Treasury Department Circular
to the Commissioners of Loans1
September 16 1790
I have already transmitted2 a Copy of an act of Congress passed on the fourth day of August 1790, making provision for the debt of the United States, & I now transmit such forms as have been devised for the government of your conduct as Commissioner of Loans in the State of ——.
On the opening of your Office, two books will be provided by you for the purpose of receiving subscriptions, agreably to the form marked (A)—one of these books will be used for receiving subscriptions in Certificates of the domestic debt of the United States3—and the other for subscriptions in Certificates of the debt of the State.
The account marked (B) is the form of a statement designed to accompany the Certificates of public debt which may be presented by the Creditors—this account you will endeavor to have made out by the subscribers to the Loan in cases where you can rely upon their accuracy.
After the statement (B) is examined by you and found right, it will be recorded in the book of Loans, marked (C) which is intended to serve as a Waste Book from which entries are to be made in your Journal.
For the amount ascertained to be due by the statement (B) three Certificates will be issued for the different species of stock created by the act of Congress agreably to the forms marked D E F.
When the three species of Certificates of Funded Debt before mentioned are issued; duplicate receipts are to be taken therefor, agreably to the form marked (G) one of which will be cut out from the receipt book as a voucher for the account marked (B).
The amount of the loans will be entered in a book agreably to form (H) a copy of which will be the form of a return to be made by you to the Treasury once in each month.
The return to the Treasury agreably to the form (H) will be accompanied by the accounts (B) and the original certificates previously cancelled by you; and will also be supported by a set of the duplicate receipts marked (G).
To prevent forged or counterfeit Certificates from being received on loan, it has been judged necessary that the Loan Office Certificates and those issued by State Commissioners, should be received only at the Treasury and by the Commissioners of Loans in those States in which such Certificates were issued: the Certificates issued by the Register of the Treasury—by the Commissioners of army accounts and by the Commissioners appointed to settle the accounts of the five great departments—Indents of Interest and bills of old emissions, are to be recd. indiscriminately at the Treasury and by the Commissioners in all the States under the limitations and cautions hereafter provided.
All Certificates issued by the Register of the Treasury and all other Certificates of which you have no Checks or Registers, or of the authenticity of which you entertain doubts, are previously to a settlement in your office, to be transmitted to the Treasury for examination—to accomplish which with safety & as much dispatch as the nature of the business will admit, the form (J) has been prepared.
In this account you will enter the date number and description of each certificate, with the apparent specie value in the first money column, leaving the other columns blank—on one copy of this account you will pass a receipt to the claimant, in case he requests it—specifying the number and amount of the Certificates presented—and that they are to be transmitted to the Treasury for examination and two Copies of the said Acct. with the Certificates previously cancelled will be by you transmitted to be examined—when the examination is made at the Treasury, the true amount of each Certificate will be inserted, in the second money column of the accounts, one of which with such remarks thereon as will enable you to compleat the business will be transmitted from the Treasury.
As the transmission of Certificates, will be attended with much trouble and delay, which ought to be avoided by every expedient which can be reconciled with a due attention to the public interest—[Notice will be given] to the public creditors, that the necessary arrangements with respect to the Loan would be facilitated [and expedited] in case the applications of holders of Treasury Certificates and those issued by the Commissioners of army accounts, and by the Commissioners for settling the accounts of the five great departments were made in the first instance at the Treasury. [It will be well for you to repeat this intimation personally to such as may apply to you with any of those Certificates, accompanied with a proper explanation.]
[But] where the Creditors [do not think fit] to apply at the Treasury this Certife. must be received by you, under the limitations before mentioned, taking care to exercise the discretion with which you are invested, for transmitting certain species of Certificates to the Treasury, in such manner that on the one hand, the public be not charged with counterfeit evidences of debt, [and] on the other the public Creditors be [not] exposed to improper delays and inconvenience.
For the renewal of Certificates to such of the public creditors as may not choose to subscribe to the proposed loan, the following forms are to be pursued.
The Certificates which may be presented by non subscribers are to be accompanied with an account agreably to the form marked (K)—which account is nearly of the same form as the account marked (B.) and is also to be made out by the Creditors in all cases where it can be conveniently done—however, instead of consolidating the arrearages of Interest to the first day of January 1791, into a new capital, as is to be done in respect to the Funded Debt, you will issue a Certificate agreably to the form marked (L) which Certificate is to bear interest from such a period, that interest being computed at the rate of six Centum Annum on the amount thereof, to the first day of January 1791 will give the sum of Interest arising from imputations on the Certificates presented agreeable to the statement (K).
For the Certificates issued to non subscribers agreably to the form (L) duplicate receipts are to be taken according to the form (M) one of which will be cut out from the receipt book and filed as a voucher for the account marked (K).
The account (K) is to be recorded in a book agreably to the form (N), which book will be nearly of the same form as the Book of Loans marked (C) and this book (N) is also to serve as a Waste Book, from which the entries relative to Unfunded Stock, are to be made in the Journal.
The aggregate amount of the several species of Certificates recd. from non subscribers will be entered in a book agreably to the form (O)—a copy of which will be the form of a return which you will make to the Treasury once in each Month.
The return last mentioned will be accompanied with the accounts marked (K) and the original Certificates previously cancelled by you, and also with one sett of the duplicate receipts marked (M).
The forms and accounts before described are indispensibly necessary to enable the Officers of the Treasury, to close the accounts relative to the several species of Certificates now open in the public books—and for the purpose of ascertaining the amount of Stock which may be credited in the books of your Office, and though a compliance with them will be attended with considerable trouble, you will have the satisfaction of reflecting, that they will become unnecessary, when the Loans are compleated.
When the records are made in the books marked (C & O) you will be prepared to make the necessary entries in your Journals. The cases which will occur with respect to accounts of principal Stock are the following viz
1st. When Stock is subscribed in your Office or is to be credited to a non subscriber on his receiving a new Certificate.
2d. When Stock is to be transfered on your books.
3d. When Stock is to be transfered from your books.
4th. When Stock is transfered to your books, by Warrant from the Secretary of the Treasury.
In the first instance the proper Accot. of Stock will be debited to the Stock holder or Non subscriber, as the case may happen.
In the second instance, the Assignor, will be debited to the Assignee, for the sum transfered.
In the third instance, the Stock holders or Non subscribers account will be debited to the account of Stock for the sum proposed to be transfered.
In all instances where applications are made for transfering Stock from your books, to those of the Treasury or of some other Commissioner the Certificate thereof is to be taken up by you & cancelled, and another issued agreably to the form (P) which Certificate is to be filled up in such manner, as [to] specify the species of Stock and the time from which Interest is payable.
In the fourth instance before mentioned, the account of Stock will be debited to the Stockholder or Non Subscriber, for the sum contained in the Warrant from the Secretary of the Treasury, directing the transfer to be made.
The proper entries to be made in most of the Cases before mentioned are exemplified4 in the first & fourth pages of the form of the Journal marked (Q).
It will be expedient for you to keep distinct Ledgers for the different kinds of Stock both for the purpose of preventing errors in transfers, and to enable you more expeditiously to balance your books, when the quarterly dividends of Interest are to be made, by employing several Clerks on that business—the forms of the Ledgers in which the accounts of Stock are to be kept are marked (R).
For the payment of Interest on the Funded Debt, the following regulations are to be observed.
For the term of [fourteen] days before interest becomes due in each quarter, your Office will be closed and no transfers permitted, of which regulation, notice ought to be given to the public Creditors.
During this time you ought carefully to balance your books; in case no errors have happened, the credits to individuals, will correspond with the amount debited to the several accounts of Stock.
When this is done an account of all the Stock credited to individuals will be entered in the Book of Dividends agreably to the form (W). On the sums of Stock credited to each individual the interest will be computed; which Intt. will be for the term of one quarter; on the stock subscribed before the expiration of the quarter ending March 31st. 1791—for the term of two quarters, on the Stock subscribed between Apl. 1st. & June 30th. 1791 & for the term of three quarters on the Stock subscribed between July 1st. & Sept. 30th. 1791—After the Loans are compleated, all the dividends will be made for one quarters interest only, except that it may sometimes happen, that Stock transfered by Warrant from the Secretary of the Treasury may not be credited in your books during the same quarter in which the account for said Stock was closed in the books from which the same was transfered.
When the computations of Interest are made in the Dividend Book, they may be proved to be right by computations on the gross sums of Stock, bearing interest from one period. After the Book of Dividends is thus compleated an Inden thereto ought to be made.
Duplicate Receipts for the interest settled in the Dividend Book are in the next place to be filled up in books to be prepared agreably to the form (X); these receipts are to be numbered progressively, and their numbers inserted in the Column for that purpose in the dividend Book against each Stock holders name. A copy of the Dividend Book being then made out to be transmitted to the Treasury, you will be prepared to open your office for the payment of Interest; which you will be able to do with dispatch, by means of the Inden to the Dividend Book, which will shew you the sum to be paid and the number of the Receipts which are to be signed.
After a payment of Interest, you will cut out of the Book one of the Receipts which you will take therefor, which being regularly filed, will serve in the first instance to govern the charge which is to be made, and afterwards as a Voucher for the account to be transmitted to the Treasury.
At the end of each quarter after the payments of Interest commence, you will render an accot. Current to the Treasury agreably to the form (Y) accompanied with a statement of the Interest paid; which statement will be of the same form as the Dividend Book, and will agree therewith so far as payments have been made, this statement will be supported by one sett of the duplicate Rects. for Interest marked (X).
At the end of the third quarter after the Dividend Book has been settled, an account of all the Interest unclaimed, is to be made out agreably to the form (Z) and transmitted to the Treasury. This account will consist of all the sums appearing due on the Dividend Book for the quarter to which it refers, and will agree with the receipts for Interest remaining unsigned. When this account is rendered the Dividend Book ought to be closed & the unsigned receipts cancelled.
As your Books will contain compleat evidence of all the claims of the Stockholders, both as respects Principal & Interest, it will not be necessary that any endorsements should be made on the Certificates of Funded Debt which may be issued. In cases of transfers of Funded Debt the new Certificate will bear Interest only from the first day of the quarter in which the transfer is made—and any demands for Interest settled in the Dividend Book, will be made only by the person in whose favour the Dividend was made, or his special Assignee.
For the payment of Interest to Non Subscribers, a book is to be prepared agreably to the form (No. 1). The documents on which these payments are to be made, will be the Certificate of Unfunded Debt issued by you agreably to the form (L).
In each part of the account (No 1) the description of these Certificates is to be entered, and the arrearages of Interest to the 1st. day of January 1791, are to be inserted in the Columns for that purpose. On the principal sum contained in each Certificate Interest is to be calculated at the rate of four Centum Annum, and on the arrearages of Interest, at the rate of three Centum Annum which Interest [will be] payable quarterly during the year 1791.
When the Interest is thus calculated and the payment made, the Creditors or their Attorneys will affix their signatures in the column for that purpose, which signatures will be considered as duplicate Receipts for the sums opposite to their names.
At the end of each quarter, you will cut out from the Interest Book (No 1) one sett of the accounts, which you will transmit to the Treasury, as a Voucher for the amount, which will be charged in your Account Current.
In this part of the business, it will be necessary that endorsements should be made on the Certifics. for all the Interest which may be paid, and in cases of transfers the same endorsements must be made on the Certificates issued as appeared on those which were given up in consequence of the transfers.
To prevent a multiplicity of entries it will perhaps be expedient that the Interest, paid to non Subscribers should be carried into the Journal, only once in each quarter, on this point however, you can exercise your discretion.
The accounts relative to the payment of Interest being very simple may be kept by you either with those respecting Principal Stock or in separate Books as you judge most convenient, and will be opened under the tittles of United States, Cash, and Interest Account, agreably to the form of a Ledger (No. 2)
The United States will be credited by Cash for all monies recd. from the Treasury, and will be debited to Interest Account, for the gross amt. of all Dividends of Interest which may be settled in favour of the Stock holders, and also for the amount of the Interest paid to Non Subscribers. This account therefore, by calculating the demands which will be made by Non Subscribers, and adding the same to the balance of the account, as it will stand on your books, will enable you to judge what monies ought to be [drawn] from the Treasury for the use of your office.
The Interest Account, will be credited for the gross amount of all Interest settled in the Dividend Book, and for the Interest paid to Non Subscribers—and will be debited to Cash for all payments of Interest made—the balance of this account will shew the amount of Interest unclaimed at your Office.
At the end of the third quarter after a dividend is made, and on the return to the Treasury of unclaimed Interest agreably to the Form (Z) the Interest Accots. is to be debited to the United States for the amount thereof, as said Interest will no longer be demanded at your Office.
The entries to the account of Cash, will consist of credits for money received and debits for money paid, and a transcript thereof will form the Account Current which you are to render to the Treasury.
The Salary to which you are intittled will be paid quarterly, on your drafts or assignments upon the Treasury, and will not therefore be blended with your accounts.
The papers marked (No. 3, 4 & 5) contain forms to be used in transfering Stock, either by personal appearance or by power of attorney; also forms of powers of attorney for transfering Stock & for receiving dividends of Interest, which forms ought to be published for the information of the public Creditors.
As nothing definitive can be done, with respect to the Loan offered for the State debts untill the first day of October 1791, it will not be necessary at present that you should proceed farther in this business than to open a subscription book agreable to the form before described—to keep a correct Register of the Certificates deposited in your Office agreably to the form (No. 6.)—to give descriptive receipts therefor to the subscribers and to report quarterly the amount of the subscriptions to the Secretary of the Treasury.
If the business of your Office shall permit it may be useful for you, to investigate by the best means in your power whether the Certificates deposited in your office possess the properties required by the Act of Congress to render them receivable on the Loan, and to make such remarks as will facilitate the settlement, when the amot. of the Subscriptions is ascertained.
In issuing the several species of Certificates which have been before described your special attention is requested to the following check which has been devised to detect the alteration of the sums for which the Certificates may be issued
In the [blank] margin of the Certificate paper, you will find five Tables, in which the numerical characters are inserted in an uniform order.
In the first Table at the left hand side, each Unit is designed to represent Ten Thousand Dollars—in the second table—One thousand Dollars—in the third table—One hundred Dollars—in the fourth table—Ten Dollars—& in the fifth table each character represents one or more Units.
The highest sum which can be expressed by means of all the Tables is 99.999 Dollars—the figure 9 being the highest in each table.
Supposing the figure (9) in the table expressing ten thousand dollars to be cut out, the table would then express 89.999.—supposing the figure (9) in the table of one thousand dollars, to be cut out & the figure (9) in the table of ten thousand Dollars restored, the table would then express the sum of 98.999.
By attending to this rule it is evident that the different tables may be by an indenture made to express any sum up to 99.999 Dollars—and as each figure has a definite place—and as the highest number in each table is significant of a certain sum in case you are careful in making the indenture it will be impossible that any Certificate should be altered to a larger amount than the sum for which it was issued without being detected by means of this Check.
As a guide to you in making the indenture, it will be well after a Certificate is filled up, to mark the numbers which express the amount thereof, after which the indenture may be made in any way, provided the significant numbers are the highest remaining in the Table.
A form of the tables, and an example of an indenture to be made so as to express the sum of 85.417 Dolls is herewith transmitted [as explanatory of the process. It is marked (No. 7).]
Df, in the handwriting of Oliver Wolcott, Jr., with insertions in H’s handwriting, Connecticut Historical Society, Hartford.
The material within brackets in this document is in H’s handwriting.
2. “Treasury Department Circular to the Commissioners of Loans,” August 31, 1790 (PAH description begins Harold C. Syrett, ed., The Papers of Alexander Hamilton (New York and London, 1961– ). description ends , VI, 588–90).
3. Section 3 of “An Act making provision for the (payment of the) Debt of the United States” (1 Stat. description begins The Public Statutes at Large of the United States of America, I (Boston, 1845). description ends 138–44 [August 4, 1790]) described the variety of paper which could be subscribed to the new Federal loan. See Nathaniel Appleton to H, February 5, 1791, note 1 (PAH description begins Harold C. Syrett, ed., The Papers of Alexander Hamilton (New York and London, 1961– ). description ends , VIII, 7–9).
4. In MS, “exemplied.”