mencing July 1, 1879, actual expenditures,
$91,683,385.10; and for the remaining three quarters of the year
the expenditures are estimated at $172,316,614.90, making the total
expenditures $264,000,000, and leaving an estimated surplus revenue
for the year ending June 30, 1880, of $24,000,000. The total receipts
during the next fiscal year, ending June 30, 1881, estimated according
to existing laws, will be $288,000,000, and the estimated ordinary
expenditures for the same period will be $278,097,364.39, leaving a
surplus of $9,902,635.61 for that year.

The large amount expended for arrears of pensions during the last and
the present fiscal year, amounting to $21,747,249.60, has prevented
the application of the full amount required by law to the sinking
fund for the current year; but these arrears having been substantially
paid, it is believed that the sinking fund can hereafter be maintained
without any change of existing law.

The Secretary of War reports that the War Department estimates for the
fiscal year ending June 30, 1881, are $40,380,428.93, the same being
for a less sum of money than any annual estimate rendered to Congress
from that Department during a period of at least twelve years.

He concurs with the General of the Army in recommending such
legislation as will authorize the enlistment of the full number
of 25,000 men for the line of the Army, exclusive of the 3,463 men
required for detached duty, and therefore not available for service in
the field.

He also recommends that Congress be asked to provide by law for
the disposition of a large number of abandoned military posts and
reservations, which, though very valuable in themselves, have been
rendered useless for military purposes by the advance of civilization
and settlement.

He unites with the Quartermaster-General in recommending that an
appropriation be made for the construction of a cheap and perfectly
fireproof building for the safe storage of a vast amount of money
accounts, vouchers, claims, and other valuable records now in the
Quartermaster-General's Office, and exposed to great risk of total
destruction by fire.

He also recommends, in conformity with the views of the
Judge-Advocate-General, some declaratory legislation in reference
to the military statute of limitations as applied to the crime of
desertion.

In these several recommendations I concur.

The Secretary of War further reports that the work for the improvement
of th