The government created by the United States Constitution went into effect in March 1789. The previous government under the 1781 Articles of Confederation had determined that its own location, New York City, would serve as a temporary capital until the new Congress could make a permanent selection. This delighted city merchants and officials, ever fearful of the lure of the nation's largest and most cultured city at the time, Philadelphia. The New York City mayor placed at the new federal government's disposal his city hall, located on Wall Street, just north of the Battery. A project to remodel and enlarge the city hall began in October 1788. Reflecting the city's optimism that the government would decide to remain there permanently, officials renamed the greatly expanded structure "Federal Hall."
The issue of location of a permanent capital city prompted an extended and acrimonious debate in the First Congress. Finally, in the summer of 1790, members agreed to locate the capital along the Potomac River in a district that would remain under federal control. While that new city was being built, the government would reside for 10 years in Philadelphia.
When Congress departed Federal Hall, the building again became city hall and remained so until it was demolished in 1812. In 1842 a new Federal Hall was erected on part of the original site and is now designated a National Memorial managed by the National Park Service.
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