Exchange of Coin

Background

Part 100, Subpart C of Treasury Regulations 31 CFR, promulgated under 31 U.S.C. 5120, provides for the exchange of bent, partial, fused and mixed coins. The Mint has identified and is actively pursuing initiatives to improve the environment, reduce energy consumption and enhance efficiency and workplace safety. Melting coins submitted for redemption by the Mint's current heat induction procedures is not energy efficient and adds to the Mint's annual electrical expenses. It is also a physically challenging process for the Mint's employees. For these reasons, in 64 FR 4063, January 27, 1999, the Mint published a proposed rule notifying the public of its intention to discontinue melting and begin using mechanical means (such as a hammer mill or rolling mill) to destroy mutilated coins. As the mechanical destruction process requires that coins be separated by alloy, these mechanical methods cannot be used to process fused coins or unsorted (mixed) coin lots. Mutilated coins delivered in these lots of mixed alloy categories often are in a condition which precludes machine sorting, and redemption of mixed coins can be labor-intensive and inefficient. Fused and mixed coins represent a very small component of the United States Mint's annual coin redemptions. Therefore, the Mint's proposed rule published in 64 FR 4063, January 27, 1999 also notified the public of the Mint's intention to amend Part 100 of 31 CFR to discontinue acceptance of fused and mixed coins for redemption and require that all bent or partial coins submitted for redemption be separated by denomination. Comments were solicited through the January 27, 1999 publication of the proposed rule in the Federal Register (which included telephone numbers of legal and technical staff and a dedicated email address). No comments from the public were received. For the foregoing reasons, effective 30 days from the date of publication of this final rule, the Mint amends Part 100 of 31 CFR to discontinue acceptance of fused and mixed coins for redemption and to require that all bent or partial coins submitted for redemption be separated by denomination.

Special Analyses

This regulation is not a significant regulatory action for purposes of Executive Order 12866. The Mint has paid out less than $8 million in total annual mutilated coin redemptions for each of 1996, 1997 and the seven-month period ending July 31, 1998. For each such period, fused and mixed coins as a group constitute less than 1% of total coins redeemed, and approximately 1% or less of the total lots redeemed. Fused and mixed coins are currently redeemed at metal rates lower than the rates paid for sorted coins. For these reasons, the United States Mint does not believe that the regulation will have an annual effect on the economy of $100 million or more or materially adversely affect any sector of the economy, productivity,

competition, jobs, the environment, public health, or State, local, or tribal governments or communities. The Mint does not anticipate that the rule will result in inconsistency, interfere with another agency's actions, materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof, or raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in Executive Order 12866. It is hereby certified that this regulation will not have a significant economic impact on a significant number of small entities. Accordingly, a regulatory flexibility analysis is not required. Lots of fused and mixed coins recorded together as a group constituted approximately 1% or less of the total coin lots redeemed for each of calendar 1996, 1997 and the period ending July 31, 1998, amounting to 23, 19 and 13 lots, respectively, of fused and mixed coins. Although the Mint does not maintain records which consistently indicate the business or personal nature of the transactions conducted by individuals or entities tendering coins for redemption, the majority of these lots were submitted by individuals transacting with the Mint in their own name. Even if each such individual were a ``small entity'' within the meaning of 5 U.S.C. 604(a), the Mint does not believe that this quantity of lots indicates that a significant number of small entities will be significantly impacted if the Mint were to require sorting of coins previously accepted as mixed and discontinue accepting fused coins.

List of Subjects in 31 CFR Part 100

Currency, Gold.

For the reasons set forth in the preamble, the United States Mint amends 31 CFR Part 100 as follows:

PART 100--EXCHANGE OF PAPER CURRENCY AND COIN

Subpart C--Exchange Of Coin

1. The authority citation for Part 100 is revised to read as follows:

Authority: 31 U.S.C. 321.

2. Revise Sec. 100.11(b) to read as follows:

Sec. 100.11 Exchange of bent and partial coins.

* * * * * (b) Redemption basis. Bent and partial coins shall be presented separately by denomination category in lots of at least one pound for each category. Bent and partial coins shall be redeemed on the basis of their weight and denomination category rates (which is the weight equivalent of face value). If not presented separately by denomination category, bent and partial coins will not be accepted for redemption. Denomination categories and rates are Cents, @ $1.4585 per pound; Nickels, @ $4.5359 per pound; Dimes, Quarters, Halves, and Eisenhower Dollars @ $20.00 per pound; and Anthony Dollars @ $56.00 per pound. Copper plated zinc cents shall be redeemed at the face value equivalent of copper one cent coins. * * * * * 3. Revise Sec. 100.12(b) to read as follows:

Sec. 100.12 Exchange of fused and mixed coins.

* * * * * (b) The United States Mint will not accept fused or mixed coins for redemption. Philip N. Diehl, Director. [FR Doc. 99-18849 Filed 7-22-99; 8:45 am] BILLING CODE 4810-37-P