Residence Act - Compromise

Compromise

The issue of locating the capital resurfaced in the summer of 1790. At the same time, Secretary of the Treasury Alexander Hamilton was pushing for Congress to pass a financial plan. A key provision of Hamilton's plan involved the Federal government assuming states' debts incurred during the American Revolutionary War. Northern states had accumulated a huge amount of debt during the war, amounting to 21.5 million dollars, and wanted the federal government to assume their burden. The Southern states, whose citizens would effectively be forced to pay a portion of this debt if the Federal Government assumed it, were disinclined to accept this proposal. Some states, including Virginia, had paid almost half of their debts, and felt that their taxpayers should not be assessed again to bail out the less provident, and further argued that the plan passed beyond the scope of the new Constitutional government. James Madison, then a representative from Virginia, led a group of legislators from the south in blocking the provision and prevent the plan from gaining approval.

When Jefferson ran into Hamilton at President Washington's residence in New York City in late June 1790, Jefferson offered to host a dinner to bring Madison and Hamilton together. Subsequently, a compromise was reached, in which the northern delegates would agree to the southerly Potomac River site, and in return, the federal government would assume debts accumulated by the states during the American Revolutionary War. Jefferson wrote a letter to James Monroe explaining the compromise.

The 1st United States Congress agreed to the compromise, which narrowly passed as the Residence Act. Jefferson was able to get the Virginia delegates to support the bill, with the debt provisions, while Hamilton convinced the New York delegates to agree to the Potomac site for the capital. The bill was approved by the Senate by a vote of 14 to 12 on July 1, 1790, and by the House of Representatives by a vote of 31 to 29 on July 9, 1790. Washington signed the Act into law one week later on July 16. The Assumption Bill narrowly passed the Senate on July 16, 1790, followed by passage in the House on July 26.

The Residence Act specified that the capital be located along the Potomac River between the Eastern Branch (the Anacostia River) and the Connogochegue (near Williamsport and Hagerstown, Maryland), and encompass an area of no more than "ten miles square" (i.e., 10 miles (16 km) on a side, for an area of 100 square miles (259 km2)). The Act limited to the Maryland side of the Potomac River the location of land that the commissioners could acquire for federal use.

The Act gave President George Washington the authority to decide the exact location and hire a surveyor. The President was required to have suitable buildings ready for Congress and other government offices by the first Monday in December 1800, and that the federal government would provide financing for all public buildings.

The Act specified that the laws of the state from which the area was ceded would apply in the federal district, meaning that Maryland laws applied on the eastern side of the Potomac while Virginia laws applied on the western side in the District of Columbia until the government officially took residence. Upon assuming control of the federal district in 1800, Congress would have full authority over local matters within the District of Columbia.

In order to garner enough votes to pass the Assumption Bill, Hamilton also needed votes from the Pennsylvania delegates. This led to the decision to designate Philadelphia as the temporary capital city of the United States federal government for a period of ten years, until the permanent capital was ready. Congress reconvened in Philadelphia on December 6, 1790 at Congress Hall.