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To the Senate and Assembly of the State of California :

In accordance with the requirements of the Constitution and laws, it becomes my duty to communicate to you information relative to the general condition of the State, with such recommendations and suggestions as may be beneficial in the promotion of its interests and ultimately leading to its future prosperity.

I congratulate you upon the auspicious opening of the new year. Success has attended every vocation and pursuit of our fellow-citizens. The fertility of our soil has yielded an abundant harvest; our orchards and vineyards have amply rewarded the labor expended on them; our mines show no diminution of their proceeds; our mechanical industries are increasing, and their activity is the best indication of their thrift.

These blessings should invoke from us an acknowledgment to Almighty God, with a prayer of earnest heart for a continuance of his mercies.

Since the meeting of the last Legislature, death has taken from us a distinguished citizen, one who served the State as Representative in Congress, Governor, and United States Senator. In the discharge of his public duties, Milton S. Latham was ever faithful and loyal to the trusts confided to him. Such attributes of respect due to his position and past services as were in my power to confer were given. to his memory.

I transmit herewith the reports of the Controller and State Board of Equalization, and take pleasure in directing your attention to State papers so able, so elaborate, yet so concise, so clear in arrangement and expression, and so replete with suggestions of the greatest value.

They show completely the workings of our revenue laws as they now exist, and constitute a reliable basis and guide for economic and intelligent legislation. The details of all expenditures are given, and the exact financial condition of the State is shown.

That condition is certainly excellent, whether considered by the light of a comparison with that of any other State, or reflected upon as a terse presentment of the question of taxation that is involved between our obligations and our resources.

The State has taxable property of the assessed value of about six hundred and ten millions of dollars. Her interest-bearing debt amounts to three million two hundred and ninety-three thousand five hundred dollars. Of that debt the State owns, holding in trust for educational purposes, two million six hundred and ninety thou

sand dollars. This leaves only six hundred and three thousand five hundred dollars of her bonds in private hands; and there is now in the treasury, and provided for by taxes already levied, something more than five hundred thousand dollars applicable to their purchase or redemption.

That showing is a good one for a commonwealth that has expended within the past ten years more than four millions of dollars upon public buildings; more than four million five hundred thousand dollars for charities; and more than twelve millions of dollars for public education.

Within fifteen years our expenditures for educational purposes. have increased from the annual average of two hundred and seventy-five thousand dollars to that of the current fiscal year-two million and twenty-nine thousand nine hundred and seventy-four dollars; expenses, ordinary and extraordinary, have been met; permanent improvements of great value have been made; taxation has not been excessive, comparatively speaking, and the public debt has been steadily reduced, until the gratifying result above set forth has been reached. It readily suggests itself that, during the whole existence of the State, her fiscal policy has generally been a prudent one, and that, upon the whole, her finances have been well managed. Í congratulate you, and the people, that such is the fact.

During the present administration the ordinary expenses of government have been light, the extraordinary ones great. The public institutions have been ably and economically managed. The various offices have been efficiently filled and prudently conducted. The expenditures for all purposes have averaged four million two hundred and forty-four thousand and thirty-eight dollars annually. For the five years preceding, the annual average expenditure was three million six hundred and thirty-three thousand nine hundred and two dollars. The increased average expenditure yearly has been six hundred and ten thousand one hundred and thirty-six dollars. Such increase is owing in part to extraordinary appropriations made-and, in my opinion, wisely madefor various purposes; but is owing mainly to our growth as a community, which has naturally necessitated greater outlay for public education, for the care of criminals, and for those charities which embrace the deaf and dumb, and the blind, the insane, and those wards of the State, the orphans and the abandoned children, which latter were provided for so munificently by the Act of March 25, 1880.

The extraordinary appropriations were as follows:



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Deficiency for support of State Printing Office for thirtieth fiscal year.
Additional for support of State Printing Office for thirty-first fiscal year.
For purchase of press, type, etc., for State Printing Office..
Enlargement of State Printing Office.

Erection of buildings for the Deaf, Dunib, and Blind Asylum..

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Reimbursement of the support fund of the Deaf, Dumb, and Blind Asylum_
Erection of a building for the use of the Normal School.
Erection of a building for the insane at Stockton...---

8,532 00

100,000 00

85,000 00

Improvement of L street, opposite the State Capitol..

Repairs to State Capitol building, furniture, etc., for twenty-ninth, thirtieth, and thirty-first fiscal years.

4,000 00

5,158 31

For Hastings' College of Law, payment of interest for twenty-ninth fiscal year..

1,159 59

For Hastings' College of Law, rent thirtieth fiscal year.

1,100 00

For State Board of Equalization for thirty-first fiscal year.

8,416 68

For Railroad Commissioners for thirty-first fiscal year.

9,450 00

Sundry claims.........

3,000 19

Sundry deficiencies for twenty-ninth_fiscal year.

5,791 63

Sundry deficiencies for thirtieth fiscal year

2,194 93

Armory rents, etc., National Guard, for thirtieth and thirty-first fiscal years.

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Deficiencies for the support of the State Prison at San Quentin prior to thirty-sec

67,018 14

Purchase of jute machinery, etc., for State Prison at San Quentin.

219,000 00

ond fiscal year....

Deficiencies for completion of Branch State Prison at Folsom prior to thirty-sec

8,945 00

Permanent improvement of State Capitol grounds.

17,500 00

Purchase of trails, Yosemite Valley..

25,000 00

Purchase of land for Napa Insane Asylum.--.

12,000 00

Expenses of State Viticultural Commissioners__

10,000 00

Educational building, etc., for Asylum for Deaf, Dumb, and Blind

45,500 00

Purchase steam launch for Quarantine Officer, San Francisco___

5,000 00

Payment of interest to University for moneys misappropriated to other State pur

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The large sum total is now represented mainly by valuable property in the shape of permanent improvements.

For charities, the annual expenditures were, for five years preceding this administration, four hundred and thirty-three thousand eight hundred and seventeen dollars. The average for the past three years has been six hundred and twenty-three thousand three hundred and sixty-two dollars. For public education, the average yearly outlay for the five fiscal years immediately preceding my inauguration was one million three hundred and eighty thousand six hundred and twenty-eight dollars. During my terin of office, the average annual outlay for the same purposes has been one million seven hundred and eighty-three thousand nine hundred and forty-eight dollars. The increased annual average of outlay, therefore, for these two items alone, amounts to five hundred and ninety-two thousand eight hundred and sixty-five dollars-which is within about seventeen thousand dollars of the total increased average.

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