, 324; Tex., 400, 401, 402, 405 County Seminary, Ind., loi, 262 Delinquent Tax, Ind., 102, 262, 265 District, Mo., 321-324 Educational, Ala., 207, 210 Five per cent, 312-315 Free School, Ga., 249; La., 279- 282; Md., 296-298; N. Y., 359 Huntington, Vt., 312, 411, 413, 415, 417, 418 Indemnity Land, 207 Institute, N. H., 84, 103, 159, 338- 341 Irreducible, W. Va., 426 Irreducible School, Wis., 429 Literary, Ky., 102, 275-276; Mass., 301; Miss., 325, 327; N. H., 84, 339, 340; N. Y., 228, 349, 350, 351, 354, 357, 359; N. C, 88, 144, 151- 152, 159, 198, 361-364; Va., 420- 422 local permanent, 5, 33-35; Conn., Mass., N. H., Va., 30; Conn., 237, 439;^ Me., 283; N. Y., 455; see also District, Town and Town- ship Funds local private, :i,:^, 34 local public, 34-37 Mass. School, 299-311 Mill, Me., 291, 294-295 ministerial. Conn., 35, 36, 166, 231, 232, 233; Me., 284-285; Mass., 37; N. Y., 36, 37, 350; lands. 476 INDEX granted by United States, Ohio, 46, 47, 48, 373 New Jersey Permanent School, 342- 346 Per Centum Fund Act quoted, N. Mex., 347 Per Centum, Ark., 219; 111., 255; la., 269; Kan., 272; La., 272, 280, 282; Me., 290; Mont., 329; Neb., 333; N. Dak., 366; N. Mex., 347; Okla., 379; Ore., 381; S. Dak., 392; Wash., 424; Wis., 430; Wyo., 435; see also Grants Permanent Public School, Vt., 408- 419 Permanent School, Ark., 100, 216; la., 268-270; Ky., 102, 275-278; Me., 283-295; Minn., 316-320; Neb., 159, 332-334; N. J., 342- 346; N. Dak., 365-369; Rd., Is., 387-388; S. C, 389-390; S. Dak., 391-393; Tenn., 394-399; Tex., 400-405 Perpetual School, Cal., 100, 221-222; La., 280 Poor School, D. C, Ga., Miss., Va., 162, 242, 249, 351 Primary School, Mich., 312-315 Primary School Interest, Mich., 315 Public School, Ala., 207; Col., 100, 226-227; Del., 100, 238-241; Id., 100, 251-253; Mo., 321-324; Mont., 329-331 Saline, Ark., 218; Ind., loi, 262-263; see also Salt land grant under Grants School, Ala., 207; Conn., 100, 228- 237; Del., term defined, 238; Fla., 100, 243; 111., 100, 158, 254-257; Mass., 82, 83, 84, 85, gi, 92, 159, 169, 173, 176, 228; W. Va., 426- 428; Wis., 429-433 School Fund proper, 111., 254-258; Ind., 283; Me., 283 School Indemnity Land, Ala., 207 School Mill, Me., 291, 294-295 School Trust, Wis., 429 Seminary, Ark., 218; 111., 255; Ind., 262; La., 281 Seven Per cent, Mich., 312-315 Sinking, Ind., loi, 262, 263; Ky., 153) 275; Fitchburg Railroad Se- curities Loan, Mass., 306, 307 Sixteenth Section, Ala., 100, 207, 208, 210; Ark., 100, 218; Miss., 325; see also Section Sixteen under Lands, Township Fund under Funds Spanish War Claim, Vt., 79-80, 412- 413, 416 Special District, Mo., 324 State Permanent School, Kan,, 159, 271-274 State School, Cal., 100, 221 S..; Fla., 100, 243-246; Me., 283; Mont., 329-331; Nev., 62, 118, 335-337; N. J., 340; Utah, 406-407 State School Land, Cal., 100, 221 Surplus Revenue Fund income, N. Y., 1831-igoo, Table XLVII, 455 Surplus Revenue of 1837, or U. S. Surplus Revenue Loan, 70-78; act quoted, 71; states using for schools, 72-74; Ala., 207-211; Ark., 217, 218; Conn., 237, 439; Del., 239; Ga., 249; 111., 254, 255, 256, 257; Ind., 262, 263; Ky., 276; La., 280, 281, 282; Me., 73, 76, 159, 289, n.*; Md., 296-297; Mass., 308; Mo., 322; N. H., 339-340; N. J., 343- 344; N. Y., 354-357, 359, 455; N. C, 363; Ohio, 374, 375; Penn., 386; R. L, 387-388; S. C, 72, 78; Tenn., 397-399; Vt., 408, 410-41 1, 413, 414, 415, 416, 418, 419; Va., 72-78 Surplus Revenue or Town Deposit income, Corm., i855-i8g5, 439 Swamp Land, Ind., 102; Mich., 312- 315; Minn., 63, 64, 102, 316-370 Table XIII, showing for all states, amovuits received, used for schools, lost, original use, present con- dition, 74-78; see also imder Index for states Teachers', la., 268 Territorial School, Ariz., 215 Town, Colonial, 33-35; Me., 284- 286; Mass., 308; N. Y., 350 Town Deposit, Conn., 73, 74, 100, 131, 158, 237, 439 Township, 96-97, Cal., 100, 222; 111., 100, 254-258; Mo., 1337138, 159, 321-324; see also Congressional Township; Sixteenth Section; Town funds Tuition, N. Dak., defined, 365 U. S. Deposit, of 1833, 69-70; of 1837, see Surplus Revenue Fimd Universitv or Seminary, Ark., 218; lU., 255; N. H., 340; Okla, 379 Valueless Sixteenth Section, Ala., 100, 207 ff. Furniture, tax for, Minn., 30; purchase of, 174; Col., 227; Miss., 328; Mont., 331; Va., 422 INDEX 477 Gambling moneys, 32, 87-88; Ariz., 214; Ind.. 262 Georgia Constitution, 1783, quoted, 36 division of school moneys, 4 free schools, 4, 36, 248 funds: Academy Fund, 249; Com- mon School Fund, 9, 247, 248; Free School Fund, 249, 250; Poor School Fund, 162, 249; School Fund, 150, 158, 162, 248-250; Surplus Revenue Fund, 73, 75, 158, 249 land claims asserted, 40; ceded, 209 land funds for schools, reserved, 4, 36, 82, 8s, 248 Land Lottery Act, 82 receipts for common schools, 1836, 4; jpo5, 248 revenue for common schools, sources of, 10, 247, 248 Gifts to permanent school funds, 86- 88; Ark., 219; Col., 227; Fla., 245; Id., 252; Ky., 277; La., 282; Mich., 315; Mo., 321, 323, 324; Nev., 336; N. C, 363; Ohio, 374; Ore., 381; S. C, 390; S. Dak., 392; Tenn., 87-88, 397, 399; Vt., 416 Gifts to support schools, Conn., 168; Ga., 247; Me., 284; Mass., 300 "Gospel and School Lot," New York, 36-37; see also Ministerial lands under Funds Governor, relation to school funds, 31; Mass., 308; Mich., 315; Minn., 319; Mont., 330; Neb., 333; N. H., 338; N. J., 344; N. Dak., 366; Ore., 382; R. L, 388; Tex., 405; Utah, 407; Vt., 415; Va., 421; W. Va., 428; Wyo., 435 Grammar schools, endowed, 33-34, 35; decline, 167 Grants, federal, see Congressional Acts, quoted; Federal lands; Federal money Grants, state moneys, 85-93; Table XVII, 100-106 Grants, state, possible sources of in- creasing permanent school fimds: Ark., 219; Col., 227; Id., 252; Ky., 277; La., 282; Mich., 112; Mo., 321, 323, 324; Mont., 330; Nev., 336; N. C, 363; Ohio, 374; S. C, 392; W. Va., 427; Wis., 430 Grass sales' proceeds, Me., 91, 285, 290; Minn., 319 Growth, see Increase Hadley, Conn., permanent school fund, 34 Hartford, Conn.: colonial school ap- propriation, 1642, 24; rate bills, 164 J, 25; colonial permanent school funds, 34, 35 Henry VIII, endowment of schools under, 33 Hillhouse, J. H., First Commissioner of Conn. School Fund, 122-123, 23s, 236 Hopkins Bequest, 34 Huntington, Arunah, bequest to Vt., 411 Idaho grants. Five Per Centum, 68 lands, sections 16 and 36, 251, 252 Public School Fund, 251-253 and n. Ignorance concerning condition of school funds. 111., 7-10, 130, 140 Illinois fines and forfeitures, 88 free schools, 26 funds for schools, importance of, 19; classified, 100, 254; Common School, defined, 254; County School, no, 254, 255, 256, 257; School Fund Proper, 158, 254- 258; Surplus Revenue, 73, 75, 159, 254, 25s, 256; _ Township, no, 254, 255, 257; University Per Centum, 255 Grants, per centum, 68, 255 lands for schools, county sales, 256, 257; owned by township, in; military, 314; section 16, 255- 256, 257; swamp, 63, 256-257 receipts for common schools, igoS'. total, 255; from permanent fimds, 255 Importance of permanent common school funds, 16, 19, 20; 111., S. Dak., 19; Col., Me., Mass., Nev., Tex., Vt., Wyo., 22; N. Y., 349, 350; see also Condition of permanent school funds; Per cent of total common school revenue Income: Conn., sources, 182^-1 8gs> Table, 439; per child, from all sources, i825-i8g5, Table, 440 Fla. State School Fund, i8yo-igo^, Table XXX, 441 Ind. Common School and Congress- ional Township Funds, i86^-igo6, Table, XXXV, 444 Ind. permanent funds and taxation, i866-igo6, Table, 445 Me. Permanent School Fund, 1851- igo5, Table, 446; sources, total and per child, Table, 448 478 INDEX Mass. School Fund and local tax, i8 35-1 go 5, Table XLIV, 450-451 N. Y. Common School Fund, U. S. Deposit Fund, state appropriation, i'jg6-igos, Table, 453-454; sources, 1831-igoo, Table, 455 See also Apportionment; Participation, conditions; Uses Income and per cent of total common school revenue, all states. Table VII, 20-21 Income, composition prior to exhaustion of lands, 95 Income, first distributed. Conn., 166, 228; Mass., 195; Me., 169, 284, 289; Miss., 326; N. Y., 195 Income, igo^, derived from permanent funds. Local and State Tax, all states. Table VI, 17-18 Increase of permanent common school funds, principal and income. Conn., i7gg-igo5, 437; Fla., iSyo-igos, 441; Ind., 443, 444; Me., i8jg-igo6, 446; Mass., 1835-igos, 450-451; N. Y., iyg6-igos, 453-454 Increase, sources of, Ala., 211; Ariz., 214, n.*; Ark., 219; Cal., 223; Col., 227; Conn., 235-236; Del., 239, 240; Fla., 245; Id., 252; 111., 257; Ind., 264-266, 442-443; la., 269; Kan., 273; Ky., 277; La., 280, 281, 282; Me., 289-291, 295; Mass., 303-307, 309, 452; Mich., 315; Minn., 319; Mo., 323-324; Miss., 327; Mont., 330; Neb., 333; Nev., 336; N. H., 338; N. J., 344; N. Max., 348 n.*; N. Y., 351, 354-355; N. C, 363-364; N. Dak., 366; Ohio, 375, 376; Okla, 378, 379; Ore., 381; R. I., 388; S. C, 389, 390; S. Dak., 392; Tenn., 399; Tex., 403, 405; Utah, 407; Vt., 416; Va., 420, 421; Wash., 424; Wis., 430; Wyo., 435 Indian lands, granted to Tenn., 53; appropriation in lieu of, Ind. Ty., 259; purchased by Ind., 266; Kan., school sections in, 272; Miss., 325 Indian reservation, teachers' moneys, N. Y., 359 Indian school endowed, Va., ^^ Indian Territory, federal appropriations, 56, 80, 259 Indiana escheated estates, lost, 146-147 fines and forfeitures, 87-88, 146 free schools, early conditions, 161, 163; funds used for private purposes, 162-163; growth of sys- tem, 1855-1885, Table XXXVIII, 44S funds devoted to schools, Bank Tax Fund, 70, 262, 263; Common School and Congressional Town- ship, 5, 64, 114, 116, 145, 146, 147-148, 159, 200, 260-266; Tables, 87, 442-445; County Seminary, 87, loi, 262, 442; Delinquent Tax, 102, 262, 265, 442; Saline, 59-60, 262-263; Sinking, loi, 262, 263, 442; Surplus Revenue Loan, 73, 75, 262, 263; Swamp Land, 64, 102, 145-146 lands devoted to schools, saline lands, 59-60; value, 60; swamp lands, 63-64, 265 private schools, supported with per- manent school funds, 162-163; rate bills, 3, 27; receipts for common schools, igoj, 260; tax, school, 164, 165, 198; local. Table, 1 866-1 go6, 445; teachers' wages, 192-193 Influence of permanent common school funds, attendance, 183; free schools, 168, 190-201; school term, 167, 176; organization, 194-300; returns, 175, 194-196; supervision, 196-197, 199; taxation, 165-170, 176, 191-198; teachers' wages and board, 171, 191, 192-193; see also Effects Inheritance tax devoted to permanent school funds. La., 282 Insane asylum supported by swamp lands, Minn., 318 Inspection of schools, required. Conn., 178, 198, 237 Institute of Technology, Mass. School Fund diverted to, 307 Institutes, teachers', supported by permanent school funds, N. H., 338; S. C, 389 Insurance, a lawful expenditure, Mont., 331 Insurance revenue devoted to common school fund, Ohio, 375 Intact funds, 6; Table VII, 20-21 Interest on permanent school fund, debts, paid out of taxes, 155-157; Ala., 208, 210; Cal., 222; Conn., 237; Id., 251; la., 268; La., 279, 281; Mich., 314, 315; Minn., 318; Neb., 332; Nev., 337; N. H., 338-340; N. Dak., 365; Ohio, 109, 368; Tenn., 394; Tex., 400; Vt., 414; Wash., 423; Wis., 129, 157, 429; derived from sinking fund, Ky., 275, 277; INDEX 479 paid by appropriations, Fla., 243; rate paid by states on credit funds or loans, Table VII, 20-21; unpaid, Ala., Kan., Miss., Mo., 143; Tex., 143-144, 404; Conn., 235 Internal improvement lands, see under Lands Intestate estates devoted to permanent school funds, 87; Ark., 219; Cal., 223; Kan., 273; Tenn., 397, 399; W. Va., 427; Wyo., 435; see also Escheats Investigation of lands needed, 201-202 Investment, board of, see Boards; Commissioners; Management Investment of permanent common school funds: losses, 132, 142-144; problem of, 155-156; unlawful. Mo., 323; mode and provisions. Ark., 216, 218; Cal., 221, 222; Col., 226, 227; Conn., 23s, 236, 438; Del., 238, 239; Fla., 242, 243; Ga., 248, 249; Id., 251; Ind., 266; la., 268; Kan., 273- 274; Me., 295; Md., 296; Mass., 299, 302, 308, 309; Minn., 319; Mo., 322, 323; Miss., 326, 327; Mont., 329; Neb., 332, 333; Nev., 335; N. J., 343; N. Y., 352, 353, 356; N. C, 362; N. Dak., 365; Ore., 380; R. I., 387, 388; S. Dak., 391; Tex., 400, 405; Utah, 406, 407; Vt., 411, 417; Va., 420; W. Va., 426; Wis., 429; Wyo., 434; see also Bank stock; Boards; Bonds; Commissioners; Loans; Losses; Management; Mort- gages; Notes; Securities Iowa lands, school: internal improvement, 62, 269; owned by state, 113, 115; sales, disastrous, 129; price of, 139; rent of, 268; unsold, 268; section sixteen, 269 Permanent School Fund, 113, 115, 129, 130, 139, 142, 159, 268-270; see also Credit funds, 8; Teachers' Fund, defined, 268 rate bills abolished, 27 receipts for common schools, IQ05, 268 _ _ supervision of schools, 197 Islands, sand, sale proceeds devoted to common school fund. Ore., 381 James I, 33, 41 Janitor, services, 174, 292, 310 JefiEerson College, Ala., lands, 209 Jefferson, Thomas, plan for governing northwest, 44 Kansas constitutional ordinance, quoted, 67 free schools, 3 funds for schools: Common School Fund, current revenue, 9; State Permanent School Fund, 62, 127, 138, 143, 148, 159, 271-274; grants for schools, per centum (five), 67, 68, 272, 273; see also Laxids lands for schools, internal improve- ment, 61-62, 148, 272, 273; re- valuation, 127; price, 138-139; sales, disastrous, 138-139; sections 16 and 36, 271, 272, 273 Kentucky Act for burning school fund bonds quoted, 152-153 free schools, 278 funds for schools: diverted, 152-154 Common School Fund, consti- tutional provision for, 276 Literary Fund, 102, 152-153, 159, 275, 276 Permanent School Fund, 7, 102, 152, 153, 154, 275-278; see also above Literary Fund Surplus Revenue Loan Fund of 1837, 73, 76, 159, 276 Lancasterian schools, D. C, 242 Land boards, see under Boards Land cession by states, sought by Con- gress, 42; terms, 42; granted, 43; Ala., Ga., Miss., 208, 209; Tenn., 394 Land claim controversy between nation and states, 40-43, 55-56, 229-230 Land Commissioners, see Board of Land Commissioners; Commissioner Land Lottery Act, Ga., 248-249 Land grants and reservations ^'' colonial, 34-36, 341; federal, origin, 39- 42; see also below under Lands de- ■ voted to permanent common school ! funds: Federal grant policy; inter- j nal improvement; militarj'^; minis- ', terial; salt; Section sixteen; swamp; | university state, 81, Table XIV, 85, 100-106; Conn., 35-36, 43, 82; Ga., 36-37, 82, 248-249; Me., 82-83, 85, 284- 285, 288-289, 290, 291; Mass., 36-37, 82, 83, 84, 85, 300, 301, 302, 304, 305, 307, 308; N. H., 84, 85, 340-341; N. J., 82; N. Y., 36-37, 82, 350, 352, 353, 355; N. C, 82; Penna., 83, 384, 385; Tex., 84, 403; Va., 43 Land Lottery Act, Ga., 248-249 480 INDEX Lands devoted to permanent common school funds agricultural lands, Nov., 236 Back Bay, Mass., 304-305, 307-308, Table XLV, 452 county, school lands, Ga., 4; Tex., 401-402 dried lake lands, La., 2S2 Federal grant policy, evolution of, 35- 37, 39, 42-55, 118, 371-372 Federal grants quoted, see Congress- ional Acts quoted federal, not taxed, 67 forfeited through exorbitant taxation, Wis., 430 internal improvement, 60, 61-62, 66; Ark., 219; Cal., 222, 223; la., 62, 269, 272, 273; Kan., 148, 272, 273; Nev., 336; Ore., 380, 381; Wis,. 430 lake lands. La., 282 military lands: Conn., 23; 111., Mo., 314; Mich., 65; N. Y., 355; U. S. military reservation, 52, 369-372; Va. military reservation, 43, 52,' 369-373 ministerial lands, see Ministerial funds under Funds Railroad Land Grant, Tex., 403 Riparian lands, proceeds of leases, increase permanent school fund, N. J., 344 . . reserved for religion, see Ministerial funds under Funds Salt Land Grant, Ohio, 51 ; devoted to permanent funds, 59; terms of, Ind., 59-60; states receiving, 59, 66; area, 66; salt lands: Ark., 219; Ind., 262-263; Mo., 59, 322; Neb., 33; Ohio, 373, 374 Section Sixteen, evolution of grant, 44-53", grants in lieu of, 52,^ 53; Ohio, 372-373; Okla., 379; states not receiving, 56, Table, 57; states receiving and area. Table XI, 57; ownership, 107, 108-114; states' grants: Ala., 208; Ark., 216, 217; Fla., 244; 111., 255; Ind., 260-261; la., 269; La., 279, 280, 281, 282; Mich., 313, 314; Mo., 313-314; Miss., 326, 327; Ohio, 371, 373; Tenn., 394-395, 39^; Wis., 430; see also Sections Sixteen and Thirty- six; Survey Sections Sixteen and Thirty-six, first granted, 54; states receiving and area, Table XI, 58; Ariz., 214; Cal., SS; Col., 226; Id., 252; Kan., 272; Minn., 317; Mont., 329; Neb., 332; Nev., 336; N. Mex., 347-348; N. Dak., 366; Okla., 379; Ore., 55, 380, 381; S. Dak., 392; Utah, 407; Wash., 424; Wyo., 435; see also Section Sixteen; SiKvey selection of school sections, Nev., policy, 118, 336; see also under Survey seminary, see University lands swamp lands: granted, quoted, 62- 63; used for schools, 63-65; di- verted, Ind., 145-146; devoted to permanent school funds: Ark., 219; 111., 256; Ind., 145-146, 265; Mich., 313, 314; Minn., 316, 317, 318; Mo., 322; N. C, 82, 361, . 362, 363; Ohio, 373; Ore., 381 tide lands, sales' proceeds, increase permanent school funds. Ore., 381 town lands, Conn., Mass., N. Y., Penna., 34-37; Me., 82, 83; Vt., 409 unappropriated land, W. Va., 427 university lands, origin, 44, 46, 47, 50; in Fla., Minn., Ohio,' Utah and Wis., 50; Ala., 209; Ark., 65, 217; N. H., 340; Okla., 379; Tex., 403 imsold school lands: area and value, foot-note 43, 13-14, 15-16, 21-22; Ala., 211; Ariz., 214; Cal., 221; Col., 226; Fla., 243; Id., 251; 111., 257; Ind., 260; la., 268; Kan., 271; La., 281; Minn., 316; Miss., 326; Mont., 329; Neb., 332; Nev., 335; N. J., 342; N. Mex., 347-348; N. Y., 350; N. C, 361; N. Dak., 365, 366; Ohio, 376; Okla., 378, 379; Ore., 380; S. Dak., 391; Tex., 400; Utah, 406; Vt., 408, 409; Wash., 423; Wis., 429; Wyo., 434 waste lands, W. Va., 427 see also Lease; Losses; Ownership; Price; Rent; Sale; Valuation Lawful uses, see Uses Lease of school lands, policy of: Col., 226; Fla., 243; Id., 251; Kan., 143, 271; La., 282; Miss., 109, 143, 326, 327; Mont., 330; N. Mex., 347-348; Ohio, 373, 376; Okla., 378; S. Dak., 391; Tenn., 243, 396; Wyo., 434; see also Rent Leased and unleased school lands, area, value, in U. S., Table VI, 21-22; see also Condition of permanent common school funds Legislation, incomplete, ineffectual, in- suflBcient, 92-93, 146-147, 163-164, 244, 246, 264, 265, 421, 432 Legislature, relation to management "Ss INDEX 481 of permanent school funds: Ala., 212; Conn., 235; Ky., 277; Me., 289; Miss., 315; Neb., 333; N. J., 343 Length of school year, see Term length Library books, a lawful expenditure of school moneys: Cal., 225; la., 270; Mass., 310; N. Y., 356; Ore., 382; Wis., 433 Library moneys, penalty for diverting, _N. Y., 360 Licenses, see under Fish; Gambling; Liquor; Marriage; Peddlers; Tavern Lieutenant-Governor, trustee of Per- manent School Fund, Vt., 415 Limited principal, Mass., 300, 302, 303, 304, 308; W. Va., 426 Liquor license proceeds added to permanent school funds, Del., 240; N. C., 86, 362; S. C., 390; to current school revenue. Conn., 31; Minn., 32; Ga., 247-248 Loan, federal, see Surplus Revenue of 1837 under Funds Loans, see Debts, states'; Mortgages Loans as investments: Ark., 142-218; Conn., 142, 236; Ind., 263, 266; la., 148, 269; Neb., 142-143; N. H., 339; N. Y., 142, 356; N. C, 362; Ore., 381; S. Dak., 391; Tenn., 398; Wis., 429 London Company, Va., school endow- ment, 33; land grant, 40 Long Island, claimed by Connecticut, 229 Losses to permanent school funds, 11- 12, 116-117; uncertain and un- known, 130, 202, 322, 358; under town management, 131,322; causes, 133; tabulated, 157-158, Table XX, 323; under county management, 133-137; under state management, 138-159 in the states: 158-159; Ala., 208, 210- 211; Ark., 218-219; Cal., 222-223; Col., 227; Conn., 235-236; Fla., 244; Ga., 249-250; Ind., 264-265; la., 129-130, 268, 269, 270; Kan., 272-273; Ky., 276-277; La., 131, ISO, 151, 154, 159, 281, 282; Me., 285-286; Md., 159, 297; Mass., 304, 30s, 307-308; Mich., 312, 314; Mo., 116-117, 129, 133-138, 159, 322-323; Miss., 159, 327; Neb., 146, 159, 333; Nev., 146, 159, 336-337; N. H., 340; N. Y., 122, 129, 358; N. C, 363; Ohio, 129, 375-376; Ore., 381-382; Penna., 383; Tenn., 398-399; Tex., i 1130, 404; Vt., 414, 415; Va., 420; W. Va., 428; Wis., 129, 430-433; Wyo., 435; see also Bank failures; Civil War, disastrous effects; Credit funds; Debts; Dishonesty; Diver- sion; Embezzlement; Investment; Loans; Management, township, loss; Misappropriations; Sale; Taxation, exorbitant Lotteries as source of school revenue, 32-33; D. C, 32-33, 242; N. Y., 32, 352; R. L, 32, 387 Lottery Land Act, Ga., 248 Louisiana appropriations for schools, i8ig, 24 funds Free School Fund, 7, 8, 131, 150- 151, 279-282 Surplus Revenue Fund, 72, 76 grants for schools, per centum, 280 lands for schools, section sixteen, 279, 280, 281, 282; dried lake lands, 282 township losses, management, 131 McEwen, Robert, Tenn. School Supt., embezzler, 145, 398 Mail, transported free, 60 Maine census, school, i8^i-ipo2, Table, 448 expenditure, school, per child, i8^i- ig02, Table, 448 free schools, 3, 284 funds devoted to schools: permanent local funds, income from, i8ji- igo2, Table, 448; see also Township funds under Funds; Permanent School Fund, 7, 22, 131, 169, 171- 172, 194-196, 283-295; Table, in- crease, 1551-/902, 446; total income, per child, relation to other sources of school revenue. Table, 1851-IQ02, 448 School Mill Fund, 291, 294-295; 1851- igo2, Table, 448 State School Fund, see Permanent School Fund Surplus Revenue Fund, 1837, 73, 76, 289, foot-note Town Funds, 131, 284-286 grass sales' proceeds devoted to schools, 91 lands, ministerial, 284-285; school, 82, 83, 85, 284-286, 288-289, 290, 291, 303; owned by Mass., 82, 83; rents, increase School Fund prin- cipal, 91; grants, 102; sale, 289 support of schools prior to Permanent School Fund, 2S4-288 482 INDEX taxes devoted to schools, Building Tax, 30; local, compulsory, 1821, 30, i68-i6g; rate, 1821-1S72, Table, 446, i85i-igo2, Table, 448; Sav- ings Bank Tax, 287-288, 293, 294; i8j3-i86g, Table, 447; 1831- ipo2, Table 448; town, 168, 283, 284, 286, 291, 292; see also above Me., funds, School Mill Fund teachers' wages, 192-193; per month, 1851-1^02, Table, 449 Malpractice, fines for, increase per- manent school fund, 381 Management of permanent common school funds, 107-128; see also Auditor; Boards; Commissioners; Controller; County Auditor; County Treasurer; Governor; Leg- islature; Merged funds; Ownership; Secretary of State; Superintendent of Public instruction; Treasurer history of, 107-114 county, 107, 1 1 5-1 16, 117; defects, 116-117; 111., 257; Ind., 116; Md., lis; Mo., 115, 116-117, 323; Miss., 327; la., IIS, 270; S. Dak., iis, 392; Tex., IIS, 40°) 402, 405 state: Ala., no, 212; Ark., 112, 219; Cal., 223; Id., 2S2; 111., no, 257; Ind., 114, 116, 266; la., 113, lis, 269-270; Kan., 273-274; Ky., 27s- 277; La., 282; Me., 29s; Md., iis; Mass., 308-309; Mich., 111-112, i2S; Minn., 113-114, 319, 320; Miss., 109, 327; Mo., IIS, 116-117, 322, 323, 324; Mont., 330; Neb., 333; Nev., 337; N. H., 339; N. J., 344; N. Y., 121, 3SI, 354, 356, 357, 358; N. C, N. Dak., 366; Ohio, 108-109; Ore., 382; Penna., 38s; R. I., 388; S. C, 390; S. Dak., 115, 392; Tenn., iio-iii, 397,399; Tex., IIS, 40O) 402, 405; Utah, 407; Vt., 416, 417, 418, 419; Va., 421; Wash., 424; W. Va., 428; Wis., 113, 433; Wyo., 435 state vs. township: advantages, 118- 119, 202, 236; defects, 119, 121, 122-124, 138-1S9, 203; efforts to improve, 124-127; evolution of, 107, 109-114,117,118, 124-128; forms of, 119-120, 121; losses under: N. Y., 121-122, 138-1S9 township, 107: change to state, 108- 113; defects, 116,131-202; loss, Cal., 222-223; 5ce (^l^o Losses; states em- ploying, 108, 281, 257,> 262 Marriage license proceeds devoted to Public School Fund, Del., 238 Maryland funds: Free School Fund, 6, 115, 296-298; Surplus Revenue Fund, 73, 76, 159, ?97 lands: Virginia's claims, opposed, 4I-S5; federal grant, sought, SS Mason, John, Grammar School be- quest, 34 Massachusetts Articles of Separation, Me., 284, 303 census, school, j5j7-jpo5. Table XLIV, 451 expenditures, public school, total, i837-igo5, Table XLIV, 4S0; per child, 184S-190S, Table XLIV, 4S1 free sciools, 161-162, 194, 300; see also Massachusetts, rate bills funds for schools Bounty Fund, 307; funds for min- istry and schools, 37; Literary Fimd, 301; School Fund, 6, 12, 22, 90, 91-92, 169, 183-18S, 194-196, 200, 299-311, 4SO-4S2; purpose, 169; Surplus Revenue Fund of 1S37, 73, 76, 308; town school funds, 34, 35, 37, 300, 308 Institute of Technology, Mass., 307 land claims, 40, 42-43 lands, Back Bay, 304-305, 307, 308 lands, ministerial, 37 lands, school, reservations, colonial town, 34, 37; area, 102; in Maine, origin, 82, 83, 84, 85, 302; value, 302, 303 rate bills, 3, 27 school age, 1837-1903, Table XLIV, 450 school support, earliest, 23 Society of Natural History, Boston, 307 tax, school, local, colonial, 29, 176; War Tax, 79, 89; compulsory, 169; rate, 176, 300, 311; local tax, 1837- 1905, Table XLIV, 451 teachers' wages, increase, 192-193; per month, 18 37-1905, Table XLIV, 451 Maumee lands, Ohio, 370 Merged funds, 202; Ala., 114; Ark., 112, 114, 218; Col., 222; Fla., 4, 112- 113, 114, 244; 111., 2Ss; Ind., 114, 261-262, 442; Miss., 114; N. Y., 357; Tenn., 86, no, in, 114, 397; Vt., 413, 416, 417, 418 INDEX 4% Mexican County School Land Grant, 401 Mexican state of Coahuila, 401 Mexican state of Texas, 401 Michigan constitution, quoted, 125 funds for schools: accounts, 7, 112 constitutional provisions, quoted, Five Per Cent Fund, see Michigan, Swamp Land or Five Per cent Fund Primary Seven Per Cent or Six- teenth Section School Fund, 7, III, 112, 125, 312, 315 Seven Per Cent Fund, see Primary Seven Per Cent Fund Sixteenth Section Fund, see Prim- ary Seven Per Cent Fund Swamp Land or Five Per cent Fund, 7,312,313,314,31s lands for schools ownership, state, 111-114 price, minimum of school lands, 127, 139, 314 _ sale of school policy, 139, 314 Section Sixteen lands: manage- ment, 111-112; grant quoted, 112; price, 127, 139, 314; origin, 313; unsold, 313 swamp lands, 63; origin, 65, 314; unsold, 313 Military exemption moneys, 323; Ind., 262; Mo., 323; Ore., 381; W. Va., 427; Wis., 430 Military fines, 323; support county seminaries, 87-88 Military taxes, Ga., 247 Minerals, sales of, proceeds, increase permanent school fund, Utah, 407; Wash., 424; see also Ore lands; Ore proceeds and royalties Ministerial taxes. Conn., 233 Minnesota building tax, 30 fines, criminal, support schools, 32 funds for schools Permanent School Fund, s, 11, 12, 91, 113-114, 126-127, 181- 182, 316-320 Swamp Land Fund, 102, 316, 317- 318 lands for schools ore lands, foot-note 43, 13-14, 91 price, 139 sale, 126-127, 139 Sections 16 and 36, value, foot- note 43, 13-14, 55, 113-114, 316, 317 swamp lands, 64-66, 317, 318 timber lands, foot-note 43, 13-14 liquor license fees, 32 territorial support of schools, 30, 32 Misappropriations of school funds, 147, 153, 154; ^^^ f^^^o Auction; Civil War, disastrous results; Diversion; Losses Mismanagement of school funds, 119; N. Y., 121; see also Losses; Manage- ment Mississippi bank failures, 144, 327 funds for schools: Chickasaw Fund, 109, 159, 325- 328 Chocktaw Fund, see Sixteenth Section Fund Common School Fund, 64; losses, 131; see also Literary Fund Literary Fund, for charity schools, 162; see also Sixteenth Section Fund Sixteenth Section Fund, 109, 143, 325, 326, 327, 328 Surplus Revenue Fund of 1837, 72, 76 lands for schools: sales' records lost, 131- 132 sixteenth section lands, sale, lease and rent, 109, 143 swamp lands, 63, 64 notes unpaid, 143 rents unpaid, 143 Mississippi territory, 208, 209 Missouri fines and forfeitures, 88 funds for schools County Public School Fund, 63, 116, 117, 129, 323, 324 Permanent Common School Funds, 5, IIS, 116-117, 129, 133-138, 141, 143, 321-324 Special District Fund, 324 State Public School Fimd, 323, 324 Surplus Revenue Fund of 1837, 72, 76, 322 Township School Fund, 133-138, 145, IS9, 323-324 school grants, per centum, 68, 69 school lands lost, 141 military, 314 salt area, 322 484 INDEX sixteenth section lands, 322 swamp lands, 63, 322, 323 Monastic funds, 33 Moneys for schools, see under Bequests; Expenditures; Funds; Gifts; Lot- teries; Receipts; Support of schools; Tax Montana funds Public School Fund, 91, 329-331 State School Fund, see Public School Fund school lands, sections sixteen and thirty-six, 102, 329, 330 Mortgages, farm, as securities, Id., 25, 251; Ind., unpaid, 142; Ind., poor investment, 264; la., 268, 270; N. Y., forged, 358; N. Dak., 365; S. Dak., 391; Utah, 406 Names, see Funds; Title National, see Federal Nebraska funds for schools Common School Fund, current revenue, 9 constitutional provisions, 127, 332, .333 Five Per Centum Fimd, 333 Permanent School Fund, 159, 332- 334 school grants: federal lands, area, 103; per centum, 333 school lands rents distributed, 91; price, mini- mum, 127-128, 333 saline lands, 59, 333 sections sixteen and thirty-sLx, 332 Nevada funds for schools Permanent School Fund, im- portance, 22 State School Fund, 335-337 school lands: internal improvement, 62; in lieu of section lands, iiS, 336 New Connecticut, sec Connecticut; Western Reserve New England Company, Conn., plans for northwest, 43, 45 New Hampshire Bank taxes, 340 Maryland resolutions endorsed by N. H., SS school funds Common School Fund, 11, 228, 338, 340-341; see also Institute Fund Institute Fund, 84, 103, 159, 338- .341 Literary Fimd, 339, 340 Surplus Revenue Fumd of 1837, 73, 76, 339-340 school lands, 55, 84, 85, 340, 341 taxes. Bank Tax, 340 New Haven: rate bills, 26; permanent school funds, 34, 35 New Jersey school funds apportionment, 183 Permanent School Fimd, 88, 183, 199, 342-346 School Fund, see Permanent School Fund State School Fund, see Permanent School Fund Surplus Revenue Fund, 76 school lands: land granted to Conn., 229; riparian, 82,85; rents, reserved, 91 tax devoted to School Fund, 90 New London, Grammar School Grant, 35 New Mexico Five Per centum Grant, 69, 347 school funds, 6g, 347-348 school lands: sections 16 and 36, 347, 348 New York appropriations, iygj-1800, 24 funds Common School Fund, 168, 171, 180, 195-196, 198, 228, 349-360, 453-455 Educational Fund, defined, 357 Literature Fund, 349, 350-351, 354, 357, 358-359 local income, 1831-igoo, Table XLVI, 455 ministerial and school funds, 36 town school funds, 36, 37 United States Deposit or Surplus Revenue Fund, 6, 72, 77, 121- 122, 132, 142, 159, 349, 354, 355, 356,357,358,455 land claims in Northwest, 40, 42-43, 229 lands for ministry and schools, 36- 37, 350 lands for schools, 82, 85, 350, 352-353; see also Town school funds lotteries, 32, 352 rate bills, 3, 27, 350, 455^ support of schools, earliest sources, 23 taxes, school: compulsory, 1795, 30, INDEX 485 164; Table, 1831-igoo, local, volun- tary, state, 455 teachers' wages, 192-193; average per month, total cost, iSji-ipoo, Table, 455 Normal departments and schools sup- ported by permanent school funds, Mass., 173, 192, 301; N. Y., 351; Minn., 318; Va., 422; Wis., 192, 433 North Carolina land claims of, in southwest, 40 land cession, area, 53 land, swamp, 82, 85, 361-362, 363 State Literary Fund, 88, 144, 151- 152, 154, 159, 198, 361-364 Surplus Revenue Fund, 72, 77 North Dakota constitutional provisions for school funds, 128, 366 funds: Five Per Cent Fund, 68, 366; Permanent School Fund, 182, 183, 365-367; Tuition Fund, defined, 365 lands: rents, 91; sections 16 and 36; 365, 366 Northwest Territory, conflicting claims to, 40-42; ceded by states, 42, 43, 371; church and school reservations, 45- 53, 57-58, 369; military reservations, Va., 370; U. S., 371, 372; ordinances for governing, 44-47; sale, 44-45, 46, 47-49) 369-373; settlement, 43- 47; siurvey, methods of, 44-45, 48, 49, 371, 372 Notes, unpaid or worthless: Ala., 143; Ark., 142, 218; Miss., 143, 326, 327; Mo., 143, 323; Tenn., 398; see also Securities, poor Objects, see Uses Ohio, claimed by eastern states, 40-42 Ohio Company, 45, 46, 47 Ohio Enabling Act quoted, 108 Ohio school funds Common School Fund, defined, 9, 368 Irreducible State Debt, 7, 108-109, 159, 368-377 Surplus Revenue Fund, 77, 374-375 school grants: moneys, 51, 67, 68, 76; lands, 51-53, 371-372; lands for religion and schools, 46, 47, 48, 51, 52, 369-372; Moravian Grant, 369, 370, 372; see also Northwest Territory school lands: ownership, 108-109; sale, 45-47, 82, 10S-109, 129; purchase, 369, 370, 371, 372; salt lands, 59, 60; section sixteen, 51-53, 373; swamp lands, 63; see also Northwest Territory Oil fees for schools, Ga., 247, 248 Oklahoma organic act, 378, 379 Permanent Common School Fund, 80, 378-379; see also Indian Territory- Ordinance of 178s, 44-45 Ordinance of 1787, 46-50 Ore lands, value, Minn., foot-note 43, 13-14 Ore proceeds and royalties added to principal, Minn., 91; Utah., 407; Wash., 424 Oregon Common School Fund, 6, 126, 380- 382 Enabling Act, quoted, 54 school grants, sections, 54, 55 school lands: for internal improve- ment, 62; swalnp lands, 63; sec- tions 16 and 36, 54, 55, 380 Territorial Government Act quoted, 54 Organization, influenced by permanent funds, 194-196; see also Free Schools; Returns; Supervision Origin of Permanent Common School Funds, 33-37, 39-106; Ala., 208-210; Ariz., 214; Ark., 217; Cal., 222; Col., 226-227; Conn., 229-234; Del., 239; Fla., 243-244; Ga., 248-249; Id., 252; 111., 255-256; Ind. Ter., 259; Ind., 260-263; la-, 269; Kan., 272; Ky., 275-276; La., 280-281; Me., 284- 285, 288-289, 290-291; Md., 296, 297; Mass., 301-303; Mich., 313-314; Minn., 317-318; Mo., 321-322; Miss., 325-327; Mont., 329-330; Neb., 332- 333; Nev., 336; N. H., 340-341; N. J., 342-343; N. Mex., 347; N. Y., 350-351, 355; N. C, 363; N. Dak., 366; Ohio, 370-373; Okla., 378-379; Ore., 380; Penn., 384-386; R. I., 387-388; S. C, 389-390; S. Dak., 392; Tenn., 394-397; Tex., 400-404; Utah, 407; Vt., 410, 411, 412-413, 416; Va., 420; Wash., 424; W. Va., 420, 421, 427; Wis., 430; Wyo., 435; see also Creation; Evolution; Fed- eral lands, grants; Federal money grants; Grants, state moneys; Land grants and reservations, state Orphan asylum aided by swamp lands. Minn., 318 Ownership state, Tenn., iio-iii; Mich., 111-114 4S6 INDEX state versus township, 107, 113-114, 373 township and state management, Ala., 109; 111., iio-iii; La., 281, 282; Mass., 109; Ohio, 108-109; see also Land claim controversy; Management Oyster lands' rents, Ga., 247, 248 Panic of 1837, 314 Parishes, La., 282 Participation in permanent common school funds: optional. Conn., 166; Me., 291; N. Y., 164-165; conditions, 177-179, 189-190; Ala., 212; Ark., 220; Cal., 225; Col., 227; Conn., 237; Del., 241; Fla., 245; Id., 253, note 122a, 111., 257-258; Ind., 267; la., 270; Kan., 274; Ky., 278; Me., 291- 292; Mass., 310-311; Mich., 315; Minn., 320; Mo., 324; Mont., 331; Neb., 334; Nev., 337; N. J., 345-346; N. Y., 360; N. Dak., 367; Ore., 382; R. I., 388; Utah, 407; Vt., 411, 412, 415-416, 419; Va., 422; Wash., 425; W. Va., 428; Wis., 433; Wyo., 436 Patterson, J. W., and N. H. Institute Fund, 341 Payments, interest on, deferred, Nev., 335 Peasley, Hy., school bequest, 33-34 Peddlers' licenses, Vt., 409 Penal fines, see Fines Pennsylvania charter, 229 funds for schools: Common School Fund, 10, 159, 383-386; Surplus Revenue Fund, 77, 386 land claims, conflict with Conn., 229, 230 lands, reserved for schools, 83, 85, 384, 38s rate bills, 3, 26, 27 school support, 77, 159 Schools: free, 26; private, 26, 83 Per cent of total common school revenue derived from permanent school funds and lands. Tables IV, 13-14; VI, 17-18; VII, 21-22; see also Importance; Income Tables Per cent paid on school fund loans, Table VII, 20-21 Per centum grants, see under Federal money grants; Funds; Grants Per centum moneys lost, 219 Physiology and hygiene, penalty for not teaching, Minn., 320; N. Y., 360 Pickering, Col. Timothy, see New England Company; Ohio Com- pany Plantations, Me., unit of apportion- ment, 287, 293, and note Planters' Bank of Mississippi, 326, 327 Plymouth Colony: colonial school tax, 29; license fees, 16^3, devoted to schools, 31; claims to western lands, 40; charter, 229 Poll Tax, see under Tax Poor children educated by town, Conn. Colony, 25; books for, Va., 422 Poor funds devoted to common schools, N. Y., 351; 5-ee also under Funds Population, see Census Pottawattomie Indians, lands pur- chased, 266 President, Board of Land Commission- ers, relation to management of school funds, Mont., 330 Price of federal lands, 47, 59 Price of school lands, minimum: Ind., 59; la., 139; Mich., 127, 139, 313; Minn., 139; Neb., 127-128; N. Dak., 128; S. Dak., 128, 391; Wash., 128 Price of school lands: Cal., 131, 221; Fla., 243; Mich., 314; Mont., 330; Neb., 333; N. Mex., 348; N. C, 362; Ohio, 129; S. Dak., 391; Tex., 130, 138, 404; Vt., 409; Wash., 423; see also Lands, unsold school lands, area and value; Sale Primary school land grant, Republic of Tex., 401 Principal of permanent common school funds: borrowed by states, see Loans; growth, see Increase; held by state, 5; distributed locally, 5; value, in- equaUty of, 11; losses in twelve states, see Table III, 12; limited, 12, 426; true value in all states, 1905, 13-14, 20-21; estimated value, ■Tpoj, 15-16; loans from to states. Table VII, 20-21; see also Condition; Credit funds; Debts; Increase; Loans; Losses; Management; Valuation; Prison supported by swamp lands, Minn., 318 Private schools: number, Fla., Mass., 162; public moneys, support, Fla., Ind., Tenn., 163; see also Academies Property, derelict, devoted to per- manent school funds, Va., 400, 421 Public improvements, paid with 111. School Fund, 257 Public land states, see Table XI, 57- 58 INDEX 487 Public lands, see Lands, federal, under Lands Public schools, see Free schools Purpose of permanent school funds: Conn., 165, 166, 228; Ga., 162; Me., 169, 288, 289, 292; Mass., 169, 300, 301; Miss., 162; N. Y., 168, 353; Vt., 170, 412; Va., 162; see also Kvms; Influence; Uses Purpose thwarted, 155, 157; see also Credit funds; Debts Putnam, Rufus, promoters, land com- panies, 43, 45 Quit rents, N. Y., 351, 355 Railroad taxes, not collected, Ind., 264; dividends devoted to schools, Ga., 247, 248; land grant, Tex., 403; stock as security, Md., 296, 297; securities devoted to permanent common school funds, Mass., 303, 305, 306-307 Ramsey, Alexander, governor of Minn., on sale policies, 139 Rate bills, 3, 25-28, 164; Conn., 168; Mass., 300; N. Y., 350; R. I., 28; Tables: VIII, year abolished, 27; JX, Conn., 1856-1S68, 28; XLVIII, N. J., 1831-1867, 455; see also Free schools Real estate devoted to permanent common school fund, N. J., 343; see also Bequests; Intestate estates; Lands Receipts for Common Schools in U. S., 1905: Table VI, per cent divided from permanent funds, lo- cal tax, state tax, Table VII, to- tal from all sources, total from funds and rents, 20-21 sources and proceeds: Conn., 1825- 1895, Tables XXVII, 439; XXVIII, 440; Fla., 1870-1905, XXX, 441; Ind., 1866-1906, XXXVII, 445; 1855-1885, XXXVIII, 445; Me., 1851-1902, Table XLII, 448; Mass., 18 35-1 90 5, Table XLIV, 450-451; N. Y., 183, 18 31-1900, Table XL VII, 455; see also Condition of permanent common school funds Receiver-general, relation to school funds, Mass., 309 Records, lost, see Title Regents, N. Y., control Literature Fund, 351 Religion funds and lands for, see Funds, ministerial Religious and sectarian schools: de- barred from public moneys, Kan., 274; supported with public moneys. Conn., 233; Ind., 162-163, 274; Minn., 320 Religious instruction forbidden, Mont., 331; Nev., 337 Rent of school house, a lawful ex- penditure, Mont., 331 Rent of school lands proceeds, 1905, Table VII, 20-21 uses, Tenn., 11 1 added to principal: Cal., 223; Me., 91; Minn., 91, 316-317, 319; N. .J-, 91 distributed annually: Col., 226; Fla., 243; Ga., 247; La., 280; Mont., 329; Neb., 332; N. Mex., 348; N. Dak., 366; Ohio, 109, 368; Okla., 378; S. Dak., 392; Tenn., hi; Tex., 401; Utah, 406; Wash., Wyo., 434 income from, 1905: Ariz., 214; Ga., 248; La., 279; Mont., 329; Neb., 332; N. Mex., 348; N. Dak., 366; Okla., 378; S. Dak., 392; Tex., 401; Utah, 406; Wash., 424; Wyo., 434 unpaid. Miss., 327; see also Quit rents; Lands, unsold school Repairs of school houses, a lawful ex- penditure of school funds: Miss., 174, 328; Mont., 174, 331; N. C, 174; an illegal use, Col., 227; Me., 293 Reports, see Returns Requirements, see Participation Resolutions quoted, Md., 41, 55; Mass., 30s Returns or school reports importance of, 164, 196; Fla., Me., Mass., N. Y., 164, 194-195; in- obtainable required for school funds: Conn., 175, 237; 111., 258 Ind., 267; Kan., 274; Me., 175 194, 195-196, 291, 293-294; Mass. 311; Minn., 320; Mo., 324; N. Y. 175; N. Dak., 367; Ore., 380; Utah 407; Wis., 433 secured through influence of per- manent funds, 175, 194-196; Me., 293-294 Table XXV, N. Y., Mass., Me., 1805-1885, 19S-196 Revaluation of school lands, 13-14, foot-note 43; Kan., 127 Revenue, see Appropriations; Income; Increase; Receipts; Support Rhode Island 488 INDEX funds for schools: Permanent School Fund, 32, 90, 153, 159, 388-389; Surplus Revenue Fimd, 77 lands, claimed by Conn., 229 rate bills, 27, 28 River improvements paid with school moneys, Ky., 276 River lands, see Riparian, under Lands Roads maintained by school moneys, Ky., 276 Royalties, see Ore Rupee Grant, Ohio, 370 Salary, see Teachers' wages Sale of school lands in states: Ala., 211; Ariz., 214; Ark., 217; Conn., 231; Fla., 244; Ind., 261, 262-263; Me., 288, 289, 290, 295; Mass., 302; Minn., 139; Mo., 322; Miss., 326, 327; N. Y., 350, 351. 353, 355; Ohio, 373, 374; Tenn., 396; Wis., 139 methods and policies: contracts,46-48, 335; steps in, 93, 95; Ohio, 108-109; Miss., 109; Ala., no; Tenn., Mich., Ark., Fla., 110-112; unbusinesslike and wasteful, Kan., 123, 138, 140, 141; directed by constitutions, 124, 128; lax and careless, Ala., La., Miss., 131-132; policies compared, la., Mich., Minn., Wis., 139; pro- ceeds diverted, Ind., 145-146; tax sales, Ind., 265; see also Lease; Payments; Per Centum Fund under Funds; Price; Rent; Unsold common school lands Salt fines support seminaries, Ind., 262 Sanitary requirements for sharing in school funds. Conn., Del., Fla., N. J., Va., 198-199, 241, 246, 341 Savings Bank Tax, Me., 288, 294; N. H., 339 School children, see Apportionment; Census; Poor children School house, erection, a lawful ex- penditure, Fla., 241; Miss., 174, 328; Mont., 174; an illegal expenditure, Ark., 220; Col., 227; Kan., 274; Me., 293; Nev., 337; Ore., 382; see also Rent; Repairs School, legal, defined, Vt., 415 School lots, see Local and town mider Funds and Town under Lands School societies, Conn., 166, 175 School year, see Term Secondary schools, see Academies; Funds Secretary, Board of Education, a com- missioner of permanent common school funds, Mass., 309 Secretary, Board of Land Commission- ers, relation to management of Per- manent School Fund, Mont., 330 Secretary of State, aids in managing school funds: Ark., 219; Kan., 273; Mass., 309; Neb., 333; N. J., 344; N. Dak., 366; Ore., 382; Tex., 405; Utah, 407; Wash., 424; Wis., 433; Wyo., 435 Sectarian, see Religious Securities of permanent cormnon school funds, 142-143; Ark., 216; Cal., 241; Conn., 437, 438; Del., 238; Fla., 243, 244; Id., 251; la., 268, 269; Ky., 275, 276; La., 279; Md., 296; Mass., 300, 303, 305; Mmn., 316; Mont., 329; Neb., 332; Nev., 335; N. J., 343; N. Y., 353, 356; N. Dak., 365; Ore., 380; R. L, 387; S. Dak., 391; Tex., 400; Utah, 406; Vt., 415, 416, 417; Va., 420; W. Va., 426; Wis., 429, 431; Wyo., 434 Securities, poor, unsafe, worthless: Ark., 218; Col., 227; Conn., 235; la., 268; Kan., 273; Mo., 323; Miss., 327; N. Y., 358; Ore., 381-382; Tenn., 398; Tex., 404; Wis., 430; see also Bank stock; Bonds; Loans; Losses; Mort- gages Shannon, R. D., Mo., Superintendent, investigates losses, 133-138, 323 Show tax, devoted to schools, 247, 248 Simons, Benjamin, Free School Fund, 33. Soldiers, free transportation, 60 Soldiers, see also under Fund, Bounty Funds and under Lands, Military Sources of permanent common school funds, classified, 39; unproductive, 92; see also Increase, sources of; Origin South Carolina claims to lands in Southwest, 40 Permanent School Fund, 11, 389, 390 Surplus Revenue Fund, 72, 78 South Dakota Permanent School Fund, 6, 19, 115, 120, 391-393 Sixteenth and thirty-sixth section school lands, 128, 392 Southall, J. W., Supt. Va., quoted on fines, 148 Spain, land claims of, 40 Special Superintendent, paid from Per- manent School Fund, N. J., 345 INDEX 489 Squatters on school lands, Ala., 211; Tenn., 395 State aid to public schools, 81-97, 100-106 State lot, Me., 285; N. Y., 36, 37, 350, 351 State moneys, see Grants, state moneys State school lands and land grants, see Land grants and reservations, state State sources of common school funds, see Grants, state moneys; Land grants and reservations, state State Superintendent, see Superin- tendent of Public Instruction States possessing no funds, 10 Stationery, a lawful expenditure, Ind., 298 Stone, sale proceeds added to school fund, Mont., 330; Utah, 407; Wash., 424 Sundries purchased with school fund income, Mass., 310 Superintendent of Public Instruction aids in managing school funds, 115; Ark., 219; la., 270; Kan., 273; Mich., 315; Mont., 330; N. Dak., 366; Vt., 415; Va., 421; Wash., 424; W. Va., 428; Wyo., 435 apportions school moneys, Ala., 212; Ark., 220; Cal., 224; Col., 227; Fla., 245; Id., 252; Ind., 266; Kan., 274; La., 2S2; Mich., 315; Minn., Mo., 324; Mont., 330 office created, Cal., 197; Fla., 197; Me., 196-197; Mich., 197; Wis., 197 salary, a lawful expenditure: N. J., 345; Mass., 310; Va.,422_ see also County Superintendent; Special Superintendent Supervision, 194; influenced by per- manent funds, Cal., Conn., Fla., la., Mich., Wis., 196-197 Support defined, Mass., 310; not de- fined, N. J., 345 Support of schools, earliest, 23-38; uncertain, 164-165; see also Federal lands, grants; Federal money grants; Funds; Grants, state moneys; In- crease, sources of; Lands; Receipts, sources and proceeds; Taxation Supreme Court fees devoted to per- manent fund, N. Y., 355 Survey, federal, origin, description, diagram; 48, 49; ordinances, quoted, 44, no; incomplete, 57; Wash., 423; state. Mo., 322 Survey systems in Tenn., 54, iio-iii, 395) 396; U. S. MiHtary Reservation, 371-372; Va. MiHtary Reservation, 371; Western Reserve, 371; Wyo. Valley, Ohio, 36 Susquehanna Company, 36, 229, 230 Symmes, John Cleve, purchase in Northwest Territory, 47, 52, 369, 370,371,372 Tables Table A, Growth of principal and income of Permanent Common School Funds, Conn., Fla., Ind., Me., Mass., N. Y., lygg-igos, 94 Table I, Credit Funds (in sixteen states), principal, igo^, 8 Table II, Official titles of Permanent Common School Fund, 10 Table III, Lost principal in twelve states, 12 Table IV, Permanent Common School Funds grouped in order of value; per cent of school revenue derived therefrom, 1905, 13-14 Table V, Permanent Common School Funds in order of estimated value including unsold lands, 15, 16 Table VI, Per cent of total common school revenue derived from per- manent funds, local tax and state tax, 17-18 Table VII, Permanent Common School Funds for all states, 1905, credit fimds, debts, loans, rate of interest, .income, per cent of total receipts, total receipts, unsold school lands, area, value, 21-22 Table VIII, Rate bills, year abolished in fourteen states, 27 Table IX, Conn., school receipts and sources of revenue, 1856-1868, 28 Table X, States receiving no federal land grants, 57 Table XI, Public land states and sixteenth and thirty-sixth section land grants, area and date, 57-58 Table XII, Internal improvement, saline and swamp land grants, 66 Table XIII, U. S. Surplus Revenue Loan of 1837, states receiving, shares, quota devoted to schools, original use of principal, final dis- position or present condition, 74-78 Table XIV, State Land Reservations, area, date, proceeds, 85 Table XV, Ind. School Fund, com- 490 INDEX parison of proceeds of sources of increase, 1 868- 1 go 3, 87 Table XVI, Creation of permanent common school funds, title, year, mode, year of states, admission into union, 98-99 Table XVII, Titles and original capital of permanent common school funds arranged by states, 100-106 Table XVIII,Lossof Township School Funds, Mo., before 18^0, amounts, balance, causes, 133-138 'i'able XIX, Summary of causes of loss to permanent school funds, 157-158 Table XX, Losses, amount, date, fund, credit funds and debts, 158-159 Table XXI, Objects to which revenue of public permanent common school fimds may be lawfully ap- plied in the several states, 173- 174 Table XXII, Conditions of partici- pation in the several states, 177-179 Table XXIII, Bases of apportion- ment of income of permanent school funds, 186-188 Table XXIV, Teachers' average monthly wages in N. Y., Mass., Ind., Me., Conn., i8ji-igoy, 192- 193 Table XXV, Returns in N. Y., Me., Mass., 1805-1S85, 195-196 Table XXVI, Growth of principal and income of Conn. School Fund, ijgg-igos; securities, igoj, 437- 438 Table XXVII, Conn., total cost of public education, sources from which derived and relative im- portance, 439 Table XXVIII, Conn, school sup- port, i82j-i8gs: amount per child derived from School Fund and from aU other sources, 440 Table XXIX, Growth of teachers' wages in Conn., and relation to total school expenditure, 440 Table XXX, Fla., State School Fund, growth, principal and income; relation of income to total expendi- ture, iSyo-igoj, 441 Table XXXI, Ind. Common School Fimd, funds composing and amount each added, 442 Table XXXII, Sotirces of increase of Ind. Common School Fund, pro- ductive and unproductive, 442 Table XXXIII, Increase of Ind. Common School Fund from fines, forfeitures, and other sources, 443 Table XXXIV, Growth of principal of Ind. Common School Fund,i55^- igo6, 443 Table XXXV, Growth of income of Ind. Common School Fund, 186^- igo6, 444 Table XXXVI, Average annual in- crease of principal of Ind. School Fund, i8s4-igo2, 444 Table XXXVII, Comparison of Ind. school revenues from funds, local and state tax, 445 Table XXXVIII, Growth of In- diana's endowed school system, 1855-1885, 445 Table XXXIX, Me. Permanent School Fimd, growth, principal and income, i8j8-igo6; total expendi- ture for schools, per cent from School Fund, i8j^-igo6, 446 Table XL, Me. local school tax rate, 446 Table XLI, Bank tax, Me., 1833- i86g, 447 Table XLII, Me., total public school expenditures. Permanent School Fund and other sources of school revenue, i8^i-igo2, 448 Table XLIII, Me. teachers' wages per month, i8^i-igo2, 449 Table XLIV, Mass. school support, summary, sources, proceeds, ex- penditures, i835-igo5, 450, 451 Table XL V, Mass. School Fund, sources of growth, 18 35-1 8 37, 452 Table XLVI, N. Y. Common School Fund, growth of principal and in- come, i8o6-igo5, 453, 454 Table XLVII, N. Y. Common School Fund, showing total cost of public education, sources and proceeds, teachers' wages, 1831-igoo, 455 Tavern license fees devoted to perma- nent fund, Del., 86, 238 Tax: Bank, see Bank taxes; corpora- tion, Ind., uncollected, 147-148, 264; direct, 247, 248, 305; inheritance, 17; military tax and fines: used as annual school revenue, Ga., 247; Ind., 262; devoted to permanent funds. Mo., 323; poll, for schools, 17, 18, 214, 245, 247, 248; Ariz., 214; railroad, 17; sales, invalid, N. C, 361, 362J sav- INDEX 491 ings banks and trust companies, Me., i85i-igo2, Table XLII, 448; tea, 31; see also Animal, Bank, Corporation, Direct, Military and Show tax; and under Fund, Delinquent Tax Fund and Tables VI, IX, XVII, XVIII, XXVII, XXXVII, XL, XLI, XLII, XL VI, XLVII Taxation, colonial, 28-30; exorbitant, on school lands. Wis., 141, 430; fed- eral lands exempt, 127; influence by permanent common school funds, 3; Conn., Me., N. Y., 165-170; Mass., 176-177; Fla., 198; La., 281; Mich., 314; Nev., 337; N. H., 339; opposed, 3-4, 164-165; discontinued. Conn., 168, 228; per cent of expenditures paid from, Table VI, 17-19; permis- sive, compulsory, voluntary. Conn., Mass., Me., Minn., Ariz., 3-4, 28-31; N. Y., Ind., 164-165; Me., 284; Mass., 300; principles, 3-4; proceeds devoted to Permanent School Fund, balances. Me., 291; N. J., 343; Tex., 402; rate, basis of apportionment, Mass., 310; required, Del., 241; Me., 292; Mass., 311; N. Y., 352; R. L,_38S, 401; Wash., 425; territorial, Minn., Ariz., 30-31, 215 Teachers' board, lawful expenditure. Conn., 171; Me., 171-172, 293; N. Y., 171; Table XXI, 173 Teachers, colonial, 25, 26, 28 Teachers' efficiency increased, 191 Teachers' institutes permanent funds, N. H., 338 Teachers must be certified and quali- fied to receive public moneys, 177, 178, 191; Cal., 225; Conn., 237; Fla., 246; 111., 258; Ky., 277; Me., 292; Mich., 31s; Minn., 320; Neb., 334; Nev., 337; N. Y., 360; Wash., 425; Wis., 433 Teachers, number a basis for appor- tionment, Cal., 224; N. J., 344-345; N. Y., 358, 359 Teachers' quota, N. Y., 359 Teachers' training, 160; see also Insti- tute Fund under Fimds; Normal de- partments; Teachers' institutes Teachers' wages, colonial, 25, 26, 29; a lawful expenditure. Table XXI, 171- 172, 173, 190-192; Ala., 212; Cal., 225; Conn., 171, 236; Del., 241; la., 270; Ind., 266; Ky., 277; Me., 171- 172, 293; Md., 298; Mass., 193, 310; Mich., 193, 315; Minn., 320; Mo., 324; Miss., 328; Neb. 334; Nev., 337; N. Y., 171, 356, 359; N. Dak., 366; Utah, 407; Va., 422; W. Va., 428; increase; see below, Tables; paid from rate bills, see Rate bills; taxa- tion for, 29-31, 160, 164; unconstitu- tional, 165; influenced by permanent common school funds, 171, 191, 192- 193; Tables: XXIV, 192-193; XXIX, 440; XLIII, 449; XLIV, 451; XLVII, 455 Tennessee free schools, indifference to, 163 funds for schools Permanen:: School Fund, 9, 86-87, iio-iii, 114, 144, 151, 163, 172, 394-399 Surplus Revenue Fund, 78, 144, 14s, 397 grant, congressional land, quoted, 39 lands devoted to schools: sixteenth section lands, 51, 53, 54, iio-iii private schools supported, 163 school legislation, ineffective, 163- 164 survey system, iio-iii Term length: Conn., in 1700, 30; fixed for participation in school funds, 125, 176; Ark., 220; Cal., 176, 178, 225; Col., 227; Conn., 167, 176, 178, 237; Fla., 178, 245; la., 270; Kan., 176, 274; Ky., 178, 278; Me., 178, 292; Mass., 178; Mich., 125, 178, 315; Miim., 178, 320; Mo., 178, 324; Mont., 178, 331; Neb., 178, 334; Nev., 178, 337; N. J., 178, 345; N. Y., 176, 178, 360; Ore., 178, 382; Utah, 178; Va., 178; Vt., 4ro, 415; Wash., 178, 425; W. Va., 428; Wis., 433; Wyo., 178, 436; increased by permanent common school funds, 167, 176 Territorial school fimd, Ariz., see under Funds Texas County School Funds, 400-405 Permanent School Funds, 11, 22, 115, 130, 143-144, 159, 400-405 school lands: no federal, 56; state, title to, 56, 84, 85, 400-405 state taxes, reserved as School Fund, 90 Text-books, prescribed. Wash., 425; see also Books Theft of school funds. Mo., 323; see also Defalcation; Dishonesty; Embezzle- ment; Losses Thompson's Island, Mass., reserved for schools, 34 492 INDEX Timber lands denuded, 140-141; Wis., 430, 431, 432 Timber sales' proceeds added to princi- pal., Me., 91, 285, 291; Minn., 319; Mont., 91, 330; Utah, 407; Wash., 424 Title to lands uncertain, Ala., 132, 211; La., 132, 281; Miss., 132, 326; Tenn., 396; see also Ownership Titles of permanent funds changed, Del, 238; Fla., 243; N. H., 338; Ky., 276 Titles, official, of permanent common school funds, 7-18; Table II, 10; Table XVI, 98-106; see also under Funds Toll rates increase common school fund, Nev., 90, 336 Townships for universities, 46, 47, 50 Transportation, a lawful expenditure, Me., 293; Mass., 310; Mont., 331 Treasurer, state, relation to manage- ment of School Fund: Col., 227; Del., 240; Kan., 273; Me., 289, 294, 295; Mass., 308, 309; Minn., 319; Neb., 333; Nev., 337; N. J., 344; Ore., 382; R. I., 388; S. C, 390; Tenn., 399; Vt., 409, 415; W. Va., 428; Wis., 433; Wyo., 435 Treasurer, township, manages funds: 111., 257 Treaty of Paris, land claims, 40 Trent Grant, Ohio, 370 Trespass moneys, increase principal: Mont., 330; Wash., 424 Truancy laws, enforcement, 179; Mass., 311; N. Y., 360 Truant officer's salary, Mass., 310 Trustees of permanent school funds, Vt., 417, 419; see also Boards Tuition defined, Ind., 266; N. Dak., 365 Tuition: rates in 17th century, 25; paid from permanent funds, la., 270; Me., 293; support schools, 300; see also Rate bills Tupper, Benjamin, and Ohio Company, 45 Turnpike lands, Ohio, 370 United States, see also Congressional; Federal United States Bank Tax, 287 United States Military Reservation, see Military lands imder Lands Unsold common school lands, area and value, Table VII, 20-21; unproduc- tive, la., 268 Uses, lawful, of permanent common school funds, Table, XXI, 173-174; 253, foot-note i22ff; Ala., 212; Ark., 220; Cal., 225; Col., 227; Conn., 236; Del., 241; Fla., 245; Ga., 248; Id., 252-253; Ind., 266; la., 270; Kan., 274; Ky., 277; La., 282; Me., 292-293; Md., 298; Mass., 310; Mich., 315; Minn., 320; Miss., 328; Mo., 324; Mont., 331; Neb., 334; Nev., 337; N. H., 338, 341; N. J., 345; N. Y., 354, 356, 357, 359; N. C, 362, 364; N. Dak., 366; Ohio, 377; Ore., 382; R. L, 388; S. C, 389, 390; S. Dak., 393; Tenn., 399; Tex., 405; Utah, 407; Vt., 416, 419; Va., 422; Wash., 425; W. Va., 428; Wis., 433; Wyo., 436; classihed, 171-173; aims, 189 Utah rate bills, 27 State School Fund, 6, 406-407 School land grant, 407 Valuation as basis of apportionment, Mass., N. Y., 184-185, 186-188, 309, 358-359 Vandalia Railroad of Indiana, 264 Vermont debts repudiated, 154 funds for schools Common School Fund, 154, 159, 409-410, 415 Himtington Fund, 411, 412, 413, 415, 417 Permanent Public School Fund, 8, 408-409, 413, 415, 416, 417, 418, 419 Spanish War Claims Fund, origin, 79-80, 412-413, 416 Surplus Revenue Fund, 73, 78 United States Deposit Fund, 410, 411, 413, 414, 415, 416, 418 Maryland's resolutions endorsed, 55 Rate bills, 27 Special Commission, 169-170, 208 Trustees of Permanent School Fund, 417, 419 Virginia funds for schools Colonial permanent school funds, .33, 34 Literary Fimd, 148, 151, 159, 162, 199, 420-421, 422, 427 Surplus Revenue Fund, 72, 78 land claims in northwest, 40-43 lands devoted to schools, 421 Mar>'land's- Resolutions endorsed, 55 Mihtary Reservation, 43, 52, 369, 370, 371,372, 373 rate bills abolished, Table, 27 INDEX 493 sale of western lands, 41 Survey system in Military Reserva- tion, 371 Visitation, see Inspection Wages, see Teachers' wages War claims and taxes devoted to per- manent school funds, Ky., Mass., S. C, Vt., 79-80, 89, 288, 30s, 416 War effects on funds, see Civil War War loans interest, Ind., 297 War supplies, transportation, 60 Warrants, state, investments, Neb., 332 Washington Common School Fund, 128, 182, 183, 423-425 constitutional provisions for school funds, 128, 424 school lands, 128, 423-424 Water and fuel, lawful expenditure. Miss., 328 Weathersfield, Conn., rate bills, 1658, 28 Wells, O. E., Supt. Wis., quoted, 149 West Virginia free schools, 3 Irreducible Fund, see School Fund School Fund, 12, 156, 159, 420, 421, 426-428 Western lands, see Lands, federal; Northwest Territory Western Reserve, see Conn., Western Reserve Wild lands. Me., 290; N. H., 84, 85, 340-341 Windsor, Conn., colonial school lands, Wisconsin free schools, 3 Irreducible School Fund, see Wis., School Fund: cf. 429 School Fund, 8, 113, 123, 139, 141, 148-149, 151, 155-157, i59> 198, 429-433 school lands, 62, 62,, 139, 141, 429- 433 School Trust Fund, see Wis., School Fund, 429 Wyoming Common School Permanent Fund, 6, 22, 434-436 sixteenth and thirty-sixth section lands, 434-435 Wyoming Valley, land reservation, 36, 229 Year, school, see Term Zane's Grant, Ohio, 370 Zulick, C. M., Gov., Ariz., on waste of school lands, 141 /% ^^' ^'^■ '^' .<<^ . .o OV - cV-' ■^^K -^, v^ '.. "^t''. "^ ,^^ " .,': o^\'0-