Report on the Holland Loan
of Three Million Florins
The Secretary of the Treasury in obedience to the orders of the President of the United States as signified in his speech at the opening of the present session4
Respectfully informs the Senate and House of Representatives
That the terms of the Loan of Three Millions of florins mentioned by the President as having been negotiated in Holland5 are as follow.
The rate of Interest is five per Cent, but the charges form a deduction from the principal sum of 4½ per Cent which will occasion the real interest to be paid on the sum actually received by the United States to be equal to five and a quarter per Cent nearly.
The reimbursement is to be made in six equal installments commencing in the Year 1800 and ending in the Year 1804. But it is in the option of the United States to reimburse the whole or any part of the sum borrowed at any time they may think proper.
That the disposition which has been made of the above mentioned sum is as follows.
One Million five hundred thousand Florins has been applied pursuant to the directions of the President of the United States as a payment to France.
A further sum of about One hundred and sixty thousand Florins will also have been appropriated towards a payment on account of the Dutch Loans, which became due on the first day of February last, including a premium of Seventy thousand Florins.
The residue is in a situation to be disposed of as may be judged expedient.
A doubt arises how far this loan may be within the meaning of the Act making provision for the reduction of the public Debt on account of the limitation of the rate of Interest,6 which taking the charges of the loan into calculation would be somewhat exceeded; and though it is presumed that that limitation was not intended to exclude the addition of the ordinary charges, yet a point of so much delicacy appears to require Legislative explanation.
The Secretary of the Treasury begs leave to observe that it is in his judgment highly expedient and very important to the general operations of the Treasury that the abovementioned loan should be deemed to be included within the meaning of the aforesaid Act.7 The residue may in this case be applied with material advantage to the purposes of that Act and the part which has been otherwise applied may be hereafter replaced.
All which is humbly Submitted.
Secy of the Treasy
February 24th. 1791
DS, RG 46, Second Congress, 1791–1793, Reports of the Secretary of the Treasury, National Archives; copy, RG 233, Reports of the Treasury Department, 1791–1792, Vol. II, National Archives.
1. This date is taken from the copy in RG 233, National Archives.
3. Annals of Congress description begins The Debates and Proceedings in the Congress of the United States; with an Appendix, Containing Important State Papers and Public Documents, and All the Laws of a Public Nature (Washington, 1834–1849). description ends , II, 1810–11.
4. In his second annual message to Congress on December 8, 1790, Washington said: “In conformity to the powers vested in me by acts of the last session, a loan of three millions of florins, towards which some provisional measures had previously taken place, has been completed in Holland.… The Secretary of the Treasury has my direction to communicate such further particulars as may be requisite for more precise information” (Journal of the House, I description begins Journal of the House of Representatives of the United States (Washington, 1826). description ends , 331).
5. The Holland loan of 1790. See H to Willink, Van Staphorst, and Hubbard, November 29, 1790.
6. 1 Stat. description begins The Public Statutes at Large of the United States of America (Boston, 1845). description ends 186–87 (August 12, 1790). This statute limited the interest on the loan to five percent.