404726 APPENDIX AA. OFFICE OF THE SECRETARY TO THE U. S. MILITARY GOVERNOR IN THE PHILIPPINES. To the SIR: Manila, P. I., September 26, 1900. U. S. Military Governor in the Philippines, In obedience to instructions, I have the honor to submit the following report of the operations of this office for the fiscal year ending June 30, 1900. The reorganization of the Secretaryship of the Military Government was effected by G. O. 64, current series, of the Military Governor's office. Under the terms of this order the office became, in all respects, one of record, charged with issuing all orders, general or special, of the Major General commanding in his capacity as Military Governor, and with the conduct of correspondence relating to civil affairs. Through it is exercised the supervision and control of the Military Governor over the following enumerated departments of civil administration: 1. Judicial Department. 2. The General Customs and Internal Revenue services 4. Office of the Captain of the Port of Manila and its 5. Treasury Department. 6. Auditor's Department. 7. Municipal Governments. 8. Public Instruction. 9. Department of Public Works, including Works of the 10. Office of Patents, copyrights and trade marks. II. Mining Bureau. 12. Forestry Bureau. 13. Department of Island Prisons. In addition the Nautical School of the Philippine Islands and the Boards of Officers on Claims and Conference with the Spanish Board of Liquidation were likewise required to report to this office. The increased work resulting from this reorganization necessitated an increase in the clerical force of the office, which now numbers six civilians and nineteen detailed enlisted men, including one chief clerk, five stenographers, three interpreters and translators, nine clerks, and one representative of the Secret Service. On the 1st of August last the system theretofore in force of keeping records in books was abandoned and the card system instituted in its stead. It promises, when better understood, to abridge the work and to afford a much more ready access to the archives of this office which have already become very voluminous. What I have said above relates to the work of the Secretary's Office proper, and no reference is made to a force of fourteen native clerks, who are occupied in classifying the archives of the Spanish Government, a reference to which work is hereinafter made. I am unable to submit any concrete recommendation as to the necessities for a clerical service in the future, being unacquainted at the present time with the functions which will, in view of the dual control which has existed since September Ist, be left to this office. Thus far there has been no diminution, but rather an increase, of office work; assuming that this condition will continue an office force of not less than thirty men will be required. As soon as it can be accomplished I would recommend that the force be constituted entirely of civilians, reserving a suitable number of these positions for the enlisted men at present on duty in the office who have proven their qualifications and who should be discharged to accept such appoint ments. TREASURY DEPARTMENT. The problem of securing a stable currency, difficult of accomplishment in all countries, appears never to have even approached a definite solution in the Philippines. Of this fact the accumulation of laws on this subject since 1836 and the voluminous records pertaining thereto which the Spanish administration left unfinished in the latter days of its existence afford convincing proof. During the period of American rule the problem has not pressed for immediate settlement until quite recently when the exchange rate between U. S. currency and Mexican silver fell below the commonly accepted commercial rate of two for one. When the daily bank rate reached 1.98, and promised to go lower, the trade in Manila. reduced the rate at which U. S. currency was accepted even lower than the bank rate, and it was reported that in certain remote localities in the provinces, where conditions were imperfectly understood, there was, for a few days, an even exchange of United States and Mexican dollars. As a provisional remedy G. O. 107, c. s., Office of the U. S. Military Governor in the Philippines, was issued, and the Government in addition engaged itself, (reserving the right to cancel the arrangement at any time), to reimburse the banks in kind for all Mexican silver which they were compelled to pay out in receiving U. S. currency from disbursing officers and trade at the rate first above named. The effect was immediate and the public confidence was restored without loss to the Treasury, but the experience gained is as yet confined to too limited a period to enable a conclusion to be expressed as to the desirability of continuing this arrangement or as to the more permanent remedy which should replace it. The recommendation of the Treasurer of Public Funds that the Spanish seized funds be taken up on his books as "Miscellaneous" is concurred in with the qualification that it be first made to appear by an expert examination of the books of the Treasury kept by the pre-existing Island Government that there are no objections to such a course. The balance on hand at the end of the fiscal year of 1899-1900 was 4,045,133.51 pesos, and on August 31, 1900, 6,520,015.48. To this total should be added the amount of Spanish seized funds of 890,229.86 pesos, making a grand total of available assets, on August 31, 1900, of 7,410,245.34 pesos. AUDITOR'S DEPARTMENT. The office of Auditor was created by G. O. No. 3, O. M. G., series of 1898, which designated Major Charles E. Kilbourne, Paymaster, U. S. A., as Auditor of public accounts. Subsequently Major Kilbourne was relieved from this duty and Lieutenant Colonel C. L. Potter, U. S. V., appointed in his place on October 10, 1898, who was in turn succeeded by Captain Albert Todd, 6th U. S. Artillery. Thereafter, on April 1, 1900, Captain Todd was succeeded by Mr. Walter G. Coleman, the present incumbent, who thus became the first civilian Auditor of the Archipelago. From data furnished by the Auditor since the rendition of his annual report the following information is obtained, showing the receipts and disbursements of the Military Government in the Philippines for the first eight months of the year 1900, and which is here noted not only as a matter of first importance and general interest but as well on account of its close connection with the reports of the various departments that follow in order: The total receipts from January 1 to August 31, 1900, were, in Mexican currency, $12,041,504.71, and the total disbursements for the same period were $7,407,988.71, leaving a surplus of receipts over disbursements in the sum of $4,633,516. Of the total receipts for this period those from customs amounted to $9,952,936.68; those from internal revenue, $902,484.97, and from miscellaneous or all other sources, $1,186,083.06. Of the disbursements there were expended in the customs service for this period, |