War of the Rebellion: Serial 127 Page 0720 CORRESPONDENCE, ETC.

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the tax imposed for the payment of the interest to accrue upon the bonds which might be negotiated. This tax cannot be diverted to any other purpose from the one for which it was intended by the law. The question then arises, provided the object of the act is not attained, whether or not it is essential to the public interest to enforce its collection.

By an act of the same session with the one already noticed, you will perceive that for the purpose of securing means for the payment of certain debts created by authority of the convention the Executive was required to borrow the sum of $90,000 for twelve months, the interest not to exceed 12 per cent. ; and if necessary he was further authorized to withdraw bonds of the Texas and Central Railroad Company to the amount of $150,000, and hypothecate them for payment of the principal and interest of the loan. Documents herewith submitted* will show the steps taken to comply with the object of this law. The required amount of bonds, as above specified, were delivered to General Nichols for the object contemplated in the act. They were deposited by him in the Citizens' Bank of New Orleans, where they still remain. He will, when opportunity may offer, withdraw the bonds and return them to the proper office at this place, unless otherwise instructed. No portion of this loan has been obtained. The heads of the different departments of the Government have extended to the Executive their constant co-operation and advice, and have been to him of very great service, for which he acknowledges his deep indebtedness. Their very able and satisfactory reports are submitted to you with this communication. To them you are referred for specific details and suggestions connected with their respective departments. You are especially referred to the comprehensive facts and sound suggestions embraced in the report of the honorable comptroller. the question of finance is at all times the one of primary importance with a legislative body, but never before in the history of Texas has it possessed such surpassing importance and at the same time been environed by so many difficulties.

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The blockade of our ports, cutting off the usual sources of supply of manufactured goods, and the increased demand for such fabrics consequent upon retaining a large number of troops in the field, directed the attention of the Executive to the manufacturing power of this institution. + Its managers were request to apply the whole of their available force to the fabrication of goods for military purposes. This has been assiduously done. Would it not be a wise policy for the Legislature to take steps to purchase all goods made at this institution suitable for the use of our troops, or to make an appropriation for its support and take possession of all its fabrics of the required class? By these means the State may be able to a great degree to clothe the soldiers of Texas who may be in the field. Thus you may be able to comply with the prudent suggestion of the Secretary of War contained in a letter which is submitted to you. This communication advises that this State supply her own troops with clothing and receive for the same the commutation of $25 for every six months' clothing more efficient than the operations of the General Government, and the subject is well worthy of your consideration. By act of Congress (Doc.

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*Not found.

+The State penitentiary.

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