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GENERAL RECEIPTS AND DISBURSEMENTS.

The following statement exhibits the Receipts and Expenditures by the Treasury during the fiscal years ending October 31, 1861 and 1862, as shown by the reports of the Auditor of State:

Balance in the Treasury Nov. 1, 1860......
Receipts for year ending Oct. 31, 1861..

Balance in Treasury Nov. 1, 1861......

$134,660 39

2,669,264 93

Disbursements for the year ending Oct. 31, 1861.....

3,442,510 57

$361,414 75

Receipts for the year ending Oct. 31, 1862.......
Disbursements for the year ending Oct. 31, 1862......

$3,486,304 55

2,974,976 46

Balance in Treasury Nov. 1, 1862......

$876,471 42

GALLANTRY OF INDIANA TROOPS.

While we rejoice in the bravery displayed by all the armies of the United States, it is a subject of profound congratulation that the Indiana troops have behaved with uniform and distinguished gallantry in every action in which they have been engaged. They form a part of every army in the field, and have been among the foremost in deeds. of daring, while their blood has hallowed every soil.

The American Annual Cyclopedia justly declares that "the Indiana troops have been perhaps more widely scattered through the different corps d'armee than those of any other State." The same high authority, in another place, speaks of the conduct of Indiana troops in the field as follows: "Whenever they have been engaged in battle they have been eager to advance, steady in the fight, and utterly averse to retreating."

Our troops, hitherto engaged in the peaceful pursuits of trade and agriculture, have manifested that lofty courage and high-toned chivalry of which others have talked so much and possessed so little, and which belongs only to the intelligent patriot, who understands well the sacred cause in which he draws his sword.

Indiana has already made a large investment of her best blood in the cause of this Union, and will never consent to its dismemberment, or to a dishonorable peace. The bones of her sons mingle with the soil from Virginia and Missouri to Louisiana, and she will not confess that the sacrifice has been made in vain, or acknowledge that it was in an unholy cause. Gen. Hackleman, Cols. Brown, Bass, Link, Lieut. Cols. Hendricks, Bachman, Keith, Gerber, Kirkpatrick, Cross

wait, Topping and Wolf; Majors Tanner, Gavitt, May, Arn, Abbett and Conklin-and many others, of lower rank, but with valor not less distinguished, have yielded up their lives upon the field that our country might be preserved. Thousands of our private soldiers, with with equal courage and patriotism, have fallen, the victims of this unnatural rebellion. They were fighting from deep convictions of duty and the love they bore their country. Their unlettered graves mark an hundred battle-fields, and our country can never discharge to their memory and their posterity the debt of gratitude it owes. Our gratitude should be testified by the tender care we take of their families and dependent ones whom they left behind, by the education of their children, and by the honor we pay to their memory.

Nor should we forget those who have perished by disease in the camp or hospital. They were denied the soldier's privilege of dying in battle, but their sacrifice was none the less. To die in the field, amid the clash of contending armies and the roar of battle, fighting in a holy cause, is glorious; but when death comes slowly on, in the loneliness and desolation of the hospital, with no mother or sister present to soothe the passing spirit and minister as love only can minister; with none but the rough hand of a comrade to press the clammy brow and perform the last offices to the dying, it is terrible.

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Notwithstanding all that was being done by public and private benevolence, toward supporting the families of soldiers, the evidence came to me from every part of the State, that many families were destitute, and that great suffering must ensue during this winter, unless active steps were taken to raise contributions and provide for the needy.

Accordingly, I issued an appeal to the people of the State, a copy of which is herewith filed, stating the necessity and calling upon all who were able to contribute of their means. I am gratified to be able to report, that a very generous response has been made to the appeal, that active measures have been initiated in many counties in the State, to relieve the necessities and provide for the comfort of the families of our soldiers who have abandoned home and all its endearments to fight the battles of our country. The clergy of the State were especially called upon to engage in the work of visitation and collecting contributions and have, as I am informed, generally responded with zeal and energy.

It is, however, manifest that all efforts will fall short of meeting the necessities of the case and that Legislative aid will be required The circumstances by which we are surrounded are novel and extraordinary, and should be met by prompt and extraordinary meas

ures.

I therefore earnestly invite the early and favorable consideration of this subject by the Legislature.

LEGION.

At the Extra Session of the Legislature a Militia Law was passed, providing for the organization of the Indiana Legion.

Although this law was defective in many respects, and should be amended, yet it provided the frame-work of an organization which has rendered most valuable service during the war. To the officers and men of the Indiana Legion, the State chiefly owes the immunity she has enjoyed from invasion, plunder and murder, by the guerrilla and marauding bands which infested many of the adjoining counties in Kentucky. Not only so, their aid and protection has been cheerfully and successfully extended to the loyal citizens of Kentucky, when it has been called for. On several occasions they met the enemy in battle, when they ably maintained the credit of the State, and behaved with that distinguished courage which has characterized the soldiers of Indiana throughout this war. Some have fallen in battle, and I earnestly recommend that their families be provided for, and placed on a footing at least equal to the families of those who fall in the Federal service. They also rendered prompt and efficient service in guarding rebel prisoners when the Federal forces performing that duty were called into the field. Although the organization and operation of the Legion have been chiefly confined to the counties bordering on the Ohio river, yet much has been done in some of the interior counties, and among them I would especially notice the counties of Jennings, Decatur, Shelby, Tippecanoe, Putnam, Parke and Vigo. The response which was made from those counties, on sudden calls for military force, was of the most energetic and satisfactory character. For a full account of the operation of the Legion, I refer you to the able and interesting report of Major General Love. Your attention is also specially called to the recommendations contained in his report relative to the amendment of the Militia Law. It is very important that provision be made presenting inducements to join the Legion, by proper exemptions and payment, and conferring the authority and pointing out the manner, by which the members of companies shall be compelled to attend meetings for drill and respond to calls for service. Such authority is doubtless contained in the Law now, but its mode of exercise is not determined. The Legislature appropriated, for the support of the Legion, $70,000 for the year 1861, and $70,000 for the year 1862. As will appear from the Auditor's report, only the sum of $7,352 23 has been expended on these appropriations up to the 31st day of October last. The distribution of the Fund among the counties and regiments, as required by the act was never made by the Adjutant General, because of insuperable difficulties growing out of defects in the Law, and the organization of the companies. I trust the Legislature will make prompt provision for the payment of all claims growing out of the operations of the Legion, and for a proper distribution of the Fund. Strongly impressed how much the peace and security of the State depended on the efficiency of the Legion, in the month of October, I Part 2.-Doc. J.-2

summoned the officers to this city to receive military instruction in a school temporarily organized and conducted by Major General Love. Some 400 gentlemen were in attendance, and the spirit and devotion manifested by them, and their progress in military knowledge, were of the most encouraging and satisfactory character.

PROCLAMATION CALLING OUT THE MILITIA.

At the time of the invasion of Kentucky by Kirby Smith, the guerillas infested the Kentucky side of the Ohio River, from Lawrenceburg to Mount Vernon, and at several points large bodies of rebel cavalry were assembled, and seemed to be awaiting an opportunity to cross the river and invade the State. The river was very low, in many places fordable, and much alarm prevailed in our border counties.

Accordingly, I issued a Proclamation, of which a copy is herewith filed, requiring all the able-bodied men, subject to military service, between the ages of 18 and 45, in the counties bordering on the Ohio River, to assemble at stated periods, with whatever arms they could command, to organize themselves into companies and be instructed in military tactics. This Proclamation was very generally acquiesced in, and carried into execution by the people, and was continued as long as the emergency seemed to require. The preparations thus made, in connection with the Legion, for repelling and punishing invasion, deterred the guerilla and marauding parties, who were plundering and murdering the Union men on the other side of the river, and protected the lives and property of our citizens.

ADJUTANT GENERAL.

I lay before you the able and interesting report of Adjutant General Noble.

It contains a brief history of the operations of the State in furnishing troops for the prosecution of the war and much most valuable information. I have instructed him to prepare another report, to contain the name of every officer and private soldier who has entered the army from Indiana, with the number of the regiment, company or battery to which he belonged. Such a report would be invaluable hereafter as a work of history.

STATE AGENCY.

The report of Hon. R. N. Hudson, the Agent of State, is herewith laid before you, and your attention invited to the recommendations contained in it, to change the form of indebtedness, by substituting coupon bonds for certificates of stock, and abolish the office of

Agent of State, as at present organized. By the terms of the compromise with the bond-holders, made in 1846, the State is required to keep an office in New York for the transfer of our stocks and the payment of the interest on them. But this agreement can be complied with fully by selecting some responsible bank, in such manner as may be determined upon by the Legislature, to perform the duties that are now devolved upon the Agent of State. Under the present system the risk attending the solvency of a Bank has to be incurred, for the Agent having no means of safekeeping the money remitted to him by the Treasurer of State, deposits it in bank, and in payment of interest to the holders of our stocks gives his checks upon the bank.

So much of the business, therefore, being necessarily done through the bank, I am of the opinion that the rest of it could be devolved upon the bank, with increased safety and economy to the State.

In 1846 the State of Indiana made an adjustment with her creditors, under which the former State Bonds were to be surrendered and cancelled upon certain conditions, and new stocks issued in exchange. Out of this adjustment sprung the Indiana Five per cent. Stocks, as known in the New York market.

One of the conditions of the adjustment was, that the State should establish an agency in the city of New York for the transfer of these stocks and the payment of the interest upon them.

By express enactment of the Legislature, it was provided that these new certificates of stocks should be transferable only at the agency in the city of New York, on books provided for that purpose. When stock was transferred the old certificate was taken up and cancelled, and a new one issued, made payable to the person to whom the transfer was made. These certificates were not payable to bearer, did not pass by delivery from hand to hand, and were not negotiable in the sense of the law merchant. It was expressly intended they should not be. At and before the time of the adjustment spoken of it was claimed by the State that numbers of her bonds, which had been deposited in New York, or hypothecated for small sums of money, and for which the State had received little or no consideration, had been improperly and fradulently put into circulation. But as they were genuine, made payable to bearer, and the property in them passed by mere delivery, she could not do otherwise than recognize them as valid obligations. These circumstances led to the peculiar provisions in regard to the new stocks. To carry out the new arrangement, printed forms of the certificates of stocks, signed by the Auditor and Treasurer of the State of Indiana, were deposited with the State Agent, in the City of New York, to be by him countersigned and filled up as to dates, amounts, names of parties, and registered in books provided by the State for that purpose. It is not improper to state here that this form and mode of transfer, before being enacted into a law, was submitted to and received the approval of Charles Butler, Esq., the agent and representative of the bond-holders, at the time of the adjustment referred to, as I am informed and believe.

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