mining | Mineral Rights | Mining

Property: Land Grants/Mining

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22/01/2011 21:27:00

Land Grants from the Federal Public Domain:

Private states ceded land to Federal Government. Fed. Govt. needed money to pay off Revolutionary War debts. ← ← Land Ordinance of 1785: legislation adopted by Congress to help raise money for rev. war debts by letting fed govt auction off land. • Mandated a system for surveying and disposing of public domain lands. • See chart on pg. 122 • Provided that section 16 of every township was used for public schools. o This land was used by territorial govts and states to sell and lease the land in order to fund public schooling.  The fed govt was very committed to public schooling. • Initial sales of land was disappointing, as price was very high. Govt eventually began to let people use credit. o There were widespread defaults and forfeitures.  In 1832, Congress eventually tried to stop getting money for the land sold on credit.  Graduation Act of 1854: allowed for progressively lower prices for any land that did not sell at min price. ← ← Squatters: Squatters were basically a problem • Some states, and eventually the fed govt used a system of “preemption” where a squatter could purchase the land that they occupied, thereby trumping the rights of purchasers at subsequent public-land sales. Preemption Act of 1841: granted a general prospective preemption right on fed land, provided Indian title had been extinguished and the land had been surveyed. o Settlers could claim up to 160 acres of land before it went up for public auction, provided they inhabited it and improved the land, constructed some kind of dwelling on it, and agreed to pay the min price of $1.25 per acre.

25 per acre. but you could get 160 acres by homestead act and another by preemption. • National Forest System in 1897: huge tracts of forested land were reserved by presidential proclamation. Timber Culture Act of 1873: special grants were given to settlers who agreed to plant trees on the prairies. canals. Companies were given land to build turnpikes. etc. • Only one homestead could be acquired per family. settlement began to slow down. then he received the title to the land with any payment. Squatters would band together to form claims associations as another tactic to secure legal title to the land they occupied. • Homesteaders could get title to land quicker if they converted claim to preemption claim and paid $1. Good land was beginning to run out. • Desert Land Act of 1877: special grants were given to settlers who agreed to irrigate deserts. This would help raise wages for the poor who remained behind. • Later. ← ← Homestead Act of 1862: allowed any citizen to claim 160 acres of unsold surveyed land. . ← ← Eventually. o These associations likely had an even greater impact on securing land for squatters than preemption laws. by the late 1800’s. • Advocates of this Act likes it because it would draw surplus labor from the East. If the homesteader inhabited the land and cultivated it for 5 years. Veterans were also given land. o Designed to prevent competitive bidding at auctions. and would act as a “safety valve” against urban unrest. logging co’s would use dummies file preemption claims for timber land). railroads. • National Park System in 1916: huge tracts of forested land were reserved by presidential proclamation.• o Preemption Act was abused (for example. homestead acts authorized larger claims for 640 acres. other than filing fees.

the miners created their own rules to avoid violent contention for control. o These rules were eventually incorporated into state legislations and judicial rulings. o Problems of insecure tenure became even bigger when surface ore. o Secure mineral rights were needed to promote investment. which could be accessed with little capital. • Miners quickly formed over 600 mining camp govts to devise local rules for recognizing and enforcing private mineral rights. Here’s why: • First.• ← ← ← ← Taylor Grazing Act of 1934: closed off all remaining public domain from further private entry. o The possible losses from the absence of any recognized ownership of the mineral lands provided the incentives for miners to agree on mineral rights arrangements. o They were specifically recognized in the fed Mining Laws of 1866 and 1872. The Mining Camps: Many of the mining camps between 1848 and 1890 were too remote for any real govt regulatory system. and most of the contracting parties expected to share in those gains. was depleted and mining turned to more capital-intensive activities. which allowed for the private patenting of federal mining land. the expected aggregate gains from the establishment of private property rights were large. • As a result. ← ← Mineral rights agreements were completed rapidly and were refined repeatedly to avoid some of the losses of an open access or common pool resources. . o Concessions could be made in bargaining within the mining camps and among politicians within the state legislatures to reach agreement without disruptive distributional conflicts. violent competition was likely. o Due to the value of the land.

the first fed mineral rights laws authorized the transfer of title to private claimants. The valuable ore deposits were believed to be extensive relative to the number of claimants. perhaps 20-30 individuals in an early mining camp. o Info about the land more or less evenly spread because agreements were made before land development. There was a political consensus in the US that fed land should be distributed quickly and at a low cost to individuals on an egalitarian basis. there were no other competing interests in the land that needed to be reconciled. Fourth. ← ← ← .• • Second. o Additionally. there were no known critical informational asymmetries among the contracting parties regarding the valuing and marking of individual claims. Suddenly. everyone wanted land and it wasn’t realistic or feasible for fed govt to try to keep it. o This expectation was because of 2 factors:  1. the number of contracting parties typically was small. and had similar ideas about how to run things. o Groups were relatively homogeneous.  2.  This allowed states and legislatures to make rules without worrying about conflicts. • In 1866. • ← ← The great gold rush to California changed things. Third. most of the contracting parties expected a share in the aggregate gains from establishing property rights.

22/01/2011 21:27:00 ← ← ← ← ← ← ← ← ← ← ← ← ← ← ← Timeline: Land Grants: 1785: Land Ordinance 1841: Preemption Act 1854: Graduation Act 1862: Homestead Act 1873: Timber Culture Act 1877: Desert Land Act 1897: National Forest System 1916: National Park System 1934: Taylor Grazing Act Mining: 1866/1872: Mining Laws .

22/01/2011 21:27:00 ← .

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