At the close of the presidential campaign, the result of which was necessarily disappointing to General Smith, he was compelled, by unfortunate investments, to look about for an occupation. His friend, General John Newton was then Chief of Engineers and the system of Internal Improvements, which had long been favored by the Republican party, was being carried forward by bountiful appropriations from Congress. Many officers and civil engineers were required for the supervision of the various river and harbor works, and General Smith, having had wide experience, was, by the act of his friend, appointed Government Agent, and placed in charge of the works on the Peninsula between the Delaware and Chesapeake Bays, with his headquarters at Wilmington, Delaware. On March 1st, 1889, he was, in compliance with a special Act of Congress, put upon the retired list of the army, with the rank of Major. This at once raised the question whether he could draw the pay appropriate to his retired rank, and at the same time receive pay as a Government Agent. After argument by his friend, the Honorable Anthony Higgins, the United States Senator from Delaware, the case was decided in his favor on the theory that an “agent” was not an officer, within the meaning of the law. The decision in this case was similar to that made in the case of Quartermaster General Meigs, who was employed to supervise the construction of the Pension Office in Washington, after he had been placed on the retired list. Under the decision General Smith continued to perform the duties and draw the pay of Agent, till 1901, when he voluntarily gave up the appointment and definitively retired from business of every kind. For the last ten years or more he resided in Philadelphia, where he enjoyed the acquaintance and society of his chosen friends to within a few weeks of his death, which occurred on the 28th day of February, 1903, four years subsequent to the death of his wife.
He retained his wonderful intellectual powers, absolutely unimpaired, to the date of his final illness. With keen wit, sparkling repartee and a mind always on the alert for fresh information and the beauties of literature, he remained a delightful and instructive companion to the end. Firm in the Christian faith and fully satisfied that life had nothing further in store for him worth waiting for, he took his departure in to the Silent Land composed and free from regret, like a strong man going to sleep. He left a son and daughter with many friends and hosts of companions scattered throughout the country to mourn his loss. His native State had filled his heart with pride and satisfaction by giving on the walls of its capital to a bronze effigy and tablet with a laudatory inscription celebrating his virtues and his most distinguished services, and handing down his memory to future generations as one in every way worthy of their respect and admiration.