Sources of Revenue. 35 



dollars additional was drawn from this fund.^ Until 1817 the divi- 

 dends on the bank stock and the interest on the United States stock 

 were included in the current receipts designed to defray the annual 

 expenses of the state. In the years 1817 and 1818, however, the 

 bank dividends were turned into the fund for the purchase of bank 

 stock. The annual income from interest and dividends formed a 

 considerable part of the annual income and no other source except 

 the state tax on the towns made a larger return to the state. 



Until 1817 the income from the United States stock exceeded 

 the dividends from the bank stock. This was due to the fact that 

 until this time the part of the fund invested in United States stock 

 was greater than the amount invested in bank stock, and not to the 

 fact that the former returned a higher rate of income. From 1801 

 until 1818 more than two-thirds of the United States stock held 

 by the state was yielding an annual interest of six per cent and the 

 remainder three per cent; but the rate of dividends on the bank 

 stock, from April 30, 1804, to the close of this period, was between 

 seven and eight per cent. For the year ending April 30, 1813, it 

 rose to over nine and a half per cent, but after 1814, owing, no doubt, 

 to the stagnation of business brought about by the war, it fell stead- 

 ily below the average already mentioned. 



These decreased returns from the bank stock in the last few years 

 lower the average annual income from the permanent fund, after 

 all of it became productive in 1801, by more than a thousand dollars. 

 The average income of the fund from April 30, 1801, to April 30, 1814, 

 was twenty-five thousand nine hundred ten dollars. In the last 

 four years of the first period, however, the average income was only 

 twenty-one thousand sixty-seven dollars. 



4. School Fund. 

 Only one more important source of revenue during this period 

 remains to be noticed — the school fund. To understand the origin 

 of this fund, it is necessary to go back to the charter granted in 1662 

 to the colony of Connecticut by King Charles II of England. This 

 charter defined the limits of Connecticut as follows : From the south 

 hue of Massachusetts on the north to Long Island sound on the 

 south, and from the Narragansett river on the east to the Pacific 

 ocean on the west, excepting such portions as were then occupied 

 by prior settlers. In 1681, William Penn was granted a charter 

 embracing a considerable portion of the above territory and which 



1 Ledger FoUo D (Ms.), p. 14. 



