The extent and nature of the contracts, purchases, and expenditures for the Indian service made since July 1, 1873. FEBRUARY 10, 1874.-Referred to the Committee on Indian Affairs and ordered to be printed. To the House of Representatives: I have the honor to transmit herewith the report of the Secretary of the Department of the Interior, to whom was referred the resolution of the House of Representatives of January 7, requesting "a statement of the extent and nature of the contracts, purchases, and expenditures for the Indian service made since July 1, 1873, setting forth which, if any, of them were made or entered into without conference with the board of Indian commissioners appointed by the President, and the extent and description of contracts and vouchers objected to by said board, stating to what extent payments have been made thereon against their remonstrance." EXECUTIVE MANSION, February 9, 1874. U. S. GRANT. DEPARTMENT OF THE INTERIOR, SIR: I have the honor to acknowledge the receipt, by reference from you, of a resolution of the House of Representatives, in the following words, viz: Resolved, That the President of the United States be, and he is hereby, requested to eanse to be furnished to this House, at as early a day as practicable, a statement of the extent and nature of the contracts, purchases, and expenditures for the Indian service made since July 1, 1873, setting forth which, if any, of them were made or entered into without conference with the board of Indian commissioners appointed by the President; and the extent and description of contracts and vouchers objected to by said board, stating to what extent payments have been made thereon against their remonstrance. In response to said resolution, I have the honor to transmit herewith a copy of a Communication from the Commissioner of Indian Affairs, dated 26th ultimo, accompanied by schedules containing the information requested, as follows: 1st. A statement showing the extent and nature of contracts entered into for the Indian service since July 1st, 1873, showing which were made without conference with the board of Indian commissioners appointed by the President. 2d. Statement of the expenditures of the Indian service since July 1, 1873, showing what vouchers were not approved by the board of Indian commissioners, and to what extent payments have been made thereon. In this connection I desire to submit some observations in relation to the workings of the present system of auditing accounts by a committee of the board of Indian commissioners. The board of Indian commissioners were appointed by you under authority of an act of Congress approved April 10, 1869, (Statutes, vol. 16, p. 40.) The board was authorized by said act to "exercise joint control with the Secretary of the Interior over the disbursement of the appropriations made by this act, or any part thereof that the President. may designate." By an act of Congress approved July 15, 1870, (Statutes, vol. 16, p. 360,) it was made "the duty of said commissioners to supervise all expenditures of money appropriated for the benefit of Indians in the United States, and to inspect all goods purchased for said Indians in connection with the Commissioner of Indian Affairs, whose duty it shall be to consult said commissioners in making purchases of such goods." The act of Congress approved March 3, 1871, (Statutes, vol. 16, p. 568,) provides: "that hereafter no payments shall be made by any officer of the United States to contractors for goods or supplies of any sort furnished to the Indians, or for the transportation thereon, or for any buildings or machinery erected or placed on their reservations under or by virtue of any contract entered into with the Interior Department, or any branch thereof, on the receipts or certificates of the Indian agents or superintendents of such supplies, goods, transportation, buildings, or machinery beyond fifty per cent. of the amount due, until the accounts and vouchers shall have been submitted to the executive committee of the board of commissioners appointed by the President of the United States, and organized under the provisions of the fourth section of the act of April tenth, eighteen hundred and sixty-nine, and the third section of the act approved April [July] fifteenth, eighteen hundred and seventy, for examination, revisal, and approval; and it shall be the duty of said board of commissioners, without unnecessary delay, to forward said accounts and vouchers so submitted to them to the Secretary of the Interior, with the reasons for their approval or disapproval of the same, in whole or in part, attached thereto; and said Secretary shall have power to sustain, set aside, or modify the action of said board, and cause payment to be made or withheld as he may determine." Under the provisions of the act of Congress of May 29, 1872, (Statutes, vol. 17, p. 186,) with powers and duties already provided, it is therein provided: "That any member of the board of Indian commissioners is hereby empowered to investigate all contracts, expenditures, aud accounts in connection with the Indian service, and shall have access to all books and papers relating thereto in any Government office; but the examination of vouchers and accounts by the executive committee of said board shall not be a prerequisite of payment." By the act approved February 14, 1873, (Statutes, vol. 17, p. 461,) the board was continued with the same powers and duties. It will be observed that by the act of May 29, 1872, the examination of accounts and vouchers by the board of commissioners was not to be longer deemed a prerequsite of payment. In view of the legislation in that behalf which had been previously enacted, and was still unrepealed, and the peculiarity of the language of the act of 1872, I deemed it best, for prudential reasons for the time being, to continue the practice of sending all accounts to the board for examination prior to the final action of the Department thereon. The examination of accounts by the board is made by an executive committee, consisting of three members, one of whom resides in New York, one in Philadelphia, and one in Boston, and, under existing regulations, accounts are required to be transmitted to one or more of those cities for the convenience of the members of said committee. It has been customary, however, to obtain the signature of but one member of the executive committee, who signs for the committee. It is well known that, under the ordinary rules of auditing and passing upon accounts in all other branches of the governmental business, the system of checks in the auditing of accounts and vouchers by the several officers through whose hands they pass, and whose approval is necessary to their allowance and payment, great delay necessarily occurs in the payment of the most meritorious claims, oftentimes to the serious injury of honorable and worthy claimants. The additional delay in the business of the Indian Office consequent on the transmission of these accounts to the members of the executive committee, materially increases the existing and unavoidable delays above referred to. At the time of the recent financial stringency throughout the country there werem any accounts suspended by the executive committee, involving a large amount of money, the continued withholding of which must have soon proved disastrous to individual claimants, besides adding to the monetary distress in certain localities. A careful examination of the reasons assigned by said committee for the disallowance of said claims showed them to be for the most part technical, or based upon information in possession of the committee, and not known to the Indian Office. Some of the claims thus disapproved were returned to the committee with additional information concerning them, which seemed sufficient to modify, if not entirely change, the attitude of the committee in regard to them. In all cases, however, it has been the rule of the Department to refer all accounts that have been disallowed by the executive committee to the Indian Office, with the reasons of the committee, if any were reported, for withholding its approval, and to request of the commissioner of Indian affairs a report thereon. On receipt of such report from the commissioner, the claims and papers have been referred to the Assistant Attorney-General, assigned to duty in the Interior Department, for his opinion as to the validity of the claims, and as to the duty of the Secretary of the Interior, which opinion has governed my action in the final disposition of the claims. The duty of examining these accounts is vexatious, embarrassing, and difficult, owing to their multiplicity and variety, and the magnitude of the sums involved. In pressing emergencies, which frequently arise, delays, either in the procurement of, or payment for supplies, may prove disastrous to the service, as well as to the honest and conscientious contractors, and it seems to be imperatively demanded that some modifications of existing regulations should be made. The committee, I am informed, is sometimes approached by outside parties, and thus placed in possession of statements in relation to the character of vouchers of which the Indian Office and the Department have no knowledge when called upon to act. For instance, the following indorsement was made by the executive committee on account No. 1853, G. M. Dodge, $19,264.96: Examined and approved, in consideration of the letter of the Commissioner of Indian Affairs to the Hon. Secretary of the Interior, dated January 22, 1874. As the Commissioner's letter states that "the cattle in question were in accordance with the requirements of the contract," I take this official statement as the basis of my action on this account, though information from other sources does not confirm the Commissioner's assertion. NATHAN BISHOP, This indorsement was answered by the Commissioner of Indian Af firs, under date of 4th instant, as follows: : DEPARTMENT OF THE INTERIOR, OFFICE OF INDIAN AFFAIRS, SIR Referring to the indorsement of Hon. Nathan Bishop, executive committee, board of Indian commissioners, on the account of G. M. Dodge, for cattle delivered at the Cheyenne River agency, amounting to $19,264.96, wherein he states that the account is approved, "in consideration of the letter of the Commissioner of Indian Affairs to the Hon. Secretary of the Interior, dated January 22, 1874. As the Commissioner's letter states that the cattle in question were in accordance with the requirements of the contract,' I take this official statement as the basis of my action in this account, though information from other sources does not confirm the Commissioner's assertion," I desire to state, for the information of the Department, as to the evidence upon which the office-letter referred to by Mr. Bishop was based, that there have been presented to this office original invoices for 11,789 head of cattle that were wintered north, together with an affidavit to the effect that, of the cattle referred to in said invoices, a sufficient number were delivered on the Missouri River for the six months' supply of northern cattle called for by the contracts, and that the cattle for freezing were embraced in such delivery. These invoices and the affidavits accompanying them were considered sufficient evidence by this office to show that the cattle delivered at the Cheyenne River agency as per said account were wintered North, and consequently that the contract in that particular had been carried out. But if the board of Indian commissioners has information from other sources that will tend to show that this affidavit is not in accordance with facts, such information may be of value to this office. Mr. Bishop has this day been requested to furnish whatever reliable information may be in his possession on the subject. Very respectfully, your obedient servaut, Hon. SECRETARY OF THE INTERIOR. EDWD. P. SMITH, Commissioner. Thus it not infrequently occurs that the Indian Office is called upon to act upon a claim, concerning which information is in the hands of the executive committee, but unknown to the Indian Office or to the Department. This condition of things should not exist. It is not likely to subserve the ends of justice, and is not calculated to produce. harmonious conclusions. I also transmit, herewith, a list of accounts, not approved by the executive committee and now before me for final action. These accounts will be examined in accordance with the policy above indicated, and the opinion of the Assistant Attorney General will no doubt govern my action, as it has done heretofore. The responsibility of finally acting upon these accounts being placed upon me by law, cannot be transferred or avoided. I shall, therefore, continue in the future as in the past, to exercise the most rigid scrutiny into their character, and shall act in accordance with my judgment and sense of duty in all cases, until Congress sees fit to provide some other method for their adjudication. It will be exceedingly gratifying to me if Congress will make the action of the executive committee in regard to said claims final, and relieve this Department from any responsibility in the matter. If Congress is unwilling to make this alteration, however, I have the honor to recommend that authority be conferred upon the Secretary of the Interior to direct the board to conduct its examination of accounts in the Indian Office, where it may have all the facts known to the office, and the office will have all the facts known to the board. This course will certainly tend to produce greater unanimity of conclusion among the various parties who are required to examine and pass upon such claims. Should Congress fail to modify the existing regulations as above indicated, I shall feel myself justified in requesting the board to conduct their examination of accounts in the Indian Office. In all cases where the Assistant Attorney-General has considered the question of approving an account not approved by the executive committee, he has furnished the Department with a written opinion giving his conclusions, a copy of which has uniformly been filed with the papers in the case and forwarded with the account to the accounting officers of the Treasury, for their information before auditing the same. Copies of those opinions are transmitted herewith. The resolution is herewith returned. I have the honor to be, very respectfully, your obedient servant, The PRESIDENT. C. DELANO, Secretary. |