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Locating the capital
The first capital of the United States was Philadelphia, where the Second Continental Congress met during the American Revolutionary War. After the war, the Congress of the Confederation was formed and convened in Philadelphia, until June 1783, when a mob of angry soldiers converged upon Independence Hall, demanding payment for their service during the American Revolutionary War. Congress requested that John Dickinson, the governor of Pennsylvania, call up the militia to defend Congress from attacks by the protesters. In what became known as the Pennsylvania Mutiny of 1783, Dickinson sympathized with the protesters and refused to remove them from Philadelphia. As a result, Congress was forced to flee to Princeton, New Jersey on June 21, 1783, and met in Annapolis and Trenton, before ending up in New York City.

Amidst the turmoil in 1783, the question of where to locate the capital. Numerous locations were offered by the states to serve as the nation's capital, including Kingston, New York, Nottingham Township in New Jersey; Annapolis; Williamsburg, Virginia; Wilmington, Delaware; Reading, Pennsylvania; Germantown, Pennsylvania; Lancaster, Pennsylvania; New York City; Philadelphia; and Princeton among others. But, the southern states refused to accept that the capital be located in the north, and vice versa. Another suggestion was for there to be two capitals. Congress approved a plan in 1783 for a capital on the Potomac, near Georgetown, in Virginia, and another capital on the Delaware River, however the plan was rescinded the following year.

The issue of locating the capital was put on hold for several years, until the Constitutional Convention was held in 1787, to draft the United States Constitution. The Constitution granted power to Congress over a federal district, with Article I, Section 8 of the Constitution stating:

To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful buildings.

The debate heated up in 1789 when Congress convened. Two sites were favored by members of Congress, including a site on the Potomac River near Georgetown, and another site on the Susquehanna River near Wrights Ferry (now Columbia, Pennsylvania). The Susquehanna River site was approved by the House in September 1789, while the Senate bill specified a site on the Delaware River near Germantown, Pennsylvania. Congress did not reach an agreement at the time.

Residence Act of 1790
The issue of locating the capital resurfaced in the summer of 1790. At the same time, Secretary of the Treasury Alexander Hamilton was pushing for Congress to pass a financial plan. A key provision of Hamilton's plan involved the Federal government assuming states' debts incurred during the American Revolutionary War. Northern states had accumulated a huge amount of debt during the war, amounting to 21.5 million dollars, and wanted the federal government to assume their burden. The Southern states, whose citizens would effectively be forced to pay a portion of this debt if the Federal Government assumed it, were disinclined to accept this proposal. Some states including Virginia, had paid almost half of their debts, and felt that their taxpayers should not be assessed again to bail out the less provident, and further argued that the plan passed beyond the scope of the new Constitutional government. James Madison, then a representative from Virginia, led a group of legislators from the south in blocking the provision and prevent the plan from gaining approval.

When Jefferson ran into Hamilton at President Washington's residence in New York City in late June 1790, Jefferson offered to host a dinner to bring Madison and Hamilton together. Subsequently, a compromise was reached, in which the northern delegates would agree to the southerly Potomac River site, and in return, the federal government would assume debts accumulated by the states during the American Revolutionary War. Jefferson wrote a letter to James Monroe explaining the compromise.

Congress agreed to the compromise, which narrowly passed as the Residence Act. Jefferson was able to get the Virginia delegates to support the bill, with the debt provisions, while Hamilton convinced the New York delegates to agree to the Potomac site for the capital. The bill was approved by the Senate by a vote of 14 to 12 on July 1, 1790, and by the House of Representatives by a vote of 31 to 29 on July 9, 1790. The Assumption Bill narrowly passed the Senate on July 16, 1790, followed by passage in the House on July 26.

The Residence Act specified that the capital be located along the Potomac River between the Eastern Branch (the Anacostia River) and the Connogochegue, near Hagerstown, Maryland, and encompass an area of no more than "ten miles square" (100 square miles). The act gave President, George Washington the authority to decide the exact location and hire a surveyor. The President was required to have suitable buildings ready for Congress and other government offices by the first Monday in December 1800, and that the federal government would provide financing for all public buildings.

The act specified that the laws of the state from which the area was ceded would apply in the federal district, meaning that Maryland laws applied on the eastern side of the Potomac while Virginia laws applied on the western side in the District of Columbia until the government officially took residence. Upon assuming control of the federal district in 1800, Congress would have full authority over local matters within the District of Columbia.

In order to garner enough votes to pass the Assumption Bill, Hamilton also needed votes from the Pennsylvania delegates. Thus, the decision to designate Philadelphia as the temporary capital city of the United States federal government for a period of ten years, until the permanent capital was ready. Congress reconvened in Philadelphia on December 6, 1790 at Congress Hall.

Implementation
Some hoped that the plan to establish the capital on the Potomac would not materialize, and that the capital would remain permanently in Philadelphia. However, George Washington quickly got the ball rolling, and along with Jefferson, personally oversaw the process as plans were developed and implemented. While plans for the permanent capital were being developed, Pennsylvania delegates continued to put forth effort to undermine the plan, including allocating funds for federal buildings and a house for the President in Philadelphia.

Though the legislation did not specify an exact location, it was assumed that Georgetown would be the capital. Washington began scouting out the territory to the southeast of Georgetown, near the Anacostia River (Eastern Branch). Some of the property owners expressed to the President that they were willing to sell land for the capital. Though, Washington also looked at other sites along the Potomac. Washington decided that a few sites should be surveyed to provide specific details about the land and its ownership. Washington returned to Philadelphia in late November 1790 to meet with Thomas Jefferson to discuss the implementation of the Residence Act. At this time, the decision had been reached to locate the capital at or adjacent to Georgetown, which is on the fall line and the farthest inland point for navigation.

In January 1791, the President proceeded to appoint a three-member commission, consisting of Daniel Carroll, Thomas Johnson, and David Stuart, to oversee the surveying of the federal district, and appointed Andrew Ellicott as surveyor. Washington informed Congress of the site selection on January 24, and suggested that Congress amend the act to allow the capital to encompass areas to the south of the Eastern Branch, including Alexandria, Virginia. Congress agreed to the President's suggested change, though the act required government buildings to be constructed on the Maryland side of the Potomac.

L'Enfant
In 1789, when discussions were underway regarding a new capital city, L'Enfant expressed interest to President Washington in being commissioned as the architect. Though any decision on the capital was put on hold until July 1791 when Congress passed the Residence Act. President George Washington appointed L’Enfant in 1791 to design the new capital city under the supervision of three commissioners, whom Washington had appointed to oversee the planning and development of the ten-mile square of federal territory that would later become the District of Columbia. Thomas Jefferson, who worked alongside President Washington in overseeing the plans for the capital, sent L'Enfant a letter outlining his task, which was to provide a drawing of suitable sites for the federal city and the public buildings. Though Jefferson had modest ideas for the Capital, L'Enfant saw the task as far more grandiose, believing he was to not only locating the capital, but also included devising the city plan and designing the buildings.

L’Enfant arrived in Georgetown on March 9, 1791, and began his work, from Suter's Fountain Inn. Washington arrived on March 28, to meet with L'Enfant and the commissioners for several days. On April 7, 1791, Washington embarked on a tour of the southern states, which lasted through May. While visiting Charleston, Washington was introduced to a young Irish builder, James Hoban.

Washington returned in mid-June to Mount Vernon and stayed there for three weeks, allowing time to be given to planning of the Federal city. Preliminary plans shown to Washington included dimensions for the public buildings, but no detailed drawings. L'Enfant's plan specified locations for the Capitol (on Jenkins Hill) and the White House, situated on a ridge parallel to the Potomac. The ground dimensions were sufficient for the commissioners to start some of the digging and foundation work. Ready to proceed, land transfers from the proprietors to the government took place on June 28, 1791, and Washington could proceed with final approvals of the sites selected by L'Enfant. Washington took a tour of the sites, accompanied by L'Enfant and Andrew Ellicott, and was satisfied witht the Jenkins Hill site for the Capitol. However, Washington requested a slight change, choosing a site just to the west of the one chosen by L'Enfant.

Ellicott, with Benjamin Banneker working along side him, proceeded to lay out the streets at L'Enfant's orders. L'Enfant was very protective of his work, storing his books, drawings, and engravings in a trunk and boxes. L'Enfant was intent on answering only to President Washington, and not the commissioners nor Jefferson. The commissioners and Jefferson, ignoring L'Enfant, began discussing plans for the public buildings. In August, Washington wanted to see a plan from L'Enfant, and it was presented to him in Philadelphia on August 27, 1791, with Jefferson present. L'Enfant envisioned the President's House with public gardens, monumental architecture, and specified the size at five times what was actually built, reflecting his grandiose visions. L'Enfant secured the lease of quarries at Wigginton Island and along Aquia Creek in Virginia to supply stone for the foundations of the Capitol in November 1791.

Design competition
In spring 1792, Thomas Jefferson proposed a design competition to solicit designs for the Capitol and the President's House, and set a four-month deadline. The prize for the competition was $500 and a lot in the federal city.

At least ten individual submitted designs for the Capitol, however the drawings were regarded as crude and amateur, reflecting the level of architectural skill present in the United States at the time. The most promising of the submissions was by Stephen Hallet, a trained French architect, however Hallet's designs were overly fancy, with too much French influence, and were deemed too costly. A late entry by amateur architect William Thornton was submitted on January 31, 1793 to much praise for its "Grandeur, Simplicity, and Beauty" by President Washington, along with praise from Thomas Jefferson. Thornton was inspired by the east front of the Louvre, as well as the Pantheon for the center portion of the design. Thornton's design was officially approved in a letter, dated April 5, 1793, from George Washington. In effort to console Hallet, the commissioners appointed him to review Thornton's plans, develop cost estimates, and serve as superintendent of construction. Hallet proceeded to pick apart and make drastic changes to Thornton's design, which he saw as amateur with numerous problems and high costs to build. In July 1793, Jefferson convened a five-member commission, bringing Hallet and Thornton together, along with James Hoban, to address problems with and revise Thornton's plan. Hallet suggested changes to the floor plan, which could be fitted within the exterior design by Thornton. The revised plan was accepted, except that Jefferson and Washington insisted on an open recess in the center of the East front, which was part of Thornton's original plan.

Construction
Surveying was underway soon after the Jefferson conference plan for the Capitol was accepted. A groundbreaking ceremony for the Capitol took place on September 18, 1793. George Washington, dressed in masonic attire, laid the cornerstone, which was made by silversmith Caleb Bentley.

Stephen Hallet was hired to oversee construction, which got underway in September 1793. Construction proceeded with Hallet working under supervision of James Hoban, who was also busy working on construction of the White House. Despite the wishes of Jefferson and the President, Hallet went ahead anyway and modified Thornton's design for the East front and created a square central court that projected from the center, with flanking wings which would house the legislative bodies. Hallet was dismissed by Jefferson on November 15, 1794. George Hadfield was hired in October 1795 as superintendent of construction, but resigned three years later in May 1798, due to dissatisfaction with Thornton's plan and quality of work done thus far.

The original intention of the Residence Act was to use proceeds from selling lots in Washington, D.C. to cover costs of constructing federal buildings in the capital. However, few were interested in purchasing lots. A shortage of funds further contributed to the delays and problems in building the Capitol and other federal buildings in Washington, D.C. The Senate wing was completed in 1800, while the House wing was completed in 1811. However, the House of Representatives moved into the House wing in 1807. Though the building was incomplete, the Capitol held its first session of United States Congress on November 17, 1800. The legislature was moved to Washington prematurely, at the urging of President John Adams in hopes of securing enough Southern votes to be re-elected for a second term as president.