The report of the Secretary of the Navy, herewith submitted, exhibits in full the naval operations of the past year, together with the present condition of the service, and it makes suggestions of further legislation, to which your attention is invited. The construction of the six steam frigates for which appropriations were made by the last Congress has proceeded in the most satisfactory manner and with such expedition as to warrant the belief that they will be ready for service early in the coming spring. Important as this addition to our naval force is, it still remains inadequate to the contingent exigencies of the protection of the extensive seacoast and vast commercial interests of the United States. In view of this fact and of the acknowledged wisdom of the policy of a gradual and systematic increase of the Navy an appropriation is recommended for the construction of six steam sloops of war. In regard to the steps taken in execution of the act of Congress to promote the efficiency of the Navy, it is unnecessary for me to say more than to express entire concurrence in the observations on that subject presented by the Secretary in his report. It will be perceived by the report of the Postmaster-General that the gross expenditure of the Department for the last fiscal year was $9,968,342 and the gross receipts $7,342,136, making an excess of expenditure over receipts of $2,626,206; and that the cost of mail transportation during that year was $674,952 greater than the previous year. Much of the heavy expenditures to which the Treasury is thus subjected is to be ascribed to the large quantity of printed matter conveyed by the mails, either franked or liable to no postage by law or to very low rates of postage compared with that charged on letters, and to the great cost of mail service on railroads and by ocean steamers. The suggestions of the Postmaster-General on the subject deserve the consideration of Congress. The report of the Secretary of the Interior will engage your attention as well for useful suggestions it contains as for the interest and importance of the subjects to which they refer. The aggregate amount of public land sold during the last fiscal year, located with military scrip or land warrants, taken up under grants for roads, and selected as swamp lands by States is 24,557,409 acres, of which the portion sold was 15,729,524 acres, yielding in receipts the sum of $11,485,380. In the same period of time 8,723,854 acres have been surveyed, but, in consideration of the quantity already subject to entry, no additional tracts have been brought into market. The peculiar relation of the General Government to the District of Columbia renders it proper to commend to your care not only its material but also its moral interests, including education, more especially in those parts of the District outside of the cities of Washington and Georgetown.