The Morrill Act & the Land-Grant Colleges
The Land-Grant College Act of 1862, introduced by Justin Smith Morrill of Vermont, provided funding for institutions of higher learning in each state. Each state received 30,000 acres of federal land for each congressional representative from that state to be sold to provide an endowment for
...at least one college where the leading object shall be, without excluding other scientific and classical studies and including military tactics, to teach such branches of learning as are related to agriculture and the mechanic arts...
Much of the land was bought by speculators and the large supply meant that most states received very little for their land. Kentucky received only fifty cents per acre. Some states were able to hold their allotment for several years and sell at a much higher price (the land allotted to Cornell University was eventually sold for over $5.50 per acre). The original Morrill Act was supplemented through the years to provide additional funding for the land-grant institutions.
The other early land-grant institutions included:
For more information see "Morrill Land-Grant Act of 1862 and Foundations of the University of Kentucky" from University Archives.