For the quarter ending March 31, 2003
PROGRAM-WIDE SUMMARY
Modern commemorative coins authorized by Congress and produced by the United States Mint date from the introduction of the George Washington 250th Anniversary Half Dollar in 1982. Congress authorized a total of 40 commemorative coin programs between 1982 and 2003, honoring American people, places, events, and institutions. Surcharges from the sales of these coins help fund a variety of organizations and projects that benefit the community at large. United States Mint commemorative coin programs have collected approximately $426.5 million in surcharges over the past 21 years for many worthy recipient organizations.
The Commemorative Coin Reform Act of 1996 (CCRA) requires the commemorative coin program to link public funding of special projects to demonstrated private support by requiring recipient organizations to show receipts of donations from private sources that are equal to or greater than the “maximum amount the organization may receive from proceeds of such surcharges.” H.R. 258, The 5-Cent Coin Design Continuity Act of 2003, Title II, Section 201, would change this criterion to “the total amount of the proceeds of such surcharge derived from the sale of such numismatic items.” As of the closing date of this report, H.R. 258 had passed the House of Representatives and was awaiting action by the Senate. It also makes coin program beneficiaries partners in bearing the risks of commemorative coin programs, and it assures that the United States Mint recovers its costs of operating coin programs. Commemorative coins are a benefit, not only to numismatic enthusiasts and the recipient organizations, but also by reaffirming our history to the Nation as a whole. Commemorative coin programs are increasing in popularity following the CCRA reforms. To ensure that commemorative coin programs reap the benefits of the reforms, the United States Mint must continue to execute and oversee these coin programs in a conscientious, prudent and businesslike manner.
Second quarter revenue for the 2002 Winter Olympic Games and the United States Military Academy (USMA) Bicentennial commemorative coin programs totals $287,338. A surcharge payment of $1.1 million was made to the Association of Graduates, USMA, from sales of the United States Military Academy Bicentennial commemorative coins.
FINANCIAL REPORTING
The attached financial statements provide quarterly and cumulative active program data.
2002 WINTER OLYMPIC GAMES
Program Highlights
The 2002 Winter Olympic Commemorative Coin Act, P.L. 106-435, authorizes the production of 400,000 silver dollar coins and 80,000 gold five-dollar coins. In the spirit of the 1996 commemorative coin reform legislation to curb proliferation of commemorative coin programs, the United States Olympic Committee (USOC) has been very responsive to past concerns, and the 2002 Games feature a single coin design for the obverse and reverse of each silver dollar and gold five-dollar coins.
Congress directed the United States Mint to divide the surcharges from the sale of the coins equally between the Salt Lake Organizing Committee (SLOC) for the Olympic Winter Games of 2002 and the USOC. The United States Mint has received audited statements from the SLOC and the USOC. Previous United States Mint commemorative coin programs honoring the Olympics have raised over $130 million for our Olympic athletes and programs.
Marketing Activities
The 2002 Winter Olympic Games Commemorative Coin Program officially ended on December 31, 2002.
Analysis of Financial Position
As of March 31, 2003, the United States Mint shipped over 250,000 coins, generating total program revenues of $14.9 million, including surcharges of $3.6 million. Estimated profits of $3.3 million covered the potential unrecovered expenses of $66,836. Cost of goods sold totaled $5.2 million, and selling, general and administrative expenses are $2.9 million. Second quarter program activity resulted in a profit of $19,931. Two recipient organizations share in the surcharges for the Winter Olympics program – the SLOC and the USOC, both of which have satisfied the private-source fundraising requirement. They are now qualified to receive surcharge payments from the United States Mint. Surcharges collected for sales through the second quarter total over $3.6 million. Total surcharges paid through March 31, 2003, were over $2.6 million.
U.S. MILITARY ACADEMY BICENTENNIAL
Program Highlights
The United States Military Academy Bicentennial Commemorative Coin Act, P.L. 103-328, authorizes the production of 500,000 silver dollar coins. Surcharges from the sale of the coins will go to the Association of Graduates, USMA, to assist efforts to provide direct support to the academic, military, physical, moral, and ethical development programs of the Corps of Cadets, USMA, West Point, New York. As authorized by the enabling legislation, this will be the last modern commemorative coin comprising silver from the Nation’s Strategic and Critical Materials Stockpile, as inventory in that stockpile has reached a level that precludes its use in future United States Mint commemorative coin programs. The U.S. Bullion Depository at West Point is the minting facility where production began in the last weeks of the first quarter of 2002, and issuance of the coin began on March 16, 2002. Consistent with the enabling legislation, the coins were struck at the West Point Mint because it is located on the USMA’s grounds.
Marketing Activities
The United States Military Academy Bicentennial Commemorative Coin Program formally ended on March 16, 2003. Sales from this program generated approximately $3.9 million in surcharges that will be turned over to the USMA to support the academic, military, physical, moral and ethical development programs of the Corps of Cadets.
Analysis of Financial Position
As of March 31, 2003, the United States Mint shipped over 390,700 coins, generating total program revenues of $12.8 million, including $3.9 million of surcharges. Estimated program profits of $1.8 million cover the potential unrecovered expenses of $548,795. Cost of goods sold totaled $3.2 million, and selling, general and administrative expenses were $3.9 million. Second quarter revenues posted a profit of $50,000 for the quarter. The Association of Graduates, USMA, submitted its matching funds statement and auditor’s attestation on April 25, 2002. The documentation is satisfactory, and the organization has qualified to receive surcharge payments from the United States Mint. On January 29, 2003, a payment of $1.1 million was made to the Association of Graduates, USMA, from sales of the United States Military Academy Bicentennial Commemorative Coins, bringing the total surcharges paid to nearly $2.9 million.
FUTURE COMMEMORATIVE COIN PROGRAMS
2003 First Flight Centennial Commemorative Coins Program (Gold, Silver, Clad)
Program Highlights
This gold, silver, and clad coin program will commemorate the 100th anniversary of the Wright brothers’ first flight on December 17, 1903, in Kitty Hawk, North Carolina. United States Mint engravers were provided with source materials and began the initial design process in December 2001. The current legislation states that the United States Mint may issue coins beginning August 2003.
Program surcharges are authorized to be paid to the First Flight Foundation for the purposes of repairing, refurbishing, and maintaining the Wright Brothers Monument on the Outer Banks of North Carolina and expanding or, if necessary, replacing and maintaining the visitor center and other facilities at the Wright Brothers National Memorial Park.
Program Status
The United States Mint’s engraving staff at the Philadelphia Mint finalized the candidate designs for the First Flight Commemorative Coin Program. The candidate designs were approved by to the Secretary of the Treasury in February 2003. As specified in the enabling legislation, the coins will be issued on August 1, 2003.
2004 Thomas Alva Edison Commemorative Coins Program (Silver)
Program Highlights
This commemorative silver dollar will commemorate the 125th anniversary of the invention of the light bulb by Thomas Alva Edison.
Program surcharges are authorized to be shared as follows:
- MUSEUM OF ARTS AND HISTORY- Up to 1/8 to the Museum of Arts and History, in the city of Port Huron, Michigan, for the endowment and construction of a special museum on the life of Thomas A. Edison in Port Huron.
- EDISON BIRTHPLACE ASSOCIATION- Up to 1/8 to the Edison Birthplace Association, Inc. in Milan, Ohio, to assist in the efforts of the association to raise an endowment as a permanent source of support for the repair and maintenance of the Thomas A. Edison birthplace, a national historic landmark.
- NATIONAL PARK SERVICE- Up to 1/8 to the National Park Service, for use in protecting, restoring, and cataloguing historic documents and objects at the “Invention Factory” of Thomas A. Edison in West Orange, New Jersey.
- EDISON PLAZA MUSEUM- Up to 1/8 to the Edison Plaza Museum in Beaumont, Texas, for expanding educational programs on Thomas A. Edison and for the repair and maintenance of the museum.
- EDISON WINTER HOME AND MUSEUM- Up to 1/8 to the Edison Winter Home and Museum in Fort Myers, Florida, for historic preservation, restoration, and maintenance of the historic home and chemical laboratory of Thomas A. Edison.
- EDISON INSTITUTE- Up to 1/8 to the Edison Institute, otherwise known as “Greenfield Village,” in Dearborn, Michigan, for use in maintaining and expanding displays and educational programs associated with Thomas A. Edison.
- EDISON MEMORIAL TOWER- Up to 1/8 to the Edison Memorial Tower in Edison, New Jersey, for the preservation, restoration, and expansion of the tower and museum.
- HALL OF ELECTRICAL HISTORY- Up to 1/8 to the Schenectady Museum Association in Schenectady, New York, for the historic preservation of materials of Thomas A. Edison and for the development of educational programs associated with Thomas A. Edison.
Program Status
The United States Mint’s engraving staff in Philadelphia prepared first round candidate designs. The designs were reviewed by the Citizens Commemorative Coin Advisory Committee (CCCAC) and the Commission of Fine Arts (CFA). The United States Mint is preparing the final design package for review by the Secretary of the Treasury. The on-sale date for this program has yet to be determined.
2004 Lewis and Clark Commemorative Coins Program (Silver)
Program Highlights
This commemorative silver dollar will commemorate the bicentennial of the historic expedition conducted by the Corps of Discovery. The expedition departed St. Louis, Missouri, on May 14, 1804. United States Mint engravers were provided with source materials and began the initial design process in December 2001.
Program surcharges are authorized to be paid to the Lewis and Clark Bicentennial Council (2/3), and the National Park Service (1/3), for activities associated with commemorating the bicentennial of the Lewis and Clark Expedition.
Program Status
Candidate coin designs were prepared by the United States Mint’s engraving staff and reviewed by the CCCAC and the CFA. The Secretary of the Treasury has approved the candidate designs. The coins are scheduled to launch in May 2004 to coincide with the departure of the expedition from St. Louis on May 14, 1804, two hundred years before.
CONCLUSION
Both the Salt Lake Organizing Committee and the United States Olympic Committee have met the private fundraising requirement and are eligible to receive surcharge payments from the United States Mint. As of March 31, 2003, surcharge revenue of $1.3 million has been sent to the SLOC and the USOC from sale of the 2002 Winter Olympic Games Commemorative Coins. The next surcharge payments will be made in the third quarter of 2003.
The Association of Graduates, USMA, has met the private fundraising requirement and the organization is qualified to receive surcharge payments from the United States Mint. On January 29, 2003, a payment of $1.1 million was made to the Association of Graduates, USMA, from sales of the United States Military Academy Bicentennial Commemorative Coins. This brings the total surcharges paid to nearly $2.9 million.