Expansion and Improvements, United States Mint DEPARTMENT OF THE TREASURY ANALYSIS OF AUTHORIZED LEVEL FOR FISCAL YEAR 1984 (In Thousands of Dollars) 1984 Appropriation (Continuing Resolution) Enacted by Congress Estimate, FY1985 ---- 1/ DIGEST OF BUDGET ESTIMATES BY ACTIVITIES FISCAL YEAR 1985 (Dollars in Thousands) Amount 3,070 Increase or decrease (-) for 1985 Total Changes Program Changes Other Changes 1/ This submission is in agreement with the President's appendix which displays a consolidated presentation of the Expansion and Improvements and Construction of Mint Facilities accounts. February 1, 1984 -3,070 The primary responsibility of the United States Mint is to provide the Nation with an adequate supply of coins. In our continuing efforts to further improve our effectiveness and efficiency in fulfilling this function, we implemented computerized forecasting models. These models are designed to include economic indicators in our coin demand forecasting, as well as production planning, and inventory controls. The The Mint currently has the ability to produce and deliver all of the anticipated coin demand of the Federal Reserve Banks through FY1985 and maintain adequate inventories. sluggish economy of the past years resulting in lower coin demand; and, the use of part-time and temporary employees to bolster coin production during peak demand periods are the contributing factors which make this possible. We estimate coin demand in FY1985 to be 20.1 billion coins with budgeted production of 19.1 billion coins. The difference of 1.0 billion will be shipped from inventory. In The Mint, with its present facilities and equipment, does not have the capacity to produce the forecasted coin demand in years subsequent to FY1985. In the early 1970's, the Department proposed a new Denver Mint to meet anticipated coinage demand during the 1980's. In 1976, Congress asked the General Accounting Office to study alternatives to the construction of a new Denver Mint, which then was estimated to cost $65 million. 1978, the Mint initiated a detailed cost-benefit study of the alternatives recommended by GAO to meet production requirements under guidelines issued by OMB. It was concluded that the recommendations of GAO to improve and expand existing facilities would be the most cost effective method of expanding Mint capacity. Detailed cost estimates were prepared for each coin facility. Estimates for facilities modifications and production equipment totaled $18 million; $15.8 million in Denver and $2.2 million in Philadelphia. Of the estimated $15.8 million needed for improvements at the Denver Mint, $5.7 million is provided by previous appropriations to a no-year appropriation entitled "Construction of Mint Facilities. For presentation in the President's FY1985 budget, the Expansion and Improvements appropriation and the Construction of Mint Facilities appropriation have been combined. To complete the Expansion and Improvement Plan, $3.969 million was approved in FY1982 by P.L. 97-92 and P.L. 97-161; $5.200 million was approved February 1, 1984 3 by P.L. 98-151 in FY1984. in FY1983 by P.L. 97-276 and P.L. 97-377; and the balance of $3.070 million was approved Denver Mint $10.1 million and Philadelphia Mint $2.2 million. The requested total of $12.3 million is required as follows: The construction at the Denver Mint will be accomplished in two phases. The first The the present Mint building. Upon completion of this multi-year program, the Mint will have increased coining February 1, 1984 WEDNESDAY, FEBRUARY 22, 1984. BUREAU OF ENGRAVING AND PRINTING WITNESSES ROBERT J. LEUVER, DIRECTOR PETER H. DALY, DEPUTY DIRECTOR MILTON J. SEIDEL, ASSISTANT DIRECTOR, RESEARCH AND ENGINEERING JOSEPH M. DeBOSE, JR., ASSISTANT DIRECTOR, OPERATIONS L. PAUL BLACKMER, JR., ACTING ASSISTANT DIRECTOR, ADMINISTRATION JOEL C. TAUB, ACTING CHIEF, OFFICE OF FINANCIAL MANAGEMENT Mr. LEUVER. Mr. Chairman, I am Robert J. Leuver and am pleased to appear before you today as Director to report the progress of the Bureau of Engraving and Printing during fiscal year 1983 and discuss our plans for future years. I am accompanied by Peter H. Daly, Deputy Director; Milton J. Seidel, Assistant Director, Research and Engineering; Joseph M. DeBose, Jr., Assistant Director, Operations; L. Paul Blackmer, Jr., Acting Assistant Director, Administration; and Joel C. Taub, Acting Chief, Office of Financial Management. Biographical sketches of Mr. Daly, Mr. DeBose, and Mr. Taub have been prepared for the record. I would like to provide an introductory statement for the record. Mr. ROYBAL. Your entire statement will be printed at this point. Mr. LEUVER. I will make brief oral comments in lieu of reading my complete statement. As you know, the Bureau is the world's largest security printer. We are proud of this fact and that the research and work we do is of highest quality. We are responsible for printing U.S. currency, postage stamps, Treasury obligations and other U.S. securities, and also for advising and assisting Federal agencies in the design and production of other Government security documents, particularly those which require protection against counterfeiting. The Bureau is not requesting an appropriation for fiscal year 1985. As you know, the operations of the Bureau are financed by means of a revolving fund which is operating well and efficiently as recently certified by GAO, as is required, and also by the Department's Inspector General's Audit Staff. One thing I would like to say is the Bureau is a very productive operation. We are career employees, myself and the rest of the staff. We look for productivity gains at all points. In the past year, we have increased productivity by both 12 and 14 percent for our currency and postage stamp operations, respectively. We have been able to reduce slightly our manufacturing costs. for currency, and for postage stamp coils, which is a large percent |