The Morrill Land Act as passed by congress intended to act as an incentive for states to build colleges. They realized that education was the way of the future, and the only way that the U.S. would progress in the future. The land grant has been refered to as "America's greatest contribution to higher education". The Land Act's intent was to make higher education available to qualified individuals at a low cost, thus preparing them for productive careers. 

Many think that the Morrill Act said that a strictly Agricultural college was to be built with the money. That is definitely what the government wanted, and this was implied in the text of the Act but it never stated that explicitly. Therefore the University didn’t break any laws when they developed a school that was not solely based around agriculture.  Many States, especially in the Midwest built agricultural colleges but chose to keep the state college separate.  This is why we see names like Iowa State. Nebraska, however, took the money and built one college: The University of Nebraska, Lincoln.