But it does not appear to me that the United States have a right to annex new conditions, not implied in the articles of compact, limiting the legislative right of taxation of the Territory or new State. The limitations which they may rightfully impose are designated by the articles themselves, and these being unalterable, unless by common consent, all legislative powers which of right pertain to an independent State must be exercised at the discretion of the Legislature of the new State, unless limited by articles, or by the Constitution of the United States or of the new State.

Indeed, the United States have no greater right to annex new limitations than the individual State may have to infringe those of the original compact. And I cannot see that this position can in any degree be altered by the circumstance of admitting into the Union, in pursuance of the express provision of the articles, a State on an earlier day than that on which it must necessarily be admitted. The conditions inserted in the 4th article of compact in relation to that object, and which constitute all that Congress thought, at the time, necessary to reserve in order to secure to the Union their right to the soil, are: 1st, that the Legislatures of the districts or new States shall never interfere with the primary disposal of the soil by Congress; nor with any regulations which Congress may find necessary for securing the title in such soil to the bona fide purchasers; 2d, that no tax shall be imposed on the property of the United States; and, 3d, that in no case shall non-resident proprietors be taxed higher than residents. Farther than that Congress cannot demand, and it is on account of the second provision that the district State Legislature has not a right to tax, or at least to sell for non-payment of taxes, the lands on which, although sold, the United States still retain a lien.

It follows that if it be in a high degree, as I believe it is, the interest of the United States to obtain some further security against an injurious sale, under the Territorial or State laws, of lands sold by them to individuals, justice not less than policy requires that it should be obtained by common consent; and as it is not to be expected that the new State Legislature shall assent to any alteration in their system of taxation which may affect the revenue of the State, unless an equivalent is offered which it may be their interest to accept, I would submit the propriety w inserting in the Act of admission a clause or clauses to that effect, leaving it altogether optional in the State Convention or Legislature to accept or reject the same.

The equivalent to be offered must be such as shall not affect the value of the pledge which the public creditors now have by the appropriation of the lands, and as shall be fully acceptable to the State, and at the same time prove generally beneficial, either in a political or commercial view, to the Union at large. And it appears to me that the following provision would fully answer those several objects, viz.: that, provided that the Convention or Legislature of the State shall assent that each and every tract of land sold by Congress shall be exempt from any tax raised by or under the authority of the State, whether for State, county, or township, or any other purpose, for the term of ten years from and after the completion of the payment of the purchase-money on such tract to the United States; The United States shall on their part agree:

1st. That the section No. 16 in every township sold or directed to be sold by the United States, shall be granted to the inhabitants of such township for the use of schools.

2d. That the six miles reservation, including the Salt Springs, commonly called the Scioto Salt Springs, shall be granted to the new State in trust for the people thereof, the same to be used under such regulations, terms, and conditions as the Legislature of the said State shall direct, provided that the said Legislature shall never sell nor lease the same for a longer term than years.

3d. That one-tenth part of the net proceeds of the lands hereafter sold by Congress shall, after deducting all expenses incident to the same, be applied towards laying out and making turnpike or other roads, first from the navigable waters emptying into the Atlantic to the Ohio, and afterwards continued through the new State; such roads to be laid out under the authority of Congress, with the consent of the several States through which the same shall pass. That such conditions instead of diminishing would greatly increase the value of the lands and of the pledge to the public creditors, and that they would be highly beneficial and acceptable to the people of the new State, cannot be doubted. And they are particularly recommended as among the most eligible which may be suggested, from the following considerations: The provision for schools, exclusively of its intrinsic usefulness, made a part of the former ordinance of Congress for the sale of lands; the grant has actually been made in the sales to the Ohio Company and to J. C. Symmes: and although the ordinance be no longer in force, and such a grant be no part of the articles of compact, yet it has always been at least hoped by the inhabitants of the Territory that it would be generally extended.

The grant of the Scioto Salt Springs will at present be considered as the most valuable, and alone would, most probably, induce a compliance on the part of the new State with the condition proposed by Congress. And if it is considered that at least one-half of the future population of that district will draw their salt from that source, the propriety of preventing the monopoly of that article falling into the hands of any private individual can hardly be disputed.

The tenth part of the proceeds of the lands, as it will be co-extensive with the sales, will continue to be considered as an equivalent until the sales are completed, and after the present grant might have ceased to operate on the minds of the people of the new State. The roads will be as beneficial to the parts the Atlantic States through which they are to pass, and nearly as much so to a considerable portion of the Union, as to the North-West Territory itself. But a due attention to the particular geographical situation of that Territory and of the adjacent western districts of the Atlantic States, will not fail to impress you strongly with the importance of that provision in a political point of view, so far as it will contribute towards cementing the bonds of the Union between those parts of the United States whose local interests have been considered as most dissimilar.

I have the honor to be, &c.