At the next regular session of the Legislature, 1864, a determined and systematic effort was made by some friends of the State University to divert the land granted by Congress for the benefit of agricultural colleges to increase the endowment of the University upon the conditions that a department of agriculture should be established, an experimental farm secured, and an agricultural course provided at the University for those who wished to pursue it. This was claimed would be a substantial compliance with the law making the grant; that it would save a large expense in buildings, professors' salaries, libraries and museums, that the endowment of the University would be increased, and that in no way could it be so easily obtained as by diverting the college grant. These views were ably urged, and with much good sense, by Gov. Kirkwood, President Spencer and Representative Hilderth.
On the other hand, the friends of the agricultural college resisted the attempt to divert the grant from its original purpose, contending that it belonged to the agricultural college by the express terms of the act; that the industrial classes comprised the majority of the people and tax-payers of the State; that they were striving to build up an institution that should be devoted to their interests, and that after having assisted in securing the grant of lands for its endowment, it would be gross injustice to divert it to an institution already richly endowed.
Public discussions were held for several evenings in the hall of the House of Representatives, in which Gov. Kirkwood appeared as the champion of the diversion, while Senator Gue appeared as the champion of the agricultural college. The scheme was finally defeated, and the entire grant confirmed as a perpetual endowment to the Iowa State Agricultural College.
The problem then arose as to the best manner of disposing of the lands so as to secure an immediate income for the support of the college. After much thought on the subject, Gov. Kirkwood and Senators Gue and C. F. Clarkson devised the plan of leasing them instead of offering them for sale. This scheme was approved by the Legislature, and passed into a law, which authorizes the trustees to lease for a term of ten years any of the endowment lands. This plan was so successful that by 1868 the income of the college from this source was nearly $30,000 per annum.
By the terms of the lease, the lessee pays 8 per cent interest on the appraised value of the land annually in advance, with the privilege of buying the same at the expiration of the lease. In case the lessee fails to pay the interest promptly, his right to hold the land is forfeited with all the improvements thereon. In 1865 the lands were appraised, a land office opened at Fort Dodge, and the Hon. G. W. Bassett appointed agent for the sale and lease of lands.
By 1868 quite a fund of "interest money" had accumulated. The trustees deemed the safest investment to be land, and accordingly, the same year, bought about 15,000 acres located in the northwestern part of the State. These lands, known as the " Sioux City Purchase," cost, including location, nearly $16,000. Mr. T. J. Stone, of Sioux City, was appointed agent for the sale and lease of the same, and who, resigning in 1876, the agency was transferred to Mr. Bassett, of Fort Dodge.
When the State accepted the Congressional grant, with all the imposed conditions, and confirmed the grant to the agricultural college, it ceased to be a purely State institution, and became a national institution, the State being trustee in charge. The national endowment act became its fundamental law, its charter, and