National Automatic Merchandising Association (NAMA)
NAMA'S MCMAHON TESTIFIES BEFORE CONGRESS
Pledges Support for 'The Presidential $1 Coin Act'

CHICAGO, IL - May 7 - National Automatic Merchandising Association Senior Vice President and Chief Counsel Tom McMahon in testimony before The Subcommittee on Domestic and International Monetary Policy told House Members that the organization supports proposed legislation that would modify dollar coins to feature the images of our nation's Presidents. According to McMahon, H.R. 3916, "The Presidential $1 Coin Act of 2004," calling for dollar coins to bear images of our Presidents would stand a good chance of stimulating interest and wider use of the dollar coin.

McMahon said, "In our view, The Presidential $1 Coin Act is a thoughtful, legitimate attempt to generate interest in the dollar coin, and, we hope, lead to wider use of the coin in commerce. We appreciate the sponsorship of this measure by Congressman Castle and Congresswoman Maloney."

McMahon told the Committee that the organization believes that a widely circulating dollar coin could benefit the industry by as much as $1 billion dollars annually. Said McMahon, "The $1 billion estimate is comprised of $300 million in increased sales and $700 million in reduced costs if the coin circulated widely."

During the testimony McMahon also expressed industry concerns about the quality of the circulating U.S. currency. "Our members are deeply concerned about a policy under consideration at the Federal Reserve, known as the Currency Recirculation Policy announced in the Federal Register in October of last year. Under this policy, commercial banks will face a recirculation fee of $5 to $6 per bundle (1,000 notes) of currency returned by a bank that contains fit currency if the bank orders new currency of the same denomination in the same week. In other words, under this policy, a bank will face a penalty if it returns fit currency to the Federal Reserve but no penalty if it returns unfit currency to circulation. This will lead to a degrading of US currency and more lost sales in our industry."

According to McMahon, the organization expressed serious concerns about the policy in written comments filed with the Federal Reserve Board on January 12th, 2004, and requested that the Board determine the effect of the policy before adopting it. To date the organization has received no response.

McMahon also shared with the Committee several suggestions to increase circulation of the coin. "First, Enact the Presidential Coin Act of 2004. Dollar coins bearing the images of our Presidents, starting with George Washington in January 2006, would stand a good chance of stimulating interest and wider use of the dollar coin."

"Second, get the Susan B. Anthony dollar coin out of circulation. Although vending machines like Susan B.'s as much as Golden Dollar coins---they both work equally well in vending machines---people don't like Susan.B's. Some people don't know what they are. And retailers who have started a program to offer dollar coins to their customers have discontinued their programs as soon as they saw Susan. B's mixed in with Golden Dollar coins when they received coins from the bank. The Susan B. is a major impediment to the success of the Golden Dollar coin. Our industry might be able to help the Federal Reserve and the Mint get Susan. B's out of circulation."

"Third, Make the Golden Dollar Coin available to the American people. Start with federal buildings. Thousands of Post Offices, military installations, federal office buildings and the like do not offer the coin over the counter to the American people. Presidential Dollar Coins will provide the perfect opportunity to begin to offer the coin to the American people. The United States Government prints $1 bills and makes $1 coins. Why are both government products not available to Americans on federal government property?"

"Fourth, engage the nation's retailers in the Presidential Coin program. If Wendy's offers Presidential Coins to its customers and those coins bring business in the door, you can bet McDonalds will follow suit. If Target offers Presidential Coins to their customers and those coins bring business in the door, you can bet Wal-Mart will follow."

Concluded McMahon, "The American people will then have a convenient, useful, cost efficient alternative to the $1 bill."

NAMA is the national trade association of the food and refreshment vending, coffee services and foodservice management industries including on-site, commissary, catering, & mobile. Its membership is comprised of service companies, equipment manufacturers and suppliers of products and services to operating service companies. The basic mission of the association, to collectively advance and promote the automatic merchandising and OCS industries, still guides NAMA today as it did in 1936, the year of the organization's founding.