Bureau of Engraving and Printing 

Program Summary by Budget Activity 

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Actual Estimated Estimated $ Change % Change

 Manufacturing $555,000 $527,000 $582,050 $27,050 4.9%

 Protection and Accountability of Assets $61,000 $61,000 $0 ($61,000) (100.0%)

Total Cost of Operations $616,000 $588,000 $582,050 ($33,950) (5.5%)

Reimbursable FTE 1,889 1,950 1,925 36 1.9%

BEP operations are financed by reimbursements to a revolving fund and as such the BEP is unaffected by a 

continuing resolution. 

The Bureau of Engraving and Printing Protection and Accountability budget activity is being eliminated and 

consolidated into the Manufacturing budget activity beginning in FY 2012.

Summary 

 

The mission of the Bureau of Engraving and 

Printing (BEP) is to develop and produce 

United States currency notes, trusted 

worldwide. The Bureau of Engraving and 

Printing (BEP) operates on the basis of 

authority conferred upon the Secretary of the 

Treasury by 31 U.S.C. 321(a) (4) to engrave 

and print currency and other security 

documents. Operations are financed through a 

revolving fund and are reimbursed through 

product sales for direct and indirect costs of 

operations including administrative expenses. 

In addition, BEP is authorized to include an 

amount sufficient to fund capital investment 

and to meet working capital requirements in 

the prices charged for products. 

For FY 2012, the Bureau of Engraving and 

Printing’s estimated total revenues are 

$582,050,000, and estimated total 

expenditures are $582,050,000. 

BEP’s vision is to maintain its position as a 

world-class securities printer, providing its 

customers and the public superior products 

through excellence in manufacturing and 

technological innovation. It strives to produce 

U.S. currency of the highest quality, as well as 

many other security documents issued by the 

Federal Government. Other activities at the 

Bureau include engraving plates and dies; 

manufacturing inks used to print security 

products; purchasing materials, supplies and 

equipment; and storing and delivering 

products in accordance with the requirements 

of customers. In addition, the Bureau provides 

technical assistance and advice to other 

Federal agencies in the design and production 

of documents, which, because of their innate 

value or other characteristics, require 

counterfeit deterrence. The Bureau’s top 

priorities for FY 2012 include the continued 

re-tooling and retrofitting of the currency 

production process which will allow BEP to 

improve productivity, reduce its environmental 

impact and provide the capabilities needed to 

produce increasingly more complex currency 

note designs. This new equipment will ensure 

that BEP continues to operate in an efficient 

and cost-effective manner. 

 

Another initiative for FY 2012 is to continue 

efforts to test and produce tactile features that 

will enhance future note designs and serve the 

needs of currency users with visual 

impairments. A research group from the 

Bureau visited several foreign bank note 
printers to gather information on their progress 

in developing tactile features. Testing is being 

conducted to determine which processes and 

features would work best at the production 

volumes needed for U.S. currency. While no 

timetable has been set for the introduction of 

this currency, the next redesign will 

incorporate changes to make U.S. currency 

more accessible to those who are blind and 

visually impaired. In addition, because 

aggressive law enforcement, effective design, 

and public education are all essential 

components of a concerted anti-counterfeiting 

program, the Bureau will continue its work in 

2012 with the Advanced Counterfeit Deterrent 

Committee to research and develop future 

currency designs that will enhance and protect 

future notes. 

BEP FY 2012 Budget Highlights

(Dollars in thousands)

Budget Estimate Amount

FY 2010 Actual $616,000

FY 2011 Estimated $588,000

Changes to Base: 

Maintaining Current Levels (MCLs): $4,850

Maintain Current Levels $4,850

Efficiencies, Savings & Base Reductions: ($11,800)

Energy Savings ($2,200)

IT Process Streamlining ($200)

Improved Business Practices ($5,000)

Replace Mainframe ($2,400)

Spoilage Reduction Savings ($1,000)

Visual Inspection Systems ($1,000)

Subtotal FY 2012 Changes to Base ($6,950)

Total FY 2012 Base $581,050

Program Changes: 

Program Increases: $1,000

R&D Equipment - Tactile Features $1,000

Subtotal FY 2012 Program Changes $1,000

Total FY 2012 Estimated $582,050

FY 2012 Budget Adjustments 

 

Maintaining Current Levels (MCLs) 

Maintain Current Levels +$4,850,000 / +0 

FTE 

Funds are required for inflation adjustments in 

non-labor expenses such as rent adjustments, 

postage, raw materials and inventories, 

supplies and equipment, health benefits and 

the increase in Federal Employee Retirement 

System participation. No inflation adjustment 

is requested for pay in FY 2012. 

Efficiencies, Savings & Base Reductions 

Energy Savings -$2,200,000 / +0 FTE 

Energy Savings - improvements in energy 

efficiency through replacement and/or upgrade 

of older assets with more energy efficient and 

environmentally responsible assets. 

IT Process Streamlining -$200,000 / +0 FTE 

Savings from data center efficiency and 

consolidation, increased server virtualization, 

and decreased energy usage and IT operation 

costs. 

Improved Business Practices -$5,000,000 / -15 

FTE

Improved Business Practices - Current manual 

administrative processes will be eliminated 

with the completion of BEP’s Manufacturing 

Support Suite. Reductions of 15 FTE will be 

achieved through proposed buy-outs and 

attrition. 

Replace Mainframe -$2,400,000 / +0 FTE 

Replace BEP Mainframe computer with offsite 

Oracle On-Demand Computer Hosting Service 

- Switching from BEP’s mainframe computer 

to Oracle On-Demand hosting service will 

result in operation and maintenance cost 

savings. 

Spoilage Reduction Savings -$1,000,000 / +0 

FTE 

Spoilage Reduction Savings - reduced material 

spoilage during currency note production 

process should enable reduced purchases of 

currency paper and other materials used in 

manufacturing currency notes. 

Visual Inspection Systems -$1,000,000 / -10 

FTE 

Productivity Improvements from new Visual 

Currency Inspection Systems - Completed 
installation of new Visual Currency Inspection 

System to improve inspection quality and 

automate work currently performed by FTEs, 

resulting in personnel cost savings. 

Program Increases 

R&D Equipment - Tactile Features 

+$1,000,000 / +0 FTE 

Represents the purchase of lab equipment for 

research and development, needed to develop 

and test new tactile feature for the visually 

impaired in future currency redesigns. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Manufacturing ($582,050,000 from 

reimbursable programs)

BEP manufactures high quality security 

documents that deter counterfeiting. These 

manufactured products are grouped into two 

programs: Federal Reserve notes, and other 

security documents. The manufacturing of 

state-of–the-art currency deters counterfeiting, 

contributes to public confidence, and 

facilitates daily commerce ensuring seamless, 

“business as usual” transactions as new 

currency designs are introduced to the public. 

Protection and Accountability of Assets (No 

funding)

The Department of the Treasury proposes to 

eliminate the Protection and Accountability 

budget activity, and consolidate it into the 

Manufacturing budget activity beginning in 

FY 2012. During the past eight years since the 

Protection and Accountability of Assets 

budget activity was created, the Department 

has determined that it fails to serve a 

meaningful purpose on a standalone basis and 

unnecessarily complicates budgetary and other 

financial reporting. 

Legislative Proposals 

 

BEP requests legislation to repeal that portion 

of 31 USC Sec. 5114(c), which limits a 

contract term for the manufacture of 

distinctive currency paper to four years. By 

repealing this limit, the contract term for the 

manufacture of distinctive currency paper will 

match all other federal contracts which allow 

five years. Proposed Amendment: Section 

5114(c) of Title 31, United States Code 

(relating to engraving and printing currency 

and security documents), is amended by 

striking "for a period of not more than 4 

years". This proposal may open up the supply 

of U.S. currency paper to competition by 

ending the four year contract limitation. 

Potential suppliers consider four years too 

short of a payback period for production of 

this unique product, which GAO identified as 

a barrier to competition. 

To prevent money laundering, BEP proposes 

the following legislative amendment: In the 

current fiscal year and hereafter, any person 

who forwards to the Bureau of Engraving and 

Printing (BEP) a mutilated paper currency 

claim equal to or exceeding $10,000 for 

redemption shall be required to provide BEP 

their taxpayer identifying number.

Capital Investments Summary 

 

BEP’s IT portfolio includes an estimated $18 

million cost to implement the Oracle 

eBusiness integrated manufacturing suite 

which will run at the Oracle Corporation’s 

“Federal on Demand” Shared Service Center 

in Austin, Texas. After implementation, BEP 

anticipates annual operating and maintenance 

cost savings of $2.4M compared to continued 

usage of the current BEP-operated mainframe. 

Due to this modernization, BEP anticipates 

productivity improvements of five percent by 

revising work practices in administrative and 

support areas for a savings of $5M annually. 
This savings estimate was developed as a 

result of BEP’s discussion with other 

manufacturing entities that implemented the 

Oracle E-Business Suite, after reviewing best 

practices supported by the software, and 

completing an initial requirements definition 

process. 

BEP Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Manufacturing Currency Shipment 

Discrepancies Per Million Notes 

(%) (Ot)

0.01 0.0 0.0 0.01 0.01

Manufacturing Manufacturing Costs For 

Currency (Dollar Costs Per 

Thousand Notes Produced) ($) 

(E)

29.47 32.77 44.85 48.0 48.0

Manufacturing Percent of Currency Notes 

Delivered to the Federal Reserve 

that Meet Customer Quality and 

Requirements (%) (Oe)

100.0 99.9 97.5 99.9 99.9

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B – Baseline

Description of Performance 

 

Manufacturing Costs for Currency (dollar cost 

per 1,000 notes produced) is an indicator of 

manufacturing efficiency and effectiveness of 

program management. This measure is based 

on contracted price factors, and anticipated 

productivity improvements, as well as the mix 

of denominations ordered year to year. As 

more sophisticated counterfeit deterrent design 

features are produced, paper and ink costs 

increase, resulting in increased total 

manufacturing costs. Actual performance 

against standard depends on BEP’s ability to 

meet annual spoilage, efficiency, and capacity 

utilization goals. This measure has performed 

at or better than its annual targets for the past 

seven years. 

Percent of currency notes delivered to the 

Federal Reserve Board that meet customer 

quality and requirements is a qualitative 

indicator reflecting the Bureaus’ ability to 

provide a quality product. All notes delivered 

to the Federal Reserve Board go through 

rigorous quality inspections. These 

inspections ensure that all counterfeit deterrent 

features, both overt and covert are functioning 

as designed. 

Currency Shipment Discrepancies is an 

indicator of the Bureau’s ability to provide 

effective product security and accountability. 

This measure refers to product overages or 

underages of as little as a single currency note 

in shipments of finished notes to the Federal 

Reserve Banks expressed as a percentage of 

total program. BEP continually strives to meet 

its long term goal of 0 percent, and has been 

able to do so several times.