<P> The Land Ordinance of 1785 was adopted by the United States Congress of the Confederation on May 20, 1785 . It set up a standardized system whereby settlers could purchase title to farmland in the undeveloped west . Congress at the time did not have the power to raise revenue by direct taxation, so land sales provided an important revenue stream . The Ordinance set up a survey system that eventually covered over three - fourths of the area of the continental United States . </P> <P> The earlier Ordinance of 1784 was a resolution written by Thomas Jefferson (delegate from Virginia) calling for Congress to take action . The land west of the Appalachian Mountains, north of the Ohio River and east of the Mississippi River was to be divided into ten separate states . However, the 1784 resolution did not define the mechanism by which the land would become states, or how the territories would be governed or settled before they became states . The Ordinance of 1785 put the 1784 resolution in operation by providing a mechanism for selling and settling the land, while the Northwest Ordinance of 1787 addressed political needs . </P> <P> The 1785 ordinance laid the foundations of land policy until passage of the Homestead Act in 1862 . The Land Ordinance established the basis for the Public Land Survey System . The initial surveying was performed by Thomas Hutchins . After he died in 1789, responsibility for surveying was transferred to the Surveyor General . Land was to be systematically surveyed into square townships, six miles (9.656 km) on a side . Each of these townships were sub-divided into thirty - six sections of one square mile (2.59 km2) or 640 acres . These sections could then be further subdivided for re-sale by settlers and land speculators . </P> <P> The ordinance was also significant for establishing a mechanism for funding public education . Section 16 in each township was reserved for the maintenance of public schools . Many schools today are still located in section sixteen of their respective townships, although a great many of the school sections were sold to raise money for public education . In later States, section 36 of each township was also designated as a "school section". </P>

The size of a township and section in the land ordinance