beverages and the titling tax on motor vehicles, and the unex-
pected reversion of appropriations items. It is estimated that the sur-
plus at September 30, 1941, the close of the present biennium, will
be $7,556,665.25, subject to any change which may be occasioned
by amendments to the income tax law. It is felt that the present
condition of the State Treasury is most satisfactory and doubtless
the best since the beginning of the budget system.

It is particularly recommended that you refer to Statement
"D," referred to in the preceding paragraph. This statement
is the Balance Sheet and shows in summary and readily under-
standable form the State's assets and liabilities. Details for the
various items in this statement are shown elsewhere in the report
as indicated by reference thereto in the Balance Sheet.

I believe you will be interested in Statement "M," pages 45 to
47, which shows the property owned by the State, by agencies,
location, class of property and valuation. The total, inclusive
of $174,439,406.58 invested in the state roads system, is
$232,866,915.06.

While particular reference has been made to two of the State-
ments, I am sure you will find many others of much interest and your
careful perusal of them at convenient times should be quite helpful
in your consideration of the State's fiscal problems.

I had the privilege of appearing before the Legislative Council
at one of its sessions during the month of October and discussed
several matters which I thought were of concern to the State, and
I want to assure you that it will be a pleasure to cooperate with you
to the fullest extent to the end that the best interests of the people
of the State will be served.

I am glad to record here the fact that this office has received splen-
did cooperation from the various state agencies in the transaction
of the State's business; and we are always ready and anxious to be
of assistance wherever possible, so that the greatest efficiency may be
obtained in the carrying out of the duties of the different institutions
and departments.

Respectfully submitted,

J. MILLARD TAWES,

State Comptroller.