Financial History Issue 133 (Spring 2020) | Page 21

built instead of the planned million-gallon
reservoir ensured it would never meet the
needs of the growing city. Crudely hol-
lowed out pine logs were used. The logs
did not insulate well, and water froze in
the winter. They were also easily pierced
by tree roots, which caused backups in the
system.
Only a small number of households
participated. During the height of a yellow
fever outbreak in the summer of 1803, the
company suspended water service for two
weeks for well repairs, with some report-
ing outages of nine weeks. The number
of households drinking Manhattan Com-
pany water dwindled.
Tapped Out
Embroiled in a three-year legal battle with
the city over payment for the Manhattan
Company’s damage to the streets after
laying pipes, Hamilton defended the com-
pany until he died in 1804 in a duel at the
hands of the company’s creator (and sit-
ting Vice President of the United States),
Aaron Burr. Burr’s deception about his
intentions to start a competitor bank with
the Manhattan Company was one of the
many disagreements between the two that
eventually led to the duel. Burr’s career,
in politics and otherwise, was all but over
after that day. The company settled for
$5,000 on a $6,881.14 bill. Burr’s relation-
ship with the company had already been
severed, as he was ousted in 1802 after his
$48,000 loan from the company bank (to
pay off old debts) grew to $120,000.
With exclusive water rights, the Man-
hattan Company continued as the only
supplier of water until the 1840s. Dur-
ing this period, New York City suffered
two major cholera epidemics. Cholera
killed more than 3,500 people in 1832 and
another 5,000 in 1849.
In the 1820s, the Common Council
attempted once again to create a system
to bring fresh water from the Bronx River.
Civil engineer Canvass White completed
a detailed feasibility survey in 1824, and
the New York Water Works Company
was created to build the system. The new
company never began construction, as its
plans conflicted with those of the New-
York and Sharon Canal Company, which
was chartered a year earlier to construct
a canal between Connecticut and New
York, and provide drinking water to New
York City. The canal company later deter-
mined that bringing water from anywhere
farther than the Croton River was too
expensive. Many other surveys funded
by the city came to the same conclusion.
Finally, in the 1830s the city embarked on
creating a reliable municipal water system,
the Croton System.
After the Croton System opened, the
Manhattan Company waterworks emptied
out and was torn down in the early 20th
century. To maintain its state charter, water
was pumped by a bank employee at the site
every day until 1923. The Bank of the Man-
hattan Company is the earliest predecessor
of today’s JPMorgan Chase, the largest
bank in the United States. In 1965, Chase
Manhattan was granted a federal charter
that was no longer dependent on providing
clean and wholesome water. 
Maura Ferguson is the Museum’s Direc-
tor of Exhibits. Sarah Poole is the Muse-
um’s Collections Manager. They are the
co-curators of “Ebb & Flow: Tapping into
the History of New York City’s Water.”
www.MoAF.org  |  Spring 2020  |  FINANCIAL HISTORY  19