From John Nicholson
[Philadelphia] January 18, 1792. “Inclosed is one Certificate of each kind granted by the State of Pennsylvania. That Number’d 13768 … is the only kind granted for the Debt of the United States, & on which the question arises whether any thereof have been subscribed to the funding system of the United States. The other two kinds No. 1687 for depreciation of the Army and 2506 for all other Debts due by the States, you will find include all that have been subscribed with the loan Officer. I also send you … the Laws of Pennsylvania where you will find … the Law under which the Certificates were granted mentioned first above.…”1
LC, Division of Public Records, Pennsylvania Historical and Museum Commission, Harrisburg; copy, Division of Public Records, Pennsylvania Historical and Museum Commission.
1. On February 2, 1792, Oliver Wolcott, Jr., comptroller of the Treasury, wrote to Thomas Smith, commissioner of loans for Pennsylvania, asking whether any “new loan” certificates “have been subscribed to the loan payable in state certificates” (Hogan, Pennsylvania State Trials description begins [Edmund Hogan], The Pennsylvania State Trials: Containing the Impeachment, Trial, and Acquittal of Francis Hopkinson, and John Nicholson, Esquires … (Philadelphia, 1794). description ends , 278).
On February 3, 1792, Smith wrote to Wolcott: “There has not been any Certificates of the description you allude to in your Letter of yesterdays date & of which you Inclosed a copy subscribed to the U states Loan. The Only Certificates received by me on Loan are those Issued agreeable to the Acts of the Assembly of this state of the 18th Decer. 1780 of the 10th April 1781 & April 1st. 1784, the returns of which are in forwardness & shall be compleated as soon as possible” (LC, RG 53, Pennsylvania State Loan Office, Letter Book, 1790–1794, Vol. “615-P,” National Archives).
On February 29, 1792, Nicholson wrote to Governor Thomas Mifflin: “The subject committed to me by your Excellency in Decr last, respecting the claim made by the Secretary of the Treasury to a surrender on the part of the State of the Continental certificates not exchanged having been brought to a close; and being this day informed at the Treasury that all obstacles were removed respecting the transfer & payment of interest quarterly to the State of the residium unsubscribed of this States quota, and orders having gone out to the Loan Office of the District of Penna: consequent thereupon, I hasten to inform you thereof. The subject was an important one, and to have required the Continental Certificates from Pennsylvania, while the New Loans for which they were given were out and the State responsible for; without these means of redemption would have placed her in an unpleasant situation, to take off the appearance of this hardship, it was suggested that in case the New Loans not exchanged would not be subscribed to the United States by the holders (which on the proposed terms of the loan might be done) yet still that the State would by the terms of the same loan, be in the receipt of a sufficient sum from the Union to meet the interest due to these Creditors, but to this it was objected, that this receipt of interest by the State would be temporary, and would cease when the settlement of our Accounts with the United States should be effected and the balances provided for agreeably to Law—whereas the demand against the state would be perpetual, and could only be discharged by payment of the debt. On the whole after much attention to this business it hath been settled to our wish; and the good sense of the Secretary of the Treasury hath led him to a decision under the Act of Congress of Augt 1790, which is equitable and consonant with the scope of the said Act” (LC, Division of Public Records, Pennsylvania Museum and Historical Commission, Harrisburg)