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4. After a full compliance with the provisions shall be contracted by or on behalf of this State of the first, second, and third sections of this to pay any portion of the State debt that may article, there shall be appropriated, in each fiscal remain unpaid under the provisions of this article year, from the surplus revenues of the canals, unless the law authorizing the creation of such the sum of one million one hundred and sixteen debt, shall itself impose and provide for the colthousand two hundred and forty-two dollars and lection of a direct annual tax, for the purpose of sixty-six cents, to be added to the sinking fund paying, and sufficient to pay the interest on such now existing for the payment of the debt known debt as it falls due, and also to pay and discharge as the enlargement and completion debt, until the principal of such debt, within eighteen years the same is sufficient to pay off and discharge from the time of the contracting thereof. said debt and interest, and the principal and interest of said sinking fund shall be sacredly applied to that purpose.

§ 5. After a full compliance with the provisons of the first, second, third and fourth sections of this article, there shall be appropriated and set apart from the revenue of the canals, the sum of $187,500, in each fiscal year, to be added to the sinking fund, now existing, until the sum, so appropriated and set apart, shall be sufficient to pay the principal and interest of what is known as the floating debt loan; and the principal and income of said sinking fund shall be sacredly applied to that purpose

§ 9. The claims of the State against any incorporated company, to pay the interest and redeem the principal of the stock of the State heretofore loaned or advanced to such company, shall be fully enforced, and not released or compromised; and the moneys arising from such claims shall be set apart, and applied as part of the sinking fund provided in the second section of this article.

§ 10. The credit of the State shall not, in any manner be given or loaned to, or in aid of any individual, association, or corporation. The same restrictions apply to the counties, towns, cities, and villages of the State.

§ 11. No moneys shall ever be paid out of the treasury of this State, or any of its funds, or any of the funds under its management, except in pursuance of an appropriation by law; nor unless such payment be made within two years next after the passage of such appropriation act; and every such law making a new appropriation, or continuing or renewing an appropriation, shall distinctly specify the sum appropriated and the object to which it is to be applied; and it shall not be sufficient for such law to refer to any other

§ 6. Such portion of the surplus reveuue of the canals as may remain, after a full compliance with the provisions of the five preceding sections, shall, in each fiscal year, be applied to the payment of the sums which have been raised by taxation and drawn from the general fund for canal purposes, until that fund shall be fully reimbursed for all sums so drawn therefrom since the year 1846, with quarterly interest thereon, at the rate of six per cent per annum. As the revenues are so received into the treasury they shall be appro-law to fix such sum. priated, or so much thereof as may be necessary § 12. The State may, to meet casual deficits to the payment of, or to the creation of a sinking or failures in revenues, or for expenses not provifund for the ultimate payment of the principal and interest of the State debt, known as the bounty debt; and after all the objects provided for in this section and the previous sections of this article shall have been accomplished, and the several debts and obligations mentioned therein shall have been fully paid and discharged, the tolls upon the canals of the State shall be reduced to a rate calculated to produce a revenue sufficient to meet the expenses of collection, superintendence and all repairs that may be necessary to keep the canals in good navigable order and condition, together with the demands of the third section of this article and no more.

ded for, contract debts; but such debts, direct and contingent, singly or in the aggregate, .shall not at any time exceed one million of dollars; and the moneys arising from the loans creating such debts shall be appropriated to the purpose for which they were obtained, or to pay the debts so contracted, and to no other purpose whatever.

§ 13. In addition to the above limited power to contract debts, the State may contract debts to repel invasion, suppress insurrection, or defend the State in war; but the money arising from the contracting of such debts shall be applied to the purpose for which it was raised, or to repay such debts, and to no other purpose whatever.

§7. The Legislature may provide by law, for § 14. Except the debts specified in the seventh, borrowing any sum of money that may be neces-eighth, twelfth, and thirteenth sections of sary to pay the principal of any portion of the this article, no debts shall be hereafter conexisting debt of the State, including the bounty tracted by or on behalf of this State, undebt, which the revenues of the canals applied as less such debts shall be authorized by a required by the preceding section of this article, law, for some single work or object, to be may fail to meet, and may also authorize the distinctly specified therein, and such law shall raising, upon temporary loan of money to pay the impose and provide for the collection of a direct deficiency of interest upon any State debt; but annual tax to pay, and sufficient to pay the internot for a longer period than may be required to est on such debt as it falls due, and also to pay raise the necessary amount by taxation. The and discharge the principal of such debt, within interest on the bounty debt shall continue to be eighteen years from the time of contracting therepaid by means of taxation, as now provided by of; no such law shall take effect until it shall at a law, until the same can be paid from the surplus general election have been submitted to the peorevenues of the canals, under the provisions of ple, and have received a majority of all the votes section five of this article. cast for and against it, at such election. On the final passage of such bill in either house of the Legislature the question shall be taken by ayes

§ 8. After the expiration of twenty years from the time when this article takes effect, no dobt

At the time of the adoption of the present Constitution, the canals were indebted to the general fund for advances for canal purposes to the amount of about $5,000,000; that debt seems to have been compromised by the provision in the Constitution requiring a perpetual annual appropriation of $200,000, as mentioned above, from the revenues of the canals, to the general fund, for the support of the State government.

and noes, to be duly entered on the Journals | the remaining portion of the canal debt of 1846, thereof, and shall be: "Shall this bill pass, the general fund debt, the enlargement and comand ought the same to receive the sanction pletion debt, and the appropriation of $200,000 per of the people?" The Legislaure may at any annum to the general fund, for the support of the time, after the approval of such law by the peo- State government. ple, if no debt shall have been contracted in pursuance thereof, repeal the same; and may at any time, by law, forbid the contracting of any further debt or liability under such law; but the tax imposed by such act, in proportion to the debt and liability which may have been contracted in pursuance of such law, shall remain in force and be irrepealable, and be annually collected, until the proceeds thereof shall have made the provision herein before specified, to pay and discharge the interest and principal of such debt and liability. The money arising from any loan or stock creating such debt or liability shall be applied to the work or object specified in the act authorizing such debt or liability, or for the repayment of such debt or liability, and for no other purpose whatever. No such law shall be submitted to be voted on within "three months after its passage or at any general election, when any other law or any bill, or any enactment to the Constitution, shall be submitted to be voted for or against.

15. Every law which imposes, continues, or revives a tax, shall distinctly state the tax and the object to which it is to be applied; and it shall not be sufficient to refer to any other law to fix such tax or object.

§ 16. On the final passage in either house of the Legislature, of every act which imposes, continues or revives a tax, or creates a debt or charge, or makes, continues cr revives any appropriation of public or trust money, or property; or releases, discharges or commutes any claim or demand of the State, the question shall be taken by ayes and noes, which shall be duly entered on the Journals, and three-fifths of all the members elected shall, in all such cases, be necessary to constitute a quorum therein.

§17. The Legislature shall not sell, lease or otherwise dispose of any of the canals of the State, but they shall remain the property of the State and under its management forever.

The debts of the State, for the payment of which the revenues of the canals are pledged, after deducting the unapplied balance of their sinking funds, were on the first day of July, 1867, as fol

lows:

Canal debt of 1814,.
General fund debt,.

Annual annuity for support of State
government..

Enlargement debt,.
Floating debt loan,.

$2,102,804 62
5,642,622 22

200,000 00
10,360,110 27

1,211,028 32

Debt due general fund for advances for
canal purposes since 1846, about..... 18,000,000 00
The bounty debt on the thirtieth day of June
last was $26,940,000. There will be due from the
treasury to the sinking fund of that debt at the
close of the present fiscal year, out of the receipts
from taxes already collected, a sum sufficient to
reduce the principal of the debt considerably
below $26,000,000.

By the provisions or the first, second, third and fourth sections of the article, herewith reported, the requirements of the Constitution of 1846, are fully carried out in reference to the payment of

The fifth section provides for an appropriation of $187,500 per annum to the sinking fund of the floating debt loan, heretofore paid by taxation.

The revenues of the canals have failed to meet the requirements imposed upon them by the pres ent Constitution, consequently, there has been raised by taxation since 1846, and drawn from the General Fund for canal purposes, with interest added, about $18,000,000.

The sixth section provides that after a full compliance with the provisions of the five preceding sections, that the remaining portion of the net revenues of the canals shall be applied to the payment of the sums raised by taxation and drawn from the general fund as stated above, and as the money is received into the treasury, it shall be appropriated to the payment of the bounty debt. It also further provides, that after all the preceding requirements are fulfilled, that the canal tolls shall then be reduced to a rate sufficient only to keep the canals in good repair and navigable condition.

The seventh section provides that money may be borrowed to pay any portion of the State debt, including the bounty debt, that the revenues of the canals may fail to pay, as it matures, and for the imposition of taxes to pay any deficiency of interest that the revenues of the canals may fail to meet.

Section eight provides that no money shall be borrowed after the expiration of twenty-five years from this time to pay any portion of the State debt that may then remain unpaid without a provision in the act authorizing the loan, requiring the payment of the principal and interest of the debt by taxation within eighteen years thereafter.

The ninth section provides that the credit of the State shall not be given or loaned to any individual, association, or corporation, and that the same restriction shall apply to the counties and towns, and cities and villages of the State.

The other sections are substantially the same as those in the existing Constitution, relating to the same subjects.

The contributions to the several sinking funds, now existing, for the payment of the canal debts, will, by the provisions of the article now submit. ted, continue the same as under the existing Con. stitution, consequently there will be no necessity of making any change in the mode of keeping the accounts or in either of the sinking funds.

By the operation of the sinking fund the debts will be paid as follows:

Canal debt of 1846 in 1868.

General fund debt in 1872.
Floating debt loan in 1872.
Enlargement debt in 1877.

more appropriate use could be made of the money when paid into the treasury than to apply it to the payment of the debts of the State, and thus relieve our overburdened people from taxation to that extent.

The whole annual requirements to meet the obligations imposed upon the revenues of the canals are $3,366,000. After the payment in The only objectors to this course will probably 1868 of the canal debt of 1846. the requirements be those who advocate an additional enlargement will then be reduced to $2,816,242.66. Under of the Erie and Oswego canal locks. An appropriathe provision of section five of the article herewith tion of the money to such a purpose, would, in the reported, the appropriation of $187,500 per annum view of the undersigned, be injudicious; and it to the sinking fund of the floating debt loan, is believed, after due consideration, by the Conwhich has heretofore been paid by taxation, will vention and the people, that the advocates of that be added to the requirements, making the total policy, whether in or out of this Convention, will amount for the next fiscal year $3,003,742.64, and be very few. so continue until 1872, when the general fund debt and the floating debt loan will have been paid. From that period, after paying the appropriation of $1,116,242.66 per annum to the enlargement debt sinking fund and $200,000 per annum to the general fund, the remaining portion of the revenues would be applicable to the pay. ment of the interest of the bounty debt.

The engineer's estimates of the cost of the enlargement of the Erie and Oswego canal locks will be found on page forty-six of the last financial report of the Auditor of the Canal Department, as follows:

CANALS. Stone locks. Wood locks.

After the payment of the enlargement debt in 1877, the entire net revenues of the canals with the exception of $200,000 per annum, appropri- Erie,... ated to the general fund, would be applicable to Oswego... the payment of the principal and interest of the bounty debt. The law authorizing the bounty loan provides for the payment of the principal and interest of the debt by taxation within twelve years from the time of the passage of the act. The amount to be annually raised to meet the requisition is about $4,000,000. By the provision authorizing the extension of the loan, nothing more would have to be raised by taxation for the payment of the principal of the debt.

If the revenues of the canals do not exceed $3,000,000 per annum it will be nesessary to raise by taxation a sum sufficient to pay the whole of the interest on that debt, up to the year 1892, when the general fund debt, and floating debt loan will have been paid. After that period the whole of the interest will be paid and provision for the payment of the principal of the debt, through the operations of its sinking fund, from the revenues of the canals. The people, therefore, from 1872 will be relieved from taxation on account of that or any other of the present debts of the State.

It will be observed that under the provisions of the article that the people would be at once relieved from the tax of $187.500 per annum, to pay the appropriation to the sinking fund of the floating debt loan, and also from the tax of about $2,600,000 per annum now raised to apply in payment of the principal of the bounty debts. The State taxes, therefore, would be about $2,800,000 less the next year and thereafter until 1872, than they were the last year, and from 1872 until the bounty debt would have been paid, under the provisions of the act authorizing the debt, the tax would be about $4,000,000 per annum less than they were the last year.

$11,902,888 15 $10,718,040 15
2,508,000 00 1,901,000 00

Wood and stone locks.

$10.985,946 65 2,064,000

$14,405, 888 15 $12,619,040 15 $13.049,946 65

The Auditor remarks in reference to the esti mates: "It may be doubtful whether either of these sums will now be sufficient to pay the cost of the work, whichever plan may be adopted. The estimates were made in 1863, and while I have no doubt great care was had in making the meas. urements and estimates of quantities, it may be questionablo whether the prices used were not below what the work and materials would now cost when let to competing bidders." The ost would probably exceed $20,000,000.

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The Erie canal was completed in 1825. At that time the western part of the State was but sparsely settled, and was in fact comparatively a wilderness, producing hardly sufficient for its few inhabitants. Only three of the Western States were then organized. Until the year 1830, the small surplus of flour, meal, pork, etc., produced in the western part of this State, was sent to the then territory of Michigan, and to other portions of the West, for the subsistence of new settlers.

The astonishing effect of the construction of the Erie canal, in increasing the population and in developing the resources of our own State and the great West, was such, that in a few years it became apparent that the carrying business would soon exceed the then capacity of the canal, and provision was made for its enlargement. The work of the enlargement was commenced in 1835, and so far completed as to admit the larger class of boats in 1853.

While, however, the enlargement was in progress, the population, wealth and resources of the country had so vastly increased, of which the It has before been stated that the amount now canal itself had been the occasion and the stimudue the general fund from the revenues of the lus, that the demands of travel and commerce canals is about $18, 000, 000, and will, with the had covered the land with a net-work of railaccumulated interest up to the time of its pay- roads. Two roads had been constructed running ment, amount to more than sufficient to pay the parallel with the Erie canal, from tide waters to principal and interest of the bounty debt. No Lake Erie, competitors with the canal for freight,

and superseding it entirely in the transportation | The following statement from the Auditor's of passengers. There has been, consequently, no report shows the total number of tons delivered considerable permanent increase of freight on the at tide water from the Erie and Champlain canals, Erie canal since 1853. The increase of freight in each year for the last seven years: to and from tide waters, has, since that period, 1860,. been carried by railroads, and the tendency of 1861.. that increase is still steadily in the same direction.

Hon. D. W. C. Littlejohn, Chairman of the Canal Committee of the last Legislature, in a report in reference to enlarging the locks of the Erie and Oswego canal, says:

1862,.

1863,.

1864,

1865,

1866,.

.....................

2,854,877

2,980,144

8,402,709

3,274,727

3,805,257

2,730,181

3,305,607

The average increase is only about equal to one boat load in each year.

The following statement, also from the Auditor's report, shows the number of tons carried on all of the canals of the State in each year for the last fourteen years: 1853,.....

1854,

"Latterly the people of this State find very little use for their canals. Their surplus products are small and mostly consumed in the vicinity of their growth by adjacent cities and villages. The tonnage going to tide water, the product of this State, has been steadily declining for nearly fifteen years, until the total tolls thereon are scarcely 1856, half sufficient to pay the expenses of keeping the 1857, canals in order; and the merchandise for the 1858,. interior, purchased at the sea-board, is shipped by 1860, the railroads almost exclusively."

The Auditor's report shows that the number of tons which arrived at tide-water by the Erie canal from the State of New York, in 1853, was 637,748; in 1866, only 287,948 tons; and in 1837, thirty years ago, the quantity was 321,251 tons, or 33,303 more than in 1866.

The following statements from the report of the Auditor of the Canal Department shows the quantity of wheat and flour which reached the Hudson river by canal, in each year, for the last fourteen years:

1852,.

1855,.

1859,

1861,.

1862,

1863, 1864, 1865,. 1866,.

......

4,247,823

4,165,862

4,022,617

4,116,082

3,341,061

3,665,192

3,781,784

4,050,214

4,507,635

5,598,785

5,557,692

4,852,941

4,729,654

5,575,220

The above shows a small average increase, but not equal to the increased tonnage of coal and products of the forest mostly upon the lateral canals. The following statement, also from the Auditor's report, shows the number of lockages to and from the Hudson river, from 1847 to 1866, both inclusive:

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1853,

1854,

1855,

1856,

1857,

1858,

1859,

1860,

1861,

1862,

1863,

1864,

1865,

1866,

618,858 1849,

240,655 1850,

301,125 1851,

475,885 1852,

263,141 1853,

454, 831 1854,

250,872 1855, 710,138 1856, 1,054,295 1857, 1,177, 292 1858, 846,446 1859, 606,891 1860, 420, 644 1861, 289,166 1862, 1863,

The average for the whole period shows that 1864, there has been a small decrease.

The following statement from the Auditor's report shows the number of tons moved on the Erie canal in each year for the last fourteen

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1865,

1866,

.46,852

.51,422

.56, 799

.57,368

.53,826

-46,787

.38, 319

46,049

28,374

33,774

27,874

34,609

34,594

40,245

35,017

28,993

29,406

30,226

It will be observed that the greater number of lockages in any one year of the series, was 57,368, in 1852, and that the lockages in 1866 were only 30,226.

2,129,834 It further appears, by the Auditor's report, that
2,196,308 the greatest number of lockages at any one lock
2,202,463 on the Erie canal, before the enlargement, was in
2,107,678 1847, at Alexander's lock, west of Schenectady,
1,566, 625
then a single lock. The number of boats passed
1,767,004
1,758, 954 was 43,957. The double locks at that point are
2,253,533 now capable of passing double the number, or
2,500,782 87,914 boats, within the time occupied in passing
8, 204, 277
2,955,302 the boats in 1847, and each boat, if as large as
2,535,692 the locks now admit, capable of carrying three
2,523,490 times the number of tons that the boats carried
2,896,027 in 1847. The number of lockages last year (1806)
at Alexander's double locks was only
14,075 less boats than pass i

One boat making four round trips in each year could have carried all of the average increase for the whole period.

1847.

It is not necessary to add other statistics to, their interest to diminish the size of boats, and show that there has not been any permanent consequently increase their speed of movement, increase, worthy of notice, of tonnage on the rather than increase the size of boats, and consecanals, since the completion of the enlargement. quently diminish their speed. There has been a gain in the quantity of coal and in the products of the forest transported on the canals, otherwise the aggregate would show a large falling off.

It is evident that the railroads have carried all the increase of freight for the last fourteen years, and that the canals have reached their maximum without having been taxed to the extent of more than one-quarter of their capacity.

The State Engineer and Surveyor recommends, as a measure to meet the growing demands of our internal commerce, the enlarging of the locks of the Erie and Oswego canals. The chief argument urged in favor of the measure is that by admiting larger boats the cost of transportation would be greatly reduced, and the speed of movement of boats increased.

It is admitted that nearly all of the up or western bound freight is now carried by railroads; boats, therefore, have but little up freight, and that of a class such as coal, etc., which is carried at very low rates. It requires thirty days' time for a large boat to make a round trip from Buffalo to Albany and back, including time of loading and discharging cargo. Under such circumstances it is hardly within the range of probabilities that there can be any reduction of cost of transportation on the canals.

In reference to the use of steam on the canals as a propelling power, the State Engineer and Surveyor says in his report:

"The experiments thus far made in the use of steam as a motor have been unsuccessful. This result is attributable to the want of capacity in

It should be borne in mind that the officer the locks. The room occupied by the power referred to recommends the enlarging of the locks without enlarging the canals. Conjectures, therefore, of increased speed under such conditions can have no authority whatever, and as conjectures they are rendered of little value, as the results of experience have shown. A loaded boat of the size recommended will be equal to a tonnage displacement of 684 tons. Now it has been found practically by forwarders that boats of the size now in use, which are generally far smaller than the capacity of the locks, cannot be propelled with the speed attained by smaller boats before the canals were enlarged. We have a right, therefore, to believe that, with another enlargement of boats, there would be another diminution of speed.

necessary for rapid transit is too great, as compared with the space remaining for stowage of cargo to make its use economical. The difficulty will be greatly lessened, if not entirely removed, by the use of the large boats." Now if the diffi culty assigned is the only obstacle in the way of using steam, it would seem that it could be more easily overcome by using steam tugs, that would run two boats 100 feet long each, than to expend say $20,000,000 to try the experiment of propelling a boat 200 feet long with the propelling power in the boat. The fact is the use of steam has been thoroughly tested and proved a failure, by reason of the boats being already too large for the size of the canal, the resistance of the water is too great to admit of a propulsion of more than The Auditor in his report shows that the aver-two miles per hour with safety to the canal banks. age time for the passage of boats from Buffalo to Albany, has increased since the completion of the enlargement, from eight and a half to ten days. The larger class of boats require twelve days.

The tonnage capacity of boats now admitted through the locks, can certainly be rated as high as 250 tons, some are registered as high as 300 tons, and they pass the locks as readily as smaller boats. And yet the Auditor's report further shows, that the average tonnage of the 485 new boats built last year was only 154 tons. After making due allowance for a few smaller class of boats built for some of the lateral canals, the new boats are not within forty per cent. as large as the locks will admit. With this greater capacity inviting use, and certain to be used if required and profitable, we find this small average of tonnage of new boats built fourteen years after the completion of locks which admit boats of at least one

third more tonnage Our enterprising forwarders are either failing to appreciate their privileges, or too shrewd not to see that their privileges are greater than it is profitable for them to accept.

When the State debts are paid from the revenues of the canals, the tolls could be reduced to a point sufficient only to keep the canals in repair. In that way they would be more formidable competitors of railroads than it is otherwise possible for them to be. The canals would continue for all time to carry coal, lumber, and other freight that cannot be easily handled on cars, and have a tendency to keep down the prices of other classes of freight on the railroads. In this way the canals will continue to be of great service to the State, even after they have ceased to yield a revenue beyond keeping them in repair.

The enlargement of the locks would have no influence whatever in retaining our ascendency in transportation. If we rely upon our canal to do the carrying trade of the West, a large portion of it will be diverted into other channels, and lost to the State.

Great and important as was the conception of our canal system, it is evident that it has in a great measure fulfilled its mission. The progress of the country is in advance of the canals; we have outgrown their first and more important use. With the exception of a part of the canals of this State, it is believed that there is not one in the whole country, owned and operated upon by a State, that is productive. Several canals have been entirely abandoned, and not one of the least imporThe above shows that forwarders find it for tance has been constructed within the last twen

The average tonnage of boats built in 1862 was 168 tons; those built in 1863, 177 tons, and those built in 1864 and 1865 were of considerable less tonnage than those built in the two previous years, and as previously shown, those built in 1866, averaged 154 tons.

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