Tag: Suffrage

Or, A Tale of Ditches, Schools, and Municipal Lighting 

Corporate Voters Project – Research Note #9

As a historian, I am trained to dig for origins. Chronology suggests causation, after all; today’s one damn thing happened only after another. So if there’s a phenomena out in the world you seek to understand – and perhaps even to explain – as a historian, one of your standard moves is to try and trace the stream to its source. 

Corporate voting has proved a difficult quarry in this respect. Partly, it’s about language: the formal charter provisions authorizing corporate voting in a municipal context have changed form over time, making it difficult to search for examples. Too, as the sordid history of the Town of Fenwick Island illustrates, corporate voting has been practiced outside the sanction of municipal charters – governed (I use the term loosely) by unpublished bylaws or oral traditions, which are difficult to get ahold of using standard historical methods.

Still, I’ve made an attempt to identify the origins of corporate voting with the sources that are readily accessible – Delaware’s published session laws – and I think I’ve come up with some likely candidates.

The earliest is an 1893 law that enfranchises artificial entities in Middletown, DE, as part of a public lighting utility financing scheme – a measure that comes a full six years before Delaware passed its copy+paste of New Jersey’s notorious corporate code, and hitched the state’s wagon to corporate franchise revenues. The next earliest is a 1917 law that explicitly grants corporations the right to vote in bond referenda financing Laurel Public Schools. 

Those are the earliest, explicit grants of suffrage to non-humans, and track closely with my prior findings, viz., that corporate voting in Delaware is first introduced through Progressive innovations in financing modern municipal  infrastructure (water, sewers, roads, power – and schools). 

But if we loosen the definition a bit, and include laws that do not specify voters as persons with human characteristics like age, race, or gender, but only indicate that voters have to be landowners – if we look for the first loophole, in other words – then we could say that an 1819 law setting up a tiny local government to manage drainage is what first opened the door to non-human voting.[1] 

Lighting, schools, or maybe even swamp management: in every case, the earliest versions of corporate voting appeared in Delaware attached to property ownership, in measures intended to capture community wealth for the community’s benefit, though infrastructure.

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The first instance of Delaware law granting artificial entities voting rights does so through a short but significant pronoun: it.

At said election each tax-payer shall have one vote for every dollar and fractional part of a dollar paid by him, her or it, respectively, as town tax, within one year next preceding said election, and all tax-payers shall have the right to vote at such election in person, or by proxy duly signed and witnessed.

~ 19 Del. Laws, c. 745, “AN ACT to amend Chapter 242, Volume 19 of the Laws of Delaware, entitled “An act to provide for the Lighting of Middletown,” February 21, 1893, p.1026 [emphasis added]

The context for this implicit corporate voting rights provision is a law changing who can borrow, and how much, on the Town of Middletown’s credit, for the purpose of building and running a lighting utility. 

In 1891, the state legislature gave Middletown itself the authority to borrow up to $10,000 to “establish an electric plant and conductors, or to erect gas works and lay pipes” to light the town (or buy existing equipment).

That legislation included a bond referenda mechanism for local approval: to raise funds by issuing bonds, Middletown would have to hold a public meeting to approve the debt; and at that meeting, residents could cast votes on the basis of “one vote for every dollar…by him or her paid” in town taxes. [2] Property taxes enfranchised voters, but only those with a gender (so: not corporations).

Then, in response to the town’s request in 1893, the state changed Middletown’s mechanisms for administering utilities and issuing bonds. The 1893 bill quoted above subdivided responsibility for running the town’s lighting, removing it from the powers of the town commissioners and entrusting it to a separately elected “board of light and water commissioners.”

And for unknown reasons, it departed from the common phrasing of other town borrowing bills, adding an “it” that opened the door for non-human but tax-paying persons – including corporation – to vote in bond approval elections.

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Middletown’s innovation did not catch on. The taxable-dollar-per-vote scheme for bond elections was quite common across Delaware – increasingly so until the middle of the 20th-century – and towns up and down the state continued to add borrowing authority for municipal utilities. But the enabling legislation for those increased financial powers almost stuck to formulations identifying “tax-payers” or “taxables” as gendered human beings (“him or her” or “male or female”). (The inclusion of property-owning women is notable in an era before women’s suffrage in state or federal elections, and fits with a general pattern of local voting rules being more inclusive rather than less). [3]

Then, in 1917, amid a flurry of education reform bills that aimed to train teachers, police truants, and raise standards, the General Assembly passed a law empowering Laurel Public Schools to erect new school buildings – and expanded suffrage to corporations, explicitly, in the bargain. [4]

At such [bond referenda] election every taxable who resides within the limits of said Incorporated School Districts and every Corporation within the limits of said Incorporated School Districts, which is taxed for school purposes therein, shall have the right to cast one vote for every dollar or majority fraction thereof of school tax paid by him, her or it.”  
~ 29 Del. Laws, c. 195, “An ACT to authorize and empower Laurel Public Schools …,” March 23, 1917, pp. 644 [emphasis added]

As with Middletown’s suggestive loophole, Laurel’s innovation in corporate voting did not spread. A few years later, in 1921, when the state authorized Newport to issue bonds to buy out private investors who had built a waterworks  – including a paint company – the legislation used the “him, her or it” formulation to identify those persons who could qualify as bond referenda voters, but did not explicitly endorse corporations as voters. 

It wasn’t until 1931 that another local government in Delaware (the Town of Milford) extended voting rights to corporations in a manner as directly as Laurel had – and then it seemed to do so primarily to include all types of property owners “whether individual, partnership, or corporation.” [5]

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If one is willing to squint a bit, there is an argument that corporate voting could have been possible (formally, legally) as early as 1819. That’s when Delaware formally incorporated a special form of local government – today known as a “tax ditch” – to manage the drainage ditches abutting White Clay Creek and Red Clay Creek, waterways in New Castle County.

“Tax ditch” companies were chartered corporations with taxation powers that provided them with the means to do what corporations typically did in the U.S. until the late nineteenth-century: borrow state power, temporarily, to build infrastructure – or, in the phrasing more common to the early US, build “internal improvements.” (The idea that corporations are normatively businesses is a late-nineteenth century invention, like the chocolate bar, or eugenics).

In this case, the company was granted the power to assess all landowners with property touching the drainage works for a tax, in order to finance the creation and maintenance of ditches, sluices, gates and other necessary drainage works. To authorize that assessment and elect ditch commissioners – who would oversee the work – the state gave property owners voting rights in the company, typically scaling the amount of votes according to the amount of the neighboring acreage they owned. 

In later legislation, the types of voters within the company were specified by race, age, and gender (and as with later bond referenda, these qualifications were sometimes more inclusive than voter qualifications in other elections).

But in 1819, for whatever reason, Delaware legislators left the matter of personhood unaddressed – and thus open to corporate voting: 

… and in all elections for officers as aforesaid, or otherwise, the said owners or possessors, owning or possessing any quantity of meadow marsh or cripple not exceeding five acres shall be entitled to one vote, all over live acres and not exceeding ten acres two votes, all over ten acres and not exceeding twenty acres three votes, and all over twenty acres four votes.” 

~ 5 Del. Laws, c. 225, “An ACT to incorporate the owners and possessors of a certain tract of meadow, marsh, and cripple, known by the name of the White-clay creek and Red-clay-creek marshes, in the county of Newcastle, …” February 5, 1819, pp.405.

This is a loophole a clever and ambitious corporate lawyer could have taken advantage of; but it unlikely it ever was. Corporations in 1819 certainly could and did own real estate, but it was unusual to own farmland of the type that would be affected by ditch company work, unless it came to a bank through a foreclosed mortgage. A trust was more likely to hold farmland – but since the legislation did not lay out how proxy voting could occur (cf. later tax ditch legislation, which often did), an artificial entity exercising any kind of franchise would have probably met with more frustration than success, in practice.

There were simpler ways to direct the ditch digging, should that have been someone’s goal. But weirder things have certainly happened in Delaware… 

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A brief word on methods and sources

My sources for this inquiry are the seventy-two volumes of “session laws” published by the State of Delaware under the title Laws of the State of Delaware (aka Del. Laws). These volumes encompass all published laws passed by the General Assembly from the colonial era to the new millennium, 1700-2000.[6] 

In my prior research, I’ve worked backwards, tracking municipal charter revisions from a moment where a town was known to have corporate voting provisions to earlier versions, to see where the provision came into being. That was a more efficient mode of discovery than reading through each massive statute tome, but it was limited. 

However, that work has provided a number of examples of corporate voting provisions – formulations which I could then use as models to search the entire Del. Laws corpus as a whole. 

Doing so was relatively straightforward, but depended on electronic versions and machine methods. Full scans of Del. Laws are available online in several different versions (Delaware Public Archives, HathiTrust). 

To correct for prior machine-errors, I used the very capable OCR software built-in to DevonThink 3 (ABBY FineReader) to improve the existing text layers of the scanned pdf volumes  – making them more accurate (this OCR version handles the medial “s” with no problem) and machine-readable (ABBY FineReader handles text structure better, too). 

Then, I used the examples of corporate voting provisions I already had to develop a set of regular expressions I could use to search the Del. Laws corpus, and identify new instances of the practice as it appeared in previously unknown legislation.

That proved quite effective, producing a manageable list of hits, which I then read over individually, and analyzed each specific instance of potential corporate voting, myself (“by hand”). 

Because I’m a Luddite in the original sense – and not opposed to new technology, on principle – I did initially tried to use Google Gemini to develop pattern sets and analyze volumes.

But you know what Alphabet’s university-grade LLMs can’t do? Reliably read OCR’d PDFs for textual patterns, or apply extant text examples to large sets of scanned books. The robot even complained that historical documents were too difficult to read (an unpersuasive whinge presumably drawn from on all the stolen student papers these things were trained on…)

It seems like the kind of thing the probabilistic plagiarism machine should be able to do, but for a data set this small and bounded, it was not worth the time it would have taken to train the model when other, better tools were available. So it goes!

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Image: Lafayette Studios, Irving Air Chute; Digging Dirt; Man in a Field Holding a Shovel, January 10, 1942, black-and-white photograph, University of Kentucky, https://exploreuk.uky.edu/catalog/xt7z348gg90h_3_326. 

[1] These special purpose local governments for drainage management are still around in Delaware. Today termed “tax ditches,” they are governmental subdivisions created by Superior Courts (i.e. county courts), administered by DNREC, and run by the “taxables,” the landowners with property drained by the ditch who are assessed taxes for its construction and maintenance. The portions of the Delaware Code regulating tax ditches do not expressly provide corporations or other artificial entities with voting rights – though it does award votes at tax ditch meetings based on “the number of dollars assessed against the land of such owner.” See 7 Del C. §4154. “Tax Lagoons” – also intended for farm use – are governed similarly. 7 Del C. §4343 .

My thanks to Dave Redlawsk for the heads up about these organizations! 

[2] 19 Del. Laws, c. 242, “AN ACT to provide for Lighting the Town of Middletown,” May 14, 1891, p.478-479. This was not Middletown’s first utility: an 1887 act authorized $15,000 in bonds for a waterworks. 18 Del. Laws, c. 158, “An ACT To authorize the Commissioners of the town of Middletown to borrow money and erect water works,”  February 10, 1887, pp.255-256

[3] Newark’s expansion of its borrowing authority was typical: 24 Del. Laws, c.192 “An ACT authorising and empowering ‘The Council of Newark’ to borrow money and to issue bonds … “ , April 4, 1907, pp 395- 397

[4]  Train teachers: 29 Del. Laws, c. 181, “AN ACT to amend Chapter 71 of the Revised Statutes of the State of Delaware relative to the holding of Teachers’ Institutes,” April 2, 1917, pp. 617-618; police Truants: 29 Del. Laws, c.182, “AN ACT to amend Chapter 71, of the Revised Code of the State of Delaware, requiring the Board of Police Commissioners of the City of Wilmington to assist in arresting truants and others who fail to attend school,” April 12, 1917, p. 619; raise standards: 29 Del. Laws, c. 184, “AN ACT to provide for the giving of Meritorious Recognition andAwards to all Free Schools, not having Special Powers by Incorporation or Consolidation, that attain a certain Standard of Excellence and Efficiency,” April 18, 1917, pp. 622-624Laurel’s bonds: 29 Del. Laws, c. 195, “AN ACT to authorize and empower Laurel Public Schools to procure a site and erect thereon a new Public School Building; to borrow money to pay for the same; to issue bonds to secure said loan, and to levy a tax to pay said bonds,”  March 23, 1917, pp. 639-645.

Like many bills authorizing the issuance of bonds in this period, legislators specified the language to be printed on the bond and its coupons, laying out in careful detail all the terms of the bond contract. Perhaps legislators did not trust town officials to manage these complex financial transactions themselves? Or consider them capable of negotiating with underwriters without overextending government credit. See 29 Del. Laws, c. 195 §3, p. 640-642.

[5] 32 Del. Laws, c. 120, “AN ACT authorizing the “Commissioners of Newport” to repay certain moneys advanced by certain persons and corporations for the completion of a water works and sewer system for the Town of Newport, and to Issue bonds to secure the payment thereof,” March 15, 1921, pp. 363-69; 37 Del. Laws, c. 162, “An Act Changing the Name of ‘The Town of Milford’ to ‘The City of Milford’ and Establishing a Charter Therefor,” Approved April 25, 1931 pp. 595.

[6] After 1866, the State of Delaware excludes from publication “all acts of incorporation, and other acts of a private nature.” Frustrating if you’re interested in business corporation and divorces; but this same measure specifies that charters for certain kinds of corporations – “railroad companies, towns and banks” – don’t fall under this exclusion, and so continue to be published in later volumes. 13 Del. Laws, c. 1, “An Act Concerning the Publication of Laws,” February 17, 1866, p.3.