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attended its operations and strong hopes are entertained that
it may, ere long, contribute something towards the heavy debt
which has been incurred in its construction.

The Kent County Rail Road Company and the Wicomico
and Pocomoke Rail Road Company have both complied with
the provisions of the Act of 1860, ch. 303, and have certified
to the Treasurer their right to receive the State subscription
named in that Act, the former $101,531, and the latter $6 0,
000. In the ease of the latter, the Act of 1866, ch. 154, in-
creased the subscription by an amendment of the Act of 1860.

I have received the last Exhibit of the nnapolis and Elk-
ridge Rail Road Company. The road is not in condition to
make any retarn to the State. I would recommend the dis-
missal of the legal proceedings against that Company, such
being the recommendation of the counsel retained on the part
of the State.

THE NAVAL ACADEMY.

By an Act passed by the General Assembly in January
last, authority was given to the Governor, Comptroller and
Treasurer, to sell to the Federal Government the Executive
Mansion and grounds attached thereto, to enable the Govern-
ment to complete arrangements then going forward for the
enlargement of that Institution.

This was wholly indispensable to the retention of the School
in Annapolis Both the Secretary of the Navy and the Presi-
dent of the United States, by his endorsement of the recom-
mendation of that officer, having urged a much larger space
than that heretofore occupied by the Naval School, it became
a matter of the first importance that the most liberal policy
should be pursued by the State, in the effort to fix the perma-
nent location of this valuable Institution within our borders,
especially as the most vigorous efforts were then being made,
to change the location to some other point.

It affords me pleasure to report to the General Assembly
that the most friendly spirit was manifested throughout, by
Vice Admiral Porter, commanding the Station, and by the
Naval Committees of both house of Congress; and that a re-
sult was arrived at, entirely satisfactory to the State of Mary-
land, whereby the permency of the Institution is believed
to have been secured against future contingency. The Man-
sion and grounds were disposed of at a cost of $25,000, with
the stipulation that the possession of the State would not be
interfered With, during the gubernatorial term of the present
incumbent, unless arrangements could be sooner made to pro-
vide suitable accommodations for the Governor elsewhere, in
which event the property would be immediately surrendered