Although this call was sent out three years after the Newburgh Petition, the prompt response of the officers showed that there had been no decline in interest. The Ohio Company of Associates resulted from this meeting.
It has been pointed out that most of those attending were also members of the military Society of the Cincinnati, so named because the Revolutionary soldiers thought they resembled the Roman soldier Cincinnatus in leaving their farms and work to save their country. No doubt the hope of western migration had been kept alive by discussion at the meetings of the Cincinnati. Most of those men also belonged to the Masonic Lodge, and this association also unified and perpetuated the ideas included in the Newburgh Petition of which most of them had been signers.
At the meeting in Boston on March 1 the delegates elected Putnam chairman and Major Winthrop Sargent clerk. One thousand “shares” were planned, and no person was permitted to hold more than five shares or less than one share, except that several persons could own one share in partnership. To facilitate the transaction of business, one agent was elected by each group of 20 shares to represent their interest at meetings of the company. Putnam, Manasseh Cutler, and General Samuel Holden Parsons, were appointed directors to manage the affairs of the company. Sargent was elected secretary and later General James M. Varnum was made a director and Colonel Richard Platt treasurer. All land was to be divided equally among the shares by lot. One year after the organization of the company 25 shares had been subscribed, and Parsons, Putnam, and Cutler were appointed to purchase a tract of land from Congress.
Although largely responsible for shaping the beginning of the new colony, Cutler did not move to the tract he purchased; he later visited the infant settlement, however, and his sons, Ephraim, Jervis, and Charles, became pioneer residents of the Northwest Territory.
Cutler contracted to purchase for the Ohio Company a million and a half acres at one dollar per acre, less one third of a dollar for bad lands and the expenses of surveying. Because the public securities with which payment was to be made were worth only twelve cents on the dollar, the actual purchase price was eight or nine cents per acre. The tract was bounded on the east by the Seven Ranges, which had been surveyed and offered for sale under the Land Ordinance of 1785, on the south by the Ohio River, and on the western side by the seventeenth Range; it extended far enough north to include in addition to the purchase one section of 640 acres in each township for the support of religion, one section for the support of schools, two entire townships for a university, and three sections for the future disposition of Congress. An interesting phase of this provision of the contract with the government was that the Ordinance of 1787 itself made no specific provision for public school lands, lands for support of religion, or for university purposes. The Land Ordinance of 1785 had provided for the setting aside of one section in each township for public schools, but for neither religion nor universities. But, so earnest of purpose were the men who had written into the Ordinance of 1787 “Religion, morality and knowledge, being necessary to good government and the happiness of mankind, schools and the means of education shall be forever encouraged,” that in their bargaining with the land commissioners, insistence was made upon these specific reservations. And so, perhaps outside the formal tenets of law, was furthered a public land policy which has done much to make our public school and university educational system an integral and distinctive feature of this government.
Five hundred thousand dollars was to be paid when the contract was signed and the same amount when the United States completed the survey of the boundary lines of the tract. The contract was signed on October 27, 1787, by Cutler and Sargent for the Ohio Company, and by Samuel Osgood and Arthur Lee for the Treasury Board, as commissioners of public lands. Because the company could not pay the second installment when it was due, the tract was reduced in size from a million and a half acres to 1,064,285 acres when the patent was issued on May 20, 1792. By giving 100,000 acres for donation lands to actual settlers, Congress reduced the final purchase to 964,285 acres.
In conformity with the Articles of Association the shareholders received equal divisions of the purchase. Instead of the 1000 shares originally expected, 822 were subscribed. When the final apportionment was made, each share received a total of 1,173.37 acres in seven allotments of eight acres, three acres, a house lot of .37 acres, 160 acres, 100 acres, a 640 acre section, and 262 acres.
Had army pay certificates been worth par, the maximum holding for any individual would have been about $5900, and from that amount down to a fractional part of $1173. In such sized holdings there could be little suggestion of either speculation or monopoly. The army certificates being depreciated in value as they were, the real value of holdings, in hard money, varied from about $700 down to a few dollars. On such vast capital was America started across a continent!!
The Ohio Company purchase was located on the Muskingum River for several reasons. Since the Associates of this Company expected to engage in farming, and since they were the first settlers, many have wondered why they did not choose a level tract rather than the hilly section of the Muskingum. The answers are several: Although they were the first settlers, they did not have first choice. Southern Ohio was the only part of the territory to which the United States could give clear title. Connecticut withheld her Western Reserve of three and a quarter million acres east of the Fort McIntosh Treaty line. The western land lying between the Scioto and Little Miami Rivers was under Virginia option. Since a location west of the Little Miami would have been too far from the settled part of the country, a tract of suitable size for the Ohio Company could be found only in the southeast part of the present state of Ohio. The southern location just west of the Seven Ranges was closer to New England and was on the then greatest thoroughfare of western travel, the Ohio River. Furthermore, the Muskingum region was as far distant as possible from the Indian settlements farther west. Another advantage was the protection afforded by Fort Harmar, which had been constructed in 1785 by United States troops under command of Major John Doughty for the purpose of stopping illegal occupation of the land. Also, the settlers would have as neighbors 13 families on the patent of Isaac Williams, which lay on the Virginia side of the Ohio, opposite the mouth of the Muskingum. In making his choice of location, Cutler considered all these factors as well as the advice of Thomas Hutchins, geographer of the United States, who told him that the Muskingum Valley was, in his opinion, “the best part of the whole of the western country.”
As soon as the purchase was assured, the Ohio Company started systematic preparation for settlement. Putnam was elected superintendent. Plans were made in Boston for a city of 4000 acres with wide streets and public parks at the mouth of the Muskingum. One hundred houses were to be constructed on three sides of a square for the reception of settlers. For making surveys and preparing for immigrants, the superintendent was ordered to employ four surveyors and 22 assistants, six boat builders, four house carpenters, one blacksmith, and nine laborers. Each man was required to furnish himself with rifle, bayonet, six flints, powder horn and pouch, half a pound of powder, one pound of balls, and one pound of buckshot. Surveyors were to receive $27 a month, and laborers $4 per month and board. Although these plans were made when it was midwinter and travel was difficult, no time was to be lost. These were men of action. They had waited over three years for Congress to make it possible to carry out their purposes. Putnam decided to lead an advance expedition to the Muskingum to be ready for surveying and building and planting early in the spring, and in five weeks after the land contract was signed, they were on their way.