All of this legislation of the state and all the acts of the auditorial boards related to the debt of the state to individuals. The 5 per cent bonds, amounting to $82,168.82, issued under the act of November 12, 1866, to the school fund, and the 5 per cent bonds, amounting to $134,472.26, issued under the same act to the university fund, were issued to those funds because of transfers made from them to the state revenue account. Those held by the school fund were on account of the United States bonds and interest coupons transferred under authority of the act of January 11, 1862, and which in 1866 were in the possession of the state, or which might be recovered by the state.2 The comptroller's reports for 1874 and subsequent years err in describing the state bonds issued to the school fund at this time.as indemnity for United States bonds used during the war. They were only transferred from the school fund during the war, but as the ordinance of 1866 and the comptrollers' reports of 1866 and 1867 make clear, they were used for general revenue purposes between August, 1865. and January, 1867. The 5 per cent bonds issued to the university fund were on account of the United States bonds and interest coupons transferred from that fund to state revenue account in February, 1860, and February, 1861. It is highly questionable whether one should regard the bonds of the state held by its special funds as binding state obligations, subject, like the state debt to individuals, to all debt conditions against non-payment of interest and failure to pay principal at the contracted date. It is certainly questionable in the case of the state obligations held at this time by the school and university funds. Neither the Constitution of 1846 nor the amended Constitution of 1861 protected the educational funds against the transfer of the funds authorized by the acts of January 31, I860, and January 11, 1862.1 Legislative action alone was responsible for the possession of the 5 per cent United States bonds by these funds and legislative action was unrestrained by any constitutional provision against recalling them at any time. But even if they should be regarded at the time of issue as a binding, bonded obligation, the failure of the state to acknowledge their validity, as it did the other debt authorized in I866, throws doubt on their validity after the overthrow of civil government in 1867. Neither the legislature nor the auditorial board of 1871 took any cognizance of these 5 per cent state bonds, and this appears to have been fatal to their position, for they were classed as doubtful or worthless in every comptroller's report after 1870, except that of 1881-2. The passage of the Reconstruction Acts of Congress in 1867 and the consequent overthrow of civil government and the establishment of military government in Texas, threw the state back exactly to where it had been at the close of the war in 1865. As the bonded debt due individuals and authorized by the act of 1866 had to be reviewed to be valid, so it would seem any other bonded debt authorized in 1866 should have been reviewed and validated to be a binding obligation. This was not done for the 5 per cent bonds held by the school and university funds, and they remained of doubtful validity, no interest being paid on them and their date of maturity passing without payment, until 1883. By this act of February 23, 1883, they were validated and were ordered paid with accrued interest.2

1 Report of the Comptroller, 1872, pp. 29-30.

2 For act of January 11, 1862, see Laws of 1862, p. 55. For act of November 12, 1866, see Laws of 1866, p. 208.

The reports of the comptroller after 1865 carried also among the debt of doubtful validity the 6 per cent state bonds dated May 13, 1865, and the comptroller's certificate of indebtedness dated June 8, 1865, the bonds being held by the school fund, and the certificate by the university fund. As has been explained these were specifically declared void as war debts in 1866, and they were not validated until 1883. Their validation and payment under the act of February 23, 1883, was, as far as legal obligation was concerned, a pure gift under the guise of payment of a debt. The failure of the state up to 1883 to pay the interest or the principal of the above obligations held by the school and university funds was therefore legally justifiable in the light of the history of the obligations.

1 See art. 10 of the Constitution of 1846 and the amended Constitution of 1861.

2 Laws of 1883, p. 15.

If the action taken by the constitutional conventions and the legislature relative to the principal of the war debt, can be justified, was the interest on the bonded indebtedness found to be valid by the auditorial boards of 1866 and 1871 paid after the war? It appears from the report of the auditorial board of 1866 that interest on the bonds of March 20, 1861, was paid to January 1, 1867, and that no interest was paid on the bonds of April 8, 1861, from January 1, 1865, to January 1, 1867.1 Such of this debt as was found to be valid by the board of 1866 and was funded in the bonds authorized by the act of November 9, 1866, had no interest paid on it until the passage of the act of November 13, 1871. The failure to pay interest as it fell due is not chargeable to the dereliction of the State of Texas but to the Congress of the United States. If there had been any bonded debt which antedated the war, there would have been no question as to the obligation of the state to pay interest on it at the time stipulated; but all of the bonded debt of the state was authorized during the war or after January 28, 1861. Therefore, the question as to payment of interest on the valid debt subsequent to the war depends on the date of the establishment of the validity of the debt. Because of the abolition of the civil government and the re-establishment of the military government by the Reconstruction Acts of Congress in March and July of 1867 the action of Texas in 1866 providing for its ascertainment was nullified, and Texas may be said not to have had any known valid debt until 1871. As soon as the valid debt was determined, payment of accrued interest was promptly made, and interest thereafter on it and on all other debt was always promptly paid.

1 See Comptroller's ledger, 1861-5, pp. 437-441.