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action of nearly all the principal cities in the Union under the sanction of State legislation with regard to their policemen and firemen, and even here in the District of Columbia under the authority of Congress.

Several of the State legislatures have recommended the application of this provision to the crews of the Life-Saving Service, the chief maritime interests urge it, and the press seems to be nearly, if not quite, unanimous in its favor. A bill with this object in view is now pending in both Houses of Congress, indorsed by the favorable report of this Department. In the Senate the Committee on Commerce has made a unanimous report in its favor, and it is earnestly hoped that it may be past during the present session of Congress. It is believed that its enactment would speedily restore the personnel of the Service to its former high estate, and even render it more efficient than ever.

REVENUE-CUTTER SERVICE.

Following is an abstract of the regular work performed by the Revenue-Cutter Service during the fiscal year 1906, together with the net expenditures: Lives saved (actually rescued) from drowning..

17 Persons on board vessels assisted....

1,66 Persons in distress taken on board and cared for.

1,285 Vessels assisted...

131 Vessels boarded and papers examined.

17,344 Vessels seized or reported for violation of law.

378 Fines and penalties incurred by vessels reported.

$67,410 Value of vessels assisted and their cargoes...

$5,012, 955 Vessels examined or spoken by patrol fleet during yellow-fever epidemic...:.

1,923 Net expenditure: Appropriation for maintenance

$1,450,000 Unexpended balance.

a $2, 188.67 The operations of the Service have continued actively along the seacoast of the United States, including Alaska, the Hawaiian Islands, and Porto Rico, and on the waters of the Great Lakes. Much important work has been done by revenue cutters in Bering Sea and the Arctic Ocean, where extended cruises have been made for the protection of fur-seal, salmon, and other fisheries and the public interests generally. There have been in commission 23 vessels of the larger class, and 16 harbor vessels and launches which are engaged at various ports in boarding duty and the enforcement of anchorage laws.

Fourteen officers have been on duty in connection with the LifeSaving Service, one as inspector of that Service and the others as assistant inspectors. They have performed the usual duties of inspecting the various life-saving districts, drilling the crews, and

a No allowance made for unexpected claims.

superintending the construction of buildings and life-saving appliances, etc.

One officer is on duty with the Immigration Service at the port of New York,

During the prevalence of yellow fever in the South, which continued from July to November, 1905, the Revenue-Cutter Service rendered effective aid in maintaining a quarantine patrol on the Gulf coast from Louisiana to Florida and preventing the introduction of the disease into the seaport towns by the water routes. Six revenue cutters and 6 chartered vessels, each in charge of an officer of the Service, composed the patrol fleet which cooperated with the Public Health and Marine-Hospital Service and examined or spoke 1,923 merchant vessels, a considerable number of which it was found necessary to place in detention. Not a case of yellow fever entered any locality by water within the limits of the patrol.

Great assistance was rendered by the Service to San Francisco immediately following the earthquake of April 18, 1906. Many lives and a large amount of property and treasure, the value of which can not be estimated, were saved by the efforts and resourcefulness of officers and men, while timely aid was given to numerous homeless and stricken people. The Service cooperated with the municipal authorities and the Army in preserving order, in checking the progress of the conflagration, which threatened to destroy the entire city, and in the transportation and distribution of supplies.

Revenue cutters have, by direction of the President, continued to cruise actively on the Atlantic coast during the winter months for the relief of distrest shipping. Succor in various ways has been afforded a large number of disabled and stranded vessels and their crews. Derelicts and other dangerous obstructions to navigation have been promptly removed or destroyed whenever it was practicable to do so.

The enforcement of the regulations governing the conduct of regattas, as required by law, has been effectively maintained in every instance coming under the supervision of the Service, which has insured a proper control of these events and the safety of participants and spectators.

Vessels.

I strongly recommend the passage of Senate bill 925, which has been amended and reported favorably to the House by the Committee on Interstate and Foreign Commerce. This bill provides for the construction of a first-class cutter for Puget Sound, a first-class cutter for Savannah, Ga., and adjacent waters on the Atlantic coast, an able seagoing tug for New Bedford, Mass., and the waters of Vineyard and Nantucket sounds, and a boarding vessel for duty at New Orleans, La. These vessels are urgently needed to improve the efficiency of the

Service at the points named. It has been found necessary to discontinue the services of the Grant on Puget Sound (where she has been stationed for many years) owing to her present deteriorated and unseaworthy condition and to the fact that she is not worth further repairs. This will leave Puget Sound, with its extensive maritime interests, and the dangerous outlying waters of the coast of Washington, without a regular cruising cutter. The pressing need of a new vessel to take the place of the Grant is apparent.

Two vessels, one for the coast of Maine and one for Albemarle and Pamlico sounds, North Carolina, are now in process of building, and proposals will be solicited as soon as practicable for the construction of a seagoing tug for life-saving purposes for the north Pacific coast and an able steamer for destroying derelicts at sea, the last two having been authorized by the present Congress. Repairs to the Thetis have been completed, and she is under orders to make the annual cruise to the Arctic Ocean. The additional appropriation allowed for special repairs will enable me to put in good condition a number of vessels which are greatly in need of repairs.

Personnel. The act to promote the efficiency of the Revenue-Cutter Service, approved June 23, 1906, is in accordance with the recommendations contained in my report of last year, and will be the means of providing in due time a sufficient number of junior line officers for the various ships. This law contains also other provisions which will prove of marked benefit in the administration of the affairs of the Service.

The limited number of grades, both in the line and staff, makes promotion unreasonably slow, particularly in the engineer corps, and I recommend that officers after performing five years' service in the grade of third lieutenant, or that of second assistant engineer, and upon passing the examinations now required by law, be eligible for promotion to the next higher grade.

I renew my previous recommendation that the senior 10 chief engineers be given longevity increase of pay up to 60 per cent on the basis of 10 per cent for every five years of service.

Suitable legislation should also be enacted in behalf of the warrant officers and enlisted men; they should be granted the same benefits as to length of service, retirement, and pensions as are accorded to men of other military branches. It is hoped that adequate provision in this respect will soon be made for them. The law contemplates that the pay of petty officers, seamen, and others on revenue cutters should be as high as the average wages paid to merchant sailors, but while the appropriation for the Service for the fiscal year 1907 will permit of a small increase of pay to enlisted men, the increase will not be sufficient to correct the inequality.

Discipline.

Much will be gained in maintaining the discipline of the Service by the act approved May 26, 1906, to regulate enlistments and punishments. This measure, which has been long needed, provides the legal means for the prompt punishment of desertion and other infractions of discipline.

Wireless telegraphy.

In my last report I called attention to the need of having wireless telegraphy on all first-class cruising cutters. In view of the proved advantages of such a system on seagoing vessels, and especially its great usefulness on public craft charged with assisting distressed mariners, the matter should not be longer delayed. I therefore recommend that $45,000 be appropriated for installing and operating the apparatus as suggested.

SECRET SERVICE.

In the suppression of counterfeiting the secret-service division reports a satisfactory diminution of activity on the part of makers of fraudulent notes and coins. But three new counterfeit issues were noted during the year, and their circulation was restricted to comparatively small amounts. The total of counterfeit money of all denominations confiscated and destroyed was a trifle over $38,000, about equally divided between notes and coins. This is nearly $100,000 less than it was ten years ago. There were 356 prosecutions for violations of the laws relating to counterfeiting. During the last six months of the fiscal year there was not one new counterfeit note issued. Specialists in criminal investigation have been provided by the secret-service division to conduct important investigations for other Departments, and there have been many arrests and prosecutions for fraudulent naturalization and for violations of the laws relating to public lands.

REPAIRS TO TREASURY BUILDING.

That portion of the Treasury building which was first constructed is built of sandstone, and the east front is in need of restoration. This is due to the fact that disintegration of the stone has set in, and some portions of it have already fallen. This condition is dangerous, and the architectural appearance of the building would be decidedly improved by replacing the sandstone with granite. The constant cost of repairs would also be avoided, and I strongly recommend that this improvement be made.

There is now on the books of this Department an appropriation of $175,000, made for the purpose of improving the ventilation of the

Treasury building, of which $162,147.42 remains unexpended. The problem of ventilation having been solved, it is recommended that said sum of $162,147.42 be reappropriated, together with $162,852.58, making in the aggregate $325,000 for replacing the east front of the Treasury building, including the colonnade, with granite, which is the estimated cost of said work.

DISTRICT OF COLUMBIA.

The net expenditures on account of the District of Columbia for the fiscal year 1906 were $11,487,249.80. The net revenues deposited in the Treasury on this account for the same period were $5,993,018.96.

The amount of the funded debt retired during the year was $463,650, reducing the annual interest charge by $16,923.22. Since the close of the year the debt has been further reduced by the purchase of 3.65 per cent bonds to the amount of $358,600. The bonded debt outstanding October 1, 1906, was $11,229,100 in bonds bearing 3.65 per cent interest.

Total issue of the 3.65 per cent bonds is limited by law to $15,000,000, and of this sum $14,997,300 has been issued.

The act of Congress approved March 31, 1906, provides that the 10 per cent retentions from District contracts for the construction of bridges and sewers shall be held for a period of one year instead of five years, as heretofore. The act also applies to all contracts of this character now completed and accepted. This has increased the number of settlements during the year, and retentions from 67 contracts, amounting to $163,611.59, were canceled by the return to the contractors of $111,950 in bonds and $38,091.11 in cash, leaving in the hands of the Treasurer $296,087.90 in retentions, represented by $208,240 in bonds and $67,914.89 uninvested cash.

Detailed information in regard to the affairs of the District of Columbia will be found in the report to be submitted by the District Commissioners and by the Treasurer of the United States, ex officio commissioner of the sinking fund of the District.

STATE BONDS AND STOCKS OWNED BY THE UNITED STATES.

The following statement shows the nonpaying State bonds and stocks, formerly in the Indian trust fund, now in the Treasury, belonging to the United States:

Louisiana..
North Carolina.
Tennessee..

$37,000.00

58,000.00 335, 666.663

Total.....

430, 666.663

A history of these State stocks and bonds is given in House Document No. 263, Fifty-fourth Congress, second session.

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