$50,000,000, leaving a very large amount-viz, about $311,000,000 -to be raised from the sale of bonds and from call loans and payments in certificates of indebtedness.

The arrear of indebtedness existing on the 1st of April was undoubtedly caused in a very great degree by the refusal of the Army and creditors generally, during February and March, to receive payment in the old issue. After the 1st of April the evil was aggravated by the unavoidable delay incident to the preparation of the new issues; and on the 1st of July the arrear of debt was at least $114,000,000 as stated in my report of November 7 (p. 4).

The difficulty of meeting the current expenditures and extinguishing at the same time the pre-existing debt resulted from the insufficiency of the means immediately available, and the payment of the troops insensibly participated in the consequences of the general deficiency. A very large proportion of the funds furnished in March for the pay of the Army, being refused by the troops, was returned into the Treasury in April.

This at once established an arrear of part for a very large sum. During the two succeeding quarters, for the reasons already stated, the amount furnished was again inadequate; and though the amount paid during the present quarter-viz, $35,000,000 -has been sufficient for the quarter's pay, the pre-existing arrarages remain undiminished. The income tax and the tax on sales for the last quarter of 1864 are relied on to some extent to meet the payments to the Army. Being payable on the 1st day of January, 1865, they are not supposed to be receivable in 4 per cent. bonds, this medium of payment being limited to "taxes in the year 1864. " Should no change be made in the law, the revenue from this source will amount to made in the law, the revenue from this source will amount to $44,000,000, according to the best estimates to be made, and contribute materially to the reduction of the arrear of indebtedness.

Should this amount be collected as proposed, in Treasury notes, and the measures I have had the honor of recommending to Congress be adopted, I indulge in the confident belief that the pay of the Army will be made hereafter with more punctuality and in a better medium.

I have the honor to remain, your obedient servant,

G. A. TRENHOLM,

Secretary of the Treasury.

Act of the general Assembly of South Carolina.

AN ACT to repeal all acts and parts of acts heretofore passed by the Legislature of this State on the subject of furnishing slave labor on the coast and fortifications within this State, and otherwise to provide for furnishing such labor.

I. Be it enacted by the Senate and Housed of Representatives now met and sitting in General Assembly and by the authority of the same, That in order to furnish the necessary slave labor to work on the coast of this State and fortifications within the limits of the same there shall be organized a force consisting of male slaves between the ages of eighteen and fifty years, liable, under existing laws, to road duty, not exceeding in number at any one time of one-tenth part of said slaves, to serve for the term of twelve months from the date of their impressment; subject, however, to the right of their respective owners, at the expiration of every three months of said term of service, to substitute other slaves so liable to road duty in their place, and who, by