[Congressional Record Volume 149, Number 37 (Friday, March 7, 2003)]
[Extensions of Remarks]
[Pages E387-E389]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          THE OLD GRANITE LADY

                                 ______
                                 

                         HON. STEVEN R. ROTHMAN

                             of new jersey

                    in the house of representatives

                        Wednesday, March 5, 2003

  Mr. ROTHMAN. Mr. Speaker, I rise today to discuss S. 168, the San 
Francisco Old Mint Commemorative Coin Act, introduced by Senator 
Feinstein and Senator Boxer of California. The proposal would create 
commemorative coins to help pay for the restoration of the San 
Francisco Mint known widely as the ``Old Granite Lady.'' I commend 
Senators Feinstein and Boxer for undertaking this commendable effort.
  The San Francisco Mint was in service from 1870 to 1937, survived the 
San Francisco earthquake of 1906, and was utilized until a few years 
ago as federal offices. Today, modern building codes require that it be 
reinforced before it can safely be used in an area that is still prone 
to earthquakes.
  I recently read an article in the February 11, 2003 edition of the 
Numismatic News, which I ask to be placed in the Congressional Record 
following my remarks, written by Bergen County Freeholder and my 
hometown Fair Lawn, New Jersey Mayor David L. Ganz, proposing 
modifications to S. 168 to further stimulate interest on the issuance 
of this coin. His proposals are worthy of consideration. Specifically, 
Mayor Ganz proposes to have commemorative coinage re-issued using 
historic coin designs that were widely used in the 19th century, are 
associated with the San Francisco Mint, and which would offer to coin 
collectors the affordable opportunity to receive proof specimens--a 
means to boost sales, increase the surcharge that will be used to help 
restore the Mint, and provide an exciting collector's opportunity as 
well.
  For example, coin collectors know the tale of the 1870 three dollar 
gold piece with the ``S'' for San Francisco Mint mark on the reverse. 
The coin is unique and was formerly in the Louis Eliasberg collection. 
It is valued in the millions. There are other proof or uncirculated 
three dollar gold pieces that are quoted in Numismedia, a coin pricing 
guide, that sell for thousands of dollars.
  The 20-cent piece also has a long history associated with the San 
Francisco Mint, including the 1875-S coin produced more than a century 
ago. An uncirculated example of this coin would cost hundreds of 
dollars. The same is true for the Liberty head nickel and the Barber 
dime--where the 1894-S, one of only 24 specimens known, is a six-figure 
rarity and a regular design is hundreds of dollars in pristine, 
uncirculated condition.
  Mr. Ganz calls for special collector coins not intended for 
circulation, but bearing original designs of a century ago utilizing a 
contemporary date. They would be produced in proof, as uncirculated 
pieces, and offered to collectors with a modest surcharge that could 
raise $123 million, if the coins sold out, to help restore the Old 
Granite Lady.
  Mr. Ganz's comments merit consideration for many reasons, not the 
least of which is that he is a respected numismatist. A former member 
of the Citizens Commemorative Coin Advisory Committee, he is one of the 
people credited by former Mint director Philip Diehl as being the 
source and inspiration for America's state quarters--which have given 
$5 billion back to the American taxpayer. I have known Mayor Ganz for 
many years and believe that his ideas merit consideration, and I hope 
that

[[Page E388]]

they may be incorporated into this meritorious effort to restore the 
San Francisco Mint.

               [From the Numismatic News, Feb. 11, 2003]

               San Francisco $3 Would Sell Better Than $5

                           (By David L. Ganz)

       True to her word, Sen. Dianne Feinstein, D-Calif., for 
     herself and Sen. Barbara Boxer, D-Calif., introduced S. 168 
     on Jan. 15, a bill entitled the ``San Francisco Old Mint 
     Commemorative Coin Act,'' which is a traditional revenue-
     raising measure containing a silver dollar and a half eagle 
     ($5) gold piece.
       Like many dozens of other bills proposed over the course of 
     the last decade that have been designed to raise funds for a 
     noble purpose, it follows a template that has been approved 
     by the Treasury, the Mint, Congress itself, and even the 
     Citizens Commemorative Coin Advisory Committee.
       That means that the coins are legal tender; have moderately 
     low mintages of 100,000 for the gold coins and 500,000 for 
     the silver--sales for which will never be achieved--and 
     surcharges designed to raise in the aggregate $3.5 million if 
     the gold coins sold out, and another $5 million if the silver 
     dollar version hit it big, for a possible total of $8.5 
     million.
       Unfortunately, it will do neither and will most likely have 
     disappointing sales in the 25,000-50,000 coin range for gold 
     and in the 100,000-250,000 range for the silver dollar, from 
     which the Mint will take expenses, leaving the San Francisco 
     Museum and Historical Society a giant goose egg to help pay 
     for the restoration of the Old Granite Lady.
       Mint accounting is not for knaves. Neither is it in 
     accordance with what most would refer to as generally 
     accepted accounting principles. The result is that an 
     exorbitant amount of overhead is charged against 
     commemorative coin production--it's a legitimate way to look 
     at it, but on a per-coin basis adds absurd amounts to cost 
     that would otherwise never be tolerated for purposes of 
     analysis or compensation.
       One need only look at several recent commemorative results 
     and fork-overs to see just how difficult the present system 
     is. That's problematical where, as here, the goal is to raise 
     funds to help restore the San Francisco Mint to the grandeur 
     of yesteryear, when it was the proudest building in the old 
     financial district of the downtown.
       Just by simple example, on the population Buffalo nickel 
     silver dollar commemorative for the Smithsonian, budget 
     documents submitted show an initial $3 million loss. Congress 
     authorized 500,000 of those coins--and they sold out in two 
     weeks--yet in the budget scoring of Jan. 25, 2001 (before 
     sales began), the outflow was $3 million down. (There would 
     eventually be $13.9 million in gross sales registered in the 
     fourth quarter of 2001.)
       The San Francisco ``S'' mintmark has had a special allure 
     for more than 130 years. To those who were collecting coins 
     earlier than 1955, when production was suspended, the ``S'' 
     mintmarked coins traditionally had lower and hence scarcer 
     mintages--and higher values.
       The Old Granite Lady, which functioned from 1870 to 1937--
     and made it through the San Francisco earthquake of 1906 
     virtually unscathed--has a long history involving coinage, 
     which the legislation that Sen. Feinstein introduced 
     recites at least in part.
       ``The San Francisco Old Mint is famous for many rare, 
     legendary issues, such as the 1870-S $3 coin, which is valued 
     today at well over $1 million,'' the precatory portion of the 
     bill begins--and then goes nowhere else.
       Commemorative coinage should serve a purpose, none of which 
     is essentially important for funding, all of which is 
     integral to the integrity of the coinage process, the history 
     of American money and telling the story of American 
     numismatics in its larger sense.
       There's nothing magical about the template that is being 
     utilized right now to create commemorative coinage. In an 
     earlier time in its 1980s, a different model was utilized--
     and I participated quite actively in seeing to it that that 
     model was not only broken, but for purpose. Significantly, I 
     suggested it should be done again.
       In 1982, modern commemorative coin issues began anew with 
     the introduction of a silver commemorative for the 250th 
     anniversary of George Washington's birth. There was no 
     surcharge; there was no beneficiary. The coin was produced, 
     it was sold and there as great success: 2.2 million 
     uncirculated pieces were manufactured and 4.8 million proofs.
       The Olympic program came and went, but in 1984-1985, the 
     Statute of Liberty centennial commission had its chance, and 
     I had the opportunity to consult with them. Lee Iacocca, that 
     colorful personality who was then the chairman of Chrysler 
     corporation headed the commission. Dr. Stephen Brigandi was 
     the executive director.
       The mold in those days was a dollar coin or two, plus a 
     gold piece. The Olympics used a $10 gold peace to disastrous 
     results, in part because it contained nearly a half ounce of 
     gold (resulting in too high an issue price) and also because 
     when enough coins weren't sold, the Mint produced more, 
     adding mintmarks as the distinguishing factor.
       Two suggestions came from me: first, change the 
     denomination of the gold coin to a $5 gold piece--to lower 
     the price substantially--and second, introduce a copper-
     nickel half dollar that could be produced as a circulating 
     commemorative coin with an uncirculated and proof counterpart 
     sold at a very modest mark-up to collectors.
       They didn't buy into the circulating commemorative 
     concept--it took a dozen more years before the state quarter 
     program that I similarly proposed became reality--but whether 
     to go with a copper nickel low-value, low-cost coin came down 
     to a question of how many might be sold, and what the 
     proceeds would be from the surcharge. After all, the Statue 
     of Liberty needed to be refurbished for its centennial.
       I made a bet with Brigandi--$100 as I recall it, though 
     that's a lot for a guy who usually bets a cent or a nickel--
     and I predicted that such a coin would sell into the millions 
     and be a true partner and participant in a three-coin 
     program.
       Ultimately, it became the most successful non-circulating 
     legal tender coin in history, with more than 900,000 struck 
     in uncirculated and over 6.9 million as proofs. No other 
     coin, before or since, has come close.
       Here's why: it was a different coin, different 
     denomination, unusual, modest in price and distinctive. 
     Collectors were encouraged to buy into a concept that played 
     right into what they do: collect.
       Those of us who are even casual about our hobby know that 
     we collect after a particular fashion. Some will try to 
     obtain all silver dollars, others all issues. Still others go 
     for a type set. But when it comes to new and unusual or even 
     different, it affords a rare opportunity, which is something 
     that I think S. 168 simply misses.
       It's not too late to change it; the bill has merely been 
     introduced and is months away from action in the Senate, no 
     less the House of Representatives.
       Here's what I would do to change the focus of the bill, and 
     to simultaneously increase its chance for economic and 
     commercial success--and at the same time, offer a boost to 
     several different areas of the hobby.
       Capitalize on the history of the Mint and the coins that 
     have come from it.
       One obvious way of doing that is to create a new $3 gold 
     piece--a play on the 1870-S that is unique (formerly in the 
     Eliasberg collection)--which was produced in the very year 
     that the Old Granite Lady opened for business.
       To buy any $3 gold piece today, be prepared to plunk down 
     thousands of dollars for an uncirculated specimen, and 
     multiples of that for a proof. For the Mint to begin a new 
     commemorative series--or even a single one-year San Francisco 
     Mint coin in that denomination--would be a boost to the 
     secondary market, a promotion for $3 gold pieces of other 
     dates and denominations, and produce the possibility of a 
     sellout success at levels far above 100,000 pieces.
       Where a half eagle or $5 gold piece contains .2420 troy 
     ounces of gold, the $3 gold pieces of regulation weight is 
     .1452 troy ounces. At $360 an ounce (more or less current 
     prices), the hard cost changes from $87 in gold to $52.27.
       Lower the gold content, lower the price. The surcharge 
     doesn't have to change. What does change is the number of 
     people making a purchase. That should go way up--just as it 
     did for the Statute of Liberty half dollar. Net result: more 
     surcharge for the Old Granite Lady's restoration.
       On the same basis, I'd probably think about adding a minor 
     coin--such as the nickel--or a subsidiary coin such as the 
     dime to the mix. There's a long history there, too, for each. 
     The first ``S'' mint on a nickel was 1912. The ``S'' dime 
     could be the 1894-S Barber design--a powerbroker concept. But 
     what is key is that it is different, unusual and likely to 
     have high sales--even with a surcharge--if the price is 
     simply not made obscene.
       A third (or fourth) choice: a 20-cent piece (the 1875-S was 
     struck there, of course)--and for all of the same reasoning. 
     Add these and watch orders and dollars come flying in. 
     Prediction if authorities follow my suggestions: a sellout.
       Here's how to do it: substitute language for the existing 
     bill in the Senate, or introduce a new one in the House, and 
     go to town for the benefit of the Old Granite Lady--and give 
     the San Francisco Mint a new historic life on the centennial 
     of its survival of the San Francisco earthquake of 1906.

       108th Congress, 1st Session

                               H.R. ____

       To require the Secretary of the Treasury to mint coins in 
     commemoration of the Old Granite Lady (the old Mint at San 
     Francisco)
       In the House of Representatives of the United States, 
     __________, 2003, Mr. ________ introduced the following bill; 
     which was read twice and referred to the Committee on 
     Financial Affairs.
       A bill to require the Secretary of the Treasury to mint 
     coins in commemoration of the Old Granite Lady (the old Mint 
     at San Francisco).
       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Old Mint at San Francisco 
     Commemorative Coin Act.''

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) the Old Granite Lady played an important role in the 
     history of the Nation;
       (2) the San Francisco Old Mint was established to convert 
     miners' gold from the California Gold Rush into coins;
       (3) the San Francisco Old Mint Building was designed by 
     architect A.B. Mullett, who also designed the United States 
     Treasury Building and the Old Executive Office Building;

[[Page E389]]

       (4) the solid construction of the Old Granite Lady enabled 
     it to survive the 1906 San Francisco earthquake and fire, 
     making it the only financial institution that was able to 
     operate immediately after the earthquake and the treasury for 
     disaster relief funds for the city of San Francisco;
       (5) coins struck at the San Francisco Old Mint are 
     distinguished by the ``S'' mintmark;
       (6) the San Francisco Old Mint is famous for many rare, 
     legendary issues, such as the 1870-S $3 coin, which is valued 
     today at well over $1 million; and
       (7) the San Francisco Old Mint Commemorative Coin will be 
     the first commemorative coin to honor a mint.

     SEC. 3. COIN SPECIFICATIONS.

       (a) Denominations.--In commemoration of the San Francisco 
     Old Mint, the Secretary of the Treasury (in this Act referred 
     to as the ``Secretary'') shall mint and issue the following 
     coins:
       (1) $3 gold coins--Not more than 500,000 $3 coins, each of 
     which shall--
       (A) weigh 5.015 grams;
       (B) have a diameter of 20.5 mm; and
       (C) contain 90 percent gold and 10 percent alloy.
       (2) 20 cent piece--Not more than 3,500,000 twenty-cent 
     pieces, each of which shall--
       (A) weigh 5 grams;
       (B) have a diameter of 22mm; and
       (C) contain 90 percent silver and 10 percent alloy.
       (3) 10 cent piece--Not more than 5,000,000 ten-cent pieces, 
     each of which shall--
       (A) weigh 2.5 grams;
       (B) have a diameter of 17.9mm; and
       (C) contain 90 percent silver and 10 percent alloy.
       (4) 5 cent piece--Not more than 7,500,000 five-cent pieces, 
     each of which shall--
       (A) weigh 5 grams;
       (B) have a diameter of 21.2mm; and
       (C) contain .750 copper and .250 nickel alloy
       (b) Legal Tender.--The coins minted under this Act shall be 
     legal tender, as provided in section 5103 of title 31, United 
     States Code.
       (c) Numismatic Items.--All coins minted under this Act 
     shall be considered to be numismatic items for purposes of 
     section 5134 of title 31, United States Code.

     SEC. 4. SOURCES OF BULLION.

       The Secretary may obtain gold and silver for mining coins 
     under this Act from any available source.

     SEC. 5. DESIGN OF COINS.

       (a) Design Requirements.--
       (1) In General.--(a) The reverse design of the coins minted 
     under this Act shall be emblematic of the San Francisco 
     Old Mint Building, its importance to California and the 
     history of the United States, and its role in rebuilding 
     San Francisco after the 1906 earthquake and fire.
       (B) The obverse designs shall be as follows: (1) on the $3 
     gold piece, the ``Princess'' design utilized by the Mint in 
     1870; (2) on the 20 cent piece, the ``Princess'' design 
     utilized by the Mint in 1870; (2) on the 20 cent piece, the 
     Liberty Seated design in use by the Mint in 1875; (3) on the 
     dime, the Barber head design utilized in 1894, and (4) on the 
     nickel, the Barber head (Liberty head) design utilized in 
     1912.
       Notwithstanding the foregoing, the Secretary may decide to 
     use the same designs, obverse and reverse, as the specified 
     designs, with an ``S'' mint-mark, as were heretofore utilized 
     on the $3 gold piece, 20-, 10-, and 5-cent coins during the 
     time period specified.
       (2) Designation and inscriptions.--Each coin minted under 
     this Act shall contain--
       (A) a designation of the value of the coin;
       (B) an inscription of the year ``2006,'' and
       (C) inscription of the words--
       (i) ``Liberty;''
       (ii) ``In God We Trust,''
       (iii) ``United States of America;'' and
       (iv) ``E Pluribus Unum.''
       (b) Selection.--The design for the coins minted under this 
     Act shall be--
       (1) selected by the Secretary, after consultation with the 
     Commission of Fine Arts and the Board of the San Francisco 
     Museum and Historical Society;
       (2) reviewed by the Citizens Commemorative Coin Advisory 
     Committee; and
       (3) reviewed by the Board of the San Francisco Museum and 
     Historical Society.

     SEC. 6. ISSUANCE OF COINS.

       (a) Quality of Coins.--Coins minted under this Act shall be 
     issued in uncirculated and proof qualities.
       (b) Period for Issuance.--The Secretary may issue coins 
     minted under this Act only during the period beginning on 
     January 1, 2006, and ending on December 31, 2006
       (c) Mint Facility.--The coins authorized under this Section 
     shall be struck at the San Francisco Mint to the greatest 
     extent possible and shall all bear the ``S'' mintmark 
     regardless of the mint of manufacture.

     SEC. 7. SALE OF COINS.

       (a) Sale Price.--The coins issued under this Act shall be 
     sold by the Secretary at a price equal to the sum of--
       (1) the face value of the coins;
       (2) a surcharge in an amount equal to--
       (A) $35 per coin for the $3 coin; and
       (B) $9.80 per coin for the 20-cent coin; and
       (C) $9.90. for the 10-cent coin
       (D) $2.95 for each 5-cent coin.
       (3) the per capita cost of designing and issuing the coins 
     (including labor materials, dies use of machinery, over-head 
     expenses, marketing, and shipping) for the gold coin, and the 
     face value and surcharge for the 20-cent piece, 10-cent and 
     5-cent coin.
       (b) Bulk Sales.--The Secretary shall make bulk sales of the 
     coins issued under this Act at a reasonable discount.
       (c) Prepaid Orders--
       (1) In General.--The Secretary shall accept prepaid orders 
     for the coins minted under this Act before the issuance of 
     such coins.
       (2) Discount.--Sale prices with respect to prepaid orders 
     under paragraph (1) shall be at a reasonable discount.

     SEC. 8. DISTRIBUTION OF SURCHARGES.

       (a) In General.--Subject to Section 5134(f) of title 31, 
     United States Code, all proceeds received by the Secretary 
     from any surcharge imposed on the sale of coins issued under 
     this Act shall be paid by the Secretary to the San Francisco 
     Museum and Historical Society.
       (b) Audits.--As a condition of receiving payments under 
     subsection (a), the San Francisco Museum, and Historical 
     Society shall be subject to the audit requirements of Section 
     5134(f)(2) of title 31, United States Code.

                          ____________________