Omaha Daily Bee Newspaper, January 4, 1895, Page 2

g9 e OMAHA DAILY BEE: FRIDAY, JANUARY 4, 1895. | main 1t has had pretty general approval, |required oath was taken glibly and un. | the same shall cense and the several counties and locallties where distress exists have gone to work and by | engaging in works of Internal Improvement | and by organized effort have furnished work and supplies for the needy In the meantime I have revived and re. formed the relief commission of 1801, who have been actively and earcestly at work | ascertaining the exte A location of the | reltef required and In soliciting and distrib- | uting gjd. Considering the stringency of the times, donations, both from within and from without, have been quite liberal Espectally | are the thanks of the state due to the stat of Oregon, which through the Chamber Commerce of Portland has already weveral car loads of grain and provisions, and to the states of Iilinols, Indiana and Towa, which are making generous shipments Thanks are also due to ths several raliroads of the country, and espceialiy those whose lines extend irto thi for 4 nsly Riving free transportation to all donations for the relief of our citizens, the aggr ©cost of which at usual rates would have been many thou: is of dollars The sum of all donations, consisting of flour, grain, food of various descriptions, coal and clothing. amounts to something | ear loads All of this, and what till to come, to gether with what t} eeveral counties and localities have supplicd, must go far to af- fording the relief required. What the legl lature may ch do, or find it able to do, is for you to determine. + That there are and will bo cases of dis- tress unprovided for, an? would be under the most liberal provision for the care of all, 18 in the nature of things. Modest and spir ited people will submit to want rather than beg or eat the bread of charity. On the other hand there are the Immodest,importunate and undeserving who are y to profit at the expense of the deserving. The history of the distribution of the ald given by the state in 1891 shows that in some Instances well- to-do people, men who had money in banks, shamelessly shared the bounty designed for their unfortunate neighbors, People of that class have been most importunate for an extra sesslon of the legislature and a repetition Of the experience of 1891. Disappointed in this, as appears by lotters and elrculars Which have found thelr way to my table, they have undertaken to berate the exeeu- tive and to solicit aid on thelr own ac count rather than through the commission o 1zed for that purpose. While some of these circulars may have been inspired by good motives othe have not, and all have brought but little good and much discredit to the state, AID THE COUNTIE The first and ot | donated Is It TO AID THE NEEDY. most pressing subject de- manding your attention, therefore, will be the action that should be taken for the relief of sufferers by the late drouth. With the Hmit of indebtedness which, under the con- stitution, is fixed at $100,000, already reached by the action of the legislature of 1801 in voting $100,000 in bonds for a like purpose, and the general fund carrying some hundred of thousands of dellars in meeting its 7 per cent unpaid warrants, you are confronted with the question of right as well as of wis- dom In voling any state ail. To my mind the giving donations from the state treasury is of doubtful propriety and shou done in extreme or ux ons, A 00 ready and frequent response by the state begets dependence, destroys manly pride and encourages improvidence, My idea ls that the several counties should care for their own needy. Many of them are free from debt and “abundantly able and willing to do 80. What they want is power to raise means on county honds if necessary and do- nate or loan the money to their citizens who are in need for such time and on such terms as may seem best. Fach county feeling its own responsibility and having a concern for its cwn people will give thorough investiga- tion in all cases and distinguish real from pretended cases of ne:d. In this way relief can bo brought to the deserving for a quarter or less of the expense that it would cost the state. This plan would not only serve for the present, but woull be applicable In other years should there be a repetition of the experience of 1894. Furthermore the bonds issued under such provisicn would fur- nish good investment for the permanent school fund of the state. If any risk wers to be taken on any of these honds the state might as well take it as fo take donations outright rom its treasury. I might furiher suggest » @8 an emergency - exists, the powers of county commissionsrs or boards of supervisors might be temporarily enlarged so that war- rants, under certain restrictions, might be Issued, fundable later in the bonds recom- mended. STATE'S FINANCIAL CONDITION. The financial condlition of the state is bad, and I trust you will not alicw the session to end without having taken steps to mend it. From the reports of the treasurer and auditor it will be seen that on the 1st day of Decam- ber last there were outstanding. warrants drawn on the general fund to the amount of $547,281.18 and o the Institutc for the Feeble- Minded tund for $51,250.93, making an aggre- gate of $608,638.11, with only $28,503.67 in those funds from which to pay them. At the samo time there was In the treasury $417 313.61 of idle money belonging to the pes manent school fund. In other words, the state was paying interest at the rate of 7 per eent per annum on upwards of $600,000 and was losing Interest on over $100,000. If under the law of 1891 the permanent school fund could have been Invested in these warrants, @8 it was intended, much of this interest, in- stead of golng to warrant brokers, would be saved for the beneft of the schools of the state. Hut unfortunately the supreme court has decided that law inoperative, as will be re ferred to In another part of this communica- tlon. This load of high interest bearing debt hag been Incurred by appropriations made by more recent legistatures—notably that of 1891 —In excess of taxes that could be levied an colleeted under our present revenue law: The assessors of the state vie with one an- other in their offorts to reduce tha valuation of property. In this they are encouraged and supported by the natural disposition of one preeinct or county to shift 1ts burden of taxa- tion cn the others. As a result the property of the state which by the census of 1890 is estimated at $1,275,085,614 is assessed at about $180,000,000, or less than 15 per cent of its value. Under the present limit of 5 mills levy on the dollar for the general fund it Is hardly possible with the observance of the strictest economy to raise, cn so low a valua- tlon, sufficlent money to meet the needs of tho state. The remedy for this lies either In an in- ereased valuation of the property of the sta or in extending the limit of the levy. To ex- tend tha limit of the levy is simple and an Inereasad valuation can be effected In differ- ent ways. One is by providing for the a sessment of property (hrough state or dis- trict assessors and thus removing the work frem local influence. Another is by giving Ereater power to state and county equalizing boards. The state equalizing board, consisting of the governcr, treasurer and auditor, under the present law, can make no change In the assessment roll' as it comes to them. In equalizing state taxation among the several eounties its power Is restricted to varying the rate under the limit fix:d as applied to ons county and another. Its authority shculd be enlarged 5o that It could not only raise the *waluation of any particular county or ecoun- ties, but increase the assessment of all the property returned to any extent not exceed- ing its true value. In the auditor's report will be found a statement showing the excess of appropria- tions for several years, the percontags of de- Unquent tax, and other interesting and in- structive information bearlug on this subject DEPOSIT OF STATE FUNDS. Tho legislature of 1591 passed an act pro- widing for the deposit of state and county funds in banks. The wisdom of such a iaw, s far as it concerns the money of the state, to my mind, is doubtful. In ordinary or mormal times its operation might b attended with little risk, but in times of Anancial “stringency and uncertalnty, such as have pre- valled for the two ycars last past, It is Mable to be accompanied with much hazard @3 experience has shown. The law lmpcses on oficers who are chosen with no speclal Teference to their fitness for the task the duty of determining the solvency of the pro- posed depositories and the financial ability Of the cbligors on the several bonds offered a8 security for deposits asked for. The act does not even provide that the sureties shall amake oath as to thelr responsibility nor for Any sworn statement of the amount, character @nd value of the preperty owped by each. Notwithstanding this the approving offices wonslsting of the governor, secretary of state snd attorney general, following the practice ©f the courts, have, as a rule, demanded of &l sureties an oath showing their Mability v and above exemption. Even this precau in the | hesitatingly and a rotten bank which had successfully docelved expert bank examiners and hundreds of innocent depositors suc- ceeded In putting upon the state an almost worthless bond for a large sum. Luckily in the case referred to, that of the Capital National bank, it will bs found, I beljeve, that no deposit was made under the bond and the state Is not the loser by the trans action. During the past two years of nanclal stringency the law has been an In- vitation to the banks of the state to appt for funds which some of them could get i no other direction, seemingly, and no less than fifty-nine applications and accompany- | Ing bonds have been recejved Of these | forty-seven were approved—enough to many | times absorb the comparatively little fdie | money in the treasury aside from the per- | manent school fund which the supreme court | case of the state against Bartley | decided not subject to t under the law. | This list of depovitories includes many banks | of undoubted stan g, some of which were ited o apply In order to furnish the treasuror avenues In which to s the etate's money Still another question arising under this act is as to hew long this approval of any depository is to hold. The conditions which | warrant approval of a bond today may | change in the course of a few months in | these Umes of uncortainly and it is hardly | supposable that the board could keep track of such changes. Still it is in behalf of the bank with such falling security that the strorgest personal and political influence would be brought to bear and the treasurer might yield to such importunity without personal responsibility or reliability on his part. If the law Is to be continued it may bo well to consider whether it should not provide for periodical examinations into the sufficiency of the several bonds and a limita- tion be fixed to the life,of them without re- approval and such other amendments as will give additional security in depositing the state’s wmoney. ¢ In this connection T may add that as a measure of additional safety in deciding on the value of some of the bonds offered the board employed the services of one of the leading commerelal agencies having an office at the capital. The services N e been valuable, the price agreed upon reasonable and I would recommend the payment of the churges made therefor. INVESTMENT OF PERMANENT SCHOOL FUND. To the state have been g and thirty-sixth scctions benefit of its public schools. has tixed th 1ands can be s fely put out | en the sixteenth of land for the The constitution minimum price at which these old at $7 per acre. The money derived from (e sale of these lands forms a permanent school fund, the interest on which, together with the rents from un lands, furnishes a temporary fund which is applied to the support of the public schools. It Is therefore ~fmportant that this permanent school fund shall be at all times invested and at the best rate of interest obtainable, As a member of the Board of Educational Lands and Funds I have labored earnestly to effect this. The law limits the investment of this fund to United States or state securities and registered county bonds. No state bonds have been offered during the last few years, and, owing to the low rate of interest and high premium commanded, and in the hope of being able to invest in county bonds which ordinarily pay the best interest, the money has not been tied up in United States bonds. But owing to the de- pression of business, failure of crops and other causes, but few counties have made new issue of bonds and those issues have been eagerly sought by bond brokers, Where the board has heard of any proposed issue it has been prompt to assure the county authorities that the stale would purchase them at as good or better rate than obtain- able clsewhere. In some few instances county bonds have thus been secured, but in others, through private arrangements with agents, by the imposition of terms which the board had no power to comply with and by other methods not necessary to recite, the offer of the state to pay to the county direct such better price has been disregarded and the bonds have had to be obtained, it at all, through second hands and at an’ increased price. In order to keep the entire permanent school fund at all times invested and earn- Ing . some interest I would rcommend the enactment of a law directing the Board of Bducational Lands and Funds to invest ail moneys of that fund, not otherwise invested, in United States bonds, with authority to sell and convert thém from time to time into other lawful and better interest paying securities when opportunities offer. Without an act of the kind suggested the board fs powerless to make such conversion. This was g0 decided in an opinion given by the supreme court as will be seen by reference to page 684, fifteenth volume of Nebraska Reports. ON BUYING STATE WARRANTS. - In answer to questions submitted to the house of representatives the supreme court gave an opinion to be found on page 659, volume 25, Nebraska Reports, holding that state warrants issued in pursuance of an appropriation made by the legislature and secured by the levy of a tax for its pay- ment are state securitics in the meaning of the constitution, which says that educa- tioral funds may be invested in state securities. Following this decision the legislature by a law, found in the session laws of 1891, chapter 48, declared that when a warrant of that description shall be pre- sented to the state treasurer for payment and there shall not be money in the proper fund to pay said warrant the state treasurer shall pay the amount due on said warrant from any funds in the state treasury belong- ing to the permanent school fund and shall hold said warrant as an investment of said permanent school fund. Early in his term of office and even before a levy had been made for their payment and they had be- come state securities the present state treas- urer, for some reason, paid a large number of warrants drawn in favor of members of the legislature and others, and for the pay- ment of which there was no money in the treasury other than the school fund, but lat'r, and afer the levy of a tax had been made for their payment the treasurer, for some other reason, declined to pay any more war- rants and turn them into the permanent school fund, contending among other things that he must first have the direction of the Board of Bducational Lands to purchase warrants. in order to compel him to comply with the law the attorney general, at the instance of the board, instituted proceedings in the supreme court. That tribunal sustained the treasurer, Lolding that inasmuch as the con- stitution had constituted the governor, secre- tary of state, treasurer, attorney general and commissioner of public lands and buildings 4 board for the investment of the permanent school funds, it was not competent for the legisluture to empower the treasurer alone without specific direction of the board to pay warrants and turn them into that fund, In answering the argument of the attorney gen- eral, who contended that it was never in- tended that the board should remain in continual session from January 1 to December | ow | and when in doubt as provided In chapter xcifi. of the compiled statutes of Nebraska, and when s paid the warrants shall be held By the trensurer as an investment of the manent school fund and shall be stamped and signe: 3 led aw, Resoived, That the further fum of $250,000 of the permanent school fund of the state, or 80 much thercof as shall be nec- essary, be, and hereby Is, set apart, from which’ to 'pay cufrent, unregistered rants already drawn, as well a8 thos which may hereafter be drawn, against the general fund, under appropriations mad At the last 1Cgisiature, ft being determine by this board that such appropriations a secured by a vy of tax for their payment, and the state treasurer I8 hereby ted to pay such war its as they ma pres sented at the eta treasury and stamped signed, and hold the same as an Invest ment of the permanent &chool fund as pr vided by statute. irther, That the state tren d, be and hereby ere to act in s behalf in deter- mining questions as to the genulneness and ership of any and all warrants pre nted und the fo ing two resolutions, will refer to be submitted the chairman, to boa 1 for its decision. WON BY A WARRANT SHARK. The law had still further opposition to en- counter, and its operation was suspended by the action of the same court in the case of the state ex rel Stull against Bartley, state treasurer. One Stull, a dealer in state w. nts, who had no particular concern about the school fund or any other fund of the stato except inasfar as he could profit by it, possessed himself of a state warrant drawn on the general fund, which he presented to the state treasury. He refused payment and demanded that it be stamped unpald for want of funds, so he could draw 7 per cent Interest on it. This being refused, a writ of mandamus was asked for and allowed compelliag the state treasurer to thus stamp it. The opinton of the court, delivered by Justice Post, may be found on page 907, vol. 50, Northwestern Reporfer. It is not for me to criticise the decision, but I cannot sup- press an expression of regret that the court found it necessary to pronounce a decision which virtually renders inoperative a law 80 well designed, and whose enforcement would save annually tens of thousands of dollars for the benefit of the public school fand of the state. While the decision may bo correct on_technical grounds, it defeats the purpose of the law, which is to obtain ail the increase or increment possible from the permanent school fund.. Neither was the decision a necessily as a protection to the sehiool fund, which was in no wise endangered by the law and the action of the board cited above. As was well said by Chief Justice Reese in his opinion, which laid the founda- tion for the law for providing for the Invest- ment of the permanent school funds in state warrants, and which opinion is found in vol . Nebraska Reports, “In whatever direc- tion or to whatever purpose the money 1s in- vested, the state is still a surety for its safe return to the proper fund.” I have recited, as briefly as T well could, the efforts made by the Board of Educational Lands and Funds to invest the permanent school fund and the obstacles It has met. I will repeat my recommendation that so much of it as is not otherwise Invested be put into United States bonds, with power on the part of the board to convert them when the opportunities for investment pre- sent themselves. ECONOMY IN STATE The people of the state have the right at all times to demand the practice of the strictest economy in the appropriation and expenditure of their money. Especially can they insist on a rigid adherence to thig r when they themselyes are struggling under an_enforced observance of it in their individ- ual affairs. The greater portion of the money which finds its way into the treasury goes for the support of the several penal, re- formatory, charitable and educational insti- tutions of the state. On ¢%c way in which these institutions are conducted, therefore, depends to a_great extent the expenses of the state. They need that attention and supervision without which extravagance, waste, and even peculation grow up. In my several relations as appointing officer and member of the Board of Purchase and Sup- plies, T have given much study to their man- agement, and I think T can safely say that most of these ‘Institutions were never more ably and econontically’ conducted: than they now are. In fact, the limited appropriations for their support made in 1893 have de- manded the exercise of more than the usual care and economy. You may recall my re- marks to the legislature two years ago, when I said: Nebraskans, in the main, are a plain people. With' most of them' life is a per- petual struggle, Hard work, frugality and nomy are their constant companions. They indulge in little extravagance them: selves, and they may reasonably expect their representalives to govern themselves in like manner. The tendency of the day is toward extravagance, and it nowhere manifests itself more than in the conduct of public affairs. Extravagance begels ex- travagance. An unwarranted or too liberal appropriation of today forms the precedent for tomorrow, and I submit to you whether your predecessors have _not always passed the high water mark. Such is my opinion, and in my judgment the aggregate of ap- propriations made by the last legislature should be cut down fully three-quarters of a million _dollars, notwithstanding the growth of the state in the meantime. Whether out of deference to my advice or not, the fact is that the sum of appropria- tions made by the legislature of 1893 was 2,208,040.26, as against $2,886,575.63 in 1891, or $677,635.37 of the $750,000 reduction recom- mended by me., Current expenses for sup- port of convicts in the penitentiary are fixed by a contract made by the legislature. The affairs of the Normal school and the university are under the control of a Board of Educa- tion and a Board of Regents, respectively. Henco these Institutions are omitted from the following comparison: During 1892 the remaining eleven institu- tions supported 1,564 inmates at a cost for current expenses of $390,678, or $248 per capita, or 68 cents per capita daily. During 1893 they supported 1822 inmates at an expense of $411,897, or §226 per capita or 62 cents per capita daily. During 1894 they supported 2,042 inmates at an expense of $393,327, or $192.61 per caplta or 52.7 cents- per capita daily. Thus it is shown that during the years of 1893 and 1894 these institutions sustained an average number of 1,932 inmales at an ex- pense of $805,224, The institutions produced $48700 of this amount in cash, farm and garden products, although the two years just closed have been very unfavorable to agriculture. In arrang- ing for a wider and sharper competition in bids for supplies, In providing for the slaughter of beeves at the farger institutions and its purchase by the carcass at wholesale prices in others instead of purchasing through local butcher shops, by analysis of coal, the manufacture of soap and other articles of large consumption, by the largest production of supplies for use of the institutions and of products for sale from their lands and in other ways the expense of supporting these institutions has been greatly reduced. What has contributed more than anything else to their economical conduct has been the require- to the AFFAIRS. 31 of each year in order to pass upon war- rants presonted and make orders for their payment from the permanent school fund, Chief Justice Norval, who delivered the opiniou of the court, answered this by say- ing: The construction we have placed u the coustitution will not have the effect outlined by the attorney general, It s the duty of the board charged with the man- agcment and control of the school funds o determine when and in what sums said funds shall be invested, as well as what sccurities of the kinds authorized, by the fundamental law, shall be purchased, an the price that ehall be paid for the same, When the board has so determined and or- dered, it muy, by resolution, entered upon the records ‘of its proceedings, authotize and direct the state treasurer to pay out the money therefor. It may, prior to the purchise, " examine ‘the particular security offered for sale, it deemed advisable and expedient, but it is not indispensable that it should ‘do so. The board may direet the treasurer, or any other member .of the board, to' do that. With a view to meeting the direction of the court, which seemed to point out the way in which the objection of the treasurer could be overcome, the board was convened when I submitted the following resolutions, which were unanimously adopted, namely: Resolved, That the sum. of $200,000 of the permanent’ school fund of the stite of Ne- raska, or so much thereof as may be nec- essury,’ be and hereby i Which to pay outstanding warrants drawn upon the general fund, which warrants aro reglstered,” and bearing numbers fro 13,292 to 16,000, inclusive, together with on set apart from ment of periodical reports from each of them. COMPELLING OFFICERS TO REPORT. Section 21 of article v of the constitution requires that the officers of all institutions of the state shall make semi-annual reports to the governer, under oath, of the moneys received and disbursed. A compliance with this wise requirement, it seems, has never been insisted on, Except in the case of the university, which is under the control of neither the governor nor Board of Public Lands and Buildings, scarcely any reports of the kind were supplied. I not only insisted upon these reports being furnished, but adopted for them such a form as would pre- sent much information valuable in keeping watch over expenditures made. These re- ports show not only the number of officers, employes, inmates, money used for hoth cur- rent and extraordinary ‘expenses, what has been produced, ‘consumed and sold, but what it has cost the state per capita during the given period for board, for clothing, for fuel and other items of expenditure. These re- ports furnish the data from which to ascer- tain the relative cost of maintaining the in- mates and for comparing it with the cost in other states, as well as ascertalning the rela- tive expense for différent periods. While these reports, with a knowledge that they are be- fore the executive and open to public inspec- tion and criticism, have served as a check to extravagance and a stimulus to greater care on the part of the heads of institutions, they will, I trust, serve as a valuable guide to you in making appropriations. A table embodying a summary of these a crued interest, it being ‘determined by this board that sald warrants are drawn in pur- suance of an appropriation made by the legislature and sécured by the levy of a tax for their payment, and therefore are state securities, and the state treasurer - strucled to at once notify the several par- ties [0 whose Dames Warrants are has mot proved @ protection, for o ome notable instance the registered bis readiness and pui lo'swy sald warrants, so that interest on reports for the past two years, logether with a ement of the expense of maintaining the same Institutions for the year preceding hered from other sources will be laid be- fore you. It will be gratifying to you, it is to me, to note the continued and marked reduction of expense attending the conduct of the several lnstitutions. Where there is 40 apparent exception to the rule the ex- the matter | planation cafl ¥ ound fn the case of schools, like those foz ths, deaf and dumb and for the | Blind, w! Cérfaln periods embrace times | of vacation, Whelh there were few It any in- | mates to tm,mau for, or as in the case of the Soldiers hoflwe, where there was a large inherited ind; Ldém'u of unpald bills, From the table refyreéd to It will be seen that the average per dapita daily expense of maintain- ing inmates ih the several institutions coming under the contfof of the Board of Purchase and Supplies’ has’ rapidly gone down from 68 cents In 1892 °46"'62.7 cents in the last half of 1804, Asia rosult, it may be stated that it the rate of 1%9® had prevailed during 1898 and 1894 the ewrrent expentes of the eleven | institutions wdull have been $058,272 in- | stead of $805,224,70r $153,048 more. In this connection please note the fact that the rate of 1802 indivhtes expenditures from appro- priations exclusively, while the amount of $805,224 includes the $48,700 produced by the institutio | that the rate of 1892 would have demanded from taxation $201,648 more than the people have paid under the rates of 1593 and 1894, Notwithstanding the diminished appropri- atons made for the support of the several state institutions there will be but little ficlency to provide for. ~ Where a deficiency sts it is not =0 much because of lack of money in the aggregate, but because of an improper_distribution of the money for the different objects enumerated in the appropri- tion. or Instance, there may be a surplus under the head of board and clothing and too little for repairs, and because money ap- propriated for one object cannot rightfully be applied to atother; a needed repair, which would avert much damage and expense, can- not be made without creating a deficiency. In this connection T would make the suggestion that appropriations for state institutions from which “to pay current or ordinary expenses should be made in a gross sum for each, based on the per capita cost of maintaining cach fnmate therein, while those for building or other permanent improvements could be specifically provided for. = The sum might bo large enough to cover an In- creaso in number of finmates, but the amount to be expended limited to the average number on the basis of a given sum per capita. This method would cost no more, but would furnish an ample but adjustable fund which, under the direction of the Board of Purchase and Supplies, could be applied to those purposes most demand- ing It. From the tabla to which I have re- ferred vou will be able to gather the data from which to carry out this suggestion. It this plan does not find favor with you T would recommend that as nearly as practics ble a uniformity of designation be observed In appropriating for various purposes in the several institutions. This is important in the preparation of the required reports. LAWS RELATING TO STATE INSTITU- TIONS, I would call your attention to the need of a revision of the laws relating to the es- tablishment and government of several of the state institutions. Some were provided for before the adoption of the constitu- tln of 1875 and were placed un- der the direction and supervision ot trustees chosen by the legislature. Under the constitution, which makes the commis- sfoner of public lands and buildings, the secretary of state, the treasurer, and attor- ney general a board intrusted with the su- pervision and control of all asylums and other Institutions except those for educational pur- poses, some confusion has arisen and some conflict of authority relating to the appoint- ment of oflicers, and upon other points which have been the subject of decision by the courts. In ome ipstitution the tenure and duties of an aflicer are fixed, while in a simi- lar one, and for no apparent reason, these are left undefined.; The whole matter should bo carefully consiflered and the laws made clear and sppeifie: GOVERNOR''SHOULD APPOINT HEADS. In the casd”of some of the institutions of the state the' governor appoints the superin- tendents and’ ofher officers, while in others this authority' 'is' given to the Board of Public Lands and 'Buildings. This Is wrong. Tho governor! should be charged with the appointment ‘{1 ‘alf these cases, and he alone should be respdnsible to the people for his actions. The responsibiiity for a bad ap- pointment shoild' not be a_divided one, and one not directly traceable or chargeable to any one persoji. ‘Constderations of a political or partisan cliaragter may be opposed. to.a favorable acggptance of this recommendation at this time,” still sound legislation should not be avoided for fear of the loss of some partisan advantage. It Is unfortunate that the heads of some Institutions, in cases where to fitness expericnce has been added, should become the sport of political fortune, and for good reasons only should tried and experienced officers be replaced. ACTIONS BROUGHT BY THE STATE. Soon after my inauguration the Capital National bank of Lincoln failed, and its af- fairs and assets, pursuant to the United States statutes, were placed in the hands of a recelver for settlement and liquidation. State Treasurcr John B, Hill, during both his terms of office, had deposited large amounts of the state funds in that bank. An investigation by a legislative committee disclosed that he had turned over to his successor, State Treasurer Bartley, who had received, them in lieu of money, certificates of deposit, issued by such bank, to the amount of $285,357.85, that were thereupon surrendered by Treasurer Bartley, and the amount thereof credited upon an account with the bank opened by him as state treas- urer, and that prior to, and including January 21, 1893, he had checked or drawn out por- tions of this amount, leaving to his credit on account of the surrendered certificates the sum of $236,304.62. No part of this has, as yet, been realized by the state from any source, and for that amount ex-Treasurer Hill has failed in any manner to account. I was advised that it would be prejudicial to the rights of the state upon his bond to file, or authorize to be filed, any claim in ita behalf with the receiver, and I did not do s0. I am informed that some claim in the premises was presented by Treasurer Bart- ley, but that, as yet, no dividend has been pald to him on account thereof. I decmed it important that an action for the recovery of this deficit should be speedily commenced upon the bond of ex-Treasurer Hill, for his last term of office, and in con- formity with my advice and directions to the attorney general, as provided by law, such an action was commenced on the 30th day of March, 1893, in the district court for Douglas county. Other investigations Instituted by the leg- islature disclosed various apparent delin- quencies, malfeasances and embezzlements on the part of persons connected with state institutions, especially the Asylum for the Insane and the state penitentiary. In con- sequence, presumably, of these disclosures, the legislature, by chapter Iviif. of the laws of 1893, appropriated and placed under the direction and control of the governor the sum of $10,000, to be used by him, so far as deemed neeessary, in employing attorneys to prosecute eriminal cases, and pay the ex- penses connected therewith where the state had been defrauded by its officers, employes or others deallug with such institutions, or having in their possession or control moneys, funds, property of effects belonging to the state, or to prosecute clvil actions or pro- ceedings against officers, persons or incor- porations indebted’ to the state on account of moneys, funds :{ effects belonging thereto, or upon any official bond, contract or obliga- tion for the sife keeping or disposal of such moneys, fundsior effects, and a supplemen- tary ‘appropriation’ of 35,000 was made for the same general purposes. Portions of these sums hive been expended in the pro- ceedings hereinafter mentioned, but a_consid- erable part thereof remalns unexpended, ap- plicable to the'sathe or similar proceedings. Under this authority I employed ex-Judge B. Wakeley of Ompha to assist the attorney general in prégechting the action referred 0 upon the Hénd! Douglas county was se- lected as the"TofUn upon advice of counsel for the state, whd believed that its inter- ests would be jeopardized by the bias and local prejudices which would pervade a jury trial in the district court of Lancaster county, where the fransactions connected with the breech of the bond and the failure of the Capital Natlonal bamk bad occurred, at- tended with much local excitement and’ feel- ing. It was, however, determined by the distriet and supreme courts (that the cause of action upon the bend arose in Lancaster county, and that there only the action could be properly brought. BEFORE THE SUPREME COURT NOW. Appligation was then made to the supreme court of the state to take original jurisdiction of the cause, under the comstitution conferr- ing such, jurisdiction in civil cases, In which the state shall be a party. Upon full dis- cussion, and mature consideration, this ap- plication was granted, and an action upon the bond was speedlly commenced in thab court, where it is now pending upon lssues of fact, to be submitted to & jury to be drawn from the state at large, and an early Deducting the $48,700 wa see | trial {s expected. T also employed Hon, G. M. Lambertson of Lincoln to assist in the prep- aration and conduct of the case in that court until its final determination. Tt think, be regarded as fortunate for the state, and in every way fair to the defendants that the controversy can now be speedily and finally determined in that high tribunal whose rulings and ultimate decision should be a guaranty that the rights of all persons | have “been protected and justice ne- | corded to all. With the official charge | which the attorney general-cleot | will have of the case, ana the | assistance, advics and services of the spectal | counsel employed, T have confidence that the | interests of the state will be duly and vigi- | lantly guarded, while no injustice to the de- | fendants will be done, and no unfair advan- taga sought to be taken of them. I consider it of the utmost importance and urgency, and counsel for the state will endeavor, that the | cause be pressed to as speedy a conclusion as practicable. The large sum of money volved, and the contingencies attending the | responsibility of sureties upon a bond of the magnitude of that concerned, seem to justify and demand this, and no good reason is ap- parent or foreseen which should prevent it As a result of investigation by the last leg- islature into the peculation and frauds con- nected with the management of affairs at some of the state institutions, and particularly as connected with the Nebraska Hospital for the Insane at Lincoln, money was appropri- ated for the purpose of employing counsel to assist in bringing the offenders to justice. I accordingly engaged Reese & Gilkenson and Mr. N. Z. Snell—one an ex-member of the supreme court and another a former prose- cuting attorney of Lancaster county—to assist in the prosecution of certain parties charged with fraud In furnishing supplies to the in- stitution named. Although great fraud had prevailed, as Is evidenced, among other things, by the fact that the coal paid for at that hos- pital averaged for the year 1891 646 tons monthly, 233 in 1892 and but 181 in 1893, yet no punishment has followed. The reasons for this result 1 do not care to discuss, but I think it was from no fault of the able at- torneys I employed. The report made by these attorneys to me is on file in the execu- tive office, CARE OF THE INSANE, Although the percentage of the Insane in Nebraska has not increased and 1s not greater than the average In other states, vet the lib- eral policy adopted by the legislature of 1891, under which the state assumes the expense of caring for all the Insane of the state with- out making in turn any charge to the coun- ties or to the estate or relations of the pa- tient, has resulted In a large influx of patients which is taxing the full capacity of the three asylums. 1If this policy is to be continued there is a demand for more room. This should not be met by a multiplication of asylums. By alteration of and additions to the other asylums the state now has ample room provided to anticipate the mneeds of a couple of decades and at a small frac- tion of the expense attending the establish- ment of a new one. Double the number of patients can be taken in charge by the same officers and maintained at a reduced per capita expense. Whether all or which one or ones should be thus enlarged is for you to deter- mine, and it would be wise if your action were gulded by some commiltee attended by a competent architect who should first examina these different institutions, These three hospitals located at Hastings, Lincoln and Norfolk, under the superintend- ency of Drs. Johnston, Hay and Little, re- spectively, have been ably managed and I desire to testify to the hearty co-operation and sympathy of these gentlemen and the stewards under them in my efforts to reduce the expenses of these institutions to the min- imum. A reference to the table furnished you will show that the annual per capita ex- pense was reduced from $270.04 in the year 1892 to $152.65 in 1894 at HMastings, from $229.72 to $193.05 at Lincoln, and from $270.34 to §258.04 at Norfolk during the correspond- ing period—all excellent showings and about cquaily good considering the difference in population of each, which of course effects the result. The institution at Hastings bears the name “The Asylum for the Incurable Insane.” To those. who are taken there who have reason engugh to understand the significance of the application ‘and “to their friends the same stands as a terror and it should be changed to “The Hospital for the Chronic Insane.’ Whether there should be a separate hospital for the chronic insane or not is discussed in the reports of the several superintendents and their discussion is worth your study. For reasons I cannot undertake to set forth it'is my opinion that the class referred to should be distributed among the several in- stitutions. TRANSPORTATION OF PATIENTS. In connection with the foregoing I desire to make a recommendation in the interest of both humanity and economy. It fs usual for sheriffs to convey lunatics from their re- spective counties to the hospital. The com- mon fear of a crazy person which possesses people generally leads these officers in some cases which have been brought to my atten- tion to bind thelr subjects with irons and straps, both cruel and unnecessary and tenc: Ing to aggravate the malady of the patient Their transportation should be by a skilled and experienced attendant from the institu- tion and money provided for the payment of the actual expense incurred. This would re- sult in a saving of 50 per cent or more of the amount now paid. SOLDIERS AND SAILORS HOME. The management of the Soidiers and Sailors Home at Grand Island under the intelligence and watchful supervision of the present visit- ing and examining board has been most satis- factory. That board reports the morale ex- cellent, that thorough discipline is maintained and that little or no complaint goes out. What the board has to say of the officers in charge i8 so just and is so verified by my cwn observations and the reports received from there that it gives me pleasure to repeat it. The report says: The board specially calls attention to the faithfulness and efliciency of those in authority at the home, and those who have worked under their supervision. Crippled by lack of appropriations and with nearly all the farm products by two successive #ons of drouth, Commandant D. A. Scoville, Adjutant M. 'K. Walker, Matron Sarah Myers and Dr. J. Janss have shown them.- selves a genuine host in the positions they occupy. They have not only kept within the limit of the funds appropriated, but they have materlally improved the appearances apd convenlences of the grounds and build- ings; they have met the phenomenal in- crease in’the membership and have made the institution a veritable home to the vet- rans who, by sickness or misfortune, have been compelled to seck this place of refug These officers have proven themselves equai to every emergency and in some instances have almost accomplished the Impossible with the resources af their command. They have been ably seconded by the employes in the several departments of work, and while thelr wages seemed scant for (he work they performed, they have been and painstaking'in the execution of the du- ties devolving upon them. A reference to the commandant’s report will, by comparison, show that extraordi- nary care and economy have been exercised in ihe administration of the affairs of the home and that, too, with an increase rather than a diminuilon of comforts and conyeni- ences o the iumates, The governor has reason to congratulate himself that these afficers have made this institution a credit to the commonwealth which founded ft. The reduction of expenses has been most marked. While not so great apparently in the year 1893 because of the Inheritance of a large number of unpaid bills and scarcely any sup- plies, the annual current expense of main- taining each inmate was reduced from $339.89 in 1892 to $224.16 in 1894, From a report made to the senate of the last legislature by a committee sent out to inquire into the affairs of the home, the maximum capacity of that institution is esti- mated at 150 inmates. At the present time, however, there are 210 enrolled, of which there are 179 present—159 men and twenty women. In his report the commandant rec- ommends the building of some additions, in which recommendation General W. W. Averill, national inspector of soldiers homes, coneurs. THE PENITENTIARY. The management of, affairs at the peniten- tiary has been highly gratifying and is the subject of general commendation. The warden, Mr. A. D. Beemer, Is exceptionally well qualified for his office, combining as he does superior executive ability with great goodness of heart. To those of you who have seen the penitentiary in former days a visit there now will be a revelatlon. The court or yard surrounded by the walls and bulldings which before was strewn with stone and litter of various kinds has been transformed Into a vegetable and flower garden with well paved walks, jetting fountains and similar improve. ments calculated to inspire the better feelings of the unfortunates who are confined there, Neatness and cleanliness prevail ou every sea- should, 1| | one faithful | hand. Good order and disclpline are maln- tained and proceed more from a respect for the warden than from compulsion Some time in the month of October, 1803, of the penitenttiry bulldings used for manufacturing purposes was nearly destroyed by fire. Believing that the partially ruined stone walls would be further damaged by time the Board of Public Lands, approving my advice, procesded to have the building restored, although no money was provided from which the expense could be paid. Mr. W. H. Dorgan, who Is in charge of the con tract labor, kindly donated all the unskilled labor necessary and the structure was rebullt under the direction and supervision of Mr. Beemer at the remarkably low cost of $4.775.81—a_quarter or less of what it would have cost, I am assured, if it had been re- built by contract, PAROLE LAW, The law passed at the last session of the legislatura T believe is a wise one and under its operation thirty-one convicts have been paroled. As the law leaves to the Rovernor the authority to parole 1 have affixed certain conditions to be observed by the paroled con- vict, the violation of any of which subjects him to a return to prison, which are as fol- lows 1. Before his release on parle employ- ment must be procured for the prisoner at same legitimate industry. His p a em- ploye putable citizen of the stat supervise the conduct of th certified to by some Juage o or porson of good standing known to the wovernor. Such employer shall furthermore express in writing his willing- ness to give employment to the convict for a specified time, provided his conduct Is sati factory, to réport any absence from work, or tendency to evil associations, and to cer- tify to the monthly report required of the convict as hereinafter referred to. he prisoner on his part shall pledge himself in writing honestly and faithfully to comply with the conditions annexed: First—He shall proceed at once to the place of employment provided for him and there remain, Second—In ‘case he finds It necessary to change his employment or residence, he shall first obtain the written consent of the governor of the state through the warden of said state penitentiary. Third—He shall, on the first day of each month, unil his final release, write the war- den of said state penitentiary a report of himself, stating whether he has been con- stantly ‘at work during the last month, and, if not, why not; how much he has earned, and How much he has expended, together with a general statement as to his surround- ings and prospects, which report must be endorsed by his employer. Fourth—He shall in" all respects conduct himself hones avold evil associations, obey the 1 abstain from the use of intoxicating liquors, fth—As soon as possible after reaching he shall report to his em- showing him his parole, and at once employment provided for ploy enter upon the him. Sixth—He shall, while on in the legal custody of the governor of the state of Nebrask: Scventh—He shall be liable to be retaken and again confined within the enclosure of said state penitentiary for any reason or reasons that shall be satisfaciory to the governor, and at his sole discretion, until he receives a copy of his final discharge through the warden. As no money is provided for the capture and return of paroled convicts in case of a necessity for it, a small sum should be ap- propriated for that purpose. CONTRACT FOR PRISON LABOR. In the year 1877 the state, through its Board of Public Lands and Buildings, en- tered into a contract with W. H. B. Stout for the keeping of penitentiary convicts and for the leasing of the peniténtiary and grounds. This contract was subsequently modified by acts of the leglslature in 18 and 1883, Thereafter, by act of March 2, 1887, the contract was further extended in favor of C. W. Mosher, assignee of Stout, Mosher giving a bond in the sum.of $100,000 for the faithful performance of the obliga- tion on his part. Thereafter, in the year 1893, Mosher became a bankrupt and crim- inal, and has since been confined in a peni- tentiary himself. In the meantime William H. Dorgan, assuming to be the assignee of Mosher, has been employing or hiring out the labor of the convicts, feeding them, and otherwise carrying out the fobligations of Mosher under the contract. Dorgan has given no bond :to the state and the Board of Pub- lic Lands and Buildngs and. state. auditor, while not recognizing Dorgan as having any rights as assignee, pay him for the mainte- nance of convicts' and otherwise treat with him as the agent or attorney of Mosher. While Dorgan has no doubt as faithfully car- ried out the conditions of the contract as Mosher would have done, yet he is under no obligation to do so, and could abandon it at his pleasure. This condition of affairs de- mands that some action be taken by you. In favorable times, and under the direction of a warden such as is now in office, I be- lieve the penitentiary could be made nearly or quite self-supporting. ‘But whether it would be wise for the state to enter upon the experiment of employing its own convict labor at this time, or whether the contract should be relet, is for you to determine, HOME FOR THE FRIENDLESS, In the report of the commissioner of pub- lic lands and buildings attention is called to the fact that the Boards of Purchase and Supplies and of Public Lands and Buildings adopted certain rules designed to apply to the business transactions of all institutions with which they had to deal. While heads of all institutions except the Home for the Friendless complied readily with these reg- ulations, that fnstitution rebelled and brought’ the matter before the courts, The law governing that institution is very imper- fect, It shouid be amended so that Its man- agement would be brought in harmony with the others. The state supplies nearly all the means for its subport and there i no reason why it should not be held to an equal respon- sibility with the others, BUREAU OF LABOR. At the request or demand of organized la- bor, a bureau of labor and industrial statis- tics was established in Nebraska by legisla- tive enactment in 1857. The object was, pri- marily, to set forth, officially, the cost of liy- ing and the price of labor, to the end that the products of labor might be thoroughly divided between employer and employe, and that wages might correspond with the cost of lving. The bureau has proved a failure, never having attained the object for which it was created. There are two reasons why it has proved a failure. First, the appropria- tion has mot been sufficient’ to enable the commissioner to carry out the lutent of the law; and second, workingmen have refused or failed to furnish statements of living ex- penses. For_each biennial perlod up to the present one $3,000 was appropriated, and for the present perfod now closing $1,000. The salaries paid have been: Deputy commis- sioner, $1,600 per year—$3,000; one clerk, £1,000—$2,000; total salarics, $5.000. Appro- priation: Former periods, $3,000; printing, $600; total cost to state for 1,000 reports, $5,600. For the present period the cost to the stato will be nearly $7,000 for 1,000 reports, When it is stated that the small appropria- tion is utterly so Inadequate as to preclude the possibility of gathering the facts and fig- | ures which would make the report valuable, | parole, remain nd under_the control or which would in any sense carry out the |appointing and unsatisfactory. intent of the law, it will be plain that the | money is not well expended. On the other hand if the amount appropriated was made commensurate with the work to be per- formed, the bureau of statistics could be made very valuable. An appropriation sufficient to pay salary and traveling expenses of special agents s absolutely necessary to collect the data re quired. ‘The work cannot be done by mail. The law should be amended to provide for at least one factory iuspector who, besides his regular dutl in_certain lines. | The bureau should be so equipped as to be | able to collect and collate all statistics of the | state of whatever nature, so that any person in this or any other country who may be looking toward Nebraska for a home, or an 1ds of the report an answer to any question e might ask as to conditions in this state, Tho legislature should either make the office something more than a mere political salary-paying place or abolish it. IRRIGATION A PRESSING ISSUR. The subject of irrigation Is of such im- portance as to demand special consideration at this time. The fact that nearly or quite half the lands within the state lio west of the line of humidity sufficient to Insure an unbroken succession of crops, renders irriga- tion necessary to protect the people against disaster in unusually dry years. The partial fallure from drouth In 1890-9 3, and the almost total failure of 1594, has awakened the people to the necessity of providing for watering _the growing crops by artificlal means. The sofl of western Nebraska where, ome extent, want now prevails, Is as for as that of any portion of the United States, and in years past has ylelded abundant harvest in response to the efforts of industrious tlers. This fact has fos« tered anti-irrigation sentiment and retarded work tending to the cstablishment of & system of firrigation, but the more recent failures from drouth have dissipated all false opposition and started active operations in several counties of the state. And now, while irrigation in Nebraska is in its infancy and necessarily experimental, it will be well for the present legislature to give the subject carcful study, to the end that wise leglslation may be enacted providing for the protection of individuals fn their rights to the use of v for irrigation purposes. The right to tho use of water from the streams should be so safe guarded by law as to prevent the very appearance of monopoly, and to preclude all “possibility of erroneons rendition of the laws which may be passed covering the ques tion, The deputy commissioner of labor and in- dustrial statistics has prepared a careful report upon frrlgation, setting forth the ex- tent to which it has been carried within the state, including a tabular statement, accom- panied by a map, showing all statistics as far as obtainable at this time. The question of water supply and best methods of applying the same to the land s discussed in the report named, to which you are referred for more extended information upon this ques- tion, BEET SUGAR INDUSTRY. Experiment of the most convincing and conclusive character has demonstrated the peculiar fitness of Nebraska's soil and cli- mate for the production of r beets. Under the stimulus of the act passed by the legis- lature of 1889, offering a bounty of 1 cent, and the further action of congress in 1890, giving a bounty of 2 cents for every pound of sugar produced, the manufacture of sugar prang up and rapidly grew into proportions which gave much promise to the state. The beet sugar factory estabiished at Grand Is- land was soon followed by the erection of another at Norfolk, both representing an in- vestment of something like §500,000, emplo; ing during a part of the year some 600 em- ployes, and disbursing many thousands of dollars in wages and in the purchase of beets. Under proper inducement these factories might be multiplied and carried into many of the counties of the state. This would result in a much needed diversification in our agriculture, in smaller holdings in land, and consequent rise in value, a largely increased population, the employment of a vast army of workmen, and adding in the end very largely to the wealth of the state. Further- more, it is demonstrated that beels, as a crop, will succeed in dry seagons when other crops fall—a matter worthy of much con- sideration, fn view of our recent experience. By the action of the legislature in 1891 the state bounty heretofore offered was withdrawn and congress has also recently repealed the law giving the bounty of 2 cents per pound. As a result one of the two factorles of the state has Just been closed, and it {s a matter of doubt whether the other will continue under present conditions. I should regard it as a serious misfortune to the state if an industry of such Importance, and which ha: drawn o much attention to Nebrasku, should die out, and it is well worth your earnest conslderation whether anything can be done by you to keep alive those factories we al- ready have, and to encourage the establish- ment. of others. Should you conclude to do 80, it might be by a bounty {o the manufac- turer of sugar, conditioned that he .pay. for beets used not less than a price named, and that the payment of such bounty do not con- tinue beyond the time when the general government may glve sufficient protection to the industry. NEBRASKA'S WORLD'S FAIR EXHIBIT. Under the law of 1891, with the amend- ments therof by the legisiature of 1893, and with the money provided to carry it into effect, Nebraska took part in tho World's Columbian Exposition, held in Chicago, in 1893. As the fair was fo open soon after I came Into office, and finding no one whom I regarded as especially fitted and better qualified for the place who was willing to assume Its duties at that late day, I con- tinued the commissioner general I found in office, The display made, Including products of agriculture, horticuiture, the forest, the dairy, the aplary, as well as cvidences of our educational work and advancement, not only demonstrated in a convincing way the re- sources of the state, but was highly credila- ble, and, no doubt, profitable. The agricul- tural exhibit, under the artistic arrange- ment of Mr. J. C. Bonnell, was among the finest to be seen, and was the subjact of much admiration” and favorable comment. Tho generous and handsome exhibit made by the Oxnards of products of their beet sugar factorles and of the processes of thelr manufacture, was a revelation to the thou- sands who witnessed it, and drew much at- tention to the state, as the letters which have come to me festify. The live stoclk display was exceptionally fine, and shared liberally in the many premiums which fell to the state. The commissioner general has made the report required of him, and with the auditor will be found an account of, and viuchers for, all moneys expended by him. In the will be found a long list of ladies and gentle- men to whom the thanks of the state are due for their efforts and contributions to- ward making the state exhibit a succoss, MAXIMUM RATE LAW. At the last session of tho leglslature a law was passed classifying freights and fixing reasonable maximum rates to be charged for transportation of the same on the railroads of the state. Before the law went into ef- fect, however, parties interested in the sey- eral roads Instituted proceedings in the fed- eral court to test Its valldity and justnes and by a recent decision rendered by a judge of the United States court the operation of the act has been suspended. The declsion of the court, as I understand it, while it as- serts the constitutionality of the act and concedes the right of the leglslature to en- act laws of this kind, holds thal’the rates so fixed are not sufficiently remunerative to the roads, and for that reason enjoins their en- forcement. The opinion of the judge is dis- It 18 to be regretted that In saying to a state that cer- tain rallway rates established by it are un reasonable the court did not give The state some rule by which reasonable rates might be determined. The opinion leaves undetermined also an« other lmportant and long agitated question, whether fictitious capitalization of rallroads fixing a basis upon which incomes shall be permitted. Not only with a view to des termining the soundness of the declsion ren- , could act as special agent | dered, but with the purpose of settling the questions I have referred to and any others which may be valuable as a guide to futur legislation, 1 would advise that provision be made and directiop glven to prosccute the case until it shall have reached the court of (Continued on Fifth Page.) investment of any kind, may find within the S ———— You WOULD BE INDICTED FOR CRUELTY 26°TH AND DOUGLAS It you should treat any nlmal 48 you are treat- 12§ your oyes. You give them )ittie rest, aund you glve them no help. Our opdclan will in- form you whether gluss- s will be of any assist- ance o your case, RAYMOND, catalogues of exhibits made by the stats «= should be added to thelr real valuo wheused®™