politicians and business owners buttressed with federal patronage, embezzled from Native tribes and local citizens, especially in the Dakota and New Mexico territories. Federal land system In acquiring, preparing, and distributing public land to private ownership, the federal government generally followed the system set forth by the Land Ordinance of 1785. Federal exploration and scientific teams would undertake reconnaissance of the land and determine Native American habitation. Through treaties, the land titles would be ceded by the resident tribes. Then surveyors would create detailed maps marking the land into squares of six miles (10 km) on each side, subdivided first into one square mile blocks, then into lots. Townships would be formed from the lots and sold at public auction. Unsold land could be purchased from the land office at a minimum price of $1.25 per acre. As part of public policy, the government would award public land to certain groups such as veterans, through the use of "land script". The script traded in a financial market, often at below the $1.25 per acre minimum price set by law, which gave speculators, investors, and developers another way to acquire large tracts of land cheaply. Land policy became politicized by competing factions and interests, and the question of slavery on new lands was contentious. As a counter to land speculators, farmers formed "claims clubs" to enable them to buy larger tracts than the allotments by trading among themselves at controlled prices. In 1862, Congress passed three important bills that transformed the land system. The Homestead Act granted free to each settler who improved the land for five years; citizens and non-citizens including squatters and women were all eligible. The only cost was a modest filing fee. The law was especially important in the settling of the Plains states. Many took a free homestead and others purchased their land from railroads at low rates. The Pacific Railroad Act of 1862 provided for the land needed to build the transcontinental railroad. The land was given the railroads alternated with government-owned tracts saved for free distribution to homesteaders. To be equitable, the federal government reduced each tract to because of its perceived higher value given its proximity to the rail line. Railroads had up to five years to sell or mortgage their land, after tracks were laid, after which unsold land could be purchased by anyone. Often railroads sold some of their government acquired