In these circumstances I was induced to make an arrangement with Captain Gillon, of the frigate South Carolina, in order to secure an unexceptionable conveyance for a further remittance of specie, as well as for other reasons to be mentioned hereafter. This conveyance being approved by the Ministry, it was proposed by M. Necker, that one million should be remitted by this opportunity, two in the frigate from France as above mentioned, and that an arrangement should be made with the Spaniards for a further remittance from Vera Cruz, agreeably to an offer from their agent in Paris. Unfortunately, while this latter plan was in agitation, the agent received intelligence that the whole of the Spanish treasure destined for Europe had arrived safe at the Havana, in consequence of which he changed the terms of his first proposal, from an order payable at sight, to bills at six months' date; this, joined to the disagreeable intelligence from Holland of the failure of the loan proposed on account of the United States, occasioned my giving a Memorial to the Director-General, and insisting, in several interviews with him, on the necessity of something decisive in his department, adding, that the administration could not pursue a better plan for securing the triumph of Great Britain than the present system of giving inadequate and dilatory succor to America.

All that I could obtain was an addition of half a million to the specie to be embarked at Brest, and about the same sum to that in Gillon's ship. The Director-General informed me, that he had passed the sum of the proposed loan to the debit of the King's finances, and repeated his assurances, that our further remittances should be made successively.

I have already informed Congress, that the reduced list of supplies had been referred to the War Department, where it had to undergo a recopying and more methodical distribution under several heads. I used my endeavors to hasten the decisions on this subject, and to procure orders at least with respect to some particular articles, the providing of which obviously required a more early notice than others; but he said no partial arrangement could be made, and that a decision must be definitively given in council upon the whole business, previous to his engaging in the execution of his part.

On the 1st of April I received a letter from M. de Corney, Provincial Commissary, informing me, that the Marquis de Segur had appointed M. de Viemerange in conjunction with him to confer with me on the objects of the estimate, and the time and means of procuring them. I immediately repaired to Versailles for this purpose.

As the ancient administration for clothing the French troops was abolished, and each regiment in France makes its own contracts for habiliments and equipments, there exists no public magazine of supplies in this way, either in the War or Marine Department, and there was no other resource for this article than the remainder of some supplies at Brest, which had been provided for General Rochambeau's army; it was proposed then to cede these to the United States, and continue the provision upon the same terms as had been settled for the King's service. The quantity was extremely inconsiderable, compared even with the reduced list, which I had presented; the time proposed for augmenting it was long, and my prospects upon the whole were very discouraging, but the impracticability of doing better in present circumstances obliged me to yield. The difficulties and delays, however, which occurred in this transaction, and a persuasion that it would not be so economical as I had at first been taught to expect, were powerful additional motives with me for accepting Captain Gillon's offer relative to the South Carolina frigate, in order to avail myself of the supplies in his possession, and to complete his vacant tonnage by purchases in Holland, where the vicinity of the seaport and manufacturing towns insured despatch. Copies of all the papers, relative to the supplies, are in the hands of the Minister Plenipotentiary. I apprized him of the necessity of watching the punctual execution of the terms of Sabatier & Co's agreement, notwithstanding the superintendence of the War Department. The artillery, arms, ammunition, and encamping supplies, were to be collected at Brest from different arsenals in Brittany and elsewhere, at the same rates at which they were provided for the national service.

When the subject of casting howitzers, conformably to the British calibre, came to be more minutely and definitively discussed, difficulties with respect to the scarcity of materials, the danger of errors in the proportion, the want of a proper person to inspect the business, in a word, objections of different kinds were started; these, added to the facility of casting shells in America, determined me finally to substitute six inch howitzers of French calibre. Experience has proved, on a comparison of their effects with those of the larger sized howitzers, that the difference is trifling, and that the former will answer all the purposes of the latter, while their proportions render them more manageable, and economise ammunition. The French artillerists, enlightened by this discovery, have determined the reform of all their larger howitzers.

Upon my arrival at Brest I found the whole of the articles agreed to be furnished for the first convoy were not yet arrived. In these circumstances I substituted some articles which I found in the magazine there, that there might not be any further loss of time, and that there should be the least possible interval between our sailing and the embarcation of the specie, which once commenced could not be kept secret in passing through a number of hands, and might be a temptation to enterprises on the part of the enemy. The same motive determined me not to shift the whole of the money into cases, which would have been more portable. This precaution became indispensable however with respect to two of the casks, that had suffered too much from the violent shaking on the road to be embarked in that condition, and although all the casks are double, I apprehend the most scrupulous care will be necessary in their debarcation and removal. I send herewith the Chevalier de l'Angle's receipt for the specie on board the frigate Resolve, the copy of the Treasurer's note at Brest, and invoices of the cargoes on board the Cibelle and the Olimpe. Besides these, the whole of the surgical instruments, drugs, and tin and wire for camp kettles, agreeably to the Board of War's estimate, are supplied upon the same footing as the other articles. The drugs and tin I expect in the brigantine Active. In addition to the list, I left a statement of the ulterior demands. These, in addition to the cargo expected by Gillon, and the invoices already cited, include the total of the supplies.

The deduction of money for their payment was incompatible with so ample a provision, as prudence might otherwise have dictated. Necessitated to confine myself to a reduced list of the most indispensable articles, in order to leave the sum for remittances as unimpaired as possible, I avoided every purchase and additional expense of workmanship, that could be readily supplied by our artisans and manufacturers at home, as the money expended here, besides accomplishing the primary object, after descending in various channels to the encouragement of arts, and animation of industry among ourselves, would return its contribution to the great reservoir of public resources.

I am sorry not to be able to give Congress a more satisfactory and definitive account of Captain Gillon's proceedings. The papers sent herewith will show the measures I had taken, and all the intelligence I had received relative to this business previous to my departure. Relying on the zeal and activity of Captain Jackson, aided by the counsels of the Minister Plenipotentiary in Holland, I cannot apprehend any improper delay.

Captain Jackson alone was intrusted with the secret of the specie to be embarked, I enjoined him not to communicate it to any one, until the moment when it should become necessary to embark it; and, that the bankers might not be apprized of its destination, I sent the order for it enclosed to him.