Paper Money

Sequestration's effect on Mint, BEP uncertain

Specifically how sequestration will affect operations at the U.S. Mint and Bureau of Engraving and Printing is unknown, even though neither federal bureau is funded through taxpayer appropriations.

Members of both the Senate and the House left Washington on Feb. 28 after failing to pass legislation that would stop automatic spending cuts from going into effect for the federal government beginning March 1 — an event called sequestration. The budget cuts will likely result in employee furloughs and cuts in funding to federal programs and spending.

Coin World contacted both the Mint and BEP to ask what sequestration means to the two agencies that produce the nation’s currency, and was directed to Treasury Department spokesperson Suzanne Elio for comment.

Elio provided a copy of a Feb. 7 letter that Acting Treasury Secretary Neal S. Wolin sent to U.S. Sen. Barbara Mikulski, D-Md., chair of the Senate Appropriations Committee stating what effects sequestration would have on Treasury operations.

While Wolin addressed specific effects on some Treasury operations he provided no specific details in the letter outlining direct effects on the Mint and BEP.

Both the U.S. Mint and BEP have revenue streams — sales of coins and Federal Reserve notes — that help fund their operations.

The U.S. Mint has been funded through the congressionally authorized Public Enterprise Fund since Fiscal Year 1996 that began Oct. 1, 1996. The PEF was authorized under Public Law 104-52.

The PEF was established to account for all revenues and expenses related to the production and sale of numismatic products and circulating coinage, and protection activities.

The PEF has three revenue streams, said Mint spokesman Michael White — circulating coins, numismatic coins and bullion coins. The revenue streams come from the Mint’s two programs — circulating and numismatic, White said, with bullion and commemorative coins both falling under the numismatic program, he said.

The BEP is funded by the sale of its numismatic products to the public, as well as paper money sold to the Federal Reserve.

Despite their revenue sources, the Mint and BEP must still have official representation before congressional oversight committees during appropriations hearings. ¦

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