months and in January of this year we began to see visual results of the efforts that were made. That was a committee of industrialists, top men from some 29 or 30 of the larger corporations in the country who got behind this payroll savings plan in industry. Other things have occurred which I think have contributed to this increase in sales. To some extent the tax program, in that people found that through buying series E bonds they could defer the payment of income tax on the increment from those bonds. As I say, it is rather difficult to pinpoint the exact cause of this, but with industry booming as it is and with the industrialists getting back of this program, the trend has been definitely upward. Mr. GARY. Mr. Pillion? Mr. PILLION. Mr. Commissioner, I note that your sales are going up by 6.8 million and your redemptions are going up by 3.3 million pieces. That is the crux of your request here, is it not, due to the cost of handling additional paper? Mr. MERRITT. It is just a fact of life, sir, that I think we have to recognize. The more sales, the more redemptions we are going to have and, as a result of increased redemptions, more fees to be paid to paying agents. So, it goes hand in hand. Mr. PILLION. That is all, Mr. Chairman. Thank you. Mr. GARY. Thank you, Mr. Merritt. Mr. MERRITT. Thank you, Mr. Chairman. Mr. CONTE. I wish to say it is good to have our good friend Jim Burris up here. Mr. GARY. Yes. We are always glad to see Jim. Mr. PILLION. I would like to add my word of welcome. Mr. GARY. Jim was a very able and efficient clerk to this committee for a long time, and when he was with us he established himself in the respect and affections of the members. I know we all welcome Jim today even if he is on the other side of the table. He ought to have a thorough understanding of our actions if we perhaps cut these requests some. Mr. CONTE. He has given us a lot of help. Mr. BURRIS. Thank you, Mr. Chairman and gentlemen. It is a pleasure and an honor to be here. THURSDAY, AUGUST 13, 1964. BUREAU OF THE MINT WITNESSES G. d'ANDELOT BELIN, GENERAL COUNSEL, TREASURY DEPARTMENT BEN C. HOLLYFIELD, ASSISTANT CHIEF ACCOUNTANT JAMES D. BURRIS, DEPUTY DIRECTOR, OFFICE OF BUDGET AND NOTE.-Reimbursements from non-Federal sources above are receipts from foreign coinage (31 U.S.C. 367) (Jan. 29, 1874, 18 Stat. cents); and proceeds from sale of medals and proof coins, and uncirculated coins (31 U.S.C. 369 (as amended Sept. 5, 1962, 76 Stat. 440)). Mr. GARY. We shall now take up the item for the Bureau of the Mint, "Salaries and expenses," $4,500,000. The appropriation for fiscal year 1964 was $7,500,000. The estimate for fiscal 1965, $9,980,000. The appropriation for fiscal year 1965, $9,980,000, which was the amount requested. The supplemental estimate is $4,500,000. I am certain that the committee is mindful of the discussions that we had during our hearings on the regular budget. I know the members of the committee are acquainted with the fact that after the hearings, the mint worked out a plan to increase the manufacture of coins to meet the shortage that we have at the present time. We have a terrific shortage of small coins throughout the entire United States. The mint is faced with the problem of not being able to meet the requirements for coins during the current fiscal year, notwithstanding the fact that we gave them the full amount of money requested for that purpose in the budget. So, they have worked out a new plan. I have here a letter dated August 10 from the Director of the Mint. I understand the Director is out of town today and consequently will not be here. First, we shall insert the justifications for the increase in the record. (The justifications follow :) Schedule on supplemental appropriations and revised estimates [In thousands] 1. Present appropriation or estimate_-- 3. Total amount available (estimate) 4. Total actual and estimated obligations. 5. Less total amount available (estimated) 6. Estimated supplemental required-- 7. Estimated supplemental included in latest budget‒‒‒‒‒ 8. Date needed For obligation, Aug. 15, 1964 For expenditure, Sept. 1, 1964 9. Estimated expenditures from supplemental : $9,980 1,900 11, 880 16, 380 11, 880 4,500 JUSTIFICATION FOR SUPPLEMENTAL APPROPRIATION A supplemental appropriation is requested for fiscal 1965, to provide $4,500,000 for the production of approximately 3 billion additional coins, including added costs of storing, shipping, and protection, plus acquisition and modification of equipment, and the provision of additional space required for the coinage activity. Seigniorage arising from the manufacture of the additional coins provided for in this request will result in the deposit of approximately $40 million in additional revenue into the Treasury. In order to carry out this crash program, the mint will continue the purchase of rolled nickel strip from outside industry to be used in the production of all 5-cent coins. Also, the purchase of bronze strip to be used in the production of 1-cent coins to the extent necessary to assure continuous operation of all available coin presses has been started. The purchase of bronze and cupro-nickel strip will release employees presently assigned to the melting and rolling functions, for assignment to other coin mannufacturing operations. Also, proof coin manufacturing operations will be discontinued at the end of calendar year 1964, and employees now engaged in the proof coin activity will be reassigned to regular domestic coinage functions to provide some personnel for the operation of additional equipment expected to be acquired. Personnel presently assigned to proof coin operations are now being paid from reimbursements received from the sale of proof coins. Upon reassignment to regular coinage, for the greatly expanded coinage production program, these personnel will be paid from appropriated funds from the supplemental appropriation. Also, additional space will be made available for the doubled stamping operations. The production of 8 billion coins during fiscal year 1965, as contemplated by this supplemental request, is based upon operating all coin stamping presses 24 hours per day, 7 days a week. Operations in the other functions will be at a rate which will provide the blanks necessary to run the presses 24 hours per day. The mint does not now have the equipment necessary to carry out the proposed coinage program. For that reason, arrangements have been made to obtain blanking presses, blank annealing and cleaning lines and stamping presses from the Department of Defense on a loan basis. These equipment items will be modified to make them suitable for mint operations, and funds for that purpose are included in this request. Funds are also included for the purchase of new items of equipment from private industry as shown in the attached list. In order that the additional equipment items may be installed in the mints, it will be necessary to relocate some of the present equipment, and move some operations to different locations in the buildings. Plans include the use of proof coin space at Philadelphia, the present refinery space at Denver and other areas. In addition, plans call for the expansion of activities of the assay office at San Francisco by the acquisition of additional space in that building, in which blanking presses, blank annealing lines, and upsetting machines will be installed, for the production of coin blanks from bonze and nickel strip. These blanks will be shipped to the Denver Mint, and some to Philadelphia, for stamping into coins. The reassignment of employees from melting, rolling, and proof coin operations, plus some additional personnel, will enable the mints to produce coins 7 day per week, with staggered shifts, and will result in a substantial reduction in premium payments for overtime. The following tables show (1) estimated production with available funds, (2) estimated production with increased funds, and (3) list of requirements for equipment acquisition and modifications, as well as conversion of space. |