Senate Report 106-355 - 2002 WINTER OLYMPIC COMMEMORATIVE COIN ACT

[Senate Report 106-355]
[From the U.S. Government Publishing Office]

106th Congress
2d Session SENATE Report
106-355
_______________________________________________________________________

Calendar No. 706

2002 WINTER OLYMPIC

COMMEMORATIVE COIN ACT

__________

R E P O R T

OF THE

COMMITTEE ON BANKING, HOUSING,

AND URBAN AFFAIRS

UNITED STATES SENATE

to accompany

S. 2266

July 24 (legislative day, July 21), 2000.--Ordered to be printed
COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS

PHIL GRAMM, Texas, Chairman

RICHARD C. SHELBY, Alabama PAUL S. SARBANES, Maryland
CONNIE MACK, Florida CHRISTOPHER J. DODD, Connecticut
ROBERT F. BENNETT, Utah JOHN F. KERRY, Massachusetts
ROD GRAMS, Minnesota RICHARD H. BRYAN, Nevada
WAYNE ALLARD, Colorado TIM JOHNSON, South Dakota
MICHAEL B. ENZI, Wyoming JACK REED, Rhode Island
CHUCK HAGEL, Nebraska CHARLES E. SCHUMER, New York
RICK SANTORUM, Pennsylvania EVAN BAYH, Indiana
JIM BUNNING, Kentucky JOHN EDWARDS, North Carolina
MIKE CRAPO, Idaho

Wayne A. Abernathy, Staff Director
Steven B. Harris, Democratic Staff Director and Chief Counsel
Madelyn Simmons, Professional Staff
Michael Nielsen, Legislative Assistant
Erin Hansen, Democratic Legislative Assistant
George E. Whittle, Editor

C O N T E N T S

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Page
Introduction..................................................... 1
History of the Legislation....................................... 1
Purpose and Scope................................................ 2
Section-by-Section Analysis...................................... 3
Section 1. Short Title....................................... 3
Section 2. Coin Specifications............................... 3
Section 3. Sources of Bullion................................ 3
Section 4. Selection of Design............................... 4
Section 5. Issuance of Coins................................. 4
Section 6. Sale of Coins..................................... 4
Section 7. Surcharge......................................... 4
Regulatory Impact Statement...................................... 4
Cost of Legislation.............................................. 5
Changes in Existing Law (Cordon Rule)............................ 7
Calendar No. 706
106th Congress Report
SENATE
2d Session 106-355

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2002 WINTER OLYMPIC COMMEMORATIVE COIN ACT

_______

July 24 (legislative day, July 21), 2000.--Ordered to be printed

_______

Mr. Gramm, from the Committee on Banking, Housing, and Urban Affairs,
submitted the following

R E P O R T

[To accompany S. 2266]

The Committee on Banking, Housing, and Urban Affairs to
which was referred the bill (S. 2266) to provide for a
commemorative coin program to commemorate the 2002 Winter
Olympic games to be held in Salt Lake City, Utah, having
considered the same, reports favorably thereon with one
amendment and recommends that the bill as amended do pass.

INTRODUCTION

On July 13, 2000, the Senate Committee on Banking, Housing,
and Urban Affairs met in legislative session and marked up and
ordered to be reported S. 2266, a bill to provide for a
commemorative coin program to commemorate the 2002 Winter
Olympic games to be held in Salt Lake City, Utah, with one
amendment. The Committee's action was taken by a voice vote.

HISTORY OF THE LEGISLATION

The 2002 Winter Olympic Commemorative Coin Act, S. 2266,
was introduced on March 22, 2000, by Senator Bob Bennett and
Senator Orrin Hatch. Senators Abraham, Akaka, Allard, Ashcroft,
Biden, Bond, Boxer, Brownback, Breaux, Bunning, Byrd, Burns,
Campbell, Chafee, Cochran, Collins, Conrad, Coverdell, Craig,
Crapo, DeWine, Dodd, Domenici, Dorgan, Enzi, Feingold,
Feinstein, Fitzgerald, Gorton, Graham, Grassley, Hagel, Helms,
Hutchison, Inhofe, Jeffords, Johnson, Kerrey, Kohl, Leahy,
Levin, Lott, Lugar, Mack, McConnell, Mikulski, Murkowski,
Murray, Nickles, Reid, Robb, Roberts, Rockefeller, Roth,
Schumer, Smith of New Hampshire, Smith of Oregon, Snowe,
Specter, Stevens, Thomas, Thompson, Thurmond, Torricelli,
Voinovich, Warner, Wellstone, and Wyden were original
cosponsors. S. 2266 has two purposes: first, to strike and sell
five-dollar gold and one-dollar silver commemorative coins in
proof ¹ and uncirculated ² qualities, and
second, once all costs of the program have been recovered, to
distribute the remaining proceeds from surcharges to the Salt
Lake Organizing Committee for the Olympic Winter Games of 2002
³ and to the United States Olympic
Committee.⁴
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\1\ Proof coins are specially produced coins made from highly
polished planchets, or blanks and special dies, and are often struck
twice to accent the design. Proof coins receive the highest quality
strike possible and can be distinguished by their sharpness of detail
and brilliant, mirror-like surface. Proof refers to the method of
manufacture and is not a condition, but normally the term implies
perfect mint state.
\2\ Uncirculated coins are coins in new condition that do not have
any signs of wear. A coin with even the slightest sign of wear cannot
qualify for this condition.
\3\ The Salt Lake Organizing Committee for the Olympic Winter Games
of 2002 is a non-profit, tax-exempt organization formed under the laws
of the State of Utah. Its primary mission is to promote, manage and
stage the XIX Olympic Winter Games in Salt Lake City.
\4\ P.L. 95-606, the Amateur Sports Act of 1978 authorized the
United States Olympic Committee as the coordinating body for all
Olympic-related athletic activity in the United States. Its primary
mission involves training, entering and underwriting the full expenses
for the United States teams in the Olympic and Pan American Games.
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There were no Committee hearings held on S. 2266. At the
Committee mark up on July 13, the Committee adopted one
amendment to S. 2266 that strikes section 6(d) of the bill.

PURPOSE AND SCOPE

The bill reported by the Committee authorizes the Secretary
of the Treasury (Secretary) to mint and issue silver and gold
commemorative coins commemorating the 2002 Winter Olympic
games. The Secretary is also authorized to distribute, on an
equal basis funds raised from the surcharges added to the price
of the coins to two organizations.⁵ Half of the
funds are to be used by the Salt Lake Organizing Committee for
the Olympic Winter Games of 2002 in staging and promoting the
2002 Salt Lake Olympic Winter Games. The remaining half of the
funds are to be used by the United States Olympic Committee for
objects and purposes of the Committee, as established in the
Amateur Sports Act of 1978.⁶
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\5\ A surcharge is the dollar amount added to the price of each
coin. Surcharges are the proceeds distributed by the Secretary of the
Treasury to the recipient group once all costs of the commemorative
coin program are satisfied.
\6\ P.L. 95-606, the Amateur Sports Act of 1978.
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The designs for the commemorative coins will be selected by
the Secretary after consultation with the Commission of Fine
Arts,⁷ the United States Olympic Committee, and the
Olympic Properties of the United States.⁸ The
designs will be reviewed by the Citizens Commemorative Coin
Advisory Committee.⁹
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\7\ Authority of the Commission of Fine Arts: 40 U.S.C. 104 and
106, 36 Stat. 371, as amended, and Executive Order 3254 of July 28,
1921.
\8\ Olympic Properties of the United States is the sponsorship,
marketing and business entity created in partnership between the United
States Olympic Committee and the Salt Lake Organizing Committee. Its
primary mission is to coordinate all commercial and fund-raising
activities for the 2002 Winter Olympic Games and the U.S. Olympic
teams.
\9\ P.L. 102-390, the United States Mint Reauthorization and Reform
Act of 1992, established the Citizens Commemorative Coin Advisory
Committee for the purposes of recommending events, persons or places to
be commemorated by the issuance of commemorative coins, and to report
to Congress annually on such recommendations.
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The Committee recognizes that the primary purpose of this
program is to commemorate the 2002 Winter Olympic Games to be
held in Salt Lake City, Utah. For the last 48 years Olympians
from the United States have been appropriately represented and
commemorated through the issuance of commemorative coins. This
program contains the fewest coins ever authorized in a coin
program, and has been developed in consultation with the
numismatic community to address collectors' concerns of
commemorative coin proliferation.
The one amendment adopted at the Committee mark up of S.
2266 authorizes that section 6(d) be struck from the bill. This
section authorized the Secretary to establish a marketing
program to promote and sell the silver and gold coins
domestically and internationally. The Committee recognizes the
importance of promoting and selling the authorized coins, but
does not agree that statutory language to that end is
necessary. The Committee believes that through consultations
with representatives of the Department of the Treasury and the
United States Mint, both agencies will make every effort to
ensure the success of this coin program through the standard
practice incorporated for each and every coin program. The
Committee also believes that the Secretary will work in full
cooperation with the Olympic Properties of the United States to
develop and implement the appropriate marketing and sales
programs for these coins. The Committee notes significant
dissatisfaction with coin marketing programs by the Mint in the
past, and expects that, learning from past mistakes, the Mint
will conduct an energetic and cost-effective marketing program
for the sale of these coins.

SECTION-BY-SECTION ANALYSIS OF THE ``2002 WINTER OLYMPIC COMMEMORATIVE
COIN ACT''

Section 1. Short title

Section 1 provides that the bill may be cited as the ``2002
Winter Olympic Commemorative Coin Act.''

Section 2. Coin specifications

Section 2 provides for minting of not more than 80,000
five-dollar denomination coins weighing 8.359 grams, measuring
0.850 inches in diameter, and containing 90 percent gold and 10
percent alloy, and for the minting of not more than 400,000
one-dollar denomination coins weighing 26.73 grams, measuring
1.500 inches in diameter, and containing 90 percent silver and
10 percent copper.
The designs of the coins minted under this Act shall be
emblematic of the participation of American athletes in the
2002 Olympic Winter Games. Each coin will have a designation of
the value of the coin, an inscription of the year ``2002,'' and
inscriptions of the words ``Liberty,'' ``In God We Trust,''
``United States of America,'' and ``E Pluribus Unum.'' The
coins minted under this Act shall be legal tender as provided
in Section 5103 of title 31, United States Code, and all coins
are considered to be numismatic items for purposes of Section
5134 of title 31, United States Code.

Section 3. Sources of bullion

Section 3 provides for the Secretary to obtain the gold for
minting coins under this Act pursuant to the authority of the
Secretary under other provisions of law. The Section also
provides for the Secretary to obtain the silver for minting
coins under this Act from any available source, including
stockpiles established under the Strategic and Critical
Materials Stockpiling Act.¹⁰
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\10\ 50 U.S.C. 98, the Strategic and Critical Materials Stockpiling
Act.
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Section 4. Selection of design

Section 4 authorizes the Secretary to select the design for
the coins minted under this Act after consultation with the
Commission on Fine Arts, the United States Olympic Committee,
and the Olympic Properties of the United States. The Citizens
Commemorative Coin Advisory Committee shall review all designs
prior to selection by the Secretary.

Section 5. Issuance of coins

Section 5 authorizes that the qualities of the coins minted
under this Act shall be in proof and uncirculated qualities.
This section also provides for the commencement of issuance to
occur on January 1, 2002. There is an exception that authorizes
the Secretary to initiate sales of such coins, without
issuance, before January 1, 2002. Lastly, this section provides
for a termination of minting authority to occur on December 31,
2002.

Section 6. Sale of coins

Section 6 establishes the price of such coins as determined
by the Secretary to include a price equal to the face value of
the coins, plus the cost of designing and issuing such coins
(including labor, materials, dies, use of machinery, overhead
expenses, and marketing). This section also authorizes the
Secretary to make bulk sales of the coins issued under this Act
at a reasonable discount. Prepaid orders, at a reasonable
discount, shall be accepted by the Secretary prior to issuance
of such coins.

Section 7. Surcharge

Section 7 provides for a surcharge to be included in all
sales of coins issued under this Act. The surcharge for the
gold coins shall be $35 per coin, and the surcharge for the
silver coins shall be $10 per coin. This section also
authorizes the Secretary to distribute surcharges received from
the sale of coins issued under this Act, subject to section
5134(f) of title 31, United States Code. Half of the surcharges
are to be distributed to the Salt Lake Organizing Committee for
the Olympic Winter Games of 2002 for use in staging and
promoting the 2002 Salt Lake Olympic Winter Games, and the
other half is to be distributed to the United States Olympic
Committee for use by the Committee for the objects and purposes
of such Committee as established in the Amateur Sports Act of
1978.
In addition, this section authorizes that each organization
that receives any payment from the Secretary shall be subject
to audit requirements of section 5134(f)(2) of title 31, United
States Code.

REGULATORY IMPACT STATEMENT

Pursuant to rule XXVI, paragraph 11(b), of the Standing
Rules of the Senate, the Committee has evaluated the regulatory
impact of the bill and concludes that it will not increase the
net regulatory burden imposed on the Government.

CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

U.S. Congress,
Congressional Budget Office,
Washington, DC, July 20, 2000.
Hon. Phil Gramm,
Chairman, Committee on Banking, Housing, and Urban Affairs, U.S.
Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 2266, the 2002
Winter Olympic Commemorative Coin Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is John R.
Righter.
Sincerely,
Barry B. Anderson
(For Dan L. Crippen, Director).
Enclosure.

S. 2266--2002 Winter Olympic Commemorative Coin Act

Summary: S. 2266 would direct the U.S. Mint to produce a $5
gold coin and a $1 silver coin in calendar year 2002 to
commemorate the 2002 Winter Olympic Games. The bill would
specify a surcharge on the sales price of $35 for the gold coin
and $10 for the silver coin and would designate the Salt Lake
Organizing Committee for the Olympic Winter Games of 2002
(SLOC) and the United States Olympic Committee (USOC), both
private entities, as recipients of the income from those
surcharges.
CBO estimates that enacting S. 2266 would decrease direct
spending by about $1.5 million over the 2001-2005 period, but
would have no net effect on direct spending over the 2001-2010
period. Because the bill would affect direct spending, pay-as-
you-go procedures would apply. S. 2266 contains no
intergovernmental or private-sector mandates as defned in the
Unfunded Mandates Reform Act (UMRA) and would not affect the
budgets of state, local, or tribal governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 2266 is shown in the following table. In
addition to those budgetary changes, by using gold obtained
from the reserves held by the Treasury, CBO estimates that the
bill would provide the federal government with $5 million to
$5.5 million in additional cash (in exchange for gold) for
financing the federal surplus in fiscal year 2002. (Those
financing effects do not, however, change the surplus). The
bill would affect budget functions 800 (general government) and
050 (defense).

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By fiscal year, in millions of dollars
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2001 2002 2003 2004 2005
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Receipt of coin surcharges:
Estimated budget authority................................ 0 -6 (\1\) 0 0
Estimated outlays......................................... 0 -6 (\1\) 0 0
Transfer of coin surcharges:
Estimated budget authority................................ 0 3 3 0 0
Estimated outlays......................................... 0 3 3 0 0
Purchase of Government silver:
Estimated budget authority................................ 0 -2 0 0 0
Estimated outlays......................................... 0 -2 0 0 0
Total changes:
Estimated budget authority................................ 0 -5 3 0 0
Estimated outlays......................................... 0 -5 3 0 0
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\1\ Less than $500,000.

Basis of estimate: S. 2266 could raise as much as $6.8
million in surcharges if the Mint sells the maximum number of
authorized coins. Based on the experience of coin programs
commemorating prior Olympic Games in the United States and the
1994 World Cup tournament, CBO estimates that the Mint would
sell close to all of the coins authorized under S. 2266,
resulting in surcharges of about $6.5 million. CBO expects the
Mint would collect most of those surcharges in fiscal year 2002
and would transfer about one-half of estimated collections to
the two private organizations in each of fiscal years 2002 and
2003.
Under Public Law 104-208, the Mint must ensure that it will
not lose money on a commemorative coin program before
transferring any surcharges to a designated recipient
organization. Thus, CBO estimates that the collection and
transfer of such surcharges would have no net effect on direct
spending over the 2001-2005 period. Excluding surcharges, we
expect that proceeds from the sale of the coins would more than
cover the costs of producing them, but that the Mint would
spend any net proceeds to fund other commercial activities.
Therefore, we estimate that there would be no other net effect
on the Mint's outlays.
In addition, because the Mint would use silver obtained
from the Defense Logistics Agency (DLA) to produce the silver
coins, CBO estimates that S. 2266 would increase offsetting
collections to the government from the sale of excess silver by
about $1.5 million in fiscal year 2002, with DLA receiving
about three-quarters of that amount. (By law, the Mint must
deposit as miscellaneous offsetting receipts to the Treasury an
amount that is equal to the book value of the silver it
acquires from DLA.) However, the government's supply of silver
is limited, and we anticipate that it will be depleted by
fiscal year 2007. Hence, the use of silver for the Winter
Olympics coin in 2002 would leave less available to produce
currently authorized coins in subsequent years, resulting in a
loss of offsetting receipts of about $1.5 million in 2007.
Similarly, we expect that the Mint would use gold obtained
from the reserves held at the Treasury to produce the gold
coin. However, because the budget treats the sale of gold as a
means of financing governmental operations--that is, the
Treasury's receipts from such sales do not affect the size of
the surplus--CBO has not included such receipts in its
estimate. CBO estimates that S. 2266 would provide the federal
government with between $5 million and $5.5 million in
additional cash (in exchange for gold) for financing the
federal surplus in fiscal year 2002.
Pay-as-you-go considerations: The Balanced Budget and
Emergency Deficit Control Act sets up pay-as-you-go procedures
for legislation affecting direct spending or receipts. The net
changes in outlays that are subject to pay-as-you-go procedures
are shown in the following table. For the purposes of enforcing
pay-as-you-go procedures, only the effects in the current year,
the budget year, and the succeeding four years are counted.

Intergovernmental and private-sector impact: S. 2266
contains no intergovernmental or private-sector mandates as
defined in UMRA and would not affect the budgets of state,
local, or tribal governments.
Estimate prepared by: John R. Righter.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.

CHANGES IN EXISTING LAW (CORDON RULE)

In the opinion of the Committee, it is necessary to
dispense with the requirements of paragraph 12 of rule XXVI of
the Standing Rules of the Senate in order to expedite the
business of the Senate.