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![[image of flower]](../../ima/flowXS_04.gif)
First Enlargement, 1850 - 1855 |
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Again in 1850 Governor Fish said that the Erie enlargement, as well as the Genesee Valley and Black River canal improvements, were "progressing as rapidly as the limited constitutional appropriations would permit." And the canal commissioners of that year stated that the value of the canal traffic had reached and passed the total value of the domestic exports from the United States for the previous year. The canal auditor called attention to the fact that the tolls on passengers and on packet boats were rapidly diminishing under the competition of the railways, which paid no tolls on passengers and, with their more frequent trains, increased speed and reduced fare, were drawing this important source of revenue away from the canals. The Assembly canal committee reported favorably on petitions to remove tolls on property carried by the railroads. They recommended the repeal of the law requiring tolls on freight carried in January, February and March, and a further modification of tolls on live stock, fresh meats, fish, poultry and dairy products. Whitford In 1849, the project of a ship canal between New York and the West by way of the Hudson river, Lake Champlain and the St. Lawrence river received considerable attention. A convention was held at Troy and later at Saratoga. Meanwhile committees explored the Champlain-St. Lawrence link by at least two routes, both using the Chambly canal for most of its distance. One entered the river at Longueuil, just below Montreal; the other, surveyed by John B. Mills, entered at Caughnawaga, 9 miles above. The prism was to be 80 feet on bottom and 120 feet on surface, and the locks were to be 245 feet, with 9 feet of water on the sill, carrying boats of 300 to 350 tons. The St. Lawrence and Champlain Company was formed and the matter of enlarging the Champlain canal came before the Assembly of 1850, but the canal committee reported adversely on the following grounds: that the cost would be $3,000,000; that the State revenues were already pledged for a term of years; that the constitutional limit of indebtedness, and the uncertainty of the completion of the Canadian portion rendered the project inadvisable. Whitford In 1850, the commissioners of the canal fund estimated the surplus revenues, applicable to the unfinished canals, to amount to $942,000. Of this amount $202,425.78 had already been appropriated, leaving $739,574.22 at the disposition of the Legislature of that year. From this amount, the Legislature appropriated $654,000 for the Erie canal with instructions to complete the enlargement at Brockport, Albion and Medina by April 1, 1852, also additional sums of $120,000 for the Black River canal and $170,000 for the Genesee Valley canal. These appropriations from the surplus revenues footed up to $944,000, and at this point were $338,250.13 beyond the actual revenues, leaving that amount to be taken from the revenues of that fiscal year. From the beginning of 1851, the canals became involved in a financial and legislative turmoil that continued until the enlargement was completed. In his annual message to the Legislature of 1851, Governor Washington Hunt urged a more vigorous canal policy and pointed out three distinct modes by which the speedy completion of the enlargement could be accomplished. By the first it was proposed to obtain the necessary funds by an issue of stock certificates, transferring absolutely, in advance, at the purchaser’s risk and for a sufficient number of years, that portion of the canal revenues which were devoted by the Constitution to the enlargement of the Erie canal and the completion of the Black River and Genesee Valley canals. This manner of disposing of the surplus revenues was thought by some of the ablest jurists to be within the competency of the Legislature. The second plan was to authorize a loan under the financial article. However, before a law for this purpose could take effect, it would have to be ratified by the people, and moreover, the Constitution required that every such law should provide for collecting a direct annual tax to pay the interest. The Governor considered that to impose a direct tax would be unjust and that no reasonable excuse could be given for such action, inasmuch as the canals continued to yield a rich return and these revenues were fully adequate to pay interest on the cost of improvements. The third resort was an amendment to the Constitution. The Governor pointed out that, if this amendment should be adopted at once, should be approved by the succeeding Legislature and then sanctioned by the people, the loan could not be secured until the Legislature of 1853 had assembled. The first of the above three plans of the Governor met with favor in the Legislature, but the whole question of canal policy was one of bitter controversy. The bill for the completion of canal improvements, embodying the "revenue certificate" plan, having passed the Assembly, its opponents in the Senate resorted to every known artifice of parliamentary tactics to prevent its passage there. As a last resort, 12 of the opposing senators resigned, leaving the body without the constitutional quorum for the passage of this and other important legislation, including the usual appropriations for the support of the Government. In this emergency, after adopting a concurrent resolution calling upon the Governor to convene a special session, the Legislature adjourned. On April 19, Governor Hunt issued a proclamation calling such special session for June 10, at which session the measure became a law. The question of the constitutionality of the act seems to have been raised at the outset. The Assembly committee presented an elaborate report in favor of the measure, supported by the opinions of several eminent jurists. Upon its reference to the Senate, that body sought the opinion of the Attorney General. In unrestricted terms, he condemned the bill as unconstitutional. But the subsequent favorable report of the Senate committee was buttressed by the opinion of no less a person than Daniel Webster, the Sage of Marshfield. Webster’s well known sentiment, that "a national debt is a national blessing," may throw some light upon his point of view. This act empowered the Comptroller to sell "canal revenue certificates" to the amount of $3,000,000 during the first year, a like amount the second year, and as much of a like amount the third year as the canal board should consider necessary for the completion of the canals in question. Restrictive clauses were inserted to prevent frauds in the unlimited issuance of the certificates, and it was provided that the contracts for the completion of the whole work should not exceed the estimates of $10,508,141 by more than 10% . No guarantee of the State was behind these securities. Only the net revenues of the canals were involved and the general credit of the State was not in anywise pledged, nor was any debt or liability against the State created. This was to avoid conflicting with section twelve, article seven of the Constitution, as it then stood. This law was subsequently known as the "Nine-million act," because of the specific amounts authorized to be issued under its provisions, aggregating that sum. It should not be confused with another and much later nine-million proposition, which came into existence in comparatively recent years. Whitford The subject of canal tolls on railroads had an important place at this time. The canal auditor warned the Legislature of the probable diminution of receipts from railroad tolls in future. The existing exemptions upon meats and livestock, the consolidation of certain short toll-paying lines, the completion of the Northern Line, which was already diverting trade from the canals, and the approaching completion of the Erie Railroad, which would contend for the transportation of the accumulated products of the West, were factors to be considered. He said: "If, under this powerful competition, our tolls do not recede more than $90,000 it will be the greatest triumph of our canal policy that has been achieved in its beneficent history." He regarded it as an interesting period in the history of the canals, saying that, hitherto their prosperity had been uninterrupted and no anxiety had been felt as to their increasing value and usefulness. Now the situation required wise and expeditious action to maintain and perpetuate their value. Legislative committees also were grappling with the question of railway tolls at this time, and numerous solutions were offered. To a select committee of the Senate were referred petitions for a law to equalize tolls upon all the trunk lines, petitions to impose tolls on the Northern and the Erie railroads, as well as others to exempt the Central Lines from tolls. The committee was divided in opinion and presented individual reports, most of which foreshadowed the coming abolition of tolls. The same Legislature, which, with extreme difficulty and in the face of the most strenuous opposition, passed the measure providing for the early completion of canal improvements, in order that the canals, in their improved form, might successfully compete with the railways, which were taking their business away from them. TheLegislature also passed an act that released the railways from the necessity of paying any tolls whatever to the State thereafter. After the lapse of more than half a century since the passage of this act, a broader and more comprehensive view of its results may be taken, than would have been possible at an earlier date. The rapid and unprecedented growth of New York State since that period – in population, wealth and power – making it in very truth the Empire State, are matters of public history, more or less familiar to us all. Nor can the mighty influence of our railway systems in that development be denied, and without doubt the State has been enriched many times over by the power thus given to the railroads of becoming essential factors in the greatness of her prosperity and upbuilding. Yet it may well be doubted whether any single legislative act from that day to this has been fraught with graver, more far-reaching consequences to the canals of the state than this act of July 10, 1851, "to abolish tolls on railroads." By it, the Legislature gave to the railways redoubled power as competitors for the traffic of the canals – the "people’s own highway." The railways could now make better rates for quicker transit – advantages, which they were not slow to grasp. Prior to its passage, the people controlled the situation. Notwithstanding the unwisdom, at various times, of the State’s financial policy, so closely had this policy been interwoven with that of the canals, – their improvement and their administration – that it still remained a fact that the golden stream of their revenues, coming largely from the increasing traffic of the West and from beyond the borders of the state, was enriching its people beyond all other sources, building up the state, paying not only the cost of the canals and their improvements, but the general expenses of the State government, rendering direct taxation for this latter purpose in previous years the exception rather than the rule. But recently, the power of the Legislature to misapply the revenues of the State had been wisely curbed by constitutional provisions, under which payment of its debts was reasonably assured. However, its framers could not have foreseen this loophole, which was to hinder and delay their well-intentioned plans. In later years, the railways, in the full tide of their opulence and power, gratefully repaid this generous gift of the people by cutting summer and raising winter rates to a point which has more than once driven the boatmen – partners of the State – from the canals, by combinations, trunk line pools, and "differentials," as will be shown later on. It has been claimed that the act was passed in the interests of "free commerce" to the traffic which sought the markets of the State. Be that as it may, it has been also claimed that every dollar of the subsequent canal debt and of the millions which have since been raised by taxation upon the people for its payment – principal and interest – were the results of this act. Whitford The idea of lengthening 8 locks and lying between Syracuse and Rochester, in such temporary manner as to bring them into use, pending the completion of the entire canal enlargement, had been considered by the canal board for several years prior to this time, and in 1849, authority had been given them to do so. This would permit the lengthening of boats, thus increasing their tonnage and the canal traffic at slight expense. Rochester interests demanded such action, and the State Engineer advised the canal board not only to lengthen the locks, but to make them of full width, in order to bear the traffic of the enlarged canal at once. The board submitted this plan for legislative approval on February 18, 1851. After the passage of the act of 1851 for finishing canal improvements, the canal board in July ordered complete plans and estimates to be prepared and the State Engineer caused test lines to be run and a careful review of the estimates to be made along the entire line. These were completed October 10. Finding the results to be within the estimates submitted to the Legislature, the canal board advertised for letting the whole work, which by the law was to be completed by the first day of May, 1854. The bids were closed on November 8, there being over 2,600 separate proposals, which required 12 days for review. For this reason the year 1851 was afterwards known in canal circles as the year of the "big letting." According to the canal commissioners report, a summary of the enlargement would $8, 832,700.19 at contract prices. Whitford During the year 1851, numerous changes of location were made, principally on the middle and western divisions. By these changes, the line of the western division was shortened about 11 miles, but the expense of construction was somewhat increased. The question of an independent line east of Rochester had long occupied the attention of the State officers in charge of the canals, and in the report of 1850 Division Engineer Stillson had urged important considerations in its favor, estimating its increased cost over the expense of enlargement on the old line, however, at $489,000, although the distance would be shortened by 6¼ miles. New surveys and estimates were again made, and the whole question was carefully considered, resulting in the adoption of the independent line. The principal changes were made between Macedon and Rochester, at Holley and just east and west of Lyons. The plans, however, were again altered in 1854. It was estimated that in 1851 there were 4,047 boats, of 70 tons average, or 283,290 tons total being used on the canals. The canal revenues for the fiscal year to October 1, 1851, was $3,722,163.11, being an increase of $235,990.08; the available surplus for improvements was $964,432.91; the increase of tonnage was still larger, rates on flour and wheat having been reduced 25%. Whitford The enactment of the "Nine-million" law of 1851 and the subsequent issue during the year of a million and a half of "certificates" under its provisions, did not by any means settle the bitter controversy which had attended its passage. The arguments used by its opponents as to its constitutionality had not been forgotten. The question of whether or not the canal improvements should be completed was not at issue, this being conceded universally. The dissension was concerning the method by which the necessary funds were sought to be raised for their completion. Nor did the circumstances surrounding the "big letting" in December tend to allay the strong feeling that existed concerning the law. "The unprecedented course of some of the representatives of the people to defeat it," says the report of a legislative committee, "the special election ordered in consequence – the excitement attending it – the extra session of the Legislature to carry out the expressed popular will – the magnitude and importance of the improvement, and the immense amount of work requisite for its completion, all conspired to attract and concentrate the attention of the public, and especially of all who hoped directly or indirectly to profit by its execution, upon the measures taken for its accomplishment. Accordingly when, after due notice had been given for the receipts of proposals for the entire work on the Erie, Genesee Valley, Black River and Oswego canals, the Canal Board . . . proceeded to open and examine the same, a scene was presented unparalleled in the history of the public works of the State. From all parts of the State, from other states, from all walks of life – from every profession, pursuit and trade – from every division and sub-division of political sects, there swarmed upon the Capital a legion of applicants, all anxious and importunate for a participation in the anticipated profits of some share in this improvement, the last for many years at least, to be obtained upon the public works of the State. The expectations of all ran high. Some had claims real or imaginary for political services. Others relied upon personal friendship for success, while others destitute of such recommendations, resorted to other and less creditable means to secure a favorable consideration. Associations, combinations and partnerships were formed, almost without numbers, and embracing components of every conceivable complexion, for the purpose of securing, in the name of some of them, a share in the contracts. While this was going on outside, the Canal Board was busily engaged in canvassing the bids and preparing their proposed allotments of the work." The amount of bids was said to aggregate about $400,000,000, and the number of bidders about 3,000. The graphic description continues: "The Board at once saw and felt the difficulty of awarding the work in such a manner as to give satisfaction generally to the host of applicants; and to add to the difficulty, jealousies existed in the minds of some of the members of the Board itself, as to the designs of other members, whom they suspected of an intention to bestow the contracts upon their political associates." It was understood that "the law, sanctioned by all experience, had repudiated the idea of letting the work to the lowest bidder, which made united action on the subject by the Board a task of increased difficulty, and rendered it still more necessary to have some general understanding between the members of the Board. . . . It was conceded, too, after the first meeting of the Board, that the work should be equally divided between the democratic and whig bidders, without regard to their being the lowest bidders." Within a few days after this remarkable "letting," the Legislature of 1852 began its session. "Coming events cast their shadows before," and when Governor Hunt, in his message, felicitated the Legislature and the people upon the adoption of the certificate plan and the prospect of immediate completion of the improvements contemplated, it is to be noted that he also advised the Legislature to keep in view the actual condition of the treasury and to limit their appropriations within the reliable revenues of the general fund. He said that the annual contributions to the sinking fund required by the Constitution were shown to be sufficient to discharge the State debt in about 17 years; after that the entire revenues could be used to pay the certificates then being issued. The toll rates upon wheat and flour having been reduced, the Comptroller raised the question as to whether the State, having pledged its canal revenues for a term of years by the act of 1851, possessed the right to impair the security of the stockholders by reducing tolls, "except to increase trade and revenue." The constitutionality of the "Nine-million act" having been called into question before the courts, the State Engineer, on January 9, 1852, warned contractors, under the letting of the previous month, not to proceed with work under their contracts, except upon their own responsibility. An adverse decision of the courts being feared, various measures of relief were proposed. In the Senate, it was sought to have the Constitution amended so as to permit a loan of $9,000,000 to complete improvements. Another resolution to borrow $6,000,000 was tabled. Another to provide for $7,000,000 "in case the law of 1851 should be declared unconstitutional by the Court of Appeals." Whitford During the legislative session of 1852, the circumstances attending in the big letting were thoroughly reviewed. In the Assembly it was openly charged that several members of the canal board had met secretly at the house of Peter Cagger in Albany, prior to the letting, and agreed on an allotment of canal contracts on the basis of political considerations and favoritism, and not to the lowest bidder. The canal board presented a formal request to both branches of the Legislature for an inquiry as to the conduct of the board, the commissioners, the state engineer and his division engineers, who had had to do with the big letting in the award of contracts, and as to their acts generally in the discharge of their duties. A joint legislative committee of five, composed of Senators Conger and Upham, and Assemblymen Moss, Cushing and Bull, were appointed under concurrent resolution " to examine and report within one week whether any and what action the legislature should take, in the matter." A large amount of testimony was taken by this committee, which appeared in a volume of some 1,200 pages as Assembly Document No. 89, 1852. The majority report frankly admitted that the contracts were in fact apportioned fairly between the two political parties, and vigorously defended such a course as being the only practicable method under the circumstances. They advanced the argument that "the law, sanctioned by all experience, had repudiated the idea of letting the work to the lowest bidder, which made united action on the subject by the Board a task of increased difficulty, and rendered it still more necessary to have some general understanding between the members of the Board." The minority report followed, modified in its conclusions and claiming that blame, if any, should attach to the defective law, which "did not require, but rather forbid the letting of the work to the lowest responsible bidder. . . . These results were confidently predicted by the opponents of the law at the time of its passage. . . . It is the duty of the State to carry out the contracts in good faith, to make the best of an inconsiderate law, and see that the enlargement is duly prosecuted." The chairman of the committee, Senator Conger, presented a further minority report, signed only by himself, which was in effect a stinging denunciation of the State officials concerned. The canal board, by resolution in February, requested the Legislature to pass an act to submit the question of the validity of the contracts in question to the Court of Appeals. The Assembly judiciary committee reported adversely upon the proposition to ask that tribunal to forestall its own judgments on appeal. The Court of Appeals, however, had the matter already under consideration in another and less startling form: One of the certificates under the law of June 10, 1851, having been issued and presented for payment, the canal auditor refused payment. The matter was then brought into the courts and in May of 1852 the Court of Appeals rendered its decision, saying, "The act, July 10th, 1851, directing the borrowing, upon interest, of $9,000,000 upon canal revenue certificates, payable out of the future surplus revenues after the completion of the canals and providing for the application of the whole sum to the completion of the canals within three years, is repugnant to the constitutional provision that the remainder of the revenues of the canals shall, in each fiscal year, be applied to the completion of the canals until they shall be finished; and also to that provision by which a power is given to the Legislature to apply the remainder of the revenues to the general expenses of the government, immediately after the completion of the canals." The State Engineer at once notified all contractors under the act, upon which this decision had been rendered, to stop work, and directed his subordinates to "measure up." Whitford In August, 1852, plans were submitted by the State Engineer to the canal board for the temporary enlargement of the old locks between Port Byron and Rochester to permit boats of enlarged size to pass the whole length of the canal; also plans to bring into use, with four feet of water, the enlarged canal between Port Byron and Montezuma, and for raising the banks for five feet of water on the whole canal wherever not enlarged. The commissioners subsequently reported that during the year trade had been seriously embarrassed from the "wedging" of boats in narrow and unenlarged sections, the original canal width being 40 feet at surface and 28 feet on bottom, and most of the boats at this time being constructed 14 feet-6 inches "over all" at the head of the floor timbers, and by the regulations being entitled to half the canal in passing. It followed that boats of the old size were not in sufficient numbers to carry the traffic, while the building of new enlarged boats was deferred from uncertainty as to when they could be brought into use. During the season of 1852 extensive surveys were made throughout the western division, both for the purpose of correcting and improving the alignment of the canal and also for increasing the width of the prism and its grade, so as to promote a more rapid movement of feedwater from Lake Erie to Montezuma, thereby obviating the necessity of using so much water from the Genesee river at Rochester for purposes of feeding. Whitford In his message to the Legislature of 1853, Governor Seymour said: "When it was decided in 1835, to enlarge the Erie canal,
it was proposed to accomplish the work by the application of the surplus tolls, without resorting to loans. There has been
collected from taxation upon the transportation of property upon our canals, since that time, the sum of $41,227,000; the
expenses of keeping them in repair amount to $11,459,000. The balance might have been applied to the completion of our
public works if we had created no debts involving charges for interest and Sinking Fund accounts; it is believed that the
balance of $29,768,000, if it had been applied as it accrued from the revenues, would have finished the works; the estimate
of their cost was $30,734,000." This view was very similar to that of Governor Young in 1848.
He said further that, unfortunately, the Legislature of 1851 rejected a proposed amendment, providing that the
constitutionality of the law should be determined before letting contracts or borrowing money. Certificates were sold for
less than one per cent premium, while State stocks of known constitutionality commanded a premium of from nine to
sixteen per cent. Contracts were let, nominally amounting to $8,029,727.45, but no allowance was made for extra, if
quicksand or hardpan developed. He explained that it was not necessary, as had been claimed, to complete the entire
enlargement to enable boats of full size to pass. The improvements already made had doubled the capacity of the canal.
From the financial point of view, the Governor thought that the application of a million dollars per year for six years to come would solve the difficulties of the canal problem. He did not believe that the surplus tolls would suffice to do it, but the balance could be raised by tax, or borrowed under the provision of section twelve, article seven, of the Constitution, for a term of 18 years, with a tax for the interest and a sinking fund, or a loan could be sanctioned by a constitutional amendment. As between taxation and a constitutional amendment, the certificate plan having failed, the canal commissioners favored the amendment. They thought that the money could be borrowed on a pledge of the revenues, after the discharge of the existing constitutional obligations as to the surplus, or the latter could be postponed with great advantage to a distant day, and the canal revenues applied directly to their completion. The latter plan was to be preferred, for the reason that statistics had been prepared, showing the gradual diminution of local tolls and the corresponding increase of through or western tolls for the previous five or six years. Obviously, the longer payment was delayed, the greater would be the proportion paid by people of other states." Commissioner Fitzhugh, of the middle division, submitted to the Legislature his special views concerning methods of economical canal administration. He believed that the same amount of work, directed with the care and economy controlling individual enterprises, could have been accomplished for about half the sum it had cost the State. He said that the canals had been so long considered a legitimate engine of political warfare, that inherent evils in the existing system of superintendency and repairs had enormously multiplied. He recommended as a sure remedy the "Contract system" of repairs, by sections, on a three- to five-year basis. As a matter of history it may be noted that this system was subsequently adopted and will be discussed. Whitford The canal commissioners said that, while there had been a large increase in business in 1852, the receipts had fallen off some $200,000. The removal of railway tolls, which went into effect December 1, 1851, rendered it necessary to make large reductions on canal tolls, to compete successfully with the railways. They believed that the receipts from tolls were diminished, in consequence of this competition for the year, by at least $500,000. In his annual report for 1852, the canal auditor called attention to the "anticipatory" expenditures, which had been made since 1848. In each of the six years, the expenditures had exceeded the appropriations by from $35,000 to $246,000, or in the aggregate, $822,487.56. This had been called to the attention of commissioners and superintendents, but it still continued, although it was a plain violation of section 8, article 7, of the Constitution, and the auditor said that he must either draw warrants in excess of appropriations, as had been the custom, or the canals must be closed in August following. The auditor said that, while there had been an apparent reduction of canal debt since the adoption of the Constitution, new debts had been created, payable from the sinking fund, to more than balance the reduction, and that the sinking fund had failed of its purpose. After the expiration of six years, or nearly one-third of the entire period, the obligations of the State for canal purposes were now larger than when the sinking fund was established, notwithstanding the constitutional mandate concerning the "sacred" application of the sinking fund to the payment of the canal debt. A legislative committee appointed to examine into the accounts of canal officials found that the expenditures for repairs during the year 1852, and especially upon the eastern division, had increased several hundred thousand dollars over the previous year. This resulted in reducing the estimated surplus applicable to improvements, from $800,000 to $300,000. On the eastern division, extravagant expenditures were said by the committee to have been incurred, which were entirely unauthorized by the canal board and in violation of the Constitution. One of the undoubted results of this arraignment of official frailties was the subsequent passage of chapter 52, Laws of 1853, requiring thereafter the monthly publication of abstracts of superintendents’ payments. Whitford The canal commissioners, replying to an inquiry, advised the Legislature that work had been done on contracts under the "Nine-million act" to the amount of $131,275.74, up to the close of the year 1852. The canal committee of the Assembly, speaking in its report of the manner in which the expenditure of the surplus revenues had been annually "anticipated" by previous Legislatures, took the broad ground that this course was forbidden by the Constitution; that the Legislature, in each year, could determine only the "manner" of its expenditures; and that prior debts formed no lien upon the current surplus revenues. The committee also urged the adoption of a modification of the "improvement" plans, for temporary use, in consideration of the practical completion in the following JUne of a line of locks on the Erie canal, enlarged to admit boats of 250 tons. They said that the only difficulty in the way of using the enlarged boats at once was the want of width and depth of channel. On the eastern, the most important division, bearing the additional traffic of four of the most important laterals in addition to its own, the enlargement was nearly completed, and for about half a million dollars an average increase of from three to five feet in breadth and a depth of five feet of water could be obtained, which would permit the use of boats of 150 tons burden. The plan had been approved by the canal commissioners and the State Engineer. Part of this sum, over and above $130,000, would also be used in the permanent improvement of the canal. The committee expressed their anxiety over the unrestricted competition of the railways that might force a further reduction of tolls, or a diversion of traffic, at a time when the canal revenues barely paid the charges against them. The State, they said, possessing entire control of the avenues of trade between the Atlantic and the western lakes, had constructed her canals at immense cost; had granted to companies the right to carry a portion of this traffic; had even transferred to them the right of eminent domain, which many doubted her power to do; and as a last and costly concession, had repealed the law imposing tolls upon them, admitting them to full and unrestricted competition . They pointed out the fact that, if the freedom of this competition was confirmed by failure to provide for corresponding canal improvements to permit larger tonnage and cheaper rates, the railways would establish a basis for their future operations inevitably resulting in much lower rates of transportation, in which competition the canals would be at great disadvantage. Thus early were the fears of those who opposed the bill of 1851, abolishing railway tolls, in a measure, justified. Whitford The "Nine-million act" having been declared unconstitutional in the previous May, the issue of $1,500,000 under its terms required payment at once. The ways and means committee of the Assembly grappled with the problem, presenting diverse reports; the majority advised a direct tax upon the people for the deficiencies apparent, including special taxes on bank circulation and railway receipts, hoping that strong public opinion would compel the administration of the canals along more economical lines for the coming year; while the minority scouted the idea and said that the burden would fall upon the agricultural interests of the state. They advised a constitutional amendment, placing the revenues where they belonged – for the improvement of the canals. In this attitude they had the support of the chamber of commerce of New York City, which memorialized the Legislature, urging immediate measures to submit to the people the propriety of amending the Constitution so as to enable the State to borrow money to complete the canals in the most expeditious manner, and stating that they were opposed to taxing railroads, as tending to divert New York traffic into other channels. On April 5, the Governor, by a special message, again called attention to the necessity of making immediate appropriations for canal improvements, to enable new boats of 230 tons capacity, but loaded with only 130 tons, to pass, in order to stimulate boat building to take the place of those annually worn out. Whitford In the way of increasing lake traffic in connection with that of the Erie canal, a charter was granted on April 12 to Erastus Corning and associates to construct a ship canal at the falls of St. Mary in compliance with the statutes of Michigan and the Federal laws. A charter also was granted to the Albany and New Baltimore Ship Canal and Basin Company, to construct and maintain a canal from South Albany along the west shore of the Hudson river, probably for transhipment purposes and for affording an outlet for canal traffic below the shallow reaches of the upper Hudson, in connection with, but not as a part of the Erie canal. This canal was never built. Whitford The Senate passed a concurrent resolution providing for a constitutional amendment. This encountered opposition in the lower house and, within three days of its adjournment and too late for a conference or for united action, unimportant amendments as to terms and periods of the proposed loan were made. In the arguments bad faith was charged, the canal question having been prominent in the preceding campaign and the Governor and many members having been pledged to promote the speedy enlargement of the canal. The Legislature, at its regular session, did not directly carry into effect the plan of temporary enlargement, outlined and urged by the State officials, but on July 20 it reinforced the canal fund with $200,000 from the sale of the remaining revenue certificates with $200,000 of the Oswego canal loan, and with $250,000, the remainder of the canal revenues for the current fiscal year. From the fund so strengthened, it appropriated $390,000 to the enlargement of the Erie canal, "as referred to in the Constitution of 1846." The Oswego canal loan was under the provisions of chapter 501, Laws of 1851, which provided for a loan of $200,000 in each of the years 1851 and 1852, for the purpose of completing the enlargement of the Oswego canal locks. Only the first item had been borrowed. The repeal of the act of the previous year (chapter 270), for the enlargement of the canals, was rendered necessary by circumstances and was effected by chapter 473, Laws of 1853. Meanwhile, the perennial question of "canal frauds" was occupying considerable time and attention. On March 17, 1853, a select committee of five was appointed by the Assembly to examine into the propriety and legality of the official conduct of certain State officers against whom charges had been made both in the commissioners’ current report and by the canal auditor. On April 13, the committee reported that John C. Mather, commissioner of the eastern division, was guilty of unauthorized and illegal expenditures in connection with improvements at West Troy, and that he stood "impeached for high crimes and misdemeanors." Whitford The session "being likely to adjourn without providing for the preservation of the public faith," as the Governor expressed it, or the interest on the canal debt, the canal improvements, the charges against Commissioner Mather and other important matters, it was convened in prolongation of the regular session, to avoid unnecessary delay and expense, by a message of the Governor on April 14. He again urged the temporary completion of the Erie canal on the lines of his former message, saying that $600,000, properly expended, would nearly double the capacity of the canal and that delay would be disastrous through the diversion of business. If the improvements asked were made, they would in no way interfere with the proposed enlargement. On the contrary, they would hasten that result by increasing domestic commerce, cheapening transportation and augmenting the revenues of the public works. The Legislature, he said, by prolonged discussions and proposed measures, had recognized the importance of completing the unfinished,works, but no plan had been adopted for their continued prosecution. Various propositions had been made to raise the necessary funds by taxation and by amendment of the Constitution. At least two amendments had been discussed; one proposed to borrow $2,500,000 each year, in addition to the surplus revenues, which would swell the annual expenditures to more than $3,000,000, and increase the debt of the State by $10,500,000; the other was to borrow annually, for six years, a sum which, with the surplus revenues, would amount to $1,500,000 and probably create a debt of $5,000,000, without applying any of it to the payments of the doubtful contracts of 1851. He said: "The deep feeling excited in the public mind by the canal lettings under the law of 1851 has created a strong opposition to any amendment of the financial provisions of the Constitution, and the differences of opinion in relation to them, have obstructed legislation, and prevented the passage of laws demanded by the interests of our public works." On the reassembling of the Legislature under the spur of the Governor’s call, efforts were made to reach an understanding upon the problem of canal finances. Being unable to agree, a conference committee of the two Houses finally accepted a compromise measure, which became a concurrent resolution proposing an amendment to the Constitution. From the canal revenues the expenses of maintenance and repairs were first to be met, with the constitutional sums required under the first two sections of article seven; from the remainder, as a sinking fund, a sum sufficient to meet the interest and the principal, within 18 years, of any loan made under the amendment; after that $200,000 was to be set apart for the expenses of State government; the remainder was to be applied to meet appropriations for canal enlargement and completion. This remainder was not to be anticipated or pledged for more than a year in advance. Under its provisions, loans could be made for the purposes, not to exceed $225,000 in each year during the ensuing four years. $1,500,000 was to be borrowed to redeem the certificates of 1851, and contracts thereafter were to be let to the lowest responsible bidder, and no contract debts incurred after June 1, 1852, were to be allowed under its provisions. Whitford Commissioner John C. Mather, of the eastern division, upon whose shoulders much of the previously mentioned criticism fell, put in a vigorous defence on May 30. While admitting the increase of expenditures for repairs, he claimed that the "false and garbled statements sent forth to the public, all emanating from one source," should be disregarded, and the public, "to whom alone the commissioners were responsible for the faithful discharge of their official duties" should be furnished a "true statement." He said that the sudden stoppage of under the act of 1851 added largely to the expenditures for repairs. He claimed that the commissioners were constitutional officers and that the canal auditor was a subordinate officer and not entitled to criticize the commissioners. Final articles of impeachment were prepared against Commissioner Mather and presented to the reassembled Legislature. After a bitter and protracted contest in the Assembly, the resolution of impeachment "for high crimes and misdemeanors" was adopted by June 22, by a vote of 80 to 35. The drainage and reclamation of the Cayuga marshes, through which the Erie canal was located, was of interest to this and the preceding Legislatures. Commissioners had been appointed, who, after examination, advised the removal of a rocky reef known as "Jack’s reef" and a bar at Mosquito Point to accomplish the purpose sought. Whitford In 1853, the project of a ship canal to connect Lake Erie with Lake Ontario, which had remained quiescent since the earlier surveys and the completion and operation of the Erie canal, was again brought to the front. Surveys, maps and estimates for a canal with 14 feet of water were made under the direction of Chas. B. Stuart, C. E., and Edward W. Serrill, C. E. In the Assembly, numerous petitions from the inhabitants of western New York were presented, asking for authority to build a ship and hydraulic canal around the falls of Niagara. The Assembly committee presented an adverse report upon the ground that such a project would be detrimental to the interests of the Erie canal, saying: "The trade of the lake region belongs to the Erie canal. It has been created by it, and is a rightful inheritance to it, as much as is the farm of the husbandman to him who has purchased, subdued and brought it into a condition of productive cultivation and consequent value. Your committee contend that the populous and productive States which border the chain of lakes and pour their rich fruits into our markets in such abundance, would have remained to this day in a state of comparative wilderness but for the Erie canal. This State work lifted the borders of civilization from the confines of our own State, and transferred them by gradual approaches to the base of the Rocky Mountains. To it, then, belong the honor and profit of this achievement, and the hand which would divest it of either, possesses a questionable friendship for our adopted system of internal improvements and the common welfare of the State." Notwithstanding the eloquence of the committee, the Assembly on July 21 chartered to Hamilton Fish and associates the right to construct a ship and hydraulic canal for ships of 500 tons under the name of the Niagara Ship Canal Company. The capital stock was limited to $5,000,000, and the State reserved the right to subsequent purchase at cost with 10% added. Whitford In reporting for 1853, the Comptroller referred to the sharp decrease in canal revenues and the resulting small remainders for enlargement, attributing it both to the competition of railroads in carrying freights and to increased expenditures of superintendence and repairs. From the auditor’s annual report was learned that up to this time there had been but two laws authorizing a direct tax for canal purposes, – one in 1842 and the other in 1853. Under the law of 1842, $456,477.35 was collected and expended in the payment of canal debts, and under that of 1853 the sum of $621,467 was to be collected for the same purpose. Of this latter amount, $590,000 was for protested canal commissioners’ drafts, drawn after they were informed that there were no means to pay them, hawked about among money lenders, and sold at a sacrifice by neddy holders. This had continued until July 20, 1853, and much of it in the face of the Governor’s recommendation of January, 1853, that laws should be enacted forbidding the practice. The auditor also called attention to an extensive system of frauds prevailing upon the canals and of which discovery had been made during the past season. These had been perpetrated by means of false entries upon bills of lading, in collusion with minor canal officials. By an order of the canal board giving to the collector discovering the fraud a portion of the penalty exacted, much of it had been uncovered and it was hoped that publicity and increasing vigilance would eradicate the evil. Whitford In addressing the Legislature of 1854, Governor Seymour urged the approval of the amendment of the year before and its submission to the people at an early date. He again earnestly recommended the temporary improvement of the canals on the lines of his former message at the expense of about $500,000. The complete line of enlarged locks between Albany and Buffalo had been brought into use. Enlarged boats, carrying 130 tons, had already passed through and many more were building. He said also that constant watchfulness was required against unnecessary expense of construction and management and that unless rigid economy should be exercised, the appropriations under the proposed amendment would be expended without the completion of the canals. Adverting to the unauthorized canal indebtedness of nearly a million, which the State, to save its credit, had been compelled to raise by tax and pay the year before, he recommended a law to prohibit any public officer from continuing expenditures or overdrawing an appropriation, when no funds remained to its credit. If the law of 1851 had not been declared unconstitutional, said the Governor, it would still have failed in its purpose, as its loans were predicated only upon surplus revenues and its certificates were not salable to advantage and the work would have necessarily been suspended. Under the amendment now proposed, the bonds would be based upon the credit of the State and would bring a substantial premium. The constitutional amendment proposed in 1853 was approved at the session of 1854. In order to facilitate matters an act was passed under which a special election was held on the third Wednesday in February, at which election the amendment was approved by the people. Canal measures occupied the attention of the Legislature to a considerable extent, but the results at the close of the session may be noted with much greater brevity than those of the preceding year. A proposition to enable corporations to build and navigate boats failed to receive the sanction of the committee on commerce for fear of its tendency to injure the individual owners. The Rochester mill owners were again in the field for damage claims for diversion of the water of the Genesee river, but nothing was done about it legislatively. Whitford In response to a Senate resolution of inquiry to the State Engineer and Canal Board as to the probable cost of the enlargement of the Erie Canal and the completion of the Genesee Valley and Black River canals and the Oswego canal locks, hurried estimates were prepared and submitted, amounting to $9,862,592.98, not including, however, the items of engineering, land damages, removal of buildings and miscellaneous expanses. These, with the addition of some omitted items, would bring the estimates up to $12,993,701.45, and even this sum was considered by the State Engineer to be insufficient to complete the improvements as contemplated by the Constitution of 1846. The Legislature made some changes and improved the methods of letting contracts, one of these suggestions authorizing the repairs on specified sections to be let for a term of years under contract, as a test of the newly created system that was destined to come into vogue during succeeding years. The formal repeal of the act of July 10, 1851, embodying the "certificate" plan, and known as the "Nine-million Act," was accomplished on April 17. The plan advocated by the Governor and others of the temporary completion of the enlargement was effected by the passage on February 15, of an act authorizing the commissioners to proceed at once to "bottom out" the Erie, the Oswego and the Cayuga and Seneca canals in their narrow and crooked portions so as to admit the passage of boats of enlarged size drawing 3½ feet of water. $115,000 was devoted to this purpose, of which $100,000 was to be expended on the Erie canal. Whitford Immediately after the passage of the law authorizing the resumption of the enlargement and completion of the canals, vigorous measures were adopted for the prosecution of the work. Under the direction of the State Engineer, new surveys, maps, plans and estimates, covering nearly the entire lines of the works to be completed were presented and approved by the canal board. The first lettings were held in July and continued from time to time up to December 27. Under the authority of the Laws of 1854, repairs near Syracuse were put under contract on October 1, for three years, at a price 40% less than the average cost of repairs had been for the preceding three years. Thus, the experiment, so far, seemed satisfactory to Commissioner Fitzhugh; that is, it was economical and, as he said, an "incalculable improvement in public morals." The supply of water from Lake Erie east as far as the Seneca river without using that of the Genesee river had been a canal problem since the days of its construction. In 1847, Chief Engineer O. W. Childs made surveys and recommended an increased capacity. In 1850, Engineer Henry Tracy made another report, recommending a still larger canal, and the canal board adopted a prism of 91 feet wide by 9 feet deep at Lockport; thence regularly diminishing to 62 feet wide by 9 feet deep to a point in the City of Rochester where the mean width of the enlarged canal was 62 feet; thence to the Rochester aqueduct 62 feet in mean width by 9 feet depth of water, then to the easterly end of the aqueduct as it was at that time; and then to the first lock east of Rochester at a mean width of waterway of 60 feet and a depth of 8 feet. Whitford In 1854, the State Engineer submitted a plan substantially that of Engineer Childs, locating the canal bottom 18 inches below the miter-sill of the lowest lock at Lockport; then on a regular grade dropping two feet to the bottom of the Rochester aqueduct with a diminishing prism, and giving a total surface declivity of 3 feet 8 inches. But the owners of the Genesee waterpower succeeded in obtaining from the board a modification, similar to the plan of 1850, except that the bottom at Rochester was not to be more than two inches below the bottom of the aqueduct, giving nine feet depth of water at Lockport and seven feet six inches at the west end of the aqueduct. Under this latter plan the canal was located, put under contract, and was under construction during 1854. Its success was shown by the fact that during an extremely dry season, when all the canals were in want of water, no trouble was experienced from Lockport to the Seneca river, without resorting to the water of the Genesee river. The difficulty caused by excessive use of water by the mills at Black Rock was expected to be overcome by the erection of a masonry division wall between the canal and the mills as a part of the enlargement plan: the mills to obtain their water directly from the harbor." From Macedon west to Rochester, opinions had for years varied as to the most desirable route. Numerous surveys had been made. Until 1851, the canal board had decided to follow the old line across the Irondequoit valley. In that year, the board adopted the "Independent" line. New examinations and estimates were prepared in 1854. Engineer Van Vleck, in charge, said that the independent line was adopted in 1851 by a bare majority of the board, and that the limited amount of money available for these improvements and the increased expense of this line, by the sum of $682,251, had caused the reconsideration of the project by subsequent boards, and its construction had been deferred. Another objection was that the law did not at this time permit the abandonment of the old line of the canal through cities and villages. The line now adopted by the board substantially followed near the old line, passing through Pittsford, but changing the lift of the locks, cutting off the heavy curves and saving nearly two miles in distance. The independent line would have saved 5.35 miles. The drainage of the Cayuga marshes continued in progress during the year. The contract at Mosquito Point bar was abandoned on November 1, but the excavations at Jack’s reef were progressing vigorously, about half of the original appropriation of $100,000, under chapter 178, Laws of 1853, having been expended. Whitford Governor Myron H. Clark’s message in 1855 said that the State tax had been raised during the previous year, 854, from one-quarter mill to one mill on the dollar, by the Legislature of 1853, but over half of the amount thus raised, $657,145.86, was paid under the law to contractors for damages, etc., which largely increased the deficiency in the general fund. The entire canal receipts during the previous year were $2,988,665.21, and the aggregate canal expenditures were $1,237,865.20. The surplus was therefore only $1,750,799.01. The constitutional requirements set apart $1,944,861.72 for various purposes, including $200,000 for State government. This created a deficiency in canal revenues of $194,062.71, which was attributed by the Governor to commercial embarrassments, unusual droughts followed by short crops; to navigation impeded by want of water and restricted channels, and to the active rivalry of competing modes of transportation; also to a large increase in repair expenditures, partly due to inconsiderate legislation. If the canal revenues did not substantially increase, said the Governor, there would be no surplus revenues for enlargement. The first loan of $2,225,000 under the new amendment realized a premium of $342,952.77. The work under contract at this time (January, 1855) amounted to $4,538,741.84, at an average of 31% less than the estimates. The canal auditor also said that it was much to be regretted that the revenues of the canals for the past fiscal year had not been equal to the charges on them, though meeting all requirements, except those of the general fund "with a revenue diminished by untoward causes," said he, "arising from the unexampled commercial embarrassments in the country. . . . With an imperfect navigation and an unfinished canal struggling under every disadvantage, against works and facilities furnished by private corporations and individual enterprise, adapted to and keeping pace with the wants and demands of trade and commerce, and burthened with an unusually large expenditure for collection, superintendence and ordinary repairs, the result is not surprising." While the expenditures under superintendents for repairs had unaccountably increased during the past few years, and while he thought it desirable that the experiment of letting out the completed sections under contract for repairs should be fully tested, the latter system was open to grave doubts of its ultimate success and expediency, for the reason that the contractor, governed by self-interest, would do as little as possible and as slightingly as possible for the money. He feared that, while such a system might do for ordinary circumstances, a large break or other emergency might find them unprepared or inefficient. The auditor conceded the injurious effect of the carrying trade of the railroads upon canal revenues. They were enjoying extraordinary rights and privileges and under present financial conditions, until the completion of the canals, should be required to pay tolls upon their tonnage as a bonus for their privileges. There was no question of the right of the Legislature, under the Constitution, to reimpose tolls. The State Engineer and the canal commissioners did not, however, share the fears of the auditor as to the disastrous effects of railroad competition, but were of the opinion that while light and costly articles would naturally seek more rapid transportation, the canal would be preferred for heavy and staple articles more than enough to make up its loss. The commissioners attributed the increased expenditures to the enhanced price of labor and materials, to at least $100,000 disbursed in widening and straightening the narrow and crooked portions of the old canal; and to a bitter controversy which had arisen between the canal board and Commissioner Mather during the year over the discharge and appointment of certain repair superintendents, which resulted in a duplicate set of officials, a double payroll and a lavish waste of money on many sections. The State Engineer was of the opinion that there was but one remedy for the errors in management, and that remedy was not by contracting the repairs, or placing higher non-partisan officials in charge, but "by a sale of the canals, after completion, in whole or in part." Upon the advice of the Attorney-General, the concurrent resolution of the year before, instructing suit to be brought against the former canal auditor for advancing moneys "to certain alleged canal commissioners without authority of law," was repealed by another resolution. This was passed on April 12, 1855. Whitford Judge Lincoln said that "agitation concerning canals did not cease with the adoption of the amendment of 1854. Amendments to the canal article were proposed in 1855. Section 12 was to be amended so as to except debts from ratification by the people." It was obvious that the Legislature, as well as the State officials, was not of one mind at this period, as to the best course to be pursued in the management of the canals. In the Senate on April 10, the canal committee reported a bill to enable the authorities to enter into a contract with Charles Cook, a former canal commissioner, and Wm. J. McAlpine, a former State Engineer, to keep all the canals in repair for 10 years, at $700,000 per year, under a bond of $250,000, but the measure failed to pass. Chapter 23, Laws of 1855, authorized the second installment of $2,250,000 of the constitutional loan, making $4,500,000 in all, to enlarge the Erie, the Oswego and the Cayuga and Seneca canals, for completing the Black River and Genesee Valley canals, and to provide for the payment of certain canal revenue certificates. The commissioners’ authority to borrow from time to time to pay the appropriations was by chapter 330, Laws of 1854. Less than a million dollars of this amount had been expended to the close of the fiscal year, September 30, 1854. Chapter 554, extending the act of the previous year, provided that any completed superintendent’s section might be let by contract for repairs. Whitford By this time, the condition of the State finances had become a matter of grave public concern. The revenues from tolls upon the canals were falling off, and it was doubtful if the gross receipts would pay the heavy fixed charges under the Constitution, as well as the rapidly increasing expenditures for maintenance and repairs, and leave any residue to apply on the enlargement. Although this condition and its causes had been the subject of more or less comment for some time, the situation now became so acute that Governor Clark as a remedy sent a special message to the Legislature on March 20, advising the reimposition of tolls upon all railroad tonnage diverted from the canals. The canal auditor also expressed similar views in his "Tonnage" report." The Assembly committee of ways and means, to which the Governor’s special message was referred, reported a bill on March 27, to reimpose tolls on railroads. Four thousand copies were ordered printed for distribution. In the bill the railways seem to have been grouped together according to the proportion of their traffic diverted from the canals. All were required to make traffic returns to the canal auditor of all property transported, except neat cattle, horses, sheep, swine, fresh meats, poultry, eggs, butter, cheese and the ordinary baggage of passengers. The New York Central, the Canandaigua and Niagara Falls, the Oswego and Syracuse, the Rensselaer and Saratoga, the Saratoga and Schenectady, the Saratoga and Washington and the Rome and Black River Railroad Companies were to pay regular canal tolls on freight as if "transported the same number of miles on either of the canals of this State." The New York and Erie, the Buffalo and New York City, the Buffalo, Corning and New York, the Cayuga and Susquehanna, the Canandaigua and Elmira, the Syracuse and Binghamton and the Watertown and Rome Railroad Companies were to pay two-thirds canal rates. The Northern Railroad Company was to pay one-half canal rates." It may be imagined that this measure created a flutter in legislative circles. The railroad companies obtained its reference again to committee and an opportunity to be heard. Thousands of printed forms were distributed and from the cities and towns along the lines of the railways came the remonstrances of officials, business men, shippers, bankers, capitalists, stock-holders and other prominent men. The "business men of New York city" added their signatures, upon the plea that trade would be driven from that city. The manuscript petitions of half a century ago are yet preserved in the archives of the State Library and an inspection of the lists shows that nearly every name was of someone financially interested in the result of the proposed legislation. This exhibition of the power of railways and of capital, even at that early period, is a striking one. No wonder that the Governor’s message failed of its purpose and that the bill did not again emerge from the committee room In Senate the committee was divided and presented an adverse report. Whitford During the season of 1855, a contract was made to test Samuel J. Seeley’s improved apparatus for
operating lock gates at the Albany weigh lock. This was by means of a wire cable or chain passing around a sprocket wheel,
which was secured to a capstan on either side. This was attached to the gates, so that power applied to the capstan
opened both gates. Balance beams were dispensed with and the gates otherwise supported, obviating the necessity of
detaching the towline. Tests showed that one man could open and close both gates in 35 seconds. Formerly
it took five
men 56 seconds. One man opened both gates in 12 to 15 seconds. Formerly it took four men 21 to 25 seconds.
A six-year-old child, weighing 40 pounds, opened both gates. The improvement was adapted to lift as well as
weigh locks and was a saving of time and money.
Engineer George Geddes reported that operations were progressing to reclaim 30,000 acres of Cayuga marsh land. |
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