This statement shows an increase of the gross debt during the past municipal year of $2,845,972.68.

The Sinking Funds for the redemption of the debt on December 28, 1870, amounted to $8,790,486.14, to which add bonds and mortgages on public lands and for street improvements, now in the City Treasury, all of which are considered good, amounting to $988,956.53, we have the total debt redemption means of $9,779,442.67, leaving the net debt of the city $16,850,468.85, being an increase of the net debt during the year of $588,344.56, as shown in the following table.

The following statement has been made to me by the Auditor of Accounts. I presume that his statement of the debts does not include large amounts which have been appropriated by recent votes of the City Council:

The total consolidated debt of the City, funded and un

funded, December 28, 1870, amounted to

Less redemption means

Net debt December 28, 1870

The total consolidated debt of the City,

$26,629,911 52

9,779,442 67

$16,850,468 85

During the municipal year there became due and were paid certificates of indebtedness on account of the city proper, $258,500; Dorchester, $164,700; Roxbury, $53,650; total, $476,850.

The last City Council, near the close of the year, passed a very important ordinance in relation to finances, creating a Board of Commissioners of the Sinking Funds for the redemption of the city debt, to be composed of the Mayor, Treasurer, Auditor of Accounts, Chairman of the Joint Committee on Accounts, Chairman of the Committee on Finance on the part of the Common Council, and two citizens at large. This ordinance provides that these commissioners shall have charge, under certain specified regulations, of the present and all future sinking funds for the redemption of the city debt; that as soon as the present general fund with its accumulations shall be sufficient to meet the payment of the outstanding debt, taxation on accouut of the same shall cease; that all loans to be issued hereafter for public buildings and land for the same shall be for ten years, those for street improvements for twenty years, and those for water works for thirty years, with separate sinking funds for their payment; and that there shall be taxed annually to meet the payments for the first class six per cent.,

second class three per cent., and the third class one and a half per cent. on the debt. If the excess of revenue and appropriations over the expenditures at the close of each financial year shall be sufficient to meet the amount required to be taxed the succeeding year, then no tax shall be levied; and if there should be more than enough to meet the amount required to be taxed, then the balance remaining shall be placed in those funds which do not appear to be earning sufficient to pay at maturity the debt for which they were created.

The ordinance on finance prior to the passage of this new ordinance provided that a tax of three per cent. should be levied on the capital of the debt, and that all unexpended balances and excess of revenue should be paid into the general sinking fund for the redemption of the debt.

It would seem that the new ordinance sufficiently protects the present bondholders of the city, and while it makes ample provision for the payment of future loans, taxation will be relieved and made more equal and satisfactory, and at the same time our high position of credit maintained as it has been heretofore.

The gross debt will require a tax this year of over $1,700,000 to pay the interest and the premium on

gold, in which a portion of it is payable. You should therefore closely scrutinize every project for increasing it; and no increase should be made unless a clear case of public necessity exists, which does not admit of delay without detriment to the welfare and prosperity of our citizens.

There is another subject, of so much interest to the citizens, and of such vital importance to the public welfare, that I invite your attention to a brief consideration of it. I refer to the public schools.

According to the school census of May last, the number of children in the city, between five and fifteen years of age, was forty-six thousand three hundred and one, and the average number of pupils belonging to the day schools of all grades during the past year was thirty-five thousand one hundred and sixty-four. The schools at present maintained by the city are five high schools, thirty-six grammar schools, three hundred and twenty-three primary schools, ten evening schools, two schools for minors, one for deaf mutes, and one kindergarten school. These schools are instructed by nine hundred and fifty teachers, of whom one hundred and thirty-two are males, and eight hundred and eighteen are females.

The current expense for school purposes during

the last financial year were $987,412.60, the salaries of teachers having amounted to $720,960.65, and the incidental expenses, including fuel and the care of buildings, to $266,451.95. Of the last named sum, the committee on Public Buildings expended $194,676.88, and the School Committee $71,715.07.

For the purchase of lots and the erection of school-houses there was expended during the last financial year the unprecedented sum of $612,337.86, and for the same purposes during the preceding year $346,610.48, making an aggregate outlay for the two years of nearly a million dollars for permanent school accommodations. A very large item in this amount was incurred for the erection of the building in Newton street, for the Girls' High and Normal School, which cost upward of $300,000.

The responsibility for school expenses is practically a divided one, the school committee having the control of the salaries of the instructors, and a portion of the incidental expenses, while the purchase of sites and the erection and repair of school edifices, and the larger part of the incidental expenses, are in the hands of the city council.

The eminent success and efficiency of our system of public instruction, which affords to the children