On July 13, 1787, the Confederation Congress passed the Northwest Ordinance. The act created a system of government for the Northwest Territory. It also specified how the various parts of the Northwest Territory could become states. Earlier legislation such as the Ordinance of 1784 and the Land Ordinance of 1785, had only said that the territory would some day become states and had described how the federal government would sell the land to private citizens.
Thomas Jefferson, Nathan Dane, Manasseh Cutler, and Rufus King usually receive credit for the ideas behind the Northwest Ordinance. According to the act, the territory would have to progress through three separate stages of government. In the first stage, the Congress was responsible for selecting the territory's leaders. There would be a governor, a secretary, and three judges. The governor and judges would jointly select laws from already existing states to create their territory's legal code. The Congress reserved the right to accept or reject all selected laws. The governor would have power over the militia and Indian matters. He also could select law enforcement officials and judges for the lower courts. All five members of the territorial government were to have sizeable holdings of land and be residents of the territory.
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