I would respectfully recommend that at least three sub-Indian agents be appointed for this country, and stationed in the valleys of the Sacramento and San Joaquin. These agents should receive ample pay in order to enable them to defray the expenses of living in that part of the country, and should be men of the highest moral character; for otherwise they would not resist the temptation to engage in illicit trade with the natives, or to employ them for the individual benefit of the agents in washing for gold. The election called by me for the 1st instant was held on that day, and has been attended with the most happy results. Every district has elected its local officers, and appointed delegates to meet in general convention at this place on the 1st proximo, to form a State Constitution or plan of territorial government, which will be submitted to the people for their ratification, and transmitted to Washington for the action of Congress. Most of the local and judicial officers named in my proclamation of the 3d of June, have already entered upon their duties, and the interest which was taken by the people in every part of the country in this election, and the zeal manifested by those elected and appointed to office, afford strong hopes that the existing government will be able to preserve order and secure the administration of justice until a new one shall be put into regular and successful operation. In my former despatch I mentioned that the civil officers of the existing government would be paid their regular salaries from the "civil funds," which had been formed, under the direction of the governor of California, mainly out of the proceeds of the temporary custom-houses established by my predecessors on this coast. It will also be necessary to use a portion of this fund in the immediate construction of jails for the security of civil prisoners. The want of such jails has already led to the most serious inconveniencies; prisoners have so frequently effected their escape, that, on several occasions, the people have risen in masses and executed criminals immediately after trial, and without waiting for the due fulfilment of all the requisitions of the laws. In many cases it has been found necessary to confine civil prisoners on board vessels of war, and in the guard-houses of the garrison; but in towns, at a distance from the coast and the military posts, the difficulty of retaining prisoners in custody has led, in some instances, to immediate and summary executions. This evil calls for an immediate remedy, which will be afforded, so far as the means at my disposal will admit. I beg leave, in this place, to add a few remarks on the use which has been, and will continue to be, made of this "civil fund."