The offers of New York and Maryland, as recorded in the proceedings of Congress of June 4, 1783, having emphasized the importance of the subject to establish a permanent seat of government, we are told in the annals of Madison that a day in October was named when the subject would be considered. However, during that very month a mutiny of dissatisfied soldiers took place. A band of soldiers started from Lancaster, Pa., on June 17, 1783, for Philadelphia, to demand from the Continental Congress the money then due. Congress appointed a committee to appeal to the executive council of the State of Pennsylvania, in session in the same building, for protection against the threatened attack by the soldiers, but the council refused, saying that the militia would doubtless not be willing to take up arms “before their resentment should be provoked by some actual outrages.” The soldiers, about 300 in number, proceeded to the state-house—Independence Hall—where Congress and the executive council were in session, surrounded that building, but attempted no violence. Occasionally some soldier would use offensive language and point his musket at the windows of the Halls of Congress, but at night the soldiers departed. Congress thereupon adjourned hastily to meet in Princeton eight days later. General Washington ordered a court-martial, in which two of the mutineers were sentenced to death and four to receive corporal punishment; but the convicted men were all pardoned by Congress. General Washington regarded the mutineers as “recruits and soldiers of a day who have not borne the heat and burden of war, and who can have in reality very few hardships to complain of.” The legislators were invited to return to Philadelphia, but the offer was refused, for the reason that the armed soldiers had grossly insulted Congress and it seemed useless to apply to the executive council for protection. This led to the appointment of a committee, of which James Madison was chairman, on the subject of a permanent seat of government. They submitted a report on September 18, 1783.

The committee reported on two questions: First, the extent of the district necessary; second, the power to be exercised by Congress in that district. As to the first question, it was reported that a district should not be less than 3 miles or more than 6 miles square; and second, that Congress ought to have exclusive jurisdiction. The report was referred to a committee as a whole, but there is no record that further action was taken.

When the question of a permanent seat of government was again taken up by the Continental Congress, it was the question of location that predominated; the question of exclusive jurisdiction had generally been conceded. The discussion was finally limited to two sites: First, a location on the banks of the Potomac at least as far south as Georgetown, which was favored particularly by the southern Members of Congress as being the geographical center of the United States; second, a site on the Delaware River near the falls above Trenton, which Pennsylvania, Delaware, and the other States near by favored.

On October 7, 1783, Congress decided that a permanent seat of government should be established on the Delaware River site, and a committee was appointed to visit the location. Ten days later, on October 17, 1783, Congress decided that there should be a National Capital at the lower falls of the Potomac, at Georgetown. This is the first mention of the present location of the National Capital. Pending the completion of necessary buildings, it was decided that the Continental Congress would meet at Trenton and Annapolis. But the idea of having two capitals was ridiculed by such men as Francis Hopkinson, who suggested that there be one Federal town to be placed on a platform supported by wheels and two places of residence. As to a statue of George Washington that had been authorized by Congress at the same session, he suggested it be placed on wheels and be taken to wherever Congress met. The idea of having two capitals was abandoned by legislation adopted at Trenton on December 23, 1784.

Two years elapsed before Congress took up the subject again. In the meantime a movement began, under the leadership of George Washington, to promote trade relations between Virginia and Maryland, and to establish trade with the western frontier by the construction of a canal along the banks of the Potomac. Washington became president of the Potomac Company at the time of its organization in 1785, and was its guiding spirit for a period of four years, until 1789, when he resigned from that office to take up his duties as first President of the United States.

A trade convention, held at Annapolis, led to the call for the Constitutional Convention, February 21, 1787, to meet in Philadelphia in May of that year.

On May 29,1787, the draft of the Constitution submitted by Charles Pinckney, of South Carolina, first mentions the section relating to the Federal district in the form in which it became a part of the Constitution of the United States (Art. I, sec. 8, par. 17), under the powers of Congress—

To exercise exclusive legislation in all cases whatsoever over such district (not exceeding 10 miles square) as may, by cession of particular States, and the acceptance of Congress, become the seat of the Government of the United States, and to exercise like authority over all places purchased by the consent of the legislature of the State in which the same shall be, for the erection of forts, magazines, arsenals, dockyards, and other needful buildings.

There was objection on the part of some lest such a provision in the Federal Constitution would create a government that would become despotic and tyrannical and result in unjust discrimination in matters of trade and commerce between the merchants within and outside of the district. But on the other hand the advocates for a Federal City over which Congress would have exclusive jurisdiction called attention to the great importance for the Government to have a permanent residence for the Congress and the executive departments, with their files and records properly housed, and cited the mutiny in Philadelphia as an illustration as to what might happen to the Government again in the absence of such Federal authority. On September 17, 1787, the Constitution of the United States was adopted and soon after was ratified by a majority of the States.

When the time came for the inauguration of President Washington, on April 30, 1789, in New York City, the Continental Congress was completing its sessions, having resided in that city from 1785, a period of four years. Of a population of 25,000 in 1776, the city in 1789 had a population of only half that number, due to the continuous occupation by the British Army for a period of seven years. During the evacuation the city was partly ruined. But a new era began; trade increased, and the city began to grow rapidly. The Continental Congress was meeting in the old city hall, which had been used by the British as a prison and was in a dilapidated condition. As Washington was to be inaugurated in New York, the people thought that city would become the seat of government, so the city hall was torn down and a new building erected on the site where the subtreasury building on Wall Street now stands.