U.S. Treasury Secretary Timothy F. Geithner Dec. 13 suspended
production of Presidential dollars for circulation, but the U.S. Mint
retains authority to strike circulation-quality Presidential and
Native American dollars for numismatic sales.
“Consistent with the Presidential $1 Coin Act, those who would
like to obtain future Presidential $1 Coins can purchase them directly
from the U.S. Mint during specified periods,” according to a statement
released Dec. 14 from the U.S. Mint by Mint spokesman Michael White.
“Prices and shipping costs for future $1 Coins will be announced in
the near future and will be set at a level that ensures that they do
not result in a cost to taxpayers.”
Presidential dollars have been available in roll and box options
directly from the Mint for those customers unable to obtain them from
banks at face value.
Dollar coins needed to satisfy circulation demand will come from
the vaults of the Federal Reserve Banks and their contracted armored
carriers where 1.4 billion Presidential dollars currently reside.
Federal Reserve and Treasury officials state that the existing
inventory of dollar coins is sufficient to satisfy circulation demand
for the next 10 to 12 years without additional production of the coins.
Government studies forecast that Presidential dollar coin
surpluses would climb to 2 billion coins by 2016, the last year of the
program, if production continued unabated.
Since the Presidential dollar coin program was introduced in
February 2007 with the George Washington dollar, nearly 2.4 billion
Presidential dollars representing the first 20 presidential
administrations have been struck in circulation quality for
circulation and for numismatic product sales. The Mint has also
produced the dollar coins in numismatic versions for Proof sets,
Uncirculated Mint sets and special packaging options. Production of
those numismatic products will continue.
Geithner’s action to suspend Presidential dollar coin production
for circulation was announced Dec. 13 by Deputy Treasury Secretary
Neal S. Wolin at a news conference to report on Treasury Department
efforts under the Obama Administration’s Campaign to Cut Government Waste.
Wolin said it is estimated that suspending dollar coin production
will save $50 million to $70 million annually.
Difficult to obtain
Although the Federal Reserve’s inventory of Presidential dollars
is well above what is needed for circulation purposes, some collectors
across the country have found it difficult to obtain the coins at face
value, especially if their local banks did not order them directly
from the Federal Reserve. Native American dollars have been made
available only through the Mint, either as a numismatic product or as
part of the Direct Ship Program.
Both dollar series have been available for acquisition directly
from the Mint.
Individual $25 face value rolls of 25 Presidential and Native
American dollars were being offered as of Dec. 15 at $39.95 per roll,
plus shipping, as part of the Mint’s regular product offerings.
Coins from both programs have also been available in larger
quantities from the Mint through its Direct Ship Program, though the
Mint recently raised the cost of the coins to consumers. Starting Nov.
15, the U.S. Mint imposed a $12.95 shipping and handling fee on $250
face value boxes of rolled Presidential dollars and Native American
dollars. Prior to Nov. 15, the boxes were offered at face value, with
the U.S. Mint absorbing the shipping costs, in order to get more
dollar coins into circulation.
From the 2007 George Washington dollar through the 2011 James
Garfield coin, Federal Reserve member banks have been able to order
the latest Presidential dollar during a time period starting at three
weeks before the coin’s release until two weeks after its release.
Until these provisions, banks had to order the coins in $1,000 face
value boxes of rolled coins.
Ceremonies and savings
Treasury Department spokesman Matthew Anderson said no decision
has been made as to whether the official launch ceremonies associated
with the release of each Presidential dollar into circulation will continue.
Anderson said the $50 million to $70 million in savings represents
strictly production costs associated with the Presidential dollars.
While the Mint profits on the production of each coin through
seigniorage — the difference between the face value of the coin (the
price at which the Mint sells the coins to the Federal Reserve) and
the cost to produce it — those totals are negated by shipping and
storage costs for the coins, according to Anderson.
The U.S. Mint’s latest cost to produce a manganese-brass clad
Presidential dollar is 32 cents, according to White.
Native American dollars
The Presidential Dollar Coin Act of 2005 mandates the production
of Presidential dollars from 2007 to 2016. The Native American $1 Coin
Act of 2008 requires that 20 percent of all dollar coin production be
Native American dollars. Those mandates will be met at the new
production levels, Anderson said.
Anderson said suspending Presidential dollar coin production at
the Denver and Philadelphia Mints affects 26 full-time or equivalent
positions total. Anderson said no layoffs will result from the
suspension of production, but the number of full-time positions or
equivalents will be absorbed through attrition over time.
Anderson said Treasury officials are also looking at potential
cost savings associated with the production of Lincoln copper-plated
zinc cents and Jefferson copper-nickel 5-cent coins, both of which
cost at or more than face value to produce. ■