Friday, March 15, 2013

Aaron Burr and the 19th Century Water Scandal at the Heart of the Founding of Chase Manhattan Bank

In 1800 the Manhattan Company (now The Chase Manhattan Bank, N.A.) sank a well at Reade and Centre Streets, pumped water into a reservoir on Chambers Street and distributed it through wooden mains to a (wealthy) portion of the community.  The ostensible purpose of the company, according to its charter, was to bring "fresh and dependable water" to a city that had been wracked by outbreaks of typhus, cholera and malaria.  However, the real purpose of the company was to engage in banking, and its founder, Aaron Burr (yes, he who fought a duel with pistols and killed Alexander Hamilton) made sure its charter stated that the proposed institution would possess the right to use its surplus capital to engage in various financial transactions. The water only served the upper class and they were badly served by a company that only cared to maintain the illusion of a public water service while protecting its banking operations.

Burr was a lawyer and a State legislator in the the New York Assembly in the 1790's, and he drafted a bill to create the Manhattan Company.  Work began immediately on the new system, but, instead of tapping water from clean wells miles away, Burr's company sank wells to the aquifer at the edge of Collect Pond. Deep wells were dug on Reade Street between Broadway and Centre Street, and the Company announced its presence by erecting a handsome structure on Chambers Street (approximately across the street from today’s Tweed Courthouse, where 49-51 Chambers is now) that included a colonnade plus a statue of Oceanus standing guard. Behind it, on Reade Street down the block from his law office, was a mini-reservoir and nearby (across Reade Street) was the tank shown in the picture, whose function was presumably to maintain pressure in the wooden water mains (made of hollowed-out logs) that gradually fanned out to reach nearby houses and neighborhood pumps.

At the age of 55, Burr re-opened his NYC law offices in June 1812. His offices on Reade Street just east of Broadway were where A.T. Stewart's Marble Palace building (later, the "Sun Newspaper" building, and now the HQ for the NYC Department of Buildings) still stands. A later Burr law office was located by the Collect Pond, at 11 Reade Street just west of Centre Street, right across from the main water pump of his Manhattan Company (NE corner of Reade and Lafayette). Over this well, at the corner of Reade and Center Streets, a tank of iron plates was constructed and a building was erected to disguise it from the street.  The tank remained thus enclosed until the building was demolished by the Manhattan Company in 1914.





That system indeed fared poorly. The wooden mains kept breaking, and residents complained that the Manhattan Company refused to use its water to flush gutters and failed to repair the streets it dug up.  The Manhattan Company served only 2,000 homes through 25 miles of piping, but, at $10 a month sufficient revenue was generated to finance a healthy bank.

In 1830 a tank for fire protection was constructed by the City at 13th Street and Broadway as was filled from a well. The water was distributed through 12-inch cast iron pipes. As the population of the City increased, the well water became polluted and supply was insufficient. The supply was supplemented by cisterns and water drawn from a few springs in upper Manhattan.  About 1836 the system was extended north along Broadway as far as Bleecker Street.  Ultimately, in 1842, the makeshift system of wells, cisterns and wooden pipes was supplanted by clean water from the Croton Aqueduct.

As a water provider, the Manhattan Company was a dismal failure. Instead of channeling a mainland river, the company built a meager waterworks - well, pump, and small reservoir - on suburban Chambers Street and laid a haphazard network of yellow pine pipe down to the town. Under the terms of its original charter, the Manhattan Company had to maintain its ability to pump water, even after its half hearted piss-poor wooden log system was supplanted by clean water from the Croton Aqueduct in 1842, which it did well into the early 20th century by maintaining its large water tank enclosed by this building at the corner of Reade and Lafayette (formerly Centre) Streets.  The building was finally torn down in 1914, and the present structure was erected.  However, beneath the building there apparently still remains the original well sunk by the Manhattan Company 213 years ago and, according to a 1914 article in the New York Times, as of that date, Chase Bank still owned the land and all rights accruing to it, including the well.

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