UNCLE SAM BUYS A CANAL
In 1901 the Senate Committee on the District of Columbia, chaired by Sen. James McMillan of Michigan, engaged four of the nation's most distinguished design professionals to study and recommend improvements to Washington's park system. Architects Daniel H. Burnham and Charles F. McKim, landscape architect Frederick Law Olmsted, Jr., and sculptor Augustus Saint-Gaudens composed the Senate Park Commission or McMillan Commission, as it became known. Charles Moore of the Senate committee's staff served as secretary to the commission and editor of its influential report, The Improvement of the Park System of the District of Columbia.
The McMillan Commission is best remembered for reviving and extending Pierre Charles L'Enfant's plan for the monumental core of the capital. But its report went on to recommend significant parkland additions and enhancements well beyond the central city, extending south to Mount Vernon and northwest to Great Falls. Even though the Chesapeake and Ohio Canal was still in commercial use, the commission viewed it as a picturesque recreational amenity for its proposed "Potomac Drive":
There was no immediate response to the commission s Potomac Drive proposal, but it was not forgotten. Nor was the concern that had caused the commission to preface its recommendation with a bow to power development. In 1921 the Army's district engineer proposed a dam near Chain Bridge high enough to submerge everything to the top of Great Falls. The next year Sen. Bert M. Fernald of Maine, chairman of the Senate Committee on Public Buildings and Grounds, introduced legislation that would direct the Army's chief of engineers to survey the banks of the Potomac from Washington to Great Falls and report on the advisability and cost of extending the national capital's park system in that area. On the motion of Sen. George W. Norris of Nebraska, Fernald's bill was amended on the Senate floor to require the chief of engineers to consider the dam proposal and "make no suggestion for an extension of the park system of the District that shall interfere with such water-power development." 
The bill passed the Senate on April 19, 1922, but died in the House. Neither body acted upon a similar bill in the next Congress. Supporters of both park and power development on the Potomac would continue to be heard from, however, for Fernald's bill and Norris's amendment presaged a conflict that would continue beyond mid-century.
When the C & O Canal did not resume operation after the 1924 flood, it became a subject of increasing government interest. In 1926 Lt. Col. J. Franklin Bell, engineer commissioner of the District of Columbia, urged Congress to authorize acquisition of the canal property for a federal highway to Cumberland. "Anyone who has driven over the mountains from Cumberland can visualize how necessary it will be in the future to have a canal boulevard for bus, truck, and automobile traffic from Cumberland to the National Capital," he declared. The road, as he envisioned it, would not necessarily obliterate the canal and might revive its use for heavy freight in powered barges by providing more and better access and transfer facilities. 
Fred G. Coldren, secretary of the National Capital Park and Planning Commission, was asked to comment on Bell's proposal. "A properly constructed automobile highway along the route of the Chesapeake and Ohio Canal from Cumberland to this city, would form the natural course for private vehicles for a very large part of the central and western portions of the Union, and this route would be more appealing . . . than any other, from the standpoints of beauty, historical interest, grade and distance," he wrote. He favored locating the road inland from the canal along the bluffs to maximize the view from it. So did the commission's executive officer, Maj. U. S. Grant III, out of his desire "to preserve the canal itself, with its quiet waters and ancient locks, as an asset of unusual beauty, providing picturesqueness and sylvan intimacy for the enjoyment of canoeists and pedestrians." 
That fall Coldren and Dorsey W. Hyde, secretary of the Washington Chamber of Commerce, visited George L. Nicolson, general manager of the C & O Canal Company, in his Georgetown office. Nicolson noted that the company's only current revenues were about $60,000 per year from the rental of water power to three businesses in Georgetown, but he maintained that it was ready to resume its transportation business whenever warranted by the coal trade. In any sale, therefore, the company could be expected to seek a price reflecting this foregone operating income. Nicolson also raised a practical difficulty: the B & O Railroad was unwilling to cede control of all canal property between Point of Rocks and Harpers Ferry because it needed to expand its trackage into the canal right-of-way at certain tight spots there. 
As Colonel Bell's proposal for a canal boulevard languished, the approaching centennial of the beginning of canal construction focused public attention on the historic waterway itself. The Citizens Association of Georgetown sponsored a pageant at the Little Falls groundbreaking site on June 2, 1928, to mark the anniversary (a month early) with costumed celebrants and nostalgic reminiscences of the operating canal. 
That December Rep. Louis C. Cramton of Michigan introduced new legislation to implement the McMillan Commission's Potomac Drive plan (and enable other extensions of the national capital park system). His bill would authorize appropriations for a George Washington Memorial Parkway extending just above Great Falls on both sides of the river, "including the protection and preservation of the natural scenery of the Gorge and the Great Falls of the Potomac and the acquisition of that portion of the Chesapeake and Ohio Canal." Maryland and Virginia would be required to bear half the costs of land acquisition in their jurisdictions. Objections from those with more utilitarian concerns were anticipated with a proviso "that the acquisition of any land in the Potomac River Valley for park purposes shall not debar or limit, or abridge its use for such works as Congress may in the future authorize for the improvement and the extension of navigation, including the connecting of the upper Potomac River with the Ohio River, or for flood control or irrigation or drainage, or for the development of hydroelectric power." 
The bill passed the House too late to be considered by the Senate in that Congress, so Cramton reintroduced it in the next Congress in April 1929. It was passed again by the House in January 1930, then referred to the Senate Committee on the District of Columbia, chaired by Sen. Arthur Capper of Kansas. Capper's committee increased the authorized appropriation from $7 million to $9 million to cover the expected cost of a bridge at Great Falls linking the Maryland and Virginia segments of the parkway road. It further amended the bill to authorize acquisition of the C & O Canal as far as Point of Rocks. The amended bill cleared both houses and received President Herbert C. Hoover's signature on May 29, 1930, becoming known thereafter as the Capper-Cramton Act. 
The authority to obtain the canal to Point of Rocks stemmed from discussions between Daniel Willard, president of the B & O Railroad, and Frederic A. Delano, chairman of the National Capital Park and Planning Commission (NCP&PC), the agency charged with acquiring federal parkland in the area. Delano, a former railroad president himself, knew Willard and was able to ascertain the B & O's interest in selling that portion of the canal, provided that the right-of-way would not be used for commercial transportation. Willard named a price of approximately $1 million. 
The Capper-Cramton Act appropriated no money, and in the early Depression years the emphasis was on curtailing rather than increasing federal spending. "If the Commission succeeds in gaining control of the canal, it is proposed to restore it as a waterway for recreation purposes and to build a parkway paralleling the water course either on the towpath or on the opposite bank," the NCP&PC's planning director noted in 1931.  But there was no immediate prospect of obtaining the necessary funds.
Franklin D. Roosevelt assumed the presidency in March 1933 much more willing than his predecessor to support public works and work relief projects. On June 16 he signed the National Industrial Recovery Act, authorizing the Federal Emergency Administration of Public Works (commonly known as the Public Works Administration or PWA). The act directed its administrator to prepare a comprehensive public works program, to include the "construction, repair, and improvement of public highways and parkways, public buildings, and any publicly owned instrumentalities and facilities." The President, through the PWA administrator or others, could acquire any real or personal property by purchase or condemnation for any such project "with a view to increasing employment quickly." 
This sweeping authority would permit acquisition and restoration of the C & O Canal above as well as below Point of Rocks. The B & O, undergoing financial difficulties, was increasingly eager to sell. But government action to buy still did not appear imminent. That July Herbert R. Preston of the B & O, the canal company's surviving trustee, wrote B & O counsel George E. Hamilton on the topic: "Mr. Nicolson was here yesterday [July 13] and we discussed very thoroughly . . . the possibility of interesting the Government in the purchase of the portion of the canal that it will some day wish to acquire. Mr. Nicolson could not think of any considerable amount of work which could be done or which would require any part of the canal property. . . . The only thing that occurred to us was that it might be suggested that the Government would not wish to begin any work in connection with the proposed boulevard and parking until it had acquired the canal property, and, while it might not be able to do any work at once upon the canal property, before it did anything it should secure the canal. . . . Neither Mr. Nicolson nor I could see very much hope in putting up a proposition for immediate consideration." 
Again the canal transaction languished, to be prodded from a different direction nearly a year later. On May 1, 1934, Frederic C. Howe, consumers' counsel of the Agricultural Adjustment Administration, sent a letter to the President's wife, Eleanor Roosevelt:
As Howe had surely hoped, Mrs. Roosevelt relayed his suggestion to her husband. The President responded promptly with a note to Secretary of the Interior and Public Works Administrator Harold L. Ickes:
Ickes forwarded Roosevelt's note to Frederic A. Delano (who in addition to being chairman of the NCP&PC was the President's uncle). Delano seized the opportunity to promote the canal acquisition and George Washington Memorial Parkway development in his reply:
Capitalizing on the current national preoccupation, Delano emphasized how canal development could increase employment. "Clean up and grading of the old Canal would provide ideal relief work," he declared. "Landscaping and reconstruction of locks and canal bridges would be excellent projects for C.C.C. camps to undertake." His final justification for purchasing the canal "and adjacent rights of way" was to provide an attractive route to the Skyline Drive, Harpers Ferry, and Antietam and Gettysburg battlefields. 
"I heartily endorse the proposed acquisition," Ickes wrote in referring Delano's memorandum to the President. Roosevelt wrote back, "Why not include this definitely in next year's budget?" He was reluctant to spend emergency relief funds to buy the canal, preferring that the money come through the regular appropriations process. 
But a congressional appropriation for this purpose was doubtful, and at year's end Delano again wrote Ickes to urge acquisition of the canal with public works money. On January 29, 1935, the two men discussed the subject with Roosevelt. "The President was favorable to the acquisition of the Canal . . . provided we could show actual work relief in connection with the development of the property equal at least to the cost of the Canal," Delano reported afterward to John Nolen, Jr., NCP&PC planning director. 
As the bureau that would develop and manage the canal once it was acquired, the National Park Service now became involved in planning more specifically for its development. That March, planners with the NCP&PC, the Park Service, and the Bureau of Public Roads reconnoitered the canal and its environs to the Point of Rocks vicinity. Parkways were then much in vogue, and an extension of the George Washington Memorial Parkway road up the Potomac to intersect with a proposed Appalachian Parkway extension of the Skyline Drive was on the drawing boards. The planners took this into account in their reconnaissance and recommendations, reported to Delano by John Nolen:
The planners determined that any parkway road above Great Falls should be on the Virginia side of the river, crossing to Maryland between Goose Creek and the Monocacy. "To parallel the canal with a highway would destroy much of its scenic and recreational value and filling it in would destroy its historic value," Nolen warned. 
Delano relayed the planners' findings and recommendations to Roosevelt, who asked that NCP&PC and NPS representatives begin active negotiations for purchase of the canal.  Before doing so, however, it was necessary to investigate the legal status of the property. "Incidentally it has occurred to me that the R.F.C. [Reconstruction Finance Corporation] have probably had various negotiations with the Baltimore & Ohio Railroad in regard to federal aid, and that this question of the government acquiring title to the canal might be included in the general bargain," Delano wrote Ickes on August 27. "But even so, it is important to know how much the Baltimore & Ohio Railroad has to sell, and whether the title they could give is of any value to the Government unless the States of Maryland and Virginia authorize the sale." 
The President remained actively involved in the discussions. "Why not ask the Department of Justice to investigate the B.&O's. title to the canal?" he wrote Ickes four days later. As it did so, NPS and NCP&PC officials drafted an executive order that would allocate $4 million under the Emergency Relief Appropriation Act of 1935 for land acquisition and Civilian Conservation Corps work along the Potomac to Harpers Ferry. The order closely paralleled one Roosevelt signed on August 5 allocating $705,000 from the same source to acquire lands and support CCC work at Isle Royale National Park. 
But the President could not act until the title situation was clarified, and the initial word from the Justice Department was not encouraging. "It is well known that the Baltimore and Ohio Railroad Company has itself no title to the lands and works of the Chesapeake and Ohio Canal Company, which are in the hands of trustees acting under the direction and supervision of the Circuit Court of Washington County, Maryland," it reported. Delano met again with Roosevelt in December. "The President thought that probably we would have to resort to seizing two or more pieces of property and allowing those who think they have title to bring a test case," he wrote afterward. 
Adopting a modified version of Roosevelt's suggested tactic, the Justice Department filed suit against the B & O Railroad Company and the C & O Canal Company and its trustees on January 8, 1936. The stated aim was to recover the Mole, an area that had been filled by the canal company on the federally owned riverbed where Rock Creek entered the Potomac in Washington. (The Mole contained the canal's tidelock, through which boats could move between the river and a basin impounded by a dam across the mouth of Rock Creek.) The government claimed that the Mole should revert to the United States because the canal company was no longer operating; the defendants asserted that the canal company remained in business and that it held fee simple title to the land. 
The government's hand was seemingly strengthened by a major Potomac flood that Marchone of the greatest on record. The income-producing Georgetown canal level was again knocked out of commission, numerous summer camps and boathouses on riverfront lands leased to others by the canal company were swept away, and the towpath was washed out in many places. But the company moved swiftly to repair the Georgetown segment, maintaining its water power revenues and its claim to be operational.
In December the Justice Department rendered its opinion as to whether and how good title to the canal might be conveyed. Attorney General Homer Cummings advised Ickes that the estate acquired by the canal company by purchase or condemnation was not subject to reversion to the prior owners upon abandonment of the canal or dissolution of the company; in other words, it could be transferred to a purchaser. The Circuit Court of Washington County, Maryland, with the concurrence of the U.S. District Court for the District of Columbia, had jurisdiction in pending suits to decree a sale of canal company property upon a showing that the company could not be made to earn sufficient revenue to defray its operating expenses and leave a surplus to be applied to the interest on its bonds. Cummings recommended negotiations with the B & O Railroad, the primary bondholder, to bring about a sale by court decree. Although the government's interest had centered on the canal from Georgetown to Point of Rocks, he expected that the Maryland court would seek disposition of the entire canal property to Cumberland. 
Upon receiving the attorney general's opinion, Thomas S. Settle, secretary of the NCP&PC, proposed that the Capper-Cramton Act be amended to authorize a $3 million appropriation for buying the canal without the matching state contribution otherwise required under the act. At its January 1937 meeting the NCP&PC voted to have its legislative committee pursue this possibility. When nothing happened, Settle repeatedly pressed Delano on the subject. But the economy was again declining, and Delano viewed the plan as inopportune. "I have very much doubt as to whether this is a good time to approach the President or Congress or the Budget Bureau for $3,000,000 to be spent for the C. & O Canal or related property," he wrote Settle in June. He suggested waiting until the fall, when there would be a clearer picture of likely revenues from pending District of Columbia tax legislation and "the general situation in the Budget." 
One Sunday that September, when the prospect of action still appeared dim, Ronald F. Lee, a young Park Service historian, hiked up the towpath from Cabin John, Maryland. "The historical and recreational interest of the old canal is certainly all that has been claimed for it and it seems a shame that nothing has been done to maintain or improve the remains," he told Branch Spalding, head of the NPS Branch of Historic Sites. Aware that the Historic Sites Act of 1935 authorized the Service to cooperate with other parties in managing historic properties, Lee suggested that the canal "be designated a National Historic Site and a cooperative agreement entered into with the [B & O Railroad] company which would permit its development for recreational purposes without forcing the railroad to turn over to the Government a fee simple title." 
Lee's suggestion might have received serious consideration had not the B & O's financial circumstances sharply deteriorated by the end of 1937, driving matters to a different conclusion. In December the railroad sought another loan of $8,233,000 from the Reconstruction Finance Corporation, to which it already owed nearly $80 million. Settle clipped a newspaper account of this request and sent it to Delano. "I am calling this to your attention especially because when the Bureau of the Budget asked you about the acquisition of the C & O Canal, at our recent hearing, you stated that the B & O may some day want something," he wrote. 
Delano wasted no time in taking advantage of the situation. He laid out his agenda in a confidential letter to Frank C. Wright, special assistant to the RFC's board of directors:
Wright, another of Delano's high-placed acquaintances, was receptive. "I shall promptly ascertain what can be done," he replied. "It seems to me that unless previously pledged under a bond issue or a bank loan, it should be feasible to put the B. & O's title to the canal property up with the RFC as additional collateral (sadly needed), after which, with the B. & O's consent, the National Parks, or some other subsidiary of the Interior Department, could acquire the title and promptly begin improvements. . . . As to price, the figures which you quote are not high, and I would be willing to see the price increased, provided the amount finally paid was credited to the B. & O. debt to the Government." Wright mentioned his personal interest in the plan for a northern extension of the Skyline Drive and hoped that a road might be built on the canal to "open up much of the really historic location of the Civil War." 
On January 7, 1938, Wright visited George M. Shriver, senior vice president of the B & O, in his Baltimore office. "He will sell for 2-1/2 millions the entire 186 miles of canal less certain properties and water rights in Georgetown and one or two small items elsewhere," Wright wired Delano that evening. "B & O agreeable to proceeds being credited to its debt to RFC and [RFC chairman Jesse] Jones is willing to charge the cost to his balance due Ickes." 
By the end of the month the initial phase of the transaction had been completed. "Effective today, February 1, 1938, the Reconstruction Finance Corporation holds as additional collateral for loans of the Baltimore & Ohio Railroad Company, all of the Baltimore & Ohio's interest in the Chesapeake & Ohio Canal and its subsidiaries," Wright wrote Ickes. The sale could occur after about six months, when all titles were perfected. Wright recommended a procedure whereby Ickes as PWA administrator would make an allotment to the Interior Department for purchase of the canal, and an equal amount would be deducted from the PWA's profit account with the RFC (created by the RFC's sale of PWA securities at premiums above face value). 
Wright continued to act as intermediary in the sale negotiations, pressing the parties involved to close the transaction. At his urging, Ickes obtained Roosevelt's approval of the purchase arrangement.  Ickes then had the Park Service appraise the canal property. It estimated the value of the canal's land from Georgetown to Great Falls at $1,178,087 and from Great Falls to Cumberland at $553,000. It added $500,000 for the recreational value of the canal to Seneca, $450,000 for the water power rights in Georgetown, and $120,000 for the structural value of the Monocacy Aqueduct. The total came to $2,801,087. This appraisal, doubtless influenced by the price generally agreed upon, enabled Delano to inform Wright that Interior had "fully justified a $2,500,000 valuation." 
On March 24 the impending purchase was made public. Delano took the occasion to congratulate Wright on his key role: "The papers last night and this morning are full of news about the acquisition of the C. & O. Canal. I don't think anything has been done in a long while which will be as much appreciated as this. Our friend Harold Ickes is getting all the bouquets, but I will testify in history that it was you and Jesse Jones who really put the job over." 
Because the B & O did not hold actual title to the canal and the canal company's receivers had all died, it was now necessary to have the Maryland and D.C. courts appoint other B & O officials as receivers to negotiate the sale of the company's property. The negotiations were complicated by the railroad's desire to reserve some of the canal lands. Although President Willard reduced the purchase price to $2 million on April 12, some of the requested reservations were unacceptable to the Park Service. In concert with the Western Maryland Railway, the B & O wanted 15 segments of canal bed totaling more than 31 miles for additional track in places above Point of Rocks where the railroad lines ran close to the canal. George J. Albrecht of the NPS Branch of Plans and Design recommended denial of all reservations except for a few that were clearly necessary to allow a second track without taking the whole canal bed. In endorsing this position to Ickes, NPS Director Arno B. Cammerer declared that "the continuity of ownership of the canal bed is of paramount importance to this Service and . . . no reservations should be allowed which will break such continuity." 
Because the B & O was itself on the verge of receivership and the Park Service was eager to begin CCC work on the canal, the receivers and government representatives came to a general agreement that postponed resolution of the stickier issues. The most significant areas sought by the railroad adjoined its Point of Rocks and Catoctin tunnels. In lieu of metes and bounds defining the extent to which the railroad could fill into the canal bed at these and other reservations, the reservations were made subject to a "slope clause." This supplemented their descriptions to include "the necessary slopes for fills, the slope limits of which shall be described by metes and bounds as soon as surveys are completed, provided that such slopes shall not extend beyond a point midway between the bottom of the canal bed slope and the top of the same slope where it joins the towpath grade, and shall not encroach upon any Canal Company locks, aqueducts, or spillway structures, and provided further that such slope limits shall be subject to the final approval of the Secretary of the Interior, or his successors." 
The reservations were described in an attachment to the sales contract, which was signed on August 6. The attachment also contained significant provisions pertaining to the Mole at the mouth of Rock Creek and the adjoining canal company land on the west bank of the creek below K Street. The Mole itself and an abutting parcel on the west, then occupied by railroad tracks and asphalt and cement companies under B & O leases, would be acquired by the United States in fee; but the B & O and its lessees could remain for two years, and the railroad could retain its team tracks on the abutting parcel as long as it continuously used them. The remaining tract running north to K Street (Parcel G), also containing tracks and leased to two other cement companies, would be conveyed to the B & O; but the government would acquire a perpetual easement, enforceable after two years, limiting the height of buildings there to twenty feet. 
In other provisions of the contract, the government agreed not to allow any portion of the canal property to be used for conveying freight or passengers by land without the consent of the B & O, except that transportation facilities could be provided to accommodate the visiting public. The receivers agreed to remove all occupants of the property other than existing water lessees before the government accepted title, unless the secretary of the interior waived this requirement in particular cases. The receivers also agreed to turn over all of the canal company's records relating to the canal property.
An Interior Department press release announcing the execution of the sales contract declared that the 22 miles of the canal from Georgetown to Seneca would be restored to their former condition. "Determination to conserve the historic water route as a national historic site definitely ends consideration of other proposals for the disposition of the lower end of the canal," it stated, while noting that plans for the remainder had not been completed. 
Ickes arranged for a PWA allotment of $2.5 million$2 million to buy the canal and $500,000 for "the construction of a parkway as well as the rehabilitation of the existing canal as an historic site."  The courts approved the transaction, and on September 23 the receivers executed the deed of sale. Ickes accepted the deed on September 28 in a ceremony in his office, giving a $2 million check to one of the receivers, Roger S. B. Hartz. (As agreed, the money was applied to the B & O's debt to the RFC.)
Soon afterward, B & O president Willard wrote Ickes to thank him and his staff for their cooperation during the sale negotiations. "While the work of the Chesapeake and Ohio Canal Company has ended, I hope that with its passing to the Government the Canal and its adjacent lands will now enter upon a new and perhaps even greater period of usefulness to the people of Maryland and the District of Columbia, and of our neighboring states," he wrote.  It was up to the National Park Service to make Willard's hope a reality.
Last Updated: 11-Oct-2004