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including two trunk lines through Canada, one shortest possible time, and the last Congress has terminating at Suspension Bridge in Canada, the taken the initiative by ordering the survey for a other the Grand Trunk, running over a subsidized ship canal around the Niagara Falls. The means American road to Portland, Maine, thence con- by which such channel shall be accomplished, are necting with a British line of steamers to Liver-regarded as of but little moment compared to pool. The latter line the new Dominion proposes what is deemed the immediate necessity of now to own and operate. Canada has expended the channel itself Substantial, however, as in the last quarter of a century over $150,000,000 the general demand of the West is, and of British capital in constructing canals and rail-specious as is the scheme of the Niagara ways to divert and control the great prize of this ship canal, it is certainly to be greatly continent, our Western commerce. She has vainly apprehended that unless the people of this State striven to overcome the commercial and climatic shall comprehend the necessities of the hour and difficulties of her geographical position, ambi- move on abreast with the times, even constitutiously constructing vast public works, and mak- tional restraint, or rather the lack of constitutioning large unremunerative investments, accom-al power on the part of Congress, will not be plishing results which at best can only be partial found sufficient to prevent the consummation of and transitory, deflecting a portion of our trade this outrage upon State soil, and State dominion, for a time, by discriminating legislation in aid of and the work itself will stand upon our own soil, the gigantic struggles for existence of her unprof- a monument of national aggression and State imitable carrying systems, from the lines of commerce becility. The limited space allotted to this report leading to our seaport cities, but only to return will not permit the further consideration of this again, reacting to the loss and injury of those who branch of the subject. have reaped a temporary benefit from the experiments.

It is claimed by some that we possess natural geographical advantages which will always give

It is only as late as 1865, Canadian commis-us commercial supremacy. This is no doubt true sioners in Washington, in their memorandum of terms for a renewal of the Reciprocity Treaty, submitted to the Committee of Ways and Means of the House of Representatives, a proposition to enlarge their canals for the passage of American vessels of over 1,000 tons, provided they could receive proper equivalents in reciprocal trade with the United States. Will any one say there is no danger to our trade from that quarter, now that the commercial and financial energies of all the British Provinces are concentrated under one head in their new Dominion? The struggle is not given up; it will be renewed at any cost, and true and wise foresight warns us to be prepared.

if we improve them as we have in the past. It is true that of all the States, New York alone reaches from the Atlantic to the great chain of western lakes without encountering at one or more places the formidable obstacles presented by the Allegany mountains. While her eastern front is on the ocean and includes harbors of unsurpassed excellence, her western territory is a portion of the great valleys of the interior. Rivers issuing from her highlands flow through her own boundaries into the Atlantic, or find their way by the Allegany and Ohio into the Mississippi river and the Gulf of Mexico. Another of her boundaries is on the St. Lawrence. Rendering her advantages available by means of railways and canals, she is enabled to penetrate into all parts of our country by following routes which nature has already formed and indicated by her streams. While her valleys and rivers, with their natural extensions, reach to the Mississippi, the Mohawk and the Hudson gather together in one common channel the chief commerce of the great West and North, increased like their rivers by continual additions from their source until they reach the ocean.

These gigantic rivalries around us are matters of the gravest moment- they should excite us to the most jealous vigilance with respect to the present. The recent movement proceeding from the North-west, looking to the building of a ship canal around the Falls of Niagara by our National Government, perhaps in equal degree should awaken our attention. The project includes the idea of now constructing the work "without the consent of the Legislature of the State." Never before has Congress attempted even the location of a "fort, arsenal or dockyard," within the Toward the great lakes and to the natural eastboundaries of a State, without obtaining title to ern termination of their navigation (Buffalo, also the necessary land, and the consent of the the termination of the Erie canal) the trade of State Legislature; the people of the West are an the West has heretofore substantially concentrated. energetic people; restiveness, impatience under By the route through the State of New York only real or imaginary embarrassment, are the necessary 500 miles in length (and a third of that distance characteristics of such a race. In their view the through the Hudson river), the trade of the West, vast volume of their productions upon still retaining substantially its direct eastward its outward progress to the eastern States course, reaches a safe and natural seaport upon and the Atlantic sea-board, meets with obstruc- the Atlantic.

tions which such a nation as our own This report has already extended beyond its inshould not hesitate to remove at once. Disap-tended limit. The subjects aro so important compointed in the delayed enlargement of the Erie mercially, financially and politically affecting the canal; disappointed until doubt has almost arisen destiny of this State and the happiness of its peoas to the ability of the canal when enlarged to meet ple, that it seems scarcely possible to limit their the necessities of the present and future commerce. consideration. The West now demands through her Senators in Congress, that some channel for the eastward course of its commerce should be found or forced in the

It will only now be added, great as are all the natural and geographical advantages of this State, we cannot retain our commercial supremacy,

without we continue our early canal policy of progressive improvement. In the view of the undersigned our whole canal system is now in the crisis of its fate. Inaction now is an abandonment of our public works-it involves decay, loss of trade, and consequent taxation of the people. The lessons of the times teach us that this is an age of progress and those who do not heed the teaching, whether they be States, parties or politicians, and keep step to the forward movement of the day will be forced behind by their more progressive rivals, who will bear off the palm of suc

cess.

ISRAEL T. HATCH.

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then the deficiency shall be supplied by taxation the next year.

§ 4. After the debts specified in sections two and three of this article are fully paid or provided for, according to the provisions of section three, the remaining revenues of the canals, after paying the said expenses of collection, superintendence, and ordinary repairs, shall in each fiscal year be paid into the treasury of the State to pay the amount advanced for canal purposes by taxation specified in the first section, and the interest thereon, until the whole amount so advanced, with interest at five per cent per annum, shall be fully paid, and until any amount hereafter advanced for canal debt or other canal purposes, with interest thereon at five per cent per annum, shall be fully paid.

§ 5. After complying with the provisions of the third and fourth sections of this article, no tolls shall be levied on the canals except what may be necessary to pay the expenses of collection, superintendence and ordinary repairs, and other necessary improvements of the canals.

§ 6. The claims of the State against any incorporated company to pay the interest and reduce the principal of the stock of the State loaned or advanced to such company, shall be fairly enforced and not released or compromised, and the moneys arising from such claims shall be set apart and applied to the payment of said stock so loaned, or to repay the money which may be advanced to pay the same.

§ 7. Every contribution or advance to the canals or their debt, heretofore or hereafter, from any source other than their direct revenues, shall be repaid into the treasury with interest, at five per cent per annum, for the use of the State out of the canal revenues, as soon as it can be done consistently with the just rights of the creditors holding the debts specified in section number two.

8. The Legislature shall not sell, lease or otherwise dispose of any of the canals of the State, but they shall remain the property of the State and under their management forever.

§ 9. No moneys shall ever be paid out of the treasury of this State, or any of its funds, or any of the funds under its management, except in pursuance of an appropriation by law, nor unless such payment be made within two years next after the passage of such appropriation act; and every such law making a new appropriation, or continuing or reviving an appropriation, shall distinctly specify the sum appropriated and the objects to which it is to be applied, and it shall not be sufficient for such law to refer to any other law to fix such sum.

3. After paying the expenses of collection, superintendence and the ordinary repairs of the completed canals, there shall be appropriated and set apart in each fiscal year, commencing on the first day of October, in the year one thousand eight hundred and sixty-seven, the whole of the remaining revenues of the State canals as a sinking fund to pay the interest as it falls due, and reduce the principal of the several stock debts specified in section two of this article, until the several debts shall be fully paid or provided for; and including the sum of seven millions of dollars hereafter to be borrowed by the Legislature, at a rate of interest not exceeding six per cent per annnm, re-imbursable in eighteen years, to be applied and appropriated to the improvement of the Erie, the Oswego, and the Cayuga and Seneca canals to admit the passage of boats or vessels to pass thereon, of at least five hundred tons burden; and the moneys so borrowed shall be applied as above provided, together with the enlargement of the remaining small locks on the Champlain canal to the size of those now on the Erie § 10. The credit of the State shall not in any canal, and to no other purpose whatever. manner be given or loaned to or in aid of any But if it shall be ascertained that the im- individual, association or corporation, nor shall the provements herein contemplated cannot be fully money or property of the State be given or loaned made and completed for the said sum of seven to or in aid of any individual, association or cormillions of dollars, then no moneys shall be bor-poration while there are any outstanding debts rowed for that purpose. The said several stock against the State. debts named in the first section of this article shall be fully paid by the first day of October, 1878; and if in any fiscal year there shall not be contributed from said revenues a sum sufficient to pay the pro rata contribution of principal in ten years with the balance then in the sinking fund,

Resolved, There should be a constitutional provision to the following effect: The credit of the State shall not in any manner be given or loaned to or in aid of any individual, association or corporation; nor shall any money belonging to the State, raised or to be raised by taxation, be

loaned or given to any individual, association or, shall not be sufficient to refer to any other law to corporation, except that State contributions to fix such tax or object. public charities, asylums, schools, academies and § 15. No deficiency loan shall be made by or colleges, may be continued, not exceeding annu- on behalf of the State, for a longer period than is ally the amounts appropriated for such purposes necessary to enable the sinking fund provided for in any year prior to 1866. its payment to accumulate an amount sufficient to discharge it; and in no case shall such loan be made for more than six years.

The PRESIDENT-The minority report will be referred to the Committee of the Whole and be printed.

§ 11. The State may, to meet casual deficits or failures in revenues or for unexpected expenses not provided for, temporarily contract debts; but such debts, direct and contingent, singly or in the aggregate, shall not at any time exceed one million of dollars, and the moneys arising from the loans creating such debts shall be applied to the purposes for which they were obtained, or to repay the debt so contracted, and to no other purity pose whatever.

§ 12. In addition to the above limited power to contract debts, the State may contract debts to repel invasion, suppress insurrection or defend the State in war; but the money arising from the contracting of such debts shall be applied to the purpose for which it was raised, or to repay such debts, and to no other purpose whatever.

Mr. CLARKE-Mr. President, I desire to submit a minority report:

The SECRETARY proceeded to read the minorreport of Mr. Clarke, as follows:

As a member of the Committee on the Finances of the State, the Public Debt, Revenues, Expen ditures and Taxation, and Restrictions on the Powers of the Legislature in respect thereto, the undersigned dissents from the report of the majority of the committee, in reference to a portion of the article submitted, and offers as a substitute the following, and in a very brief manner further reports thereafter:

ARTICLE

SEC. 1. After paying the expenses of collection, superintendence, and ordinary repairs, there shall be set apart, in each fiscal year, out of the revenue of the State canal, from the first day of June, 1867, the sum of one million seven hundred thousand dollars, to be added to the sinking fund, now existing, to pay the interest and to redeem the principal of that part of the State debt known as the canal debt of 1846, until the same shall be wholly paid; and the principal and income of said sinking fund shall be sacredly applied to that purpose.

§13. Except the debts specified in the twelfth and thirteenth sections of this article, no debts shall be hereafter contracted by or on behalf of this State, unless such debt shall be authorized by a law for some single work or object to be distinctly specified therein; and such laws shall impose and provide for a collection of a direct annual tax to pay, and sufficient to pay, the interest on such debt as it falls due; and also to pay and discharge the principle of such debt within eighteen years from the time of the contracting thereof. No such law shall take effect until it shall at a general election have been submitted to the people, and have received a majority of all the votes cast for or against it at such election. On the final passage of such bill in either House 2. After complying with the provisions of of the Legislature, the question shall be taken by the first section of this article, there shall be ayes and noes, to be duly entered on the Journals appropriated and set apart out of the surplus revthereof, and shall be: "Shall this bill pass, and enues of the State canals, in each fiscal year, from ought the same to receive the sanction of the the first day of June, 1867, the sum of three hunpeople ?" The Legislature may at any time after dred and fifty thousand dollars, until the time when the approval of such law by the people, if no a sufficient sum shall have been appropriated and debt shall have been contracted in pursuance set apart, under the said first section, to pay the thereof, repeal the same, and may at any time by interest and extinguish the entire principal of the law forbid the contracting of any further debts canal debt therein mentioned; and from under such law; but the tax imposed by such and after that period, then the sum of act, in proportion to the debt and liability which one million five hundred thousand dollars, in may have been contracted in pursuance of such law, each fiscal year, shall be added and appropriated shall remain in force and be irrepealable and be to the sinking fund, now existing, to pay the interannually collected, until the proceeds thereof est and redeem the principal of that part of the shall have made the provision hereinbefore speci-State debt called the general fund debt, including fied to pay and discharge the interest and princi- the debt for loans of the State credit to incorpopal of such debt and liability. The money arising from any loan or stock creating such debt or liability, shall be applied to the work or object specified in the act authorizing such debt or liability, or for the repayment of such debt or liability, and for no other purpose whatever. No such law shall be submitted to be voted on within three months after its passage, or at any general election when any other law or any bill or amendment to the Constitution shall be submitted to be voted for or against.

rated companies, made prior to the first day of June, 1846, so far as they shall, or may hereafter, become a charge on the State treasury or general fund, until the same shall be wholly paid; and the principal and income of said sinking fund shall be sacredly applied to the purpose aforesaid.

§3. After a full compliance with the provisions of the first and second sections of this article, there shall be paid out of the surplus revenues of the canals, to the treasury of the State, on or before the first day of September, in each year, $ 14. Every law which imposes, continues or for the use and benefit of the general fund, the revives a tax, shall distinctly state the tax and sum of two hundred thousand dollars, for the supthe object to which it is to be applied, and it | port of the State government.

§ 4. After a full compliance with the provisions shall be contracted by or on behalf of this State of the first, second, and third sections of this to pay any portion of the State debt that may article, there shall be appropriated, in each fiscal remain unpaid under the provisions of this article year, from the surplus revenues of the canals, unless the law authorizing the creation of such the sum of one million one hundred and sixteen debt, shall itself impose and provide for the colthousand two hundred and forty-two dollars and lection of a direct annual tax, for the purpose of sixty-six cents, to be added to the sinking fund paying, and sufficient to pay the interest on such now existing for the payment of the debt known debt as it falls due, and also to pay and discharge as the enlargement and completion debt, until the principal of such debt, within eighteen years the same is sufficient to pay off and discharge from the time of the contracting thereof. said debt and interest, and the principal and interest of said sinking fund shall be sacredly applied to that purpose.

§ 5. After a full compliance with the provisons of the first, second, third and fourth sections of this article, there shall be appropriated and set apart from the revenue of the canals, the sum of $187,500, in each fiscal year, to be added to the sinking fund, now existing, until the sum, so appropriated and set apart, shall be sufficient to pay the principal and interest of what is known as the floating debt loan; and the principal and income of said sinking fund shall be sacredly applied to that purpose

§ 9. The claims of the State against any incorporated company, to pay the interest and redeem the principal of the stock of the State heretofore loaned or advanced to such company, shall be fully enforced, and not released or compromised; and the moneys arising from such claims shall be set apart, and applied as part of the sinking fund provided in the second section of this article.

§ 10. The credit of the State shall not, in any manner be given or loaned to, or in aid of any individual, association, or corporation. The same restrictions apply to the counties, towns, cities, and villages of the State.

§ 11. No moneys shall ever be paid out of the treasury of this State, or any of its funds, or any of the funds under its management, except in pursuance of an appropriation by law; nor unless such payment be made within two years next after the passage of such appropriation act; and every such law making a new appropriation, or continuing or renewing an appropriation, shall distinctly specify the sum appropriated and the object to which it is to be applied; and it shall not be sufficient for such law to refer to any other

§6. Such portion of the surplus reveuue of the canals as may remain, after a full compliance with the provisions of the five preceding sections, shall, in each fiscal year, be applied to the payment of the sums which have been raised by taxation and drawn from the general fund for canal purposes, until that fund shall be fully reimbursed for all sums so drawn therefrom since the year 1846, with quarterly interest thereon, at the rate of six per cent per annum. As the revenues are so received into the treasury they shall be appro-law to fix such sum. priated, or so much thereof as may be necessary § 12. The State may, to meet casual deficits to the payment of, or to the creation of a sinking or failures in revenues, or for expenses not provifund for the ultimate payment of the principal ded for, contract debts; but such debts, direct and and interest of the State debt, known as the bounty contingent, singly or in the aggregate, shall not at debt; and after all the objects provided for in this section and the previous sections of this article shall have been accomplished, and the several debts and obligations mentioned therein shall have been fully paid and discharged, the tolls upon the canals of the State shall be reduced to a rate calculated to produce a revenue sufficient to meet the expenses of collection, superintendence and all repairs that may be necessary to keep the canals in good navigable order and condition, together with the demands of the third section of this article and no more.

any time exceed one million of dollars; and the moneys arising from the loans creating such debts shall be appropriated to the purpose for which they were obtained, or to pay the debts so contracted, and to no other purpose whatever.

§ 13. In addition to the above limited power to contract debts, the State may contract debts to repel invasion, suppress insurrection, or defend the State in war; but the money arising from the contracting of such debts shall be applied to the purpose for which it was raised, or to repay such debts, and to no other purpose whatever.

§ 7. The Legislature may provide by law, for § 14. Except the debts specified in the seventh, borrowing any sum of money that may be neces-eighth, twelfth, and thirteenth sections of sary to pay the principal of any portion of the this article, no debts shall be hereafter conexisting debt of the State, including the bounty tracted by or on behalf of this State, undebt, which the revenues of the canals applied as less such debts shall be authorized by a required by the preceding section of this article, may fail to meet, and may also authorize the raising, upon temporary loan of money to pay the deficiency of interest upon any State debt; but not for a longer period than may be required to raise the necessary amount by taxation. The interest on the bounty debt shall continue to be paid by means of taxation, as now provided by law, until the same can be paid from the surplus revenues of the canals, under the provisions of section five of this article.

8. After the expiration of twenty years from the time when this article takes effect, no dobt

law, for some single work or object, to be distinctly specified therein, and such law shall impose and provide for the collection of a direct annual tax to pay, and sufficient to pay the interest on such debt as it falls due, and also to pay and discharge the principal of such debt, within eighteen years from the time of contracting thereof; no such law shall take effect until it shall at a general election have been submitted to the people, and have received a majority of all the votes cast for and against it, at such election. On the final passage of such bill in either house of the Legislature the question shall be taken by ayes

At the time of the adoption of the present Constitution, the canals were indebted to the general fund for advances for canal purposes to the amount of about $5,000,000; that debt seems to have been compromised by the provision in the Constitution requiring a perpetual annual appropriation of $200,000, as mentioned above, from the revenues of the canals, to the general fund, for the support of the State government.

and noes, to be duly entered on the Journals | the remaining portion of the canal debt of 1846, thereof, and shall be: "Shall this bill pass, the general fund debt, the enlargement and comand ought the same to receive the sanction pletion debt, and the appropriation of $200,000 per of the people?" The Legislaure may at any annum to the general fund, for the support of the time, after the approval of such law by the peo- State government. ple, if no debt shall have been contracted in pursuance thereof, repeal the same; and may at any time, by law, forbid the contracting of any further debt or liability under such law; but the tax imposed by such act, in proportion to the debt and liability which may have been contracted in pursuance of such law, shall remain in force and be irrepealable, and be annually collected, until the proceeds thereof shall have made the provision herein before specified, to pay and discharge the The fifth section provides for an appropriation interest and principal of such debt and liability. of $187,500 per annum to the sinking fund of The money arising from any loan or stock creating the floating debt loan, heretofore paid by taxasuch debt or liability shall be applied to the work tion. or object specified in the act authorizing such debt or liability, or for the repayment of such debt or liability, and for no other purpose whatever. No such law shall be submitted to be voted on within three months after its passage or at any general election, when any other law or any bill, or any enactment to the Constitution, shall be submitted to be voted for or against.

§ 15. Every law which imposes, continues, or revives a tax, shall distinctly state the tax and the object to which it is to be applied; and it shall not be sufficient to refer to any other law to fix such tax or object.

§ 16. On the final passage in either house of the Legislature, of every act which imposes, continues or revives a tax, or creates a debt or charge, or makes, continues or revives any appropriation of public or trust money, or property; or releases, discharges or commutes any claim or demand of the State, the question shall be taken by ayes and noes, which shall be duly entered on the Journals, and three-fifths of all the members elected shall, in all such cases, be necessary to constitute a quorum therein.

§17. The Legislature shall not sell, lease or otherwise dispose of any of the canals of the State, but they shall remain the property of the State and under its management forever.

The debts of the State, for the payment of which the revenues of the canals are pledged, after deducting the unapplied balance of their sinking funds, were on the first day of July, 1867, as fol

lows:

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Floating debt loan,.

Debt due general fund for advances for canal purposes since 1846, about.....

$2,102,804 62
5,642,622 22

200,000 00
10,360,110 27
1,211,028 32

18,000,000 00 The bounty debt on the thirtieth day of June last was $26,940,000. There will be due from the treasury to the sinking fund of that debt at the close of the present fiscal year, out of the receipts from taxes already collected, a sum sufficient to reduce the principal of the debt considerably below $26,000,000.

By the provisions or the first, second, third and fourth sections of the article, herewith reported, the requirements of the Constitution of 1846, are fully carried out in reference to the payment of

The revenues of the canals have failed to meet the requirements imposed upon them by the present Constitution, consequently, there has been raised by taxation since 1846, and drawn from the General Fund for canal purposes, with interest added, about $18,000,000.

The sixth section provides that after a full compliance with the provisions of the five preceding sections, that the remaining portion of the net revenues of the canals shall be applied to the payment of the sums raised by taxation and drawn from the general fund as stated above, and as the money is received into the treasury, it shall be appropriated to the payment of the bounty debt. It also further provides, that after all the preceding requirements are fulfilled, that the canal tolls shall then be reduced to a rate sufficient only to keep the canals in good repair and navigable condition.

The seventh section provides that money may be borrowed to pay any portion of the State debt, including the bounty debt, that the revenues of the canals may fail to pay, as it matures, and for the imposition of taxes to pay any deficiency of interest that the revenues of the canals may fail to meet.

Section eight provides that no money shall be borrowed after the expiration of twenty-five years from this time to pay any portion of the State debt that may then remain unpaid without a provision in the act authorizing the loan, requiring the payment of the principal and interest of the debt by taxation within eighteen years thereafter.

The ninth section provides that the credit of the State shall not be given or loaned to any individual, association, or corporation, and that the same restriction shall apply to the counties and towns, and cities and villages of the State.

The other sections are substantially the same as those in the existing Constitution, relating to the same subjects.

The contributions to the several sinking funds, now existing, for the payment of the canal debts, will, by the provisions of the article now submitted, continue the same as under the existing Constitution, consequently there will be no necessity of making any change in the mode of keeping the accounts or in either of the sinking funds.

By the operation of the sinking fund the debts will be paid as follows:

Canal debt of 1846 in 1868.

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