1984 Olympic Commemorative Coinage

GAO commented on legislative proposals to mint coins to commemorate the 1984 Los Angeles Summer Olympic Games and to help finance these Games and amateur athletics without the use of tax revenues. Three issues will determine the extent to which the Government will indirectly finance the Games through a coinage program: (1) the extent to which the Government bears the financial risk of depreciation in the market price of the gold and silver and other costs associated with redemption of the coins at face value; (2) the extent to which the Government incurs uneconomical manufacturing costs, thereby foregoing revenues which the Government has derived from minting; and (3) the extent to which the coins are marketed as tax-deductible contributions, resulting in foregone Federal tax revenues. Under Senate Bill 1230, the Government will bear the capital investment risk of depreciation in the market price of gold and silver as well as redemption costs. All rights to the coins are transferred to the Olympic Committee at the time of sale. Any unsold coins will be melted down or returned to the Treasury. Changing the coins' specifications increased the risk to the Government because of depreciation of the bullion as well as the costs associated with redemption to the coins at face value. The Senate bill is silent on marketing the coins as tax-deductible contributions. House Bill 6058 changes the coins' technical specifications. The bill does not require the Treasury to recover the value of the coins' bullion content plus their face value in the sale price. Changing the coins' face values to those of historic U.S. coins may also increase marketability. House Bill 6069 requires the Treasury to recover the coins' $1 face value plus the cost of issuing the coins, including their silver content, in their sale price. The Treasury would also retain the ownership of the coins until they are sold to the public. Thus, the Government will retain the benefit of appreciation as well as the risk of depreciation in the market price of the unsold coins' silver content.