1st Session.

1 No. 1380.

ACCOUNTS BETWEEN THE UNITED STATES AND THE SEVERAL STATES.

MAY 18, 1900.—Ordered to be printed.

Mr. NELSON, from the Committee on Public Lands, submitted the

following

REPORT.

[To accompany 8. 2895.]

The Committee on Public Lands, to whom was referred Senate bill 2895, have had the same under consideration and report as follows: The object of this bill is to settle the accounts between the United States and the several States relative to the distribution of the proceeds of the public lands, and thus bring to a conclusion several long-contested questions. The bill consists of two parts, the first devoted to the claims of the States for 5 per cent upon the net proceeds of the public lands disposed of for bounty land warrants, Indian reservations, and other purposes named, and the second to the advances deposited many years ago with the States out of the proceeds of the public lands.

Similar bills have been before Congress for many years, and the following reports, all favorable, have been made on them in the two Houses: House Report 707, Forty-fifth Congress, second session; Senate Report 121, Forty-sixth Congress, second session; Senate Report 193, Forty-seventh Congress, first session; House Report 345, Forty-seventh Congress, first session; Senate Report 775, Fifty-second Congress, first session; Senate Report 1043, Fifty-third Congress, third session; House Report 1552, Fifty-third Congress, third session; Senate Report 226, Fifty-fourth Congress, first session; House Report 996, Fifty-fourth Congress, first session; Senate Report 12, Fifty-fifth Congress, first session; House Report 1668, Fifty-fifth Congress, third session.

1. THE 5 PER CENT ACCOUNTS.

THE PROMISE TO THE STATES.

Upon the admission of the various public-land States to the Union the enabling acts have provided for the reservation of 5 per cent of the net proceeds of the sales of public lands within each State for the

benefit of the State. Each State has stipulated in return, either the exemption of the public lands from tax, the exemption for a certain period from tax of lands granted for military services, the equality of non resident with resident land owners, or some other like covenant. The provisions on this subject are found in the following acts:

The variation in form and identity of purpose in these acts is seen by the following provisions taken from the above-cited acts:

Act for admission of Arkansas, June 23, 1836 (sec. 3, 5 Stat. L., 58): That five per cent of the net proceeds of the sale of lands lying within said State, and which shall be sold by Congress from and after the first day of July next, after deducting all expenses incident to the same, shall be reserved for making public roads and canals within the said State, under the direction of the general assembly thereof.

Act for admission of Minnesota, February 26, 1857 (sec. 5, 11 Stat. L., 167):

5th. That five per cent of the net proceeds of sales of public lands lying within said State which shall be sold by Congress after the admission of the said State into the Union, after deducting all the expenses incident to the same, shall be paid to said State for the purpose of making public roads and internal improvements, as the legislature shall direct.

Act for admission of North and South Dakota, Montana, and Washington, February 22, 1889 (sec. 13, 25 Stat. L., 680):

That five per centum of the proceeds of the sales of public lands lying within said States which shall be sold by the United States subsequent to the admission of said States into the Union, after deducting all the expenses incident to the same, shall be paid to the said States, to be used as a permanent fund, the interest of which only shall be expended for the support of common schools within said States, respectively.

The States have always insisted that under these provisions of law they are justly entitled to 5 per cent, not alone upon the sales of public lands for cash, but also upon the disposition of the public lands for permanent Indian reservations to discharge the treaty obligations of the United States to the Indians, and upon lands disposed of in

satisfaction of bounty-land warrants and agricultural-college or other scrip issued by the United States in payment of its obligations.

FIVE PER CENT ON INDIAN RESERVATIONS.

The claim for 5 per cent on Indian reservations was early made by the States and admitted by the United States.

By the act of March 2, 1855 (10 Stat. L., 630), the following provision was enacted, confined to the State of Alabama:

AN ACT to settle certain accounts between the United States and the State of Alabama.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Commissioner of the General Land Office be, and he is hereby, required to state an account between the United States and the State of Alabama, for the purpose of ascertaining what sum or sums of money are due to said State, heretofore unsettled, under the sixth section of the act of March second, eighteen hundred and nineteen, for the admission of Alabama into the Union; and that he be required to include in said account the several reservations under the various treaties with the Chickasaw, Choctaw, and Creek Indians within the limits of Alabama, and allow and pay to the said State five per centum thereon, as in case of other sales.

Approved, March 2, 1855.

The next Congress, on March 3, 1857, made the following provision, by the first section for Mississippi and by the second section for all the other States (11 Stat. L., 200):

AN ACT to settle certain accounts between the United States and the State of Mississippi and other States.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Commissioner of the General Land Office be, and he is hereby, required to state an account between the United States and the State of Mississippi, for the purpose of ascertaining what sum or sums of money are due to said State, heretofore unsettled, on account of the public lands in said State, and upon the same principles of allowance and settlement as prescribed in the "Act to settle certain accounts between the United States and the State of Alabama," approved the second of March, eighteen hundred and fifty-five; and that he be required to include in said account the several reservations under the various treaties with the Chickasaw and Choctaw Indians within the limits of Mississippi, and allow and pay to the said State five per centum thereon, as in case of other sales, estimating the lands at the value of one dollar and twenty-five cents per acre.

Sec. 2. And be it further enacted, That the said Commissioner shall also state an account between the United States and each of the other States upon the same principles, and shall allow and pay to each State such amount as shall thus be found due, estimating all lands and permanent reservations at one dollar and twenty-five cents per acre.

Approved, March 3, 1857.

The rate of calculation for the 5 per cent is by estimating the several Indian reservations at $1.25 an acre.

In an opinion rendered by the Secretary of the Interior on March 20, 1858, printed in Senate Report 226, Fifty-fourth Congress, first session, page 3, it was held that the benefits of this act extended not alone to lands reserved and occupied by the Indians, but to lands located in the various States by scrip issued to the Indians in discharge of the treaty obligations of the United States. The Secretary said:"

The principle was thus indicated that when lands within those States had been disposed of by the United States to satisfy stipulations of an Indian treaty, they should, as respects the calculation and payment of the 5 per cent, be placed on the same footing as the lands sold by Congress.

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In this connection the principle of adjustment established appears plainly to have been intended to embrace all the lands within the State disposed of by the United States to satisfy the stipulations of the treaties with the Indian tribes named.

S. Rep. 107

Within this class the tracts taken to satisfy the scrip which had its foundation in the Choctaw treaty of 1830 are as plainly included as the tracts more directly selected by the Indians to satisfy their rights under the treaty.

The act of 1857 plainly shows a purpose to establish a general rule to regulate the accounts between the various States and the United States on the subject of Indian reservations, and the accounts of all the States then in the Union were adjusted in accordance with this act. The amounts paid under this law to the several States are as follows:

Many years afterwards other States not in the Union in 1857 applied for a statement of accounts in their favor in accordance with this act, but two successive Secretaries of the Interior denied their claims, holding that the act was limited to the States in the Union at its date (see 5 Land Dec., p. 712; 22 Land Dec., 550).

The portion of this bill relating to Indian reservations is therefore nothing more than an application to the States of Minnesota, Oregon, Kansas, Nevada, Nebraska, California, Colorado, North Dakota, South Dakota, Montana, Washington, Idaho, Wyoming, and Utah of the principles applied to the other States.

The original theory upon which this grant was made to Alabama, and subsequently to Mississippi and the other States, was that the reservation to the Indians of lands was a discharge of the obligation of the United States to those Indians, and that the States themselves should be in a no worse position when the United States used its lands to discharge its obligations than when the lands were sold for cash. The principle once applied to States in the Union in 1857 should be extended to all the other States.

It may indeed be supported for another reason. The continuance of the Indians within the boundary of a State, while a responsibility which the United States can not avoid, is yet a heavy burden upon the people of the State. No taxes are paid, the progress of settlement is impeded, intercommunication is broken up, and there is always danger of some of the many possible embarrassments in the relation between the Indians and their white neighbors. It is some compensation for this burden carried by the States, although by no means an equivalent for the disadvantage, that they should receive the same grant as would be given were the lands sold for cash to progressive settlers.

The committee has carefully guarded this portion of the bill from any possible abuse. The 5 per cent is to be paid only on existing permanent reservations, including lands allotted to Indians exempt from taxation. No allowance is to be made for past reservations ceded to the United States by the Indians or for any lands except those now actually occupied by the Indians.

The committee reports also the following amendment to provide for certain specific cases where the United States receives nothing from the sale of lands, but holds the proceeds in trust for Indian

tribes:

Nor shall it include any lands ceded by Indians or Indian tribes to be disposed of

for the benefit of such Indians or Indian tribes, nor a per cent on the moneys derived on the sale of such lands.

An instance of the lands affected by this provision is found in the act of January 14, 1889, for the relief and civilization of the Chippewa Indians in the State of Minnesota. (25 Stat. L., 642.) After providing for the sale of the surplus lands of these Indians, section 7 then provides: That all money accruing from the disposal of said lands in conformity with the provisions of this act shall, after deducting all the expenses of making the census, of obtaining the cession and relinquishment, of making the removal and allotments, and of completing the surveys and appraisals in this act provided, be placed in the Treasury of the United States to the credit of all the Chippewa Indians in the State of Minnesota as a permanent fund, which shall draw interest at the rate of 5 per cent per annum, payable annually for the period of fifty years after the allotments provided for in this act have been made, and which interest and perinanent fund shall be expended for the benefit of said Indians.

The sale by the United States being for the benefit of the Indians, and the proceeds being held in trust, no money from the sale is in the Treasury of the United States. Under these conditions the committee have thought that the 5 per cent ought not to be donated to the States from the moneys of the United States.

The committee have also carefully guarded this subject by the closing proviso of the second section that where 5 per cent has once been paid on an Indian reservation there should be no further payment on the same lands if they should subsequently become a part of the public domain and be sold for cash.

The committee believe that these provisions are just both to the United States and to the States, and that the grant within these limitations ought not longer to be withheld.

BOUNTY-LAND WARRANT LOCATIONS.

This bill proposes to grant to each State 5 per cent upon the bountyland warrants located in the State, calculated at $1.25 per acre. The justice of this contention is best exhibited by examining the statutes on the subject. The origin of the bounty-land warrant policy is set forth in Senate Report No. 193, Forty-seventh Congress, first session, as follows:

The acts of Congress for the benefit of the recruiting service of the United States at the opening of the Revolutionary war are dated in August and September, 1776. The Commonwealth of Virginia about the same time (October, 1776), for the purpose of raising her quota of men and meeting the exigencies of the coming war, also offered lands to her soldiers as part compensation for their military services. These lands thus offered by the legislature of Virginia were afterwards patented by Congress to her soldiers agreeably to the terms of cession made by Virginia to the Federal Government of the Northwestern Territory March 1, 1784.

The several military grants for the war of 1812 are dated December 24, 1811, January 11, 1812, February 6, 1812, December 12, 1812, January 24, 1814, January 27, 1814, February 10, 1814, April 18, 1814, and December 14, 1814.

Those of the Mexican war are dated February 11, 1847, March 3, 1847, September 28, 1850.

It is clear from the language of these grants that they were designed to effect a future object, and in no sense did they relate to a past subject. The time when and the circumstances under which they were passed indicate but too manifestly the aim in view, namely, to facilitate and encourage enlistments that the requisite numerical force of the army might be enlarged as rapidly as possible in order to meet the pressing necessities of each of the impending wars.

At the time the resolution of September 16, 1776, was adopted, Congress owned no land, but expected by conquest to become entitled to all the land which England had acquired by discovery. Anticipating, therefore, the acquisition of large landed