76148 Federal Register / Vol. 71, No. 244 / Wednesday, December 20, 2006 / Rules and Regulations 

regulation did not impose an unfunded 

mandate. 

List of Subjects in 30 CFR Part 934 

Intergovernmental relations, Surface 

mining, Underground mining. 

Dated: November 22, 2006. 

Allen D. Klein, 

Director, Western Region. 

■ For the reasons set out in the 

preamble, 30 CFR part 934 is amended 

as set forth below: 

PART 934—NORTH DAKOTA 

■ 1. The authority citation for part 934 

continues to read as follows: 

Authority: 30 U.S.C. 1201 et seq. 

■ 2. Section 934.15 is amended in the 

table by adding a new entry in 

chronological order by ‘‘Date of Final 

Publication’’ to read as follows: 

§ 934.15 Approval of North Dakota 

regulatory program amendments 

* * * * * 

Original amendment submission date Date of final publication Citation/description 

* * * * * * * 

May 24, 2006 ...................................................................... December 20, 2006 ........................................................... NDAC 69–05.2–06–03 

NDAC 69–05.2–10–01 

NDAC 69–05.2–12–12 

NDAC 69–05.2–16–09 

NDAC 69–05.2–22–07 

NDAC 69–05.2–24–01 

[FR Doc. E6–21716 Filed 12–19–06; 8:45 am] 

BILLING CODE 4310–05–P 

DEPARTMENT OF THE TREASURY 

Monetary Offices 

31 CFR Part 82 

Prohibition on the Exportation, 

Melting, or Treatment of 5-Cent and 

One-Cent Coins 

AGENCY: United States Mint, Treasury. 

ACTION: Interim rule with request for 

comments. 

SUMMARY: To protect the coinage of the 

United States, this interim rule prohibits 

the exportation, melting, and treatment 

of 5-cent and one-cent coins. This 

interim rule is issued pursuant to 31 

U.S.C. 5111(d), which authorizes the 

Secretary of the Treasury to prohibit or 

limit the exportation, melting, or 

treatment of United States coins when 

the Secretary decides the prohibition or 

limitation is necessary to protect the 

coinage of the United States. This 

interim rule is effective until April 14, 

2007. The public is invited to comment 

until January 14, 2007. Thereafter, but 

prior to April 14, 2007, the Department 

of the Treasury will reevaluate the need 

for the rule in light of the public 

comments, and other relevant factors. 

Upon consideration of the public 

comments and other relevant factors, 

the Department of the Treasury may 

issue a final rule extending or modifying 

the provisions of this interim rule, or 

may allow the interim rule to expire 

without extension. 

DATES: Effective Date: This interim rule 

is effective December 20, 2006 through 

April 14, 2007. 

Expiration Date: Unless extended by a 

further rulemaking document published 

in the Federal Register, this interim rule 

expires April 14, 2007. 

Comment Due Date: January 19, 2007. 

ADDRESSES: Send written comments to 

Daniel P. Shaver, Chief Counsel, Office 

of Chief Counsel, United States Mint, 

801 9th Street, NW., Washington DC 

20220. 

FOR FURTHER INFORMATION CONTACT: 

Kristie Bowers, Attorney-Advisor, 

United States Mint at (202) 354–7631 

(not a toll-free call). 

SUPPLEMENTARY INFORMATION: 

I. Background 

Section 5111(d) of title 31, United 

States Code, authorizes the Secretary of 

the Treasury to prohibit or limit the 

exportation, melting, or treatment of 

United States coins when the Secretary 

decides the prohibition or limitation is 

necessary to protect the coinage of the 

United States. In enacting 31 U.S.C. 

5111(d), Congress has conferred upon 

the Secretary of the Treasury broad 

discretion to ensure that he can 

effectively carry out his statutory duties 

to protect the Nation’s coinage and to 

ensure that sufficient quantities of coins 

are in circulation to meet the needs of 

the United States. Pursuant to this 

authority, the Secretary of the Treasury 

has determined that, to protect the 

coinage of the United States, it is 

necessary to generally prohibit the 

exportation, melting, or treatment of 5- 

cent and one-cent coins minted and 

issued by the United States. The 

Secretary has made this determination 

because the values of the metal contents 

of 5-cent and one-cent coins are in 

excess of their respective face values, 

raising the likelihood that these coins 

will be the subject of recycling and 

speculation. In fact, the Department has 

received anecdotal reports suggesting 

that this activity may already be 

occurring. The prohibitions contained 

in this interim rule apply only to 5-cent 

and one-cent coins. 

The primary reason for limiting the 

melting, exportation, and treatment of 5- 

cent and one-cent coins is to avoid a 

shortage of these coins in circulation. 

Under 31 U.S.C. 5111(a)(1), the core 

responsibility of the Secretary of the 

Treasury with respect to the Nation’s 

coinage is to ‘‘mint and issue coins 

* * * in amounts the Secretary decides 

are necessary to meet the needs of the 

United States.’’ In meeting the needs for 

low-value circulating coin 

denominations, the United States Mint 

estimates that it augments and 

replenishes only about four percent of 

the Nation’s 5-cent coin supply, and 

only about eight percent of the one-cent 

coin supply, each year. Accordingly, the 

extraction of even relatively small 

amounts of these coins from circulation 

could have a significant impact on the 

United States Mint’s ability to produce 


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Federal Register / Vol. 71, No. 244 / Wednesday, December 20, 2006 / Rules and Regulations 76149 

sufficient volumes of these coins to 

meet the needs of commerce. Another 

reason for limiting the melting, 

exportation, and treatment of 5-cent and 

one-cent coins is that the United States 

Mint, and ultimately the United States 

Treasury and the taxpayer, would have 

to bear the additional cost of 

replenishing these coins. At prevailing 

prices, and based on existing 

commercial coin counting and 

recirculation capacities, the cost to the 

United States Treasury in replenishing 

5-cent and one-cent coins taken out of 

circulation and diverted as scrap metal 

for recycling could be well in excess of 

$1 million per day, and volumes 

required for replenishment could be in 

excess of the United States Mint’s 

capacity. 

The authority granted to the Secretary 

by the Coinage Act of 1965 has been 

invoked on two prior occasions; in both 

instances the regulations were 

implemented as interim rules that were 

later made permanent until rescinded. 

In 1967, during the transition from 

silver to cupro-nickel clad coinage, 

then-Secretary Fowler authorized 

regulations that prohibited the 

exportation, melting, or treatment of all 

U.S. coins containing silver. 32 FR 7496 

(May 20, 1967). In 1974, to stem the 

unprecedented increase in demand for 

one-cent coins attributable to 

speculation that the metal content of the 

coin would soon exceed its face value, 

then-Secretary Shultz invoked this 

authority, approving regulations that 

limited the exportation, melting, or 

treatment of one-cent coins. 39 FR 

13881 (April 18, 1974). These prior 

regulations were rescinded in 1969 and 

1978, respectively, when the 

prohibitions were no longer necessary to 

protect the Nation’s coinage. 34 FR 7704 

(May 15, 1969); 43 FR 24691 (June 7, 

1978). 

The interim rule provides limited 

exceptions to the prohibitions. First, 

exportation and any of the otherwise 

prohibited activities may be authorized 

by license granted by the Secretary (or 

designee). Second, the interim rule also 

provides exceptions for coins exported 

in small amounts for legitimate use as 

money or for numismatic purposes, and 

for small amounts of coins carried on 

the person, or in the personal effects, of 

individuals leaving the country. Finally, 

there is an exception for coins treated in 

small quantities for educational, 

amusement, novelty, jewelry, and 

similar purposes. 

The Secretary of the Treasury has 

delegated to the Director of the United 

States Mint the authority to issue these 

regulations and to approve exceptions 

by license. 

II. Public Comments 

The public is invited to submit 

written comments concerning any 

aspect of this interim rule. Comments 

should be received by January 14, 2007. 

All comments will be available for 

public inspection. To inspect 

comments, contact Kristie Bowers, 

Attorney-Advisor, United States Mint at 

(202) 354–7631 (not a toll-free call). 

III. Procedural Requirements 

This rule is not a significant 

regulatory action for the purposes of 

Executive Order 12866. Because no 

notice of proposed rulemaking is 

required, the provisions of the 

Regulatory Flexibility Act (5 U.S.C. 

chapter 6) do not apply. 

Pursuant to 5 U.S.C. 553(b)(B), it has 

been determined that notice and public 

procedure regarding this interim rule 

are contrary to the public interest. 

Issuing this rule for notice and comment 

rulemaking would only serve to hasten 

recycling and speculation in 5-cent and 

one-cent coins, thereby exacerbating the 

very problems this interim rule seeks to 

prevent. As stated above, the Secretary 

of the Treasury has determined that the 

prohibitions contained in this interim 

rule are necessary to protect the coinage 

of the United States for two principal 

reasons. 

First, the economic burden on the 

Treasury, and ultimately on taxpayers, 

occasioned by the need to replace 5-cent 

and one-cent coins withdrawn from 

circulation if these regulations are not 

implemented could be in excess of $1 

million per day. At current metal prices, 

the profit potential from recycling 5- 

cent and one-cent coins to reclaim 

copper, nickel and zinc is sufficiently 

lucrative to effect these dangers in a 

very short time period. If this were to 

happen, delaying the implementation of 

this rule for notice and comment will 

have undermined the Secretary’s ability 

to fulfill his statutory duty to protect the 

Nation’s coinage. 31 U.S.C. 5111(d). 

Rather, protecting the 5-cent and onecent coins currently in circulation, 

without delay, is essential to avoiding 

the destruction of coins that would 

result in high costs to the Government. 

Cf. Arteaga v. Lyng, 660 F. Supp 1142, 

1147 (M.D. Fla. 1987). 

Second, the potential pace and 

volume at which such withdrawals 

could occur would exceed the United 

States Mint’s replenishment capacity 

and potentially cause a circulating coin 

shortage. In this regard, employing a 

notice of proposed rulemaking will 

serve its intended purposes—that is, to 

inform the public that the Secretary is 

considering a limitation on the melting, 

treatment, and exportation of 5-cent and 

one-cent coins because the value of their 

metal content makes it economical to 

recycle as scrap metal. However, such a 

notice of proposed rulemaking also 

would have a significant unintended, 

but very predictable, consequence—

namely, it would serve as an official 

notice to the public that until such a 

regulation is finally implemented, the 

melting, treatment, and exportation of 5- 

cent and one-cent coins not only is 

profitable, but also is unquestionably 

legal. The numerous inquiries that the 

United States Mint receives, asking 

whether it is legal to melt one-cent 

coins, suggests that there is a widelyheld belief among the general public 

that destroying United States coins is 

either unlawful or, at the very least, 

unseemly. However, once a notice of 

proposed rulemaking publicly 

reinforces that there is no current 

prohibition against melting the Nation’s 

coins for profit, the sale of massive 

quantities of 5-cent coins and one-cent 

coins to recycling firms as scrap metal 

can be accomplished very quickly, 

causing a precipitous shortage of these 

denominations. In this regard, the 

Attorney General’s Manual indicates, as 

to the ‘‘public interest’’ ground for 

finding good cause under 5 U.S.C. 

553(b)(3), that it ‘‘ ‘connotes a situation 

in which the interest of the public 

would be defeated by any requirement 

of advance notice,’ as when 

announcement of a proposed rule would 

enable the sort of financial 

manipulation the rule sought to 

prevent.’’ See United States Department 

of Justice, Attorney General’s Manual on 

the Administrative Procedure Act at 31, 

quoted in Utility Solid Waste Activities 

Group v. Environmental Protection 

Agency, 236 F.3d 749, 755 (D.C. Cir. 

2001). Similarly, ‘‘in special 

circumstances, good cause can exist 

when the very announcement of a 

proposed rule itself can be expected to 

precipitate activity by affected parties 

that would harm the public welfare.’’

Mobil Oil Corp. v. Department of 

Energy, 728 F.2d 1477, 1492 (Temp. 

Emer. Ct. App. 1983). Accordingly, 

delaying this rule for notice and 

comment would be contrary to the 

public interest because it could impair 

the Secretary’s mission to ensure that 

there are sufficient quantities of onecent and 5-cent coins in circulation to 

meet the needs of the United States. See 

31 U.S.C. 5111(a)(1). 

While these concerns are predictive in 

nature, and therefore not susceptible of 

strict factual proof, in the judgment of 

the Department, the risk to the public’s 

confidence in the integrity and 

reliability of the United States’


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76150 Federal Register / Vol. 71, No. 244 / Wednesday, December 20, 2006 / Rules and Regulations 

monetary system, in the event that 

precipitous speculation or recycling 

causes a shortage of one-cent or 5-cent 

coins, is not insubstantial. Cf. Mobil Oil 

Corp., 728 F.2d at 1492. 

For these reasons, it has also been 

determined that, pursuant to 5 U.S.C. 

553(d)(3), good cause exists to make this 

interim rule effective immediately. 

Although the Secretary of the 

Treasury has determined that it is 

necessary to make this interim rule 

effective immediately, the Department is 

interested in obtaining input from the 

public on this matter. The public 

therefore is invited to submit written 

comments concerning this interim rule. 

Within 120 days, the Department of the 

Treasury will evaluate the public 

comments and consider other relevant 

factors before deciding whether to issue 

a final rule extending or modifying the 

provisions of this interim rule, or 

allowing the interim rule to expire 

without extension. 

List of Subjects in 31 CFR Part 82 

Administrative practice and 

procedure, Currency, Penalties. 

Authority and Issuance 

■ For the reasons set forth, Chapter 1 of 

Subtitle B of title 31 of the Code of 

Federal Regulations is amended by 

adding part 82 to read as follows: 

PART 82—5-CENT AND ONE-CENT 

COIN REGULATIONS 

Sec. 

82.1 Prohibitions. 

82.2 Exceptions. 

82.3 Definitions. 

82.4 Penalties. 

Authority: 31 U.S.C. 5111(d). 

§ 82.1 Prohibitions. 

Except as specifically authorized by 

the Secretary of the Treasury (or 

designee) or as otherwise provided in 

this part, no person shall export, melt, 

or treat: 

(a) Any 5-cent coin of the United 

States; or 

(b) Any one-cent coin of the United 

States. 

§ 82.2 Exceptions. 

(a) The prohibition contained in 

§ 82.1 against the exportation of 5-cent 

coins and one-cent coins of the United 

States shall not apply to: 

(1) The exportation in any one 

shipment of 5-cent coins and one-cent 

coins having an aggregate face value of 

not more than $100 that are to be 

legitimately used as money or for 

numismatic purposes. Nothing in this 

paragraph shall be construed to 

authorize export for the purpose of sale 

or resale of coins for melting or 

treatment by any person. 

(2) The exportation of 5-cent coins 

and one-cent coins having an aggregate 

face value amount of not more than $5 

carried on an individual, or in the 

personal effects of an individual, 

departing from a place subject to the 

jurisdiction of the United States. 

(b) The prohibition contained in 

§ 82.1 against the treatment of 5-cent 

coins and one-cent coins shall not apply 

to the treatment of these coins for 

educational, amusement, novelty, 

jewelry, and similar purposes as long as 

the volumes treated and the nature of 

the treatment makes it clear that such 

treatment is not intended as a means by 

which to profit solely from the value of 

the metal content of the coins. 

(c)(1) The prohibition contained in 

§ 82.1 against exportation, melting, or 

treatment of 5-cent coins and one-cent 

coins of the United States shall not 

apply to coins exported, melted, or 

treated under a written license issued by 

the Secretary of the Treasury (or 

designee). 

(2) Applications for licenses should 

be transmitted to the Director, United 

States Mint, 801 9th Street, NW., 

Washington, DC 20220. 

§ 82.3 Definitions. 

(a) ‘‘5-cent coin of the United States’’

means a 5-cent coin minted and issued 

by the Secretary of the Treasury 

pursuant to 31 U.S.C. 5112(a)(5). 

(b) ‘‘One-cent coin of the United 

States’’ means a one-cent coin minted 

and issued by the Secretary of the 

Treasury pursuant to 31 U.S.C. 

5112(a)(6). 

(c) ‘‘Export’’ means to remove, send, 

ship, or carry, or to take any action with 

the intent to facilitate a person’s 

removing, sending, shipping, or 

carrying, from the United States or any 

place subject to the jurisdiction thereof, 

to any place outside of the United States 

or to any place not subject to the 

jurisdiction thereof. 

(d) ‘‘Person’’ means any individual, 

partnership, association, corporation, or 

other organization, but does not include 

an agency of the Government of the 

United States. 

(e) ‘‘Treat’’ or ‘‘treatment’’ means to 

smelt, refine, or otherwise treat by 

heating, or by a chemical, electrical, or 

mechanical process. 

§ 82.4 Penalties. 

(a) Any person who exports, melts, or 

treats 5-cent coins or one-cent coins of 

the United States in violation of § 82.1 

shall be subject to the penalties 

specified in 31 U.S.C. 5111(d), 

including a fine of not more than 

$10,000 and/or imprisonment of not 

more than 5 years. 

(b) In addition to the penalties 

prescribed by 31 U.S.C. 5111(d), a 

person violating the prohibitions of this 

part may be subject to other penalties 

provided by law, including 18 U.S.C. 

1001(a). 

Dated: December 12, 2006. 

Edmund C. Moy, 

Director, United States Mint. 

[FR Doc. 06–9777 Filed 12–15–06; 12:41 pm] 

BILLING CODE 4810–02–P 

DEPARTMENT OF THE TREASURY 

Fiscal Service 

31 CFR Part 356 

[Docket No. BPD GSRS 06–02] 

Sale and Issue of Marketable BookEntry Treasury Bills, Notes, and 

Bonds—Customer Confirmation 

Reporting Requirement Threshold 

Amount 

AGENCY: Bureau of the Public Debt, 

Fiscal Service, Treasury. 

ACTION: Final rule. 

SUMMARY: The Department of the 

Treasury (‘‘Treasury,’’ ‘‘We,’’ or ‘‘Us’’) is 

issuing in final form an amendment to 

31 CFR part 356 (Uniform Offering 

Circular for the Sale and Issue of 

Marketable Book-Entry Treasury Bills, 

Notes, and Bonds) that raises the 

customer confirmation reporting 

requirement threshold amount from 

$500 million to $750 million. Beginning 

on December 31, 2006, any customer 

awarded a par amount of $750 million 

or more in a Treasury marketable 

securities auction must send us a 

confirmation of its awarded bid(s) by 10 

a.m. on the day following the auction. 

This final rule also clarifies that 

customer confirmations may now be 

sent by e-mail as well as by fax or hand 

delivery. 

DATES: Effective Date: January 1, 2007. 

ADDRESSES: You may download this 

final rule from the Bureau of the Public 

Debt’s Web site at http:// 

www.treasurydirect.gov or from the 

Electronic Code of Federal Regulations 

(e-CFR) Web site at http:// 

www.gpoaccess.gov/ecfr. It is also 

available for public inspection and 

copying at the Treasury Department 

Library, Room 1428, Main Treasury 

Building, 1500 Pennsylvania Avenue, 

NW., Washington, DC 20220. To visit 

the library, call (202) 622–0990 for an 

appointment. 


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