TABLE NO. 17.-Outstanding indebtedness, detailed by municipalities, June 30, 1917. 1 Bonds purchased by University of Porto Rico, $9,500, deducted from amount due insular revenue, as proceeds of sale were placed into miscellaneous receipts. 2 Independent bond issue. The new organic law which became effective immediately upon its enactment on March 2, 1917, contains a number of provisions having an important bearing upon the treasury department, which on that date received the official designation of "department of finance." The filling of the vacancy caused by the resignation of the former treasurer, Hon. Allan H. Richardson, which had been postponed until after the passage of the new law, was, according to the terms of the act, placed in the hands of the governor, and on the day following its approval the appointment of the acting treasurer to the position of treasurer was made and confirmed by the executive council, together with the other officers who were to fill the newly created positions in other departments. This appointment carried with it the additional duty of membership in the executive council, and the pressing requirements of the last month of the assembly, together with the protracted sessions of the board of review and equalization, have left little opportunity for a detailed study of the many innovations which it would be desirable to put into effect, and which have therefore been necessarily postponed for action during the present fiscal year. The routine work of the department has been carried on successfully, however, despite the enforced vacancy in the position of assistant treasurer and the loss of so many of the most valuable men of the department through the allurements of commercial employment and the drain on the personnel through volunteering for service with the colors, and to the loyal service of those who remained is due the credit for the record of achievement which has been maintained throughout the year. The excellent services rendered during the year by the field force of assessors and the internal-revenue agents has already been commented upon, and it would be no more than just to add that fully as faithful service has been rendered by the corps of collectors, located in 66 of the 76 municipalities into which the island is divided. Exhibit No. 19 of the consolidated financial tables in last year's report showed a total of $35,402.20 of taxes outstanding and uncollected, which was a reduction of about 50 per cent from the amount pending collection at the corresponding time of the previous year. The total amount of taxes assessed and levied for the current year, as shown in Exhibit No. 19-A, is $2,734,451.68, making a total charge of $2,769,853.88. The amount of taxes collected is $2,749,571.93, which, together with certain penalties and readjustments of additional items, reach the total of $2,765,926.15, as shown in Exhibit No. 19-B, and leaves the total amount of taxes pending collection, therefore, on June 30, 1917, reduced to the sum of $20,281.95, which is the lowest point that this account has shown for more than five years, and when compared with the total amount of over $25,000,000 levied since the installation of the tax system is seen to represent but eight one-hundredths of 1 per cent of the total levy. Of this total, approximately $4,000 corresponds to two sugar mills in bankruptcy proceedings in the Federal court, which will be terminated within the next few months, and the whole of this amount collected, while about $1,100 more is awaiting other judicial action. Nearly $2,000 more represents taxes the payment of which has been extended for a limited period upon proper security having been given for the eventual payment, while another $3,000 is under investigation as to the correctness of claims which have been presented against the assessment. Of the remaining $10,000, which is an accumulation from the beginning of the present tax system, it is improbable that much can be collected. An act approved at the last session of the legislature provides that taxes more than four years overdue and whose collection is impracticable on account of all property having disappeared may be certified to the auditor, and upon examination by this officer and certification by him to the legislature may be ordered written off. This provides a simple means of disposing of many uncollectible accounts generally of taxes levied on personal property, especially automobiles, which has changed hands or disappeared and the debtor either can not be located or claims to have no other property subject to seizure. The number of collectors' offices has again been slightly reduced by the elimination of Lajas and Hatillo, two small towns, each of which is located near another town where a collector's office is maintained. To provide for the sale of documentary and cigar stamps in these places, as well as certain other populated centers which have attained sufficient importance to have secured a post office, another act of the last session authorized the treasurer to place a sufficient number of such stamps in the hands of the postmaster or other responsible person to supply the needs of the surrounding region. The compensation for this service is to be based on the value of the stamps sold and is limited to $25 per month. In addition to their official duties, which have included besides the collection of the property tax described above the collection through the sale of revenue stamps of the $2,890,986.95 of excise taxes and the $34,660.27 of inheritance taxes and $410,107.52 of income tax the collectors have contributed loyally to a number of other movements which are not strictly within the scope of this department. They have aided in the compilation of statistical data concerning the principal crops of the island and in many other ways have demonstrated the value of having representatives of the Insular Government in the most widely separated parts of the island. At the time the United States Treasury issued the call for subscriptions to the first war loan, the various officials and field men of the department of finance answered readily to the opportunity to aid in this patriotic service. It was particularly fitting that this should be so, as the Federal Government has during the past six years attended to the details of placing on sale the various issues of insular bonds, and the department welcomed the chance to reciprocate. Circulars were prepared and issued from each of the collectors' offices and subscriptions were received and collections made in over 90 per cent of the island towns. When it is considered that in an even greater degree than in the United States the Porto Rican people are unfamiliar with government bond issues or loans, and that perhaps not one in ten thousand owned this class of securites before the war, the response from all classes of people was very gratifying. Although comparatively small in total amount, the $600,000 worth of liberty loan bonds bought by the Porto Rican people means much more as an expression of loyalty to the American Government than can be measured in dollars and cents. While desiring to observe fully the principle that annual reports should not contain biographical or eulogistic matter relating to the past or present personnel, I wish to express here the loss which the department has sustained in the death of Eugene J. Reynolds, chief of the bureau of municipal finance, on June 25, 1917, at Addison, N. Y., while on leave of absence. His long years of service in the department, during which his exceptional ability had earned for him successive promotions, culminating in the position which he occupied at the time of his death, and his rare tact and sound judgment which had made his conduct of the affairs of the bureau so successful, measured not only by its value to the government but also by the esteem in which he was held by the municipal authorities with whom he dealt, makes his place in the department and in the hearts of his associates most difficult if not impossible to fill. Early in the year Mr. Stanley Warzala, the chief of the bureau of excise taxes, resigned after 14 years of faithful and valuable services in the department, and Mr. W. A. Hillis, the internal-revenue agent at large, was appointed to succeed him. Mr. Hillis has succeeded in maintaining the high record of efficiency left him by his predecessor, and to him, as well as to Mr. Noah Shepard, the chief of the bureau of property taxes, and Mr. Paul F. Oakes, the paymaster and chief of the bureau of accounts, and to the other members of the department's personnel, it is desired to express the appreciation which their loyal cooperation so highly merits. Respectfully submitted. CHARLES F. HILL, APPENDIX VI. REPORT OF THE COMMISSIONER OF THE INTERIOR. OFFICE OF THE COMMISSIONER OF THE INTERIOR, San Juan, P. R., August 20, 1917. SIR: In accordance with the provisions of section 13 of the act of Congress entitled "An act to provide a civil government for Porto Rico, and for other purposes, approved March 2, 1917, I have the honor to submit the annual report regarding the operations of the department of the interior during the fiscal year ending June 30, 1917. PUBLIC WORKS AND GENERAL ENGINEEring. The bureau of public works of this department has direct charge of the construction and maintenance of all insular roads, bridges, culverts, harbors, bulkheads, and water fronts (with the exception of the port of San Juan) and of the investigation of the physical conditions of franchises and permits involving technical questions relating to railroads, bridges, piers, and general engineering construction, as well as the supervision of the construction and maintenance of municipal roads. This bureau is by far the most important division of the department of the interior, and the chief of the bureau, who is designated by law as the superintendent of public works (which designation, by the way, is a misnomer) occupies the most difficult engineering position in Porto Rico. The bureau handles the problems of insular road and bridge construction and maintenance, which are constantly becoming more difficult of adequate solution because of the continuously increasing traffic of automobiles and trucks and the present inability of the insular treasury to finance the reconstruction of such portions of the insular highways, which, being subject to the heaviest traffic, require a more solid and permanent pavement. WEATHER. The weather conditions for the year just ended have been worse from the standpoint of damage done to the public works than for many years past. Unusually heav rains set in early in July, when the fiscal year had hardly begun, which lasted all through the fall, as late as the first half of December, greatly damaging the surface of the roads, causing landslides, and weakening and partly or totally destroying some bridges and culverts. The strong winds and extraordinary rainstorm which occurred August 22, 1916, when the wind blew with a velocity of 90 miles an hour during several hours, did great damage all over the island, destroying the telegraph and telephone lines, uprooting trees, and intercepting the traffic over the public roads for more than 24 hours. This storm was followed by severe cyclonic disturbances during the rest of the month of August. The removal of the landslides produced by this extraordinary weather, which fell generally all over the island, cost about $16,000. This expenditure was immediately necessary in order to restore the public traffic. Besides this, other heavy expenditures were required and made for repairing a good number of struc tures which had been badly damaged, notably among them the pile bridge over the Manati River at Barceloneta, which was twice partly washed out, the Estero River wooden bridge at Mayaguez which was completely carried away, restoring the macadamized roadway and to clean out obstructed ditches. The total of these expenses amounted to about $35,000, which had to be paid out of the annual appropriation for maintenance of roads and bridges. This unexpected additional expense was partly made up to the department by a deficiency appropriation of $30,000 passed at the last session of the legislature held during the past winter. The most seroius single item in the list of damages was the destruction by flood on July 14, 1916, of the 90-meter span, reinforced concrete bridge over one of the mouths of the Grande de Arecibo River at Arecibo. The flood, one of the highest recorded, scoured the pile foundations of the bridge to a depth of 30 feet, causing the collapse of seven sections, each 10 meters in length. The bridge was nearing completion, so that the event involved not only the loss of the money spent in building the part destroyed |