For sauce: In a saucepan, melt butter, then blend in flour. Cook over moderate heat and slowly stir in milk. Season with salt & cayenne. Continue cooking until sauce is smooth and boiling. Reduce heat and add cheese, stirring, until cheese is blended. Add green pepper/pimento mixture, stir, and remove from heat. Grease a baking dish and fill with alternate layers of potatoes and sauce. Bake in moderate oven, 350 degrees, until potatos are done, about 1-1/2 to 2 hours. Potatoes may be turned with a spoon to ensure even cooking. Mrs Nicholas J. Constantine