To George Washington from John Hoskins Stone, 12 December 1796
From John Hoskins Stone
Annapolis Decr 12th 1796
Sir.
I had the honor of receiving your letter of the 7th Inst. respecting a loan of money by the state of Maryland to the Commissioners of the City of Washington, which was imediately communicated to the General Assembly and that Subject is under consideration.1 The Object of this loan is certainly of primary importance to this State and I make no doubt of its being viewed in that light by the Legislature, and added to this, that it will feel a pleasure in carrying into operation your recommendation—but it does not appear to me that it will comport with our Situation to extend ⟨the⟩ Loan to 150,000 Dollars—probably not more than 80,000 o[r] 100,000 Dollars can be spared at this time—By the unremitting exertions of a few men the funds of the State of Maryland are So arranged as to produce a certain revenue beyond the expenses of the Government, without any kind of Taxation, and there appears to be Some degree of reluctance in changeing those funds—whatever can with propriety be done relative to this loan, will meet with my most cordial Support2—with Sentiments of the hightest respect and regard, I have the honor to be sir Yr mo. Obt Sert
J. H. Stone
ALS, DNA: RG 59, Miscellaneous Letters.
1. After receiving GW’s 7 Dec. letter, Stone forwarded it to the Maryland legislature on 10 December. It was read before the state Senate and referred to the House of Delegates (, 105:20).
For GW’s initial order authorizing the D.C. commissioners to secure a loan from the state of Maryland, see Commissioners for the District of Columbia to GW, 31 Oct. (second letter), and n.2 to that document; see also GW to the commissioners, 21 November.
2. On 9 Dec., a committee of the Maryland House of Delegates had considered a memorial from the D.C. commissioners announcing both their authorization from GW “to borrow of the state of Maryland any sum of money not exceeding” $150,000 and their appointment of commissioner Gustavus Scott “to negotiate said loan.” The memorial explained the commissioners’ earlier attempt to negotiate a loan for $200,000 in Amsterdam, “now delayed by the unsettled state of affairs in Holland.” After reading the memorial, the committee recommended that the legislature grant the commissioners the loan, but concluded that “more than” $100,000 “ought not to be loaned, because of the negotiation in Europe to borrow” $200,000. On Wednesday, 14 Dec., the House of Delegates passed a resolution to loan the commissioners $100,000 “for the use of the city of Washington.” The loan was to “be paid in six per cent. stock of the United States bearing an immediate interest of six per cent. at par,” provided that the commissioners “give bond to the state of Maryland, conditioned for the payment of” $100,000 “and punctual payment” of 6 percent interest quarterly. The senate assented to the house resolution on 17 Dec. (, 105:57, 68, 31). The loan was in the form of U.S. debt certificates, which the commissioners were forced to sell for cash. The price of the certificates, then at about 15 percent below par, reduced the amount that the commissioners received from the loan to $79,000 (see Arnebeck, Through a Fiery Trial, 410). For more on the 14 Dec. resolution, which Scott transmitted to GW, see Commissioners for the District of Columbia to GW, 26 Dec., and n.4; and GW to Scott, same date.