Paper Money

Are ‘star notes’ becoming an endangered species?

The Bureau of Engraving and Printing has acquired equipment that can print Federal Reserve notes with non-sequential serial numbers and that could mean the eventual end to the production of star notes. Shown are both sides of a Series 2017 note representative of regular star notes.

Images courtesy of Heritage Auctions.

Currency dealer Mike Abramson noticed, buried on the website of the Federal Reserve’s Bank Services, news unnoticed by most, about a change to United States paper currency production that may be one of the most significant changes in years and could eventually mean the end of star notes.

The Bureau of Engraving and Printing Capital Investment Plan for the 2023 fiscal year mentions the acquisition of two pieces of new machinery called NS LEPE (Non-sequential Large Examining and Printing Equipment). LEPE equipment can print 32- and 50-subject sheets, and BEP started using it at the Fort Worth, Texas, facility in 2012 for 32-subject sheets. In February 2014, it printed the first notes on 50-subject sheets.

The NS LEPE equipment, FedCash Services explains, also provides additional production capacity by using these larger 50-subject sheets, but with a significant difference that will result in major changes to what has been the norm.

Currently, FedCash Services says, new straps (wrapped packages) contain 100 Federal Reserve notes with the serial number on the first note ending with “01,” and the serial number on the last note ending in “00.” “Star” notes replace sequential serial numbers on dollars that are removed because they do not meet quality standards.

The new equipment will operate in a manner that will result in nonconsecutive sequencing of new straps of notes. Even more significant from a collector’s standpoint, the new equipment will not produce the star notes that replace imperfect notes in a strap of newly printed notes. Star notes will continue to be produced by traditional banknote production equipment until further notice.

The new printing process means that future serial number patterns in a strap may contain gaps and will no longer be in consecutive sequence. The first note in a non-sequential strap is not expected to have a serial number ending in “01” and the last is not expected to have a serial number ending in “00.”

The transition period for the new printing process will last several years and will be phased in by denomination, starting this year. Only the $1 denomination is currently in production. FedCash Services says non-sequential straps of the $1 note will be available based on local inventories and distribution schedules and that until the new printing process transition has ended, sequential and non-sequential straps will coexist in deliveries. NS-LEPE note packaging and labeling will be indistinguishable from sequential note packaging.

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