The concept of interest payments is old and universal. Since its earliest beginnings, the banking industry has followed this simple precept: When you deposit money, you earn interest on it.

But there was once a bank in which that was not how it worked: the town bank in Jacksonville in the early 1850s.

Jacksonville was a gold-mining boom town. It was situated in the middle of some of the richest gold diggings in history, and the town was awash in the yellow stuff. There was so much gold sloshing around Jacksonville in the early years that the local bank soon realized there was no need to pay anyone interest on it.

Instead, they charged.

That’s right: in exchange for having one’s gold tucked away safe from marauding bandits and night-stalking thieves, the bank actually charged a percentage of all deposits. It was like a negative interest rate. Or, you might think of it as the town where the bank “robs” you.

But if ever there was a town that was truly blasé about gold, it was Jacksonville — or Table Rock City, as it was then called. There was gold everywhere in the little frontier town. Gold was to Jacksonville as lumber would later be to Cottage Grove or Valsetz, and salmon to Astoria: the most important product, the driver of the local economy, but nothing much out of the ordinary or special.

So, what was out of the ordinary and special in Table Rock City? Food. In the early months there, flour was selling for $1 a pound. And ordinary table salt was trading straight across, pound for pound, with gold dust.

Those prices did come down as time went by and outside merchants realized the opportunity there, but they stayed plenty high. Thomas Frazar, arriving in 1852, was only able to get 60 cents a pound for his wagonload of flour — a big discount off of a dollar a pound, but still a 500-percent markup from the 12 cents a pound flour was fetching in Portland at the time.

Table Rock City sprang up almost overnight in 1951 after a freight packer named George Frazier (no relation to Thomas Frazar) and an unnamed assistant stopped by the shores of Jackson Creek to camp for the night. Frazier was on a run from Scottsburg — then a burgeoning seaport situated at the head of navigation on the Umpqua River, the entry point for oceangoing freight coming into southern Oregon — to the gold fields of Yreka. The California Gold Rush was just a few years old; it had started in 1848 and then exploded the following year. Now, in 1851, miners were spreading northward into southern Oregon, and still finding good color seemingly everywhere.

Of course, Frazier and his sidekick took a moment before settling down for their evening meal to dip a pan in Jackson Creek and sling some muddy gravel around. After all, why not?

Why not, indeed. Chances are those freighters got no sleep at all that night. By the time the sun went down, they knew their fortunes were made. Jackson Creek was loaded with gold.

The packers promptly dubbed the creek “Rich Gulch,” settled down, staked a claim and got to work.

That first half-season, an estimated $30,000 worth of gold came out of Frazier’s claim — at 1851 prices, remember, or roughly $900,000 in modern money; not bad for a few months’ work for two guys. It was mostly in the form of coarse gold nuggets worth $1 to $20 each.

Word soon got out, and within a month or two a town had sprung into being there by that golden creek, and gold was pouring into pockets for miles around.

The problem was, one couldn’t eat gold. Nobody wanted to go into business growing crops when fortunes were being washed out of the creek. Nobody wanted to run a bank, either — guarding the deposits, helping customers, and all those boring things that took up the time one could be spending going after the next $30,000 gold mine.

So it was no big surprise that the people who did those things — spent their time hauling foodstuffs in from Sacramento and Scottsburg, keeping watch over other people’s gold for them, pouring drinks in the local saloon — valued their time and efforts a little differently than they might have in another town. A week spent dragging a wagonload of flour over the pass was a week not spent raking in coarse gold by the pint. That lost opportunity would have to be made up in the form of high prices.

And oh yes, it was.

By the end of 1852, Table Rock City was the biggest town in Jackson County, boasting a population of about 2,000. Of course, as with all boomtowns, the good times couldn’t last forever; but by now, it was the county seat, meaning that even after the gold petered out it would remain an important place. So unlike places like Auburn and Cornucopia, the town’s residents built its houses and buildings with a future in mind.

Soon a colony of Chinese miners moved in from California, and Jacksonville had the first Chinatown in Oregon. The future looked bright, and the town prospered even as the gold mines started their inevitable petering-out.

Then, in 1884, disaster struck — disaster in a sort of miraculous form, from a modern historical standpoint. The Oregon & California Railroad was built running through Medford, bypassing Jacksonville completely. After that, the stagecoaches that had regularly thundered through the town’s streets no longer came.

Jacksonville businesses started moving away, cozying up to the railroad line. The town faded, and its decline was made official in 1927 when the county seat was moved to Medford as well.

By the time World War II was over, Jacksonville resembled a ghost town from a movie set — full of gorgeous old, empty buildings surmounted by one of the finest old county courthouse buildings in the state.

Moreover, possibly because so few people now lived there, it had never experienced a real fire. The town stood as it had in the late 1800s, frozen in time and preserved by the climate.

The recovery started just after the war, when the Southern Oregon Historical Society was founded specifically to preserve that beautiful, old county courthouse from the wrecking ball; they subsequently opened a museum in it, in 1950 (it closed for lack of funds several years ago, and the courthouse is now, as of the time of this writing, unoccupied). Recovery got a huge boost in 1963, when John Trudeau, an orchestra conductor from Portland, launched the Britt Festival on pioneer Peter Britt’s old estate — a sort of natural hillside amphitheater with a gorgeous view of the valley spilling out behind the stage.

Then in 1966 the entire town was declared a national historic district. By that time, Jacksonville’s recovery was well under way.

Today, Jacksonville is a popular destination for folks who want to see some vintage Oregon gold country history in person. It’s also a popular place in which to retire.

Its population isn’t much above its Gold Rush peak, just shy of 3,000. And although plenty of gold miners (recreational, for the most part) still call it home, Jacksonville’s glory days of gold production are gone now.

Or are they? In a remarkably striking statistical anomaly, this tiny town of 2,800 or so has, over the past 15 years, been the home of three multimillion-dollar Oregon Lottery jackpot winners, including a massive $340 million Powerball win in 2005. On a per-capita basis, no other town comes close to Jacksonville’s performance; a resident of Jacksonville in 2001 had a 1 in 800 chance of finishing the decade a millionaire.

So, maybe the old Midas Touch hasn’t left Jacksonville after all.

(Sources: Frazar, Thomas. “Pioneers from New England,” Oregon Historical Quarterly, spring 1982; www.westernmininghistory.com; www.jacksonvilleoregon.com; brittfest.org; Sullivan, William L. Hiking Oregon’s History. Eugene: Navillus, 2006)

Finn J.D. John teaches at Oregon State University and writes about odd tidbits of Oregon history. For details, see http://finnjohn.com. To contact him or suggest a topic: finn2@offbeatoregon.com or 541-357-2222.