No. 1, Stekin Territories

I have the honour to acknowledge Your Grace's Despatch No
134 of the 26th July last, enclosing an Order in Council providing for the Government and temporary administration of
Justice in those parts of Her Majesty's Dominions which are
declared and set forth by that Instrument as constituting the
Stekin Territories, with Copies of the Acts of Parliament on
which the Order in Council is founded.

2. Your Grace anticipates that the powers conveyed by the
Order in Council will enable me to deal satisfactorily with
any amount of population by which these Territories are at
present likely to be occupied, and if that should not be the
case, Your Grace requests me to report any difficulties in which I may find myself involved, and to offer any suggestions
that may occur to me respecting the most effectual and practicable
mode of dealing with those difficulties.

3. In obedience to those instructions, I beg to submit that
the Order in Council restricts my power of legislation to two
areas, namely: the disposal of Lands, and the occupation of the
Gold-fields; and to Fees as the sole source of Revenue.

4. It is almost certain that Fees, which must of necessity
be levied directly on Miners and other occupants of the Gold-fields,
and which, from their nature, are especially odious and difficult
to collect, will not yield a sufficient revenue to meet the
ordinary and necessary expences of Government, for a great part
of which I should therefore be compelled to draw on the funds of
the Imperial Government.

5. This latter course being inconsistent with the avowed
Colonial policy of Her Majesty's Government, I would take the
liberty of suggesting that Customs Regulations and Rates of Duty
on Imports should be established for the Stekin Territories,
as the readiest means of procuring a revenue equal to the cost
of the civil expenditure.

6. Should that resource prove insufficient, other taxes
might be imposed, of such a nature, however, as would fall
primarily on the Capitalist and Merchant, and not directly on
the Miner, who under no circumstances is a cheerful contributor
to the public revenue, and not infrequently is, from absolute
poverty, utterly incapable of meeting the smallest payment.

7. Should these suggestions meet with the approval and
sanction of Her Majesty's Government, it will be necessary to
enlarge the powers conferred by the Order in Council, and
distinctly to authorize me to impose and levy Customs Duties
and all other taxes that may be found proper and expedient as
means of revenue.

8. I would also beg to suggest as a measure that would
materially simplify and lighten the duties devolving on me,
that the Laws now in force in British Columbia should be extended,
as far as they are applicable, to the Stekin Territories; and
finally in case of my being compelled by a stern necessity to
proceed without legal sanction, that Her Majesty's Government
may send a confirmation of all my public acts, or authorize
the issue of a Proclamation indemnifying me and my Officers for
Acts done before the establishment of any legitimate authority
in the Stekin Territories.

In other respects the Order in Council will, I conceive,
meet the objects proposed.