GOVERNOR'S SPECIAL MESSAGE. EXECUTIVE DEPARTMENT, To the Senate and Assembly of California: In my Annual Message, at the commencement of the present session, the financial condition of the State was carefully presented, and your efforts invoked to relieve its embarrassments. As in duty bound, I recommended certain measures deemed essential to the preservation of the faith and credit of the State, and the diminution of that burden of taxation which now weighs so heavily on the energy and industry of the people. These embarrassments are daily increasing, and I am the more firmly convinced of the necessity and importance of the measures then earnestly urged upon your consideration. Under existing circumstances, however, I feel it my duty again to invite your attention to the condition of the finances of the State, and to make further suggestions which are regarded as important. It is believed .hat the State is possessed of Beach and Water property sufficient, at least, if judiciously disposed of, to liquidate her entire Civil indebtedness-a result much desired and loudly demanded by our com mon constituents. As it will be necessary in this communication to make frequent reference to the actual condition of the finances of the State at the present time, an official statement of the same has been obtained from the Comptroller of State, which is herewith submitted. It will be seen, therefore, that the debt of the State has accrued since the organization of our State Government, at an average rate exceeding six hundred and seventy-one thousand dollars per annum, and must continue to increase at about the same rate, until provision is made for the reduction of our expenditures, and the payment of all our liabilities in cash, instead of depreciated State paper. Such being the actual condition of things, we are called upon by every consideration of honor, patriotism, and fidelity to our constituents, to use the means legitimately at our disposal, for the purpose of saving the sinking credit of the State, and rendering justice to the people whom we repre sent. The Attorney General of the State, in a communication dated February 18, 1853, addressed to the Assembly, makes the following statement: "I think I may safely estimate the value of Beach and Water property, in the city of San Francisco, which has not been disposed of according to the provisions of the Statutes, and which rightfully belongs to the State, at the sum of five millions of dollars:-a great part of which property is now held and claimed by persons who have no legal or equitable right to it." Here we have the deliberate and unequivocal opinion of the legal adviser of the State, in which, so far as the United States is concerned, he is fully sustained by numerous decisions of the highest judicial tribunal of the country. The Supreme Court of the United States, at the January term, 1845, in the case of Pollard's Lessees vs. Hogan, decided that "the right of eminent domain over the shores and the soils under the navigable waters, for all municipal purposes, belongs exclusively to the States within their respective territorial jurisdictions; and they, and they only, have the constitutional power to exercise it. "To give to the United States the right to transfer to a citizen the title to the shores and the soils under the navigable waters, would be placing in their hands a weapon which might be wielded greatly to the injury of State sovereignty, and deprive the States of the power to exercise a numerous and important class of police powers. But, in the hands of the States, this power can never be used so as to affect the exercise of any material right of eminent domain or jurisdiction with which the United States has been invested by the Constitution." The Court declare, "that by the preceding course of reasoning, we have arrived at these general conclusions: First, The shores of navigable waters and the soils under them, were not granted by the Constitution of the United States, but were reserved to the States respectively. Secondly, The new States have the same rights, sovereignty, and jurisdiction over the subject, as the original States. Thirdly, The right of the United States to the public lands, and the power of Congress to make all needful rules and regulations for the sale and disposition thereof, conferred no power over the shores of navigable waters, and the soils under them." See 3 Howard, 212. At the January term, 1850, the Supreme Court of the United States reaffirmed the above case, and the opinion of the Court was delivered by Chief Justice Taney as follows: "This is an action of ejectment, brought by the plaintiff in error to recover a lot of ground in the town of Mobile, in the State of Alabama. He claimed title under an inchoate Spanish grant, dated December 12, 1809; and an act of Congress confirming this title, passed July 2, 1836; and a patent from the United States, dated March 15, 1837, which issued in pursuance of the act of Congress. The validity of this title was disputed by the defendant, upon the ground that the premises were a part of the shore of a navigable tide-water river, lying below high water mark, when the State of Alabama was admitted into the Union, in 1819; and that, therefore, at the time of the passage of the act of Congress, the sovereignty and dominion over the place in question were in the State, and now in the United States; and the Court instructed the jury, that if the land described in the plaintiff's declaration was below ordinary high water mark, at the time Alabama was admitted into the Union, the confirming act of Congress, and the patent, conveyed no title to the patentee. The same question upon the same act of Congress and patent, was brought before this Court in the case of Pollard vs. Hogan, at the January term, 1845, reported in 3d Howard, 212. That case was fully and deliberately considered, as will appear by the Report; and the Court then decided that the act of Congress and patent conveyed no title." See 9 Howard, pp. 477, 478. These decisions, as well as many others which might be cited, to say nothing of the universally admitted general principle of law, clearly establish the right of the State of California to dispose of the "Shores of all navigable waters and the soils under them," within her limits; and that the State alone has the dominion and control of this property. It is also well settled by numerous decisions, that no separate or exclusive right, adverse to the State or public right, is acquired by a city or town to the tide-waters or soils under them, by virtue of an act of the Legislature extending the limits of such city or town over such waters. "The Supervisor of the town of Flushing, in the State of New York, brought an action of debt for a penalty prescribed by a regulation of the town, by which it was ordered that no person should rake clams within the boundary of said town, and the decision of the Court was, that the town had no right to pass the law in question. The town of Flushing," the Court said, "must show a right of property to the lands in the bay, in order to entitle them to make rules and regulate the use of these lands. The Act extending the bounds of the town over the bay and into the Sound or East River, so as to include the Islands southward to the main channel, was merely for the purpose of jurisdiction, and is no evidence of a grant of property in the soil covered by the water. All the ground under the navigable waters of the Hudson River is within the boundaries of some town, for the purposes of civil and criminal jurisdiction; but it does not follow that the lands under the water belong to the towns situated on the River." See Angell on Tide Waters, pp. 46, 47. It is not deemed necessary, in this communication, to notice the adverse claims, originating under certain acts passed by the Legislature of this State of 1851, which it is presumed will be set up to this property by individuals. That such claims exist, is well understood, however; and the sooner the questions involved are adjudicated upon and definitely settled, the better for all concerned. This property, though immensely valuable, so long as the question of title is unsettled, will remain, as at present, unproductive to the State. Its speedy improvement is certainly a matter of great importance to the city of San Francisco, as well as to the State; because it will add millions to the amount of taxable property, and of course greatly increase the revenues of both. In addition to the amount of property which will be then subjected annually to taxation, I have no doubt that, by a judicious disposi |