& Co., and October 15th I addressed a letter to them, asking if General Varnum had purchased bonds from them. In reply to this letter I received a telegram and a letter as follows: DR. COWGILL: NEW YORK, October 27, 1873. My Dear Sir:-We dispatched to you a few days ago in reply to your favor of the 15th inst., as follows: "Varnum alone can give the information." I answered thus, at the instance of General Varnum who proposed to see you in person with reference to the subject matter of your note. This is the first time that you have put a direct question to me, as to whether or not Varnum, Treasurer, had bought bonds from us. If you had done so, under restrictions placed upon me, I should have declined to answer you, but in so doing that of itself would have given rise to suspicion upon your part, that probably some such transaction had taken place. You would have then sought and obtained the information from the party or parties who alone had the right to communicate it. I never could see myself any good reason for not conversing freely with you upon the subject, yet I assure you we are not at liberty to do so. It is proper to say that the resolution of the Board of Trustees, confirming the purchase of the bonds from us made early in last June, and indeed the preliminaries of the negotiations, dating very much earlier than that, with some of the Trustees exacts of Treasurer positively secrecy as to the purchase and sale referred to, until the matter was consummated and ordered officially to be given to the publie. My relations with you warrant me in withholding no information from you, when sought, and by consent of Varnum I write this. Yours truly, L. P. BAYNE. P. S.-The transaction was one of pure business. wanted to buy, and we certainly wanted to sell. Varnum In this letter Mr. Bayne says truly that it was the first time I "had ever put a direct question to him as to whether or not Varnum, Treasurer, had bought bonds," and it is equally true that I had never put an indirect question upon the subject, as the possibility of either General Varnum purchasing for, or of Mr. Bayne selling to the College, had never crossed my mind until October. I then addressed to the Trustees of the Agricultural College two communications, as follows: OFFICE OF COMPTROLLER, TALLAHASSEE, FLA., November 10, 1873. To the Trustees of the Florida Agricultural College: } GENTLEMEN-Section 17 of the act entitled an act to establish the Florida Agricultural College, approved February 18, 1870, says the "Trustees shall report to the Comptroller annually on the first day of October" their action in reference to the sale of land or land scrip, and the disposition of the proceeds of said sale, in such form as he may direct. This seems to make it the duty of the Comptroller to indicate to the Trustees the form in which this report shall be made. I therefore request the report to be made in the form of full and explicit answers to the following questions: Ist. Was the land or land scrip sold? 2d. At what time was the sale made? 3d. Upon what terms, whether for cash or upon credit, and if for credit, mention manner and date of payment. 4th. To whom was the sale made, and by whom as the agent of the board? 5th. Have the terms of sale been strictly complied with: if not, mention the date and place and mode of actual payment. 6th. To whom was the money paid as the agent of the Trustees? 7th. What disposition was made of this money-was it at once invested permanently, or was it placed on temporary deposit? If so, at what rate of interest? 8th. What permanent investments have been made, date of purchase of bonds or other securities, description of bonds, from whom purchased and at what price? 9th. By whom such investments were made as the agent of the Trustees, and by what authority? 10th. An itemized account of all necessary expenses incurred in these transactions. Very respectfully, C. A. CowGILL, Comptroller. COMPTROLLER'S OFFICE, TALLAHASSEE, FLA., Nov. 10, 1873. To the Trustees of the Florida Agriculrural College. GENTLEMAN-In May last, I addressed you a communication which was designed to place before you the propriety of invest ing the fund, derived from the sale of the lands given by Congress to the College, in the new six per cent. gold bonds of the State of Florida. Believing then as I do now, that it would be to the advantage of the College if the Trustees would invest this money so as to benefit the State by placing funds in the Treasury, thereby assisting materially in restoring the State to a cash basis, I urged them to do so, saying that I considerid the endorsement of the State's credit by this action of the Trustees almost essential to such restoration. No formal reply was given to this communication, but Lieutenant-Governor Stearns was distinctly told by some of the Trustees that they had directed the investment to be made in Florida bonds, and that it was clearly understood that these bonds should be the bonds of 1873, so that the purchase money would come into the Treasury. This assurance Lieutenant-Governor Stearns telegraphed to me, according to an arrangement made between us previous to my departure for New York, where I was then engaged in redeeming the hypothecated bonds of 1868-9, and the information thus conveyed to me was used by me officially while endeavoring to place the bonds upon the Stock Exchange of New York. A day or two after I had received the telegram from Lieutenant-Governor Stearns, General Varnum, as the Tresurer and Agent of the Board, appeared in New York and informed me that the action of the Trustees in reference to this investment was a secrect; that the whole matter was left in his hands to be acted upon at his discretion, and that Lieutenant-Governor Stearns could have had no authority for giving me the information. That he was not prepared to say what he would do-that he desired to do the best thing for the College, and he wished to prevent speculators from taking advantage of the opportunity to sell their bonds. After my return to Florida, which occurred on the 6th of July, General Varnum, in other conversations, by saying "that all would be right," that he "had authority to invest, but could not say when he would do so, but that all would be right," and by using similar expressions to myself and other Cabinet Officers, induced us to rest perfectly confident in the belief that the investment was to be made in the bonds of 1873, and that the money would go into the State Treasury. We could place no other construction upon the expression "that all would be right," as we were thinking and talking in this connection of nothing but the means of appreciating the State's financial condition. I never was more greatly surprised and grieved than when I learned by a letter from Mr. Bayne, of New York (a copy of which is herewith enclosed), that the money had been invested by General Varnum in the purchase of bonds held and owned by him (Mr. Bayne) as his own' private property, and to-day I am informed that while General Varnum was in New York in June, he then purchased 50 bonds for $40,000 from Bayne & Co., and contracted to purchase 50 more when there mainder of the Agricultural College Scrip money should be paid by Mr. Lewis, while at this time in New York, and afterwards in Tallahassee, he informed me that "he did not know what he should do, but must keep all a secret until his mind was made up," etc. 66 I can perfectly understand why the Trustees might feel it to be their duty to say to the Comptroller in answer to his letter, we would like to purchase the bonds from the State so as to benefit the State Treasury, but we must purchase from those who will sell the cheapest, therefore we will buy in the open market after advertising for proposals, but I cannot understand why, after an apparently studied reticence on the part of your agent, every departure from which only misled me and other State officers, whether so intended or not, the money should have been invested in bonds owned by a private individual-no one hearing of the transaction until its consummation, and no other parties having a chance to make a lower offer. I think I may with propriety, and therefore do ask: Was not the State of Florida deserving of some consideration in this transaction? She has acted liberally by providing that all necessary expenses of obtaining and investing this money shall be paid from the State Treasury (Sec. 11 of Chap. 1766), and I think she was entitled to a prompt, courteous and candid reply to the communication made by the Comptroller. I have the honor to ask if the money has been thus invested, and if there remains no chance for the State to receive any benefit from the Agricultural Fund. Very respectfully, C. A. COWGILL, Comptroller. On the 12th of November, the Trustees acknowledged the reception of these letters, promising a speedy answer, and requested that I would furnish them with a copy of the contract made with Bayne & Co., with which request I promptly complied. The following letter from the President of the Board of Trustees was sent to me on December 10th. OFFICE SUPERINTENDENT OF PUBLIC INSTRUCTION, C. A. COWGILL, ESQ., Comptroller : SIR-Your communications to the Trustees of the Agricultural College bearing date November 10th, were received, and I have been directed by the Board of Trustees to place in your hands the entire action of the Board in relation to the subject of your communications, which you will find in the annual report of Trustees to His Excellency, O. B. Hart, a copy of which I will furnish you at an early day. Yours respectfully, JONATHAN C. GIBBS, President Board of Trustees. On the 17th of December, a proof of this report to the Governor was furnished me. In it I look in vain for even an allusion to my second letter of November 10th, in which I state how the proposals made by me to General Varnum to purchase bonds from the State were received, and also ask why the purchase was not made according to my request, although a copy of the contract with Bayne & Co. furnished to them by me in response to their wishes is printed as part of General Varnum's report with other matter equally irrelevant. I am surprised to find no assertion that the Trustees intended to purchase from the State, as I had always supposed such to have been their intention, as their order to invest in the 1873 bonds was given in response to my letter of May 17th, strengthened by the personal solicitation of yourself and others, and quite recently most of the Trustees have informed me that they had so intended and supposed the bonds had been purchased from the State. General Varnum, as agent of the Trustees, went to New York, and while there refused confidential communication with me and when the State daily asked him, through the Comptroller, who, by your permission, held exclusive charge of the bonds, to buy her bonds, gave no direct reply, and certainly gave not the slightest intimation that he was then buying or had bought from Bayne & Co. as the supposed agents of the State. In his report to the Trustees of the College, General Varnum says "that Messrs. Bayne & Co. by contract with the Comptroller had been authorized to make exclusive sale of the new bonds until October first," and further that "Bayne & Co. having in their possession all of the new bonds which had been |