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Governor LaFayette Grover's Administration

Biennial Message, 1874

Source: Messages and Documents, Biennial Message of Gov. LaFayette Grover to the Legislative Assembly, September 1874, Salem, Oregon, Mart. V. Brown, State Printer, 1874.

BIENNIAL MESSAGE
LEGISLATIVE ASSEMBLY
EIGHT REGULAR SESSION ---1874

Gentlemen of the Legislative Assembly:

In entering upon a second term as Chief Executive of the State I congratulate you, as the representatives of the people, upon the noticeable progress in our affairs and the marked development of our resources which have distinguished the last four years of our history. No State should be more heartily thankful for abounding natural resources, at the hand of an all-wise Providence. Since your last meeting the blessings of good order, health generous harvest and general prosperity have prevailed.

You assemble here under happy auspices to consult for the continued prosperity and, be judicious legislation, to promote the common good of our vigorous and proud young commonwealth.

It becomes my duty to tender to you such information of the present state of public affairs as may appear appropriate to the occasion, and to make such recommendations as may be pertinent.

A detailed statement of the condition of the Chief Departments will be laid before you, by their respective heads, to which I respectfully refer you for full accounts of their workings. I here present a condensed statement of the financial condition of the State.

FINANCES
The balances in the treasury at the close of the financial year, September 6, 1872, were $172,597 41.
To the credit of the several funds, as follows:
General Fund (including $4,811 38 for advertised warrants), coin……$ 5,533 91
General Fund, currency………………………………………………979 00
Common School Fund {Principal, $1,256 59} coin………………… 2,464 69
{Interest, 1,208 10}
Common School Fund {Principal, $ 683 13} currency………………1,759 09
{Interest,…..1,075 96}
University Fund, coin…………………………………………………68 55
University Fund, currency……………………………………………251 14
State Land Fund, coin………………………………………………25,557 16
State Land Fund, currency…………………………………………35,813 06
Five Per Cent. U. S. Land Sale Fund, currency……………………13,306 08
Escheat Fund, coin…………………………………………………1,612 92
Escheat Fund, currency……………………………………………1,785 37
Soldier's Bounty Fund, coin……………………………………… 69,095 48
Soldier's Relief Fund, coin…………………………………………14,370 96
Total…………………………………………………………….$698, 775 01

RECEIPTS
Received since, into the treasury, the sum of $628, 775 01 to the credit of the following funds:

General Fund (including one and one-half mills
Relief and Bounty tax), coin………………………………$460,695 22
General Fund, currency……………………………………486 00
Common School Fund Principal, coin………………………19,812 10
" " " currency………………………………………. 6,938 20
" " Interest, coin…………………………………………40,806 68
" " " currency………………………………………. 14,046 67
University Fund, coin……………………………………16,616 51
University Fund, currency………………………………2,893 69
Escheat Fund, coin………………………………………5,810 35
State Land Fund, currency………………………………19,199 92
State Land Fund, coin……………………………………25,940 56
Five Per Cent. U. S. Land Sale Fund, currency……………5, 226 36
Agricultural College Fund, currency………………………964 50
Swamp Land Fund, coin…………………………………5,607 50
State Capitol Building Land Fund, coin……………………705 00
Tide Land Fund, coin………………………………………3, 025 75
Total………………………………………………………$628, 775 01

DISBURSEMENTS
Paid since, out of all the funds, the sum of $663, 193 45 to the debit of the following funds:
General Fund, coin…………………………………………$ 47,260 76
General Fund, currency………………………………………459 00
Legislative Fund, coin…………………………………………24,011 96
Penitentiary Fund, coin………………………………………48,791 51
Judicial Fund, coin……………………………………………36, 758 34
Executive Fund, coin…………………………………………14,892 11
Insane Fund, coin……………………………………………61,814 86
Convict Fund, coin……………………………………………4,546 68
Printing Fund, coin……………………………………………19,838 73
Incidental Fund, coin…………………………………………21,200 85
Penitentiary Building Fund, coin………………………………61,960 78
State House Building Fund, coin………………………………99,990 00
Fugitive Fund, coin……………………………………………3,817 77
Indigent Fund, coin……………………………………………2,517 43
Agricultural College Fund, coin…………………………………773 15
Common School Fund Loans, coin……………………………16,986 74
Common School Fund Loans, currency…………………………5,035 70
Common School Fund Interest (distributions and expenses), coin…41,452 95
Common School Fund Interest (distributions), currency……………13, 395 78
University Fund Loans, coin………………………………………16, 685 06
University Fund Loans, currency……………………………………1,000 00
Soldiers' Bounty Fund (exclusive of State House building transfer), coin…25,146 85
Soldiers' Relief Fun, coin………………………………………………32,148 77
State Land Fund, currency……………………………………………67 00
State Land Fund (for Lock Bond Interest and expenses)………………35,647 25
Five Per Cent. U. S. Land Sale Fund, currency………………………18,526 86
Swamp Land Fund, coin………………………………………………5,556 32
State Capitol Building Land Fund, coin…………………………………56 00
Tide Land Fund, coin…………………………………………………2,854 24
Total………………………………………………………… $663,193 45

Leaving funds in the Treasury, September 14, 1874, $138, 178 97, to the credit of the several funds, as follows:
General Fund, coin…………………………………$1,546 19
General Fund, currency……………………………1,006 00
Common School Fund Principal, coin………………4,081 95
" " " currency…………………………………….. 2,585 63
" " Interest, coin…………………………………… 561 83
" " " currency…………………………………….. 1,726 85
University Fund, currency…………………………2,144 83
Escheat Fund, coin…………………………………7,423 27
Escheat Fund, currency……………………………1,785 37
Bounty Fund, coin…………………………………21,613 97
Relief Fund, coin……………………………………21,054 86
State House Building Fund, coin……………………10 00
State Land Fund, coin………………………………15,850 47
State Land Fund, currency…………………………54,945 98
Five Per Cent. U. S. Land Sale Fund, currency………5 58
Agricultural College Land Fund, currency……………964 50
Swamp Land Fund, coin………………………………51 18
State Capitol Building Land Fund, coin………………649 00
Tide Land Fund, coin…………………………………171 51
Total…………………………………………………$138,178 97

LIABILITIES OF THE STATE
Bonds
Outstanding Soldiers' Bounty………………………………………$26,500 00
Outstanding Soldiers' Relief………………………………………20,747 00
$47,247 00
Lock Bonds
Payable out of Internal Improvement Land Fund……………………$200,000 00
Wagon Road Warrants
Payable out of Swamp and Tide Land and Five Per Cent. U. S.
Land Sale Funds…………………………………………………… $31,550 00

State Warrants
Outstanding, on all accounts, payable out of State Revenue……..$287,459 00

It will be observed that the accumulations in the Soldiers' Bounty and Relief Bonds, and that the Lock Bonds and the Wagon Road Warrants stand against resources in hand sufficient when available, to liquidate this class of liabilities, so that the only liabilities payable out of the revenue of the State are the outstanding State warrant.

There has been an apparent large increase of outstanding warrants since my last biennial message. This is owing to the fact that nearly all the warrants drawn on the Treasury from 1868 to 1870 were suspended for the reason that they were drawn without an appropriation having first been made for their payment, the Legislature of 1868 having adjourned without making the general appropriations. The assembly of 1870 provided for the payment of a part only of these warrants while the balance were carried forward to be provided for by the last appropriation bill. In addition to the payment of the face of these warrants an addition of thirty per cent. Average increase upon their face has had to be paid for interest on account of the suspense.

Again, no building tax was levied for the construction of the new Penitentiary, and the entire cost, except proceeds of convict labor, was paid by warrants on the General Fund, which was sufficient only for the current general expense, and the devotion of convict labor to this work swelled the appropriations for the support of the prison.

There were several appropriations made by the last Legislature which need not be, and should not be, repeated. Our State Constitution limits the indebtedness of the State to fifty thousand dollars. The provision is as follows: Article 10, Section 7. "The Legislative Assembly shall not loan the credit of the State, nor in any manner create any debts or liabilities which shall singly, or in the aggregate with previous debts or liabilities, exceed the sum of fifty thousand dollars, except in case of war," etc. It is contended by some that this provision refers to funded debts only, and not to the margin of outstanding warrants issued for current expenses. But it appears to me that the form of the liability does not vary the binding force of this restriction. The aggregate of all indebtedness against the State should be within fifty thousand dollars. In fact, it was the evident intention of the framers of our State Constitution that the State should be absolutely free from debt.

Article 9 Section 2, provides that: "The Legislative Assembly shall provide for raising revenue sufficient to defray the expenses of the State for each fiscal year, and also a sufficient sum to pay the interest on the State debt, if there be any." Section 6, of the same article, provides that: "Whenever the expenses of any fiscal year shall exceed the income, the Legislative Assembly shall provide for levying a tax for the ensuing fiscal year, sufficient, with other sources of income, to pay the deficiency, as well as the estimated expense of the ensuing fiscal year." These are positive mandates of our fundamental law. The Legislative Assembly is made responsible that the State be free from debt.

I desire to co-operate with you to enforce these requirements literally. The sole reason why Executive sanction was refused to the emigration bills of two years ago, was that no means were provided to meet the expenditure proposed, and that the general appropriations already made exceeded the revenue, while the General Appropriation Bill could not be modified by Executive action without vetoing the whole bill at the heel of the session, and disorganizing the State government. You will therefore appreciate the corelative duties of the Legislative and Executive Departments upon this subject.

The levy for current general revenue, by Act of October 22, 1864, is five mills on a dollar. The military tax is a mill and a half on a dollar. But, owing to a general misapprehension of the law, four mill only for general State purposes have been collected during the last four years and for some time previously.

One mill of the military tax can now be dispensed with, as the Military Fund is now nearly sufficient to pay off the balance of outstanding Military Bonds. Reducing the military tax one mill, it might be well to institute a half-mill building tax, to stand until all public buildings are completed, and to restrict, absolutely , all appropriations for building purposes to the resources of the Building Fund. Let the State tax be reduced to four mills, and confine the current general expenditures to the revenue arising therefrom, and let the other half-mill, taken from the Military Fund, be transferred to create a Sinking Fund with which to liquidate the excess of outstanding warrants.

A more simple, and perhaps in the end, a more satisfactory plan would be to let the general taxes stand as they are for the present. Collect the five mill State tax, but confine current expenditure within a four mill revenue, until there shall be no outstanding State Warrants, then reduce the State tax one mill. Draw upon the surplus military fund, for State House expenditures, as heretofore, until the Capitol can be occupied. Liquidate all military warrants, then repeal the military tax altogether.

LOCK BONDS
The accumulating funds from the Internal Improvement Grant should be placed at interest, and authority be given for their payment increase. As the faith of the State is pledged for the administration of the Internal Improvement Fund so as to meet these obligations, prompt and sufficient appropriations to meet the maturing coupons are imperative.

PUBLIC LAND OF THE STATE
By the act of the Legislative Assembly of October 15, 1862, the Governor was empowered and directed to locate all he lands to which the State was entitled, under the several acts of Congress, making grants to the State.

The condition of our public land interests, at the time of my entrance upon the duties of the Gubernatorial office, four years ago, was fully set forth in my last biennial message. Since that period the work of securing the interests of the State, in these public grants, has steadily progressed.

INTERNAL IMPROVEMENT GRANT
The full amount of the Internal Improvement Grant of five hundred thousand acres, held under act of Congress of September 4, 1841, has been selected and finally approved to the state by the Secretary of the Interior - the exact quantity so vested being 500, 006.99 acres, as per final statement of the Commissioner of the General Land Office, bearing date February 6, 1874

UNIVERSITY LANDS
By act of Congress of February 14, 1859, admitting the State of Oregon into the Union, seventy-two sections, amounting to forty-six thousand and eighty acres of land, were set apart and reserved for the use and support of a State University. These lands have been fully selected and the quantity of 44,366.81 acres have been finally approved by the Department of the Interior. The limited balance will be approved in the due course of official business.

INDEMNITY COMMON SCHOOL LANDS
The lands taken in lieu of the sixteenth and thirty-sixth sections in each township, held for common school purposes, under authority of the act of Congress of January 7, 1853, have been selected as fast as the surveys have been completed in regions where the settlements have preceded the surveys.

In all cases where the settlements have not reached newly surveyed lands, at the time of the surveys, the sixteenth and thirty-sixth sections become vested in the State without listing, by force of the original grant for common school purposes. The amount of the Indemnity Common School Lands, so far selected and approved by the General Land Office, is on hundred and nine thousand, seven hundred and nine acres. The amount selected and awaiting examination for approval is five hundred and eighty acres. These selections cannot be finally completed until all the public land of the State shall have been surveyed by the General Government.

AGRICULTURAL COLLEGE LANDS
The condition of the land granted by Congress by Act of July 2, 1862, providing for the establishment of Colleges in the several States for the benefit of Agricultural and Mechanic Arts, was fully stated in my last biennial message. On account of obstacles therein set forth, the lands selected under this grant had not been approved, although they had been selected by a Commission created and authorized by the Legislative Assembly at its regular session in 1868.
The special Act of Congress touching this subject, approved June 4th, 1872, provided , in section second thereof, "that any such selections already made by said State (Oregon) and the lists duly filed in the proper district land office, be and the same are hereby confirmed, except so far as they may conflict with any adverse legal right existing at the passage of this Act." On examination of the lists of these lands for final approval by the Commissioner of the General Land Office they were found to conflict with the Klamath Indian Reservation, and that the quantity of 10,092 acres of the same lay within said reservation. The boundaries of the reservation were not definitely known to the commission charged with the duty of selecting these lands, hence the conflict. The amount of 79,235.17 acres of this grant is now finally approved, and the lands have been offered for sale pursuant to the provisions of the Legislative Act for that purpose approved October 28, 1872.

The amount to be selected anew, after all rejections for conflict, is 10, 764.83 acres. The selection of this balance has not been hastened, for the reason that lands of a greater value than now obtainable can be listed after the public surveys have been further extended.

These lands have not been disposed of as rapidly as was expected when first offered for sale. It is thought by some who are well acquainted with the premises that the limitations of the statute providing for their disposal requiring sales to be made to actual settlers only and in quantities of not more than three hundred and twenty acres to each settler, are obstructions in the way of sale.

It is asserted that the lands selected are better adapted to grazing purposes than to general agriculture, and that more than a half section is necessary for a profitable stock ranch, while those who already own three hundred and twenty acres of land are debarred by the statute from purchasing any of the Agricultural College selections.

It is certainly a good public policy to divide the public lands of the State into as many homesteads as is compatible with successful settlement, but the early disposal of these lands, in order that the funds arising therefrom may be made available for the support of the Agricultural College, would seem desirable. The minimum price is fixed by the act of Congress making the grant, at two dollars and fifty cents per acre. I call our attention to this subject and suggest an inquiry whether, for the purpose of facilitating sales, a change in the conditions of sale prescribed by the act of October 28, 1872, might not be advisable.

PUBLIC BUILDING LANDS
The quantity of ten sections, or six thousand four hundred acres of public lands, were granted to the State of Oregon by the act of Congress of February 14, 1859, before referred to, which, in the words of the Act, were "to be selected by the Governor of said State, in legal subdivisions, for the purpose of completing the public buildings, or for the erection of others at the seat of government, under the direction of the Legislature thereof." Since your last session these lands have been selected and approved by the local land offices within whose jurisdiction the locations have been made, but final approval by the Department of the Interior has not yet been had.

SALT SPRINGS
The Act of Congress last before mentioned also contains the following provision: "That all salt springs within said State, not exceeding twelve in number, with six sections of land adjoining, or as contiguous as may be to each, shall be granted to said State for its use, the same to be selected by the Governor thereof within one year after the admission of said State, and when so selected to be used or disposed of on such terms, conditions and regulations as the Legislature shall direct. Provided, that no salt spring or land, the right whereof is now vested in any individual or individuals, shall by this article be granted to said State."

No selections of springs or lands having been made under this authority within the stated limit of time, on the 17th day of December, 1860, Congress passed "An Act to amend the fourth section of the Act for the admission of Oregon into the Union, so as to extend the time for selecting the Salt Springs and contiguous lands according to the provisions of the fourth section of the Act entitled 'An Act for the admission of Oregon into the Union', approved February 14, 1859, be extended to any time within three years from the passage of this Act, anything in said section to the contrary notwithstanding." The extended time expired December 17, 1863, without selections of Salt Springs and lands adjacent thereto having been made. The right to these springs and to the lands mentioned in this grant therefore lapsed at that period.

There are several Salt Springs within this State of superior character and of great future value, already known, and I doubt not there are many others yet undiscovered which might be secured to the State if the time for selection could again be extended. The entire quantity of public lands which would enure to the State if the springs could be acquired, would be forty-six thousand and eighty acres. This is a grant customary to be made to the new states upon their admission into the Union, and is of such importance that I suggest that you memorialize Congress to pass an act again extending the limit for selecting the Salt Springs and contiguous lands.

SWAMP LANDS
The right of this State to the swamp and overflowed lands within her borders, unequivocally granted by Act of Congress, of March 12, 1860, extending to Oregon the provisions of the Swamp Land Act of September 28, 1850, has not yet been fully acknowledged by the General Land Office.

In my last biennial message the following remarks were made upon the condition of this class of lands as existing at that time:

"But little notice was taken of this important grant by the public authorities of this State until the session of the last Legislature, at which an Act was passed bearing date October 26, 1870, entitled 'An Act providing for the selection and sale of the swamp and overflowed lands belonging to the State of Oregon.' This Act provided that the Board of School Land Commissioners should appoint deputies to proceed as soon as practicable, to select in the field all the lands rendered unfit for cultivation by inundation or overflow within this State, and to make return of the same to said Commissioners.

"Pursuant to this authority, deputies have been appointed who have proceeded to the field and made selections in their several districts of such land as they deemed to fall within the description of said Acts of Congress, omitting under instructions from the Board, all such swamp lands as are claimed and occupied by bona fide settlers, under whatever right they claim. The amount of swamp and overflowed lands so selected, free from conflict, and reported to the Board up to the present time is 174,219 97-100 acres, lists of which have been duplicated and duly forwarded for filing in the office of the Surveyor General of Oregon.

"In examining the title of the state to these lands, and the condition of the grant, found that there had been a practical omission on the part of the Department of the Interior to execute the laws of Congress making this grant, as far as the same related to Oregon. The usual special instructions sent to Surveyors General of other States, holding under the same acts of Congress, directing a segregation of the swamp lands, had not been transmitted to the Surveyor General of this State. Deputy United States Surveyors in the field had generally made no note of the swamp lands, but had returned al this class of lands as arable, and the several local land offices had been accustomed to dispose of them without reference to the title of the State, as public lands of the United States, subject to homestead and pre-emption settlement. By this means considerable portions of the swamp lands owned by the state, and which re still vested in the State, had been disposed of as the lands of the United States.

"A letter was addressed by me to the Secretary of the Interior, bearing date November 9, 1871, calling his attention to the acts of Congress under which we hold these lands, and to the omission of the Land Department of the United States to execute the laws. The correspondence upon this subject is herewith accompanying. In this correspondence I have urged the General Land Department to execute the Swamp Land laws of Congress in favor of Oregon, as they have been executed in favor of other States under the same laws, and to suspend all action of our local land offices involving adverse possession of these lands until the question of title could be adjusted between the State and the United States. On the part of the Secretary of the Interior and the Commissioner of the General Land Office a willingness has been indicated to enter upon the segregation of the Swamp Lands, but no work has been done in that direction by them, and no instructions have been issued, to the knowledge of the Executive, in answer to the requests contained in the correspondence. I can state, therefore, as the present condition of this important interest, that the acts of Congress making the swamp land grant to Oregon remain practically unexecuted by the Land Department of the United States. In the meantime, lands unquestionably of a swampy character are being disposed of by the local land offices, thus absorbing the property of the State and complicating the title to the swamp and overflowed lands within her borders. * * * In relation to the right of the State to old these lands, even without any action of the United States Land Department, and without patent, I have not the slightest doubt."

Since the last session of your body a leading decision has been made by the Supreme Court of this State, in the case of Joseph Gaston vs. Frank L Stott, involving the possession of that tract of swamp and overflowed land known as Wappatoo Lake, in Yamhill and Washington counties. The court, Justice McArthur delivering the opinion, unanimously held that the acts of Congress recited, created a grant in presenti and passed a fee simple title to the state of all the swamp and overflowed lands within her borders; and that the State has a right to make selections and to dispose of the lands acquired under this grant before the issuing of the patent by the general government.

This position has been held by the highest tribunals of all the States, entitled to this class of land under the acts of Congress from which we derive title, and also by the Supreme Court of the United States. In the case of Railroad Company vs. Smith, 9 Wallace, U. S. Supreme Court Reports, page 99, the Supreme Court of the United states in passing upon the effect of the omission of the Secretary of the Interior to segregate swamp lands in Missouri, as directed by the act of Congress of September 28, 1850, uses the following pointed language:

"Must the State lose the land, though clearly swamp land, because that officer has neglected to do this? The right of the State did not depend on his action, but on the Act of Congress, and though the state might be embarrassed in the assertion of this right by the delay or failure of the Secretary to ascertain and make out lists of these lands, the right of the States to them could not be defeated by that delay."

The condition of the swamp lands within the State is the same as stated in my message of two years ago, except that progress has been made in segregation by State agents acting under authority of the Board of School Land Commissioners, as directed by statute. The total amount of swamp lands which have been surveyed and selected by the several deputy swamp land commissioners under authority of the act of the Legislative Assembly of October 26, 1870, is 266,600.42 acres.

No instructions of any character have been received at the office of the Surveyor General of this State, customary to be issued to that office in all states entitled under the swamp land acts of Congress.

The refusal of the General Land Office to act in the premises is now reduced to a mere technicality. The Act of Congress of September 28, 1850, the provisions of which were extended to this state by the act of March 12, 1860, provides, "That it shall be the duty of the Secretary of the Interior, as soon as may be practicable after the passage of this Act, to make out an accurate list and plats of the lands described as aforesaid (the swamp and overflowed lands), and transmit the same to the Governor of the State; * * * and, at the request of the Governor, cause a patent to be issued to the state therefor." On the 21st day of May, 1860, the Commissioner of the General Land Office addressed a letter to the Governor of Oregon, proposing the adoption of one or the other of two systems in segregating these lands, in the following words:

"1. Whether the State would be willing to abide by the field notes of the surveys, as designating the lands, or

"2. Whether, in the event of the non-acceptance of these notes as he basis, the State would furnish evidence that any lands are of the character embraced by the grant.

"This is important to the State also, as, by the second section of the Act, the selections in townships, where the surveys have been completed, are required to be made within two years after the adjournment of the first Legislature convened after the passage of the Act; and, where the surveys are yet to be made or completed, within two years from the adjournment of the next session, after notice to the state that the surveys are completed and confirmed."

The Commissioner of the General Land Office, in a communication to the Governor of Oregon, dated April 26, 1873, referring to this subject says: "This letter was acknowledged by the Governor February 22, 1861, and information given that he had submitted the proposition, with the inclosures, to the Legislature which convened second Monday in September, 1860, but that the Legislature had failed to determine which of the two propositions submitted from this office should be accepted." On the 3d day of January, 1872, in reply to the objection, raised for the first time in a letter of the Commissioner to me, bearing date November 10, 1871, that the State had not elected which of these methods would be more agreeable; that, by the provisions of the Act of our Legislative Assembly, of October 26, 1870, providing for the selection and sale of the swamp and overflowed lands, "the State of Oregon has elected to make selections of swamp and overflowed lands within her borders, by agents appointed by the State, and to furnish evidence that all lands claimed by her are of the character embraced by the grant referred to."

But the General Land Office still refuses to proceed because the legislative act did not declare, in so many words, that the State did elect to select the lands by its own agents, and does not provide for furnishing the General Land Office with any testimony whatever. I have not lately discussed this matter with the Department of he Interior, because I deemed further discussion of no value to the State. The acts of Congress under which we hold the swamp lands do not require any election on the part of the State as to what method shall be adopted in the segregation. The proposition of the Commissioner of the General Land Office, contained in his letter of May 21, 1860, to the Governor of Oregon, asking the state to elect between two proposed methods, which had before that time been practiced in other states in segregating swamp lands, seems to have been made out of deference to the dignity and interests of the State to facilitate just and satisfactory action in the premises, rather than to clog and successful prosecution of the work. As to the Legislature of this State prescribing the manner of furnishing evidence to the Department of the Interior upon this subject, I do not deem it competent for a State to make rules and regulations for transacting any public business with the Departments of the United States.

Our legislative act, of 1870, most certainly made election to select the swamp lands by agents of the State, because it provided directly that these lands should be selected in that manner, and such agents have been at work in the field performing this duty, from time to time, for four years. To say that the State has not so elected is to deny that a statute is the expressed will of the Legislature.

The reason which induced the Legislature to provide for making these selections by agents of the State was that this important grant might be wholly lost if left to the accidents of the general surveys.

To avoid further controversy, and to meet the views of the General Land Office, I recommend that a joint resolution be passed specifically electing to select the swamp and overflowed lands by agents of the State, and instructing the Board of School Land Commissioners to furnish such evidence, and in such manner, of the character of these lands as the Department of the Interior shall prescribe.

All the swamp and overflowed lands have been listed in duplicate, and reported in that form to the Surveyor General of Oregon, authenticated in manner as prescribed by that office. One of these lists has been by him forwarded to the General Land Office. The magnitude of this interest is greater than at first supposed. The southeast quarter of the State, not yet surveyed, and but very little explored, appears, by latest information, to be occupied between its mountain ranges by a succession of ridges, hills, lakes and marshes, all productive and valuable. The securing of these lands is the more important for the reason that the residue of their proceeds after paying the Wagon Road warrants is devoted to one of the most important public projects which has attracted notice in this State. I refer to the construction of the Portland, Dalles, and Salt Lake Railroad.

TIDE LANDS
The title of the State to the tide lands upon he sea coast and rivers was first brought to public attention in this state in my last biennial message. I then stated that "these lands belong to the State by virtue of its sovereignty, or the right of eminent domain, independent of any title from the General Government." But in the public mind these lands are confounded with the swamp lands. The titles of the two classes of property are essentially distinct and different. The former does not depend on a grant by Congress; the latter does. The title to lands between the ebb and flow of the tide has been in controversy in other States, and final adjudications by the highest tribunals have determined the right to be originally in the States. In the case of Pollard et al. vs. Hagan, reported in 3d Howard, 212, the plaintiff's held a tract of tide land in Alabama by patent from the United States, which, after controversy, was specially confirmed by two several Acts of Congress. The defendant held under a deed from the State, and proved that the premises were covered by water at common high tide. The case was a leading one, and was ably argued and fully considered. The Supreme Court of the United States held:

"First. The shores of navigable waters and the soils under them were not granted by the Constitution to the United States, but were reserved to the States respectively.

"Secondly. The new states have the same rights, sovereignty, and jurisdiction over this subject as the original States.

"Thirdly. The right of the United States to the public lands, and the power of Congress to make all needful rules and regulations for the sale and disposition thereof, conferred no power to grant to the plaintiffs the land in controversy."

In this case a United States patent was set aside, and two acts of Congress touching the title to the premises were declared void, and the right of the State to the tide lands by virtue of her sovereignty, was sustained.

This doctrine was recognized and enforced by the Supreme Court of California in the case of Farish vs. Coon, 40 California Reports, 33. In this case salt marshes had been selected and approved to the State as a part of the five hundred thousand acres granted by Congress Act of September 4, 1841, for Internal Improvements. The lands had been sold by the State to private parties, and had been improved at great expense, and had been held in private possession nearly twenty years. But the court set all the conflicting rights aside, and awarded the property to the custody and disposal of the Board of Tide Land Commissioners as lands held by the State by the original title of sovereignty.

I have thus suggested the tenure by which the State holds the tide lands, in order to give a clear idea of the power of the Legislature over them, and of the propriety of distinct and complete enactments for their disposal.

The Tide Land Act passed two years ago is very defective. Its force is limited to land abutting or fronting upon or bounded by the shore of any bay, harbor, or inlet on the sea coast of this State. This limit should be extended to all lands within this State abutting or fronting upon the Pacific ocean and upon all waters confluent thereto, and lying between the ebb and flow of the tide.

The body of he act also requires careful revision, embodying more explicit authority for the Board of School Land Commissioners to make disposal of these lands.

THE FIVE PER CENT FUND
The total amount derived from the five per cent of the net proceeds of sales of the public lands within the State, enuring under provisions of the Act of Congress of February 14, 1859, admitting Oregon into the Union, is $23,956 69.

In my last biennial message it was stated that the sum $5,424 25, belonging to this fund, had been withdrawn by the former Secretary of State. Suit has been instituted, on the part of the State, against the late Secretary and sureties, on his official bonds, to recover all moneys on account of which that officer was in default. A final judgment has been recovered in the premises amounting to the sum of $10,558 94 for which execution is now out against said sureties. It is probable that the whole amount will be paid into the State Treasury. This will include the said Five Per Cent. Fund default of $5,424 25 and will restore and fund complete. The accumulations into this fund will continue until sales of the public lands within the State shall cease.

Thus far the account of this fund rendered to the State, by the Department of the Interior, has included the sales only made for cash. It has been urged by several States, interested in like manner as our own, that a percentage of all lands disposed of for a consideration should be included in the account of sales. The State of Iowa has made a special effort before the Commissioner of the General Land Office to secure a ruling to this effect upon existing law, but thus far without success. It would appear but just, after having pledged to the several new States five per cent of the net proceeds of sales of all the public lands within their borders, for the purpose of Internal Improvements, that in all cases where the public lands mentioned have been disposed of for a consideration to the United States, not immediately beneficial to the State, as in case of Soldiers' Bounty Lands, Agricultural College Land scrip from other States, permanent Indian Reservations and like permanent disposals of the public domain, the five per centum allowance should be made to the State on their minimum value.

A proper presentation of this subject, by memorial of he Legislature to Congress might facilitate the passage of An Act recognizing the just right of this State to be allowed five per centum of the net proceeds of all public lands disposed of within her borders wherein the State was not interested.

COMMON SCHOOL FUND
The Irreducible Common School Fund arising from the sales of the sixteenth and thirty-sixth sections in each township of the public lands, and from those taken in lieu thereof, had reached two years ago, the sum of $450,000. The sales of the public lands of the State have been slow during the last two years, owing to the stringency of the money market during that period. But a fair progress has been had in these sales, indicating a healthy growth of the State, and steady increase in the Common School Fund. The whole fund now in the hands of the Board of School Land Commissioners and of the local agents of the Board in the several counties, amounts to the sum of $504,216 46.

In relation to the management of this fund, I repeat my recommendation of two years ago, which was as follows:

"The efficient work of the Board is swelling the amount of educational funds to such importance that more complete provision should be made for the custody and control of funds in the hands of local agents, and particularly in reference to the collection and return of interest for distribution to the schools. Local agents should be required to give bonds to the Board for the safe custody of the moneys in their hands, and for the faithful performance of their official trusts."

UNIVERSITY FUND
The total grant of public lands to the State for the support of a University is 46,080 acres. Of this amount there have been sold by deed and bond, 19,905 55-100 acres. There consequently remain unsold, 26, 174 45-100 acres.

AGRICULTURAL COLLEGE FUND
This fund has but just begun to accumulate for the reason that it has been but a short time since the lands belonging to this fund were approved at the General Land Office. There have been but 257 92-100 acres deeded and 480 acres bonded. The fund arising therefrom is $1,844 80.

LITIGANT LAW
The enactment of the law for the protection of litigants, by the Legislative Assembly of 1870, has given rise to much discussion as to the necessity and propriety of the Act. There are manifest good reasons why there should be some specified journals authorized to publish all legal advertisements, and that the rates of publication should be fixed by law. Two years ago a bill was passed repealing this Act, but the repealing bill was vetoed on the ground that the original Act, requiring a specific undertaking to do the litigant publishing; and, upon the filing of such undertaking, the statute declared that the publisher should hold the privilege during the term of the appointing power. Deeming that this created a vested franchise for the term named, I declined to approve the bill. But the term specified in the Act having expired, the Act is now subject to repeal.

PORTLAND POLICE LAW
The best method of governing American cities is an unsolved problem. Great abuses have been suffered, both in general management and in the administration of Police Departments. To meet an evident necessity, four years ago a law was passed by the Legislature reorganizing the Police Department of the city of Portland. In the new system the Governor of the State is required to appoint three Police Commissioners, who have full control of the subordinate organization and working of the Police force. This la is in contravention of the general principle of local self-government, and should be changed as soon as practicable. I think the time has arrived when the change can safely be made. Peace and good order have been maintained in Portland since the adoption of the present system. No change should be made without making the Police force responsible to some controlling authority, otherwise it will be ineffective and injurious to the city.
Governor Hoffman, of New York, who had great opportunities of observation, remarking upon the government of the city of New York, said in his annual message of 1872: "No good government can be secured to any great city unless it shall have one responsible head, in whom shall be vested all executive power, and to whom, as the elected representative of the people, all departments charged with executive duties shall be directly and summarily responsible and accountable."

I recommend that the Portland Police Law be so amended as to make the Mayor the responsible head of the Police system of the city.

THE CODE
It is customary in other States, and has been the practice in this State to provide by law for a compilation of the statutes, at least once in ten years. Such a compilation has been made in pursuance of the Act of last Assembly providing "for collecting, compiling and printing the laws of Oregon," approved October 22, 1872. Upon the completion of the work by the Commissioners, and after its examination by the Governor and the Secretary of the State, and its acceptance by the Governor as required by the statute, the State Printer appeared and demanded the manuscript compilation for printing. The Act referred to required the Governor to advertise the work of printing and binding and to let the same to the lowest bidder and to contract with such for the doing of the work.

The State Printer insisted that he was entitled to do the printing, notwithstanding this provision of law, on the ground that by the 1st Section of Article 12, of our State Constitution, it is provided that the State Printer "shall perform all the public printing for the State, which may be provided by law."

Deeming it my province to execute the laws as I find them upon the statute book, I declined to deliver the manuscript to the Public Printer, but proposed to advertise for the printing, as by said Act directed. At this juncture a proceeding of mandamus was instituted by the State Printer before Associate Justice (now Chief Justice) Bonham, asking an order that the Governor deliver said copy to him, the State Printer, to be printed.

The Governor accepted service, and agreed to a stipulation of facts, and that the court should determine the law. On full consideration of the subject, on the 26th day of January last, the following conclusion was reached and made of record in the case:

"The court finds that the act of the Legislative Assembly, approved October 12, 1872, entitled an act for collecting, compiling and printing the laws of Oregon, so far as the same requires the Governor to let the printing of the laws therein provided for to the lowest bidder, is in contravention of Section one of Article twelve of the Constitution of this State, and so much thereof is void. Therefore it is ordered and adjudged by the court that the plaintiff herein is lawfully entitled to the possession of the manuscript or an authenticated copy thereof, of such compiled laws for the purpose of printing the same as required by the Constitution of this State."
Upon this adjudication, which was consonant with the views of the compiling commissioners, the manuscript was delivered to the State Printer to be printed.

The binding was advertised and let to be done by the lowest bidder, at one dollar and fifteen cents per volume; a price much lower than any public work of the kind has ever been before done in this State.

The three thousand volumes required by the Act to be printed have been completed and bound, forming a compact volume of 922 pages. The work was carefully executed under the personal supervision of Judge Matthew P. Deady, one of the Commissioners, and is of intrinsic value to the State and to the legal profession.

The State Printer has not allowed the publishing of any copies of this Code, except the number authorized by law, so that the State can derive the full benefit of the sale of the work.
The cost of Code printing by the State Printer will, I am informed, be about eighteen thousand dollars. The rates of sale of this work should be fixed by law at a price which will reimburse the State for the expenditure.

An impression has prevailed to some extent that the decision of the court pronouncing one clause of the recited Act to be void, annuls the whole Act. This is an error. The body of the Act is as valid, and as operative, as though the condemned clause had never been inserted therein.

BOARD OF SCHOOL LAND COMMISSIONERS
The labors of the Board of School Land Commissioners have been continued with efficiency. This Board is constituted directly by provision of the State Constitution and is composed of the Governor, Secretary of State, and State Treasurer, and charged with the duty of selling the School and University Lands and investing the funds arising therefrom. By section six of the act of October 28, 1868, regulating the sale of these lands and providing for the management of these funds, it is enacted "that the Board of the School Land Commissioners shall pay over all moneys now in their hands, or that may arise from the sale of said School and University Lands to the County Treasurers of the counties in which the lands are located and shall be loaned by said Treasurers," etc., etc.

This section came under the adjudication of the Supreme Court of this State, at its present session, and was held by the court to be void for the reason that it was in direct conflict with section 5, of Article VIII, of the Constitution, which devolves upon the Board of School Land Commissioners solely, the duties here specified to be done by County Treasurers. The Code Commissioners have arrived at the same conclusion and have so stated in a note to the text of the new Code.

Anticipating such a result whenever the question should be raised the Board has uniformly required all transactions by County Treasurers, touching these funds, to be in the name of the Board, so that the State might not suffer for the want of proper and sufficient securities, and yet an effort has been made to carry out the letter and spirit of this unconstitutional section of said Act as near as circumstances would permit.

I would recommend that an act be passed providing for agents in the several counties, to be appointed by the Board, who should act under its direction. Bonds should be required for the faithful performance of duties, and compensation be provided for services.

This interest is too grave a one to be lightly or inconsiderately disposed of. The report of the Board, showing specifically the amount of land sold and bonded, and the name of each purchaser, and minutely all it transactions for the past two years, prepared by the Clerk, Thomas H. Cann, is herewith submitted. The Board has held monthly sessions to hear and determine all conflicts of right between applicants for land, and between settlers claiming the same land. Full records have been kept of all proceedings, as in a court of record, and duplicate originals have been preserved, in bound volumes, of all deeds executed.

As the extra duties of segregating and disposing of the swamp lands, and of the tide lands, as well as other duties have been also devolved upon this Board by statute, in addition to the duties created by the Constitution, it is probably the most laborious organization in the State. The work done by the Board of School Land Commissioners, in Oregon, is done in other States by Surveyor General, State Land Office, Board of Swamp Land Commissioners, in Oregon, is done in other States by Surveyor General, State Land Office, Board of Swamp Land Commissioners, Tide Land Commissioners, and School Fund Commissioners - all separate and distinct officers, having compensation as such.

It has been found necessary to employ a Recording Clerk of this Board, under authority of section twelve of the Act of October 28, 1868, and the special provision of the law of last session making appropriation for that purpose.

Previously to 1868 the members of this Board were compensated for their services at the rate of four hundred dollars per annum. The provision making this allowance was repealed at the session of that year, for the reason that the Board was inoperative. All the arrearages of work have been brought up during the past four years, together with the multiplied duties of that period, in addition to the legitimate duties of the chief offices of the State; and al without compensation as a Board.

SALMON FISHERIES
The salmon fisheries of the Columbia river are assuming such importance that I take occasion to call your attention to the subject. The product of these fisheries was scarcely noticeable four years ago, but last year it approximated one million dollars in export value, and for the season of 1874 exceeds a million and a half.

This river, bearing to the ocean a volume of water hardly less than that of the Mississippi, pure, cool, and generally unobstructed by ice in its lower extent at all seasons, is doubtless the best salmon producing river in the world. We have been accustomed to think that this fish product was inexhaustible. But the river fisheries of all countries, where the laws have not intervened for their preservation, have one uniform history - first decimation, then destruction.

The rivers of the northeast coast of he American continent were at an early date in our history, relatively as well supplied with this imperial food-fish as the rivers of the northwest coast are now. But through want of public attention, by over fishing and unseasonable fishing, and by the obstruction of streams with mill dams, having no fish ladders for the ascent of the fish, the salmon has become almost unknown in all the rivers of New England, and totally gone from many of them.

At one time the salmon frequented all the rivers of Great Britain, but have been driven out of man of them by the turbid, poison waters from the sewers of manufacturing towns.
By the construction of fish-ways and by stringent regulations of law limiting fishing to certain seasons of the year, days of the week and hours of the day, in which it shall be lawful to take fish, the run of salmon, once much diminished, has of late years been increased in several of the rivers of Scotland and Ireland.

The sad of the Middle States, a fish which, like the salmon, makes its annual incursions from the sea, has been lost to several rivers once filled with their roving millions. They were destroyed by reckless fishing, and cut off from their spawning grounds by mill dams. A lively interest is now manifested throughout the States bordering on the Atlantic sea-board, seeking by fish culture, not only to recover lost fisheries, but to create new ones, and to introduce species of fish valuable for food, not before known in those waters.

In Oregon we have, in great abundance, two of the best river fishes in the world, the salmon and the trout. To preserve these is worthy of careful legislative enactments.

Salmon fishery constitutes an interest of so much importance that no action should be taken upon it without a complete knowledge of what action is demanded, and a clear conception of the public good in the premises. I therefore recommend the establishment of a fish commission to be composed of prominent and competent citizens, who will be willing to serve without compensation, and who will consider the whole subject and report their views upon it to the next Legislative Assembly.

As the Columbia River forms a common boundary between the State of Oregon and Washington Territory, and is subject to the concurrent jurisdiction of both, the commission should be authorized to correspond with the authorities of the Territory of Washington, in order that whatever legislation may be had on the subject, may become the law of both jurisdictions.
The salmon has seldom frequented the waters of the upper Willamette river, not being able to pass the falls at Oregon City. It was anticipated that the salmon would pass to the upper Willamette through the canal and locks lately constructed at those falls for the purpose of navigation, but it is ascertained that the fish will not follow slack-water channels, and consequently will not present himself at the gates of these locks. Yet the upper Willamette river, on account of its smooth and pure waters, and its milder temperature is thought by the observant to be the best home for young fish of all the tributaries of the Columbia. If the salmon could pass the falls of the Willamette without injury, the result would be great blessing t the people of the Willamette Valley, as well as a great addition to the spawning grounds tributary to the Columbia fisheries.

The salmon readily ascend the fish-way in Scotland and Ireland. I would therefore suggest, that in case the fish commission is authorized, that the Board be charged with the duty of examining whether or not a fish-way could be constructed at the falls of the Willamette at limited expense, to meet the end referred to.

PILOTAGE AND TOWAGE ON THE COLUMBIA AND WILLAMETTE RIVERS

Your special attention is called to the necessity of more suitable and certain regulations of pilotage and towage on the Columbia and Willamette rivers. It is most important to our rapidly increasing commerce that these regulations should be just, discriminating and efficient.

HARBOR-MASTERS
The number of foreign vessels destined to arrive in ballast, at the ports of Portland and Astoria, for the purpose of transporting the surplus products of this State, suggests the necessity of enactments providing for the regulation of these harbors, and the appointment of harbor-masters. No considerable compensation will be necessary.

REPRESENTATIVE FROM CLATSOP COUNTY
The people of Clatsop County have elected a Representative to the present Assembly without authority of the last General Apportionment Law. It is claimed, in this case, that the County was districted with Tillamook County in the election of a Representative, while she was entitled, under the rates established in the late apportionment law, to a Representative alone. Justice should be done in the premises.

PENITENTIARY
I call your special attention to the interesting and lucid report of the Superintendent of the Penitentiary. All the detailed workings of this institution are set forth with care and faithfulness.
Our State Prison, during the past four years, has been brought up to a much higher standard of discipline and productive industry than was at first anticipated. Four years ago the State was without a tenantable prison. The prison grounds were unimproved and undrained. Portions of the premises, having been subject to overflow, and remaining at seasons wet, were unhealthy. The prison farm, consisting of one hundred and fifty-seven acres, as been drained, cleared of brush and worthless trees, fenced and reduced to cultivation. A new prison has been built, complete in all apointments, and so substantially constructed that it will stand for centuries.
A water power of immense capacity has been created almost wholly by the employment of prison labor, the value of which in the future employment of mechanical prison industry can hardly be estimated. This water power has been so thoroughly and scientifically constructed that it is not liable to future damage by flood or time. The canal is of earthwork of uniform grade through a clay subsoil. It crosses but one depression requiring a culvert, which is passed upon an arch of masonry, the uniform earth embankments being kept up. The old wooden prison buildings have been utilized as workshops.

The efficient management of the Superintendent, Wm. H. Watkinds, Esq., is worthy of high commendation. The care of the health and morals of the prisoners, the success shown in securing to the State cheerful and productive labor, the evident progress made in reformatory discipline all prove the competent and faithful public officer.

The subject of prison reform has a broader bearing and a wider interest than is generally supposed. Many become interested in its progress and look upon the result with the single view of its effects upon the unfortunate prisoner alone. But the welfare of the State is affected in several aspects of the case. Society must receive to its bosom all discharged convicts. Do they come as persons capable of beginning new lives and of becoming industrious citizens? Or do they come as hardened criminals, to return again to a life of crime? If the former, the State gains a productive member of its body, not to be a public expense, but to assist in bearing the common burden. If the latter, the released convict again becomes a prey upon society and his road leads back to prison, there to be a tax upon the State.

In leading prisons, in the older States, where special measures of reform have not yet been adopted, the proportion of discharged convicts, who return to prison life, is stated to be from seventy to ninety per cent. During the last four years the proportion of returns has not reached four percent. The exact number of discharged prisoners, during that period, has been one hundred and seventy-nine, and the number who, after discharge, have been convicted of crime and resentenced has been but six.

The Superintendent reports but one convict now at large, by escape, since his superintendency, and that no escapes have taken place within the last two years. This is remarkable in view of the fact that convict labor has often been employed outside of prison bounds.

To the credit of the women of Oregon I take occasion to remark that during the Executive term of four years, just elapsed, there has been but one female inmate of our State Prison, and that of the one hundred and thirteen convicts now in our Penitentiary, not one is a woman.

I join in the recommendations of the Superintendent's report, and desire to call attention to that portion of he report which refers to leasing convict labor. The time has arrived when action must be had upon this subject. After year of trial in the older States the system now adopted in the best regulated prisons is that of leasing to contractors the labor of the prisoners, in numbers to sit the classes of business in which they are to be employed, at a certain per diem rate, the State furnishing shops for mechanical labor with the power, and the main line of shafting connected with the power, the State reserving its control of the prisoners and their support and discipline.
No important manufacturing interest can be established at the Penitentiary by contract for labor unless there is special authority of law for long-time contracts.

The preparation of flax for foreign shipment has been introduced as an experiment, and has proved a success; so much so that the parties engaged in the business desire to engage the labor of a number of convicts on long lease, for the prosecution of this important branch of industry, for the first time introduced into Oregon last year, at the prison. I specially commend this enterprise to your consideration.

Many other branches of manufactures mentioned in the Superintendent's report can at once be introduced in case continued leases of labor to be authorized.

The compensation of the Superintendent is without doubt low, when taking into consideration the valuable and responsible services performed by him.

The reports of the Penitentiary Building Commissioners, showing the accounts of the final completion of he buildings and the expenditure of the appropriation, accompanies the Superintendent's report; also the report of the Prison Chaplain, Dr. C. H. Hall, and of the Prison Librarian, Dr. E. R. Fiske. These gentlemen have labored for the good of prisoners devotedly and without compensation, in the true missionary spirit. The suggestions in their reports are worthy of consideration by the Assembly.

Under the care of the Prison Physician, Dr. A. M. Belt, whose report also accompanies tat of the Superintendent, the health of the prison has been remarkably good. The Physician says: "the prisoners have been nearly exempt from the evil effects of solitary vices that are so common in prisons. This is due largely to the excellent rules of the institution, securing wholesome diet and regularity of labor, exercise and rest."

It is befitting here that I pay a tribute to the memory of one who, from the establishment of the Penitentiary at the seat of government to the time of his death (which occurred since your last meeting), was its voluntary chaplain. The Rev. Alvan F. Waller, one of the earliest missionaries of the Methodist Episcopal Church in Oregon, for more than thirty years witnessed the progress of this new community - first the colony; then the Provisional Government; then the organization of the Territorial form under the United States; and, afterwards, the State. Through all these stages of successive development he has left the impress of a strong mind and a ceaseless energy upon the land marks of our progress.

He took the greatest interest in, and gave the most valuable assistance to, the later efforts at prison reform. In the words of the Superintendent's report, "He visited the prison through sunshine and storm alike - the prisoners during health and sickness, and followed their remains to their last resting place, giving them the benefits of Christian sepulture without pay or expected earthly reward." He rests well whose work is well done.

HOSPITAL FOR THE INSANE
The report of the Superintendent of the Hospital for the Insane is herewith submitted. Dr. J. C. Hawthorne, the Superintendent, has been connected with the care of the insane in this State ever since the first establishment of a State Asylum, twelve years ago.

The institution during the past two year has been conducted with the same care and humane treatment, and with equal success in the recovery of unfortunate sufferers from insanity. The whole number of patients now in the hospital is one hundred and sixty-three public, and four privates. Of these one hundred and nineteen are males and fifty-eight are females. The report is full and instructive, and is worthy of careful consideration. It is but justice to the Superintendent to say that his management of this institution is a high credit to Oregon. The contract of the last four years has expired, and it will be the duty of the Legislature to make further provision for keeping our insane.

In making new engagements it will hardly be necessary to suggest that a spirit of enlightened humanity should assist in the disposal of the subject.

The report of the Visiting Physician, Dr. Andrew D. Ellis, replete with interesting details, is also submitted.

PARDONS
As required by statute, a report of pardons granted during the biennial period just closed, together with the reasons for such pardons, is herewith furnished for the information of your Honorable Body. A less number have been granted in proportion to the number of prisoners than during any like period heretofore. I have sought to examine and act upon each case presented with impartiality and with an effort to execute the trust which I hold for society, with faithfulness. By a moderate exercise of the pardoning power, and by encouraging prisoners to shorten the term of their imprisonment by merit marks, under the statute, for good conduct and extra work, a better discipline is maintained.

THE MODOC INDIAN WAR
On the first of December, 1872, the country was startled by the news that the Modoc Indians belonging to the Klamath Indian Agency had risen in arms and fallen upon the unprotected and unsuspecting settlements on Lost River, and had, on the 29th and 30th of November, ruthlessly murdered eighteen unoffending citizens, pillaged their property, and committed their dwellings to flames. There were no available United States troops within succoring distance of the scattered and dismayed neighborhoods of the Lake Basin. By telegram the Governor was petitioned for immediate relief and protection. The duty of the moment seemed imperative, and orders were at once given for the mustering of a company of mounted volunteers in Jackson County, and John E. Ross was commissioned as Brigadier General of the 1st Brigade of the Oregon Militia, and directed to move at once to the scene of distress, to report what force was required, and to do what humanity and the duty of the State demanded. This force reached the field of the massacre eight days before any other military assistance arrived, and engaged itself in burying the dead and in offices of mercy to the survivors.

This was the initiation of the Oregon Volunteer Service in the Modoc Indian war of 1872 and 1873, which, during the checkered fortunes of Indian hostilities in Southern Oregon, during those years, employed five companies in all.

At the request of the Secretary of War I made a full and detailed report of this service with its initiatory history, to Major General J. M. Schofield, commanding the Military Division of the Pacific, under date of February 13, 1874, a copy of which is herewith submitted. I also submit the official reports of Major General John F. Miller and of Brigadier General John E. Ross, of the Oregon State Militia, touching operations in the field during this service.

At the last session of Congress our delegation there procured the passage of an Act virtually assuming the expenses of the State incurred in this service; and, during the month of July last, Inspector General James A. Hardie, of the United States Army, under instructions of the Secretary of War, visited Oregon to examine and report upon the accounts engendered in the support of these volunteer troops.

There are good grounds for expecting that a favorable report will be made. The whole amount of the first and second services, as reported to General Schofield, is $130, 728 00. I think it but just that those who have mustered into military service at a time of emergency, and have furnished property for such service, should have the guarantee of the State for their compensation.

I desire especially to present the case of he volunteers who were promised, by their officers, and by the Executive the exertion of their influence to secure to them the pay of two dollars per day for their services, This rate of pay has been entered upon the muster-rolls. It is extremely doubtful whether this rate will be allowed by Congress, though most just, under the circumstances. The State should make good the full pay of these volunteers.

All honor is due to the officers and men of this service. In the winter months, in a mountainous district, where storms are severe, they served without tents and often short of blankets and rations, for the reason that on so sudden emergency, such could not be supplied. Their services were valuable to the State and to the United States and tended greatly to assist in closing the war.

It is benefitting that I take this occasion, thus publicly, to acknowledge, on behalf of the State of Oregon, the distinguished services of Brevet Major General Jefferson C. Davis, of the Army of the United States, for his brilliant and decisive conduct in closing the Modoc Indian war. To General Frank Wheaton, and the officers who served under him, our acknowledgements are due for their gallant and soldierly services from the first, and for their generous conduct toward the Oregon Volunteers. A resolution of thanks would not be inappropriate, in the premises, as the peace of our entire eastern frontier was involved in the success of the Modoc campaigns.
As to the Modoc outlaws who committed the massacres of the 29th and 30th of November, 1872, and who now stand indicted for murder in Jackson County, they were taken out of the jurisdiction of this State by force, under the direct order of the President of the United States. They are now fugitives from the justice of this State. As soon as the unlawful detention ceases, they are liable to be returned on the requisition of the Governor of Oregon, and to be submitted to trial and punishment according to law.

The claims f our citizens in South-eastern Oregon, whose property was destroyed by the savages at the time of the massacre are most just. These settlers ha no part in the cause of the hostilities and were all innocent of offense toward the Modocs. A memorial of the Assembly setting forth in a clear light public opinion here on this subject, might assist our representatives in Congress in their efforts for an appropriation to cover these claims.

WALLOWA VALLEY
Joseph's band of Nez Perce Indians, after having joined the general tribe of Nez Perces in the treaty of 1855, disposing of all their lands except a reservation on which they agreed to live, refused last year to abide by the terms of a subsequent stipulation made by the tribe to retire wholly from Oregon. During the Modoc war Joseph's band was on the eve of an outbreak to assert its right to the Wallowa lands formerly released by the tribe. These lands have been surveyed by the United States and opened for settlement. Many of our citizens had settled there. As a peace measure the President of the United States made an executive order setting aside these lands as an Indian reservation. The Indian Department caused the property of the settlers to be assessed with view to their removal. At this juncture I transmitted to the Secretary of the Interior a communication reciting the full history of the treaties in controversy, asserting the right of this State to the jurisdiction of these lands and the rights of our citizens to their farms and property in the Wallowa regions, and gravely protesting against the steps being taken by the General Government, as unauthorized by law. Senator Kelly and the late Representative Wilson had filed their protests in the premises also.

It is now indicated that the executive order of the President will not be enforced, but that the lands will be considered open for settlement. A military force has been lately stationed in the valley to preserve peace with the Indians. This region is one of the most valuable parts of Oregon for grazing purposes. A copy of my communication on this subject to the Secretary of the Interior, bearing date July 21, 1873, is herewith submitted.

STATE PRINTING
The Constitution has the following provision concerning the State Printer: "He shall perform all the public printing for the State which may be provided by law. The rates to be paid to him for such printing shall be fixed by law, and shall neither be increased nor diminished during the term for which he shall have been elected." You will perceive by this that you cannot legislate upon the rates of printing to be done by the present State Printer during his term, but a carefully considered printing Act for the future might be matured and passed. In such an Act distinct provisions should be incorporated defining what work shall be done by a retiring State Printer at the close of his term, and what work shall be done by the new incumbent, as this has become a subject of standing controversy under the present law.

EQUALIZATION
It is a Constitutional provision (Article 9, Section 1) that "the Legislative Assembly shall provide, by law, for a uniform and equal rate of assessment and taxation, and shall prescribe such regulations as shall secure a just valuation for taxation of all property, both real and personal." This undoubtedly contemplates a system of general equalization. There is positive public wrong, as well as unfaithfulness to the Constitution, in allowing a leading class of property like cattle to be assessed in the different counties at widely different rates, varying from $8 to $21 per head average, and railroad lines of equal value, from $3,000 to $8,000 per mile, as appeared by the tax rolls of last year.

The work of the Board of Equalization, organized under the Equalization Act of o years ago, having been affected by a judicial decision, was not enforced. The members of the Board have resigned.

To secure equality and justice in the assessment and collection of taxes has been a troublesome matter in all the States. A satisfactory system is difficult to arrive at. Our present tax laws lack system and should be reformed. The defects in former Acts, pointed out in my last biennial message, were not remedied by the legislation of two years ago.

I herewith lay before you the reports of the Board of Equalization which discuss the whole subject ably and fully.

STATE CAPITOL
In the construction of the State Capitol, of the appropriation of $100,000 there has been expended the sum of $99,990. This sum has been paid in cash, as the work progressed, from moneys set aside for that purpose from the Military Fund. There are, in the Commissioners' hands, materials (chiefly iron, tools and necessary articles), paid for, the amount of $12,298 49.
There have been applied also, in construction of the building, convict labor, brick and other materials from the Penitentiary, the amount of $22,603 80. The cost of the work now in place is $110,802 60.

The work done is within the original estimates of cost, which is very unusual in buildings of this kind. The foundation, which is massive, is of basaltic rock, embedded in a sustratum of indurated clay, and laid in hydraulic cement. The whole foundation work is subdrained by deeply covered ditches, relieving it entirely from possibility of being affected by our rainy season. The balance of the work is in sight, and will speak for itself, both as to plan and architectural style, which, I think, will challenge your approval. The standing walls should be carried up to an even line this season, and securely covered before winter.

The Commissioners will lay before you, with their report, an estimate prepared by the architects, showing the cost of inclosing the building and finishing so much of it as will furnish convenient room for public occupancy, leaving the main tower, the South wing and the basement story to be completed at a future day, when the State is older and or population larger. Less than the sum already expended will accomplish this. The skill, conscientious diligence and success of the Commissioners deserve commendation. The architects have given special attention to this work, and the structure is sufficient evidence of their architectural accomplishments.

GEOLOGY
The preliminary report of the State Geologist, Professor Thomas Condon, is respectfully submitted to your consideration. An outline of the remarkable features of the geology of Oregon is here presented, showing our State to be a field not only of the deepest interest to general geological science, but one which will probably develop great wealth in gold, silver, iron, lead, coal and lime. It is already becoming apparent that the southeast quarter of Oregon, bordering on Nevada, which is yet unsettled, may prove to be as rich in mines of silver and gold as our sister State. I commend the suggestions made in this report to your favorable notice.

AGRICULTURAL COLLEGE
The Agricultural College has been evidently conducted with great effort to reach the objects of its organization.

The corps of instructors is composed of gentlemen of high attainments in science and of successful experience as educators. I hope the Assembly will provide means for sustaining this valuable institution until the lands granted by Congress for its support can be made available for that purpose. The reports of the President and Professors of the College are herewith laid before you.

STATE UNIVERSITY
Pursuant to the Act of last session of the Legislative Assembly, locating the State University at Eugene City, a building destined for the occupancy of this institution has been erected and inclosed, but not finished inside. The structure is a substantial brick building, three stories high and well calculated for the purpose designed.

The University endowment accumulating from the Congressional Land grant, will reach one hundred thousand dollars within a few years, and I am informed that there is also a donation of property of the value of twenty-five thousand dollars more from a private citizen, contingent only upon a successful and permanent organization of this institution at Eugene City. I recommend that reasonable further time be given to complete this building, in full compliance with the terms of said Act.

INSTITUTIONS FOR MUTES AND THE BLIND
The schools established for mutes and the blind have been successfully conducted. I lay before you very full and interesting reports of the superintendents and teachers of these institutions, also reports of the Board of School Land Commissioners and the Board of Education, giving full details of the management and fiscal accounts of the same. The Private Secretary of the Governor, Hon. Henry H. Gilfry, has during the last two years, devoted much personal attention to the general interests of these schools, and has made all the purchases of supplies and disbursed all the moneys in detail for their current support, free of charge, in addition to the full performance of his own official duties.

COMMON SCHOOLS
The Superintendent of Public Instruction will lay before you a report of his conduct of that office since its creation.

The duties of the Superintendent have been faithfully discharged, and the difficulties of organization under a new law have been overcome with a good degree of success. The Board of School Land Commissioners should be enabled, with more certainty, to collect the interest on the Irreducible Common School Fund, to be used in the current support of schools.

IMMIGRATION
I have been in receipt of valuable communications and papers touching the subject of immigration. Several plans are proposed for the assisted of emigrants who desire to become citizen of Oregon.

The state of our public finances will not admit of the expenditure of a large sum of money in this interest, however desirable. We need population, but it will be certainly wise to act within our resources of revenue. A commission of emigration, consisting of prominent citizens who would serve without compensation, authorized to correspond with appointed voluntary commissioners abroad, and to advise and direct emigrants arriving here, and to publish authentic information concerning the resources of the State, at limited expense, might be advisable.

The strongest inducements which we can offer for immigration of the best classes will be freedom from debt and low taxes. The communications and papers referred to are herewith respectfully submitted.

FOREIGN ATTORNEYS
Attention has been called to the fact that our statute, providing for the admission of attorneys to practice in the courts of Oregon, permits no one to be admitted except he be a citizen of the United States, and of this State. As our Constitution admits to the privilege of suffrage, all persons of foreign birth over twenty-one years of age, who shall have declared their intention to become citizens of the United States, and shall have resided within this State for one year, it appears but just that such should be admitted to practice as attorneys in our courts, if otherwise qualified. I recommend that privilege be so extended by Legislative enactment.

ADJUTANT GENERAL
Previously to 1870 the Adjutant General was allowed a salary of $800 per annum. The salary was repealed at the Legislative session of that year. No pay or allowance for actual expenses are now provided by law for that officer. Colonel A. P. Dennison, who has lately resigned the office of Adjutant General, performed important services, at his own personal expense, during the late Modoc Indian hostilities. He petitions before you with the recommendation that this expense be paid.

QUARANTINE
The quarantine laws have been strictly enforced. There can be no doubt that the introduction of contagion by ships from infected ports has been materially lessened. Five vessels have been quarantined, and all suspected vessels boarded and examined, during the last tow years. Our pure atmosphere is not apt to communicate contagious diseases readily. With the enforcement of good health regulations our State will be comparatively free from pestilence. I refer you to the accompanying report of the Health officer at Astoria.

CESSION OF LANDS TO UNITED STATES FORLIGHTHOUSES
A communication from the Secretary of the Treasury has lately been received by me stating that "under the impression that the General Government had jurisdiction over the navigable waters within the United States and the land covered thereby, lighthouses have from time to time been erected on submarine sites within the territorial limits of the States, without procuring the cession of jurisdiction required by the Act of Congress of May 15, 1820. It is now understood that the States may have jurisdiction over lands covered by navigable waters within their territorial limits."

The Secretary requests, in the interest of commerce and navigation, that the Governor will recommend to the Legislature of this State, "The passage of a general law, ceding to the United States, jurisdiction in all cases of sites of lighthouses and other aids to navigation, built on submerged foundations, and where the land under water is owned by the State, providing for the cession to the United States of the land also."

The communication is accompanied with a form of a bill which will be sufficient and satisfactory in the premises. These papers are respectfully submitted with a recommendation to your favorable action.

This request is a recognition of the title of the State to all lands under navigable waters within her boundaries, which is similar in character to the right by which we hold the lands on our sea coast, lying between the ebb and flow of the tide. It is the right of sovereignty or of eminent domain pointed out in my last biennial message. Some of the original thirteen States are just now developing this title after allowing it to lie dormant for a century.

GENERAL FISCAL MANAGEMENT
The general fiscal management of all departments of public affairs has been good. The public work has been accomplished with general faithfulness and success, and in nearly all cases the expenses have been kept within the appropriations. There is a deficiency in the appropriation for the support of the Penitentiary. This is caused by the fact that the appropriation was less than ever before in proportion to the umber of prisoners, while the entire proceeds of prison labor were turned over to the Capitol Building Commission, and a large outlay from the appropriation was required for the purchase of wood and sand, consumed in the manufacture of brick for the construction of the Capitol. There has been also an exceptional increase of inmates in our Penitentiary during the last two years.

No public moneys have been used, unless previously appropriated by the Legislature for the specific purpose to which they have been devoted.

There has not been a default, or the negligent use of the public moneys to the amount of one dollar, by any public officer or employee of the State, during the four years, that I am informed of.

I believe you will find their accounts, on examination, to be full, complete and satisfactory. Throughout the counties, as far as their connections with the State has been concerned, there has been general responsibility. In the construction of all public buildings the contracts have been bona fide, and as much of the work as possible has been directly applied by labor upon the structure.

RETRENCHMENT
The power of retrenchment is solely with the Legislative Assembly. No tax can be levied and no public money can be used without an Act of the Legislature first having specifically authorized the same. No public officer can increase his own pay, nor create perquisites not authorized by the law-making power. To you the people look for such action as may lessen the expenses of government.

In the transportation of convicts to the Penitentiary, and insane patients to the Asylum, and in returning fugitives from justice, a very great saving can be made if the auditing of accounts shall be based upon actual expenditure in performing the service, and a reasonable per diem pay for the officer. No guards should be allowed, except by special order of the proper court.

No retrenchment can properly be made in the Executive Department. In other States a contingent executive fund is customary to be provided, to defray necessary expenses incident upon the performance of the many duties already liable to be devolved upon the Executive, without special allowance to meet them. In this State there is no such fund, while the Governor is constantly called upon to perform Executive duties connected with the administration of the laws, the expense of which he pays out of his own private funds. I need only instance one of this class of expense. The Governor is the Inspector of the Insane Asylum; at each visit he travels fifty miles, and sometimes necessarily spends two days at Portland, at his own personal expense, in performing this duty.

The Corresponding Clerk of the Board of School Land Commissioners specially in charge of the Eastern Oregon land records and correspondence can be dispensed with, not because the double duty cast upon the Board of doing their own work and of bringing forward the undone work of the former Board has now been accomplished, and the Chief Clerk of the Board can now take charge of that duty in addition to his own work.

The rates of pay to subordinates and guards at the Penitentiary might be fixed by law, though I believe general economy has been there practiced in this respect.

As to reductions in fees of county offices, and in effecting general county reforms, being specially familiar with the subjects, the members of the Assembly will be the proper judges of what the people desire to be done. I will take great pleasure in joining you in all the proper measures of retrenchment and reform.

REGISTRY LAW
Something should be done to restrain frauds and corruption at elections. If a Registry Act is passed it should not be too cumbersome or expensive, and should be confined to precincts connected with cities and with railroad stations, whence complaints of abuses of the suffrage arise.

FREE PASSES
The new Constitution of the State of Pennsylvania prohibits railroad corporations from issuing free passes to any public officer. Laws have lately been enacted in several other States to like effect. I think provision of this character in the laws of this State would meet with public approbation.

REGULATION OF RAILROADS
The preservation of the State and the people from the assaults of monopolies is one of the first duties of legislation, and clearly within your constitutional power of action. You create corporations; you can appoint and regulate their functions. Throughout Europe, where railways are not conducted directly by the government, there are the most minute and stringent rules enforced by public authority for their management and limitation. In several of the other States of this Union, where such public control has not before been established, there is now going on a struggle between the people and these corporations, testing the very elements of the right of sovereignty and of the law making power.

In Oregon we have transferred to private corporations, in trust for the people's benefit, magnificent grants of public land made by Congress to the State for the construction of railroads, reserving no direction of the expenditure for their proceeds, making no conditions and prescribing no limits to their operations. This State is probably the only one in the Union having a total want of railroad regulations prescribed by law.

In such a condition, it is remarkable that, feeling the impulse of new-grown power, and incited by the keen energy of private interest, the railroad corporations should be liable to trample upon the peoples' rights and to forget their obligations to the State?

As all corporations in this State exist under provisions of general law, and special enactments conferring special privileges are forbidden by the Constitution, those general corporation laws are subject to amendment as other general laws, and all incorporation under them is made with reference to that power of amendment.

The plenary power of the State to regulate common carriers and to protect the rights and interests of the people whenever infringed, I think is undoubted.

That railways are of great benefit to the public and are indispensable handmaids to the multiplied industries and growing commerce of Oregon, is no objection to the purpose of regulation, but constitutes the reason of the demand for legislation upon this subject. All property rights and all classes of business must exist under law, and where the management of any class of property or business is liable to affect the property of business of others in an unusual or deleterious manner, regulation by law is not only proper but imperative. This is the law of public policy.

That the privileges of railroad corporations should be limited to the purpose of their incorporation, as carriers of passengers and freights; that there should be fixed by law a reasonable maximum of rates; that the interests of merchants, millers and shippers should be guarded against wrongful discriminations adverse to them; that prominent points of business on railroad lines should be made stations for shipment and delivery of produce and merchandise; that the road should be required to be fenced at all points exposed to danger for want of protection by fences, and that a simple and direct mode of bringing actions at law by parties injured, would appear to be of obvious propriety.

The sentiment in this proposed action is not one of hostility to railway enterprises, but one of justice, protection, and encouragement to the varied interests of the people and to the commerce of the State. It is the sentiment of equal and exact justice to all, special privileges to none. To exercise strict and definite regulation is a difficult problem. There had better be no action rather than wrong action, but let the sovereignty of the State be asserted, and its legislative power be made manifest in this, as in all tings subject to jurisdiction under our Constitution.

TRANSPORTATION BY WATER
Oregon has for its western boundary the great Pacific Ocean, opening out to the commerce of the world. The Columbia, the second river in importance in North America, bounds us on the North. The Willamette extends its navigable waters far into the interior, and many beautiful lesser rivers furnish local facilities for water transportation. These are nature's highways - the God-given arteries of commerce. The obstructions to easy and general navigation upon all our navigable streams are not difficult of removal. The nature of the river beds is such that when once properly improved the improvements will be lasting.

To indicate in a sentence the importance of the improvement of one of our rivers, let me say that there are now being gathered into warehouses in the valley of the Willamette, within easy delivery to the river, five mission bushels of wheat. The improvement of this river for barge navigation in the dry season throughout its navigable course, would cost one hundred and twenty-five thousand dollars. The reduction of the rates of transportation five cents per bushel average on the wheat crop of this year would leave to the producers of this valley in a single season a quarter of a million of dollars. If there are interests which should receive limited assistance from the State this is one of the first so entitled.

In the established policy of the General Government it is the duty of Congress to improve rivers and harbors, as facilities to general commerce. An energetic memorial to Congress from the Assembly might strengthen the hands of our Senators and Representative in their efforts in this behalf.

RAILROAD SUBSIDIES
Oregon is the only State in the Union in which bonds of the State, of counties, and of cities have not been issued as subsidies to railroads, or in payment of stocks in railroad corporations. The State and its subdivisions are absolutely free from debts of this class. It is my judgment that they should remain so. The experience of many of the other States in this particular has been disastrous a depressing to general prosperity. A system brought into being and sustained only by stimulants is never healthy. To construction of our constitutional limitations upon this subject, set forth in the Executive Message declining to approve the Portland Subsidy Bill, four years ago, will be steadily adhered to.
These remarks are limited to our internal State policy. There are commanding reasons why, in the development of the railroad system of the United States, a connecting branch of some road should be extended to Oregon and that such extension should receive the assistance of the General Government, in order that this State be placed upon an equality with the other States which have received like assistance. Oregon is the only State of the sisterhood now isolated from general railway communication, and our whole political power and influence should be exerted to secure the just attention of Congress to the interests of the great northwest.

NEW INDUSTRIES - BEET SUGAR, FLAX AND SHIP-BUILDING
It may be of public interest to notice here the recent introduction into this State of a new and important industry- the manufacture or production of sugar from beets. This industry has already been fully tested in our sister State, California, and after the usual drawbacks of new enterprises, has now, I am informed, proved permanent and remunerative to those interested.
The State of Oregon need certainly fear no comparison with any State in agricultural productions suited to her climate, and can enter on this industry if judiciously conducted, with every assurance of success. What success in this line means and of what importance it must be to the whole agricultural interests of this State- enhancing the value of farm land and affording greatly increased employment, may be best inferred from the following facts:

The discovery that sugar could be produced from beets was first made in 1747, and first applied on a large or practical scale in the early part of the present century. Since then the manufacture has continued to increase, and in 1866, (of which accurate returns have been made up) the production in Europe of beet sugar amounted in round numbers to over 600,000 tons, or in cash value over $150,000,000. At present the cash value of the beet sugar crop may be set down at over $200,000,000, a yearly increase or addition to the wealth of those countries in which the manufacture is carried on, which otherwise, (as now in the case of Oregon) would have to be expended in procuring from abroad this necessary of life. By the usual per capita estimate of consumption applied to Oregon, near one million dollars' worth of sugar may be assumed to be used, which in lieu of being imported from abroad, might be raised here, assisting greatly in our development.

The growth of flax for lint for foreign export was undertaken last year, and during the present season has made such progress and met with such success that the future development and stability of this interest are assured. The remark of one of our leading agriculturalists, that whatever class of husbandry is suited to the climate and soil of Oregon will develop the most perfect product in the world, I believe to be true.

Another important interest destined to reach great results, and now just beginning to be developed, is shipbuilding. We have the best general supply of shipbuilding timber anywhere to be found, except with our neighbors of Washington Territory. The spar timber of Oregon and Washington is shipped to all quarters of the globe.

GENERAL PROGRESS
The progress of the State, during the last four years, has been healthy and rapid. The increase of its rate of development, in material products, has been a least four-fold. The value of our exports have reached a sum certainly exceeding ten millions of dollars.

I estimate the export value of our wheat and flour at nearly four millions, gold; oats, other grains and fruits, on million; wool, hides, meats, cattle and horses, two millions; salmon, one million five hundred thousand; lumber and coal, one million; gold, silver and iron, one million five hundred thousand. This exhibit for a population of one hundred thousand people is almost without a parallel. We need more population. Let us maintain a responsible, just and prudent State Government; let us lighten the public burdens, practice industry and economy; encourage education and maintain our present standards of morals and religion and all lands will send us increase.

L. F. GROVER
STATE OF OREGON,
EXECUTIVE DEPARTMENT,
Salem, September 16, 1874.

Oregon Secretary of State • 136 State Capitol • Salem, OR 97310-0722
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