U.S. Currency: Reader Program Should Be Evaluated While Other Accessibility Features for Visually Impaired Persons Are Developed
Published: 2014-09-26T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: All blind and many persons with low vision are unable to distinguish currency denominations without assistance. The U.S. District Court for the District of Columbia found that Treasury failed to provide meaningful access to U.S. currency to visually impaired persons, and in 2008, ordered Treasury to take steps to do so. The court did not define meaningful access, leaving it to Treasury to choose a course of action. Within Treasury, BEP designs and manufactures currency. GAO was asked to review the progress BEP has made toward meeting the district court's order. In addition, the Explanatory Statement accompanying the Consolidated Appropriations Act, 2014, mandated GAO to report on strategies for minimizing the cost of developing currency with accessibility features.
This report examines (1) the status of BEP's efforts to provide currency that is accessible for visually impaired persons and how BEP is considering costs as part of these efforts and (2) factors that may affect BEP's efforts. To answer these questions GAO reviewed court and BEP documents, and interviewed officials from BEP, the Federal Reserve Board, and the Secret Service as well as representatives from advocacy organizations for visually impaired persons and trade associations for cash-handling companies.
section_title: What GAO Found
paragraphs: The Bureau of Engraving and Printing (BEP) has progressed in making currency accessible through a three-pronged approach it adopted and is considering the costs of its approach as it continues its efforts. BEP has:
Added large, high-contrast numerals to notes, and it plans to continue to refine these numerals.
Started to distribute free currency-reader devices that can scan a note and audibly announce its value. However, BEP's plans to evaluate the effectiveness of this new program are incomplete, and without a complete evaluation, BEP cannot determine the program's effectiveness.
Made limited progress in developing a raised tactile feature on notes, which would provide the ability to determine the note's value by touch. While BEP has narrowed the options of what a tactile feature would look like on a note and how it would be applied, BEP officials stated that challenges developing the feature will delay selecting an option to test until March 2015—over a year behind schedule.
Supplementing these efforts, BEP developed a smartphone app that identifies notes. High-contrast numerals add little additional cost, and BEP estimates it will spend about $35 million on currency readers over 3 years. Cost estimates to produce a tactile feature are preliminary and range widely.
GAO identified three factors that may affect BEP's efforts to complete its three-pronged approach. First, the inclusion of a tactile feature will require a redesign of currency, but it is not known when this will occur. Because BEP makes changes to currency to stay ahead of counterfeit threats, redesign occurs as needed and not at regular intervals. Second, BEP has faced difficulties developing a raised tactile feature, falling behind its internal schedule. Third, senior BEP and Federal Reserve officials told us that they have discussed the Federal Reserve's concerns about the potential cost impact of a tactile feature and whether technological changes since the 2008 court order could provide alternative options to BEP's current approach. BEP officials stated that they have not yet determined how these concerns might be addressed. Advocates for organizations representing visually impaired persons consider a tactile feature to be important and are concerned about the length of time it is taking BEP to provide access to currency.
section_title: What GAO Recommends
paragraphs: GAO recommends BEP evaluate its currency reader program while it develops a tactile feature in the next redesign of currency. BEP did not take a position on our recommendation.

section_title: Letter
paragraphs: All blind and many persons with low vision are unable to distinguish one  denomination of U.S. currency from another without assistance because  the notes are uniform in size, texture, and general design. To identify the  value of a note, a blind person must rely on a sighted person for help or  use an assistive device that can identify a note and signal its value  audibly or by vibrating. A person with low vision may likewise require  assistance in some circumstances—such as in low lighting—but may be  able to identify note denominations in other circumstances. The inability  to consistently distinguish the value of notes without external help,  according to a 1995 National Research Council study and advocates for  the visually impaired, prevents visually impaired individuals from fully  participating in society because they cannot independently and  confidentially exchange currency, such as when making cash purchases  or using public transportation.
Specifically, the lawsuit alleged that Treasury violated Section 504 of the Rehabilitation  Act of 1973 (29 U.S.C. §794), which prohibits discrimination against people with  disabilities in programs or activities receiving federal financial assistance or under any  program or activity conducted by an executive agency or the U.S. Postal Service.
U.S. currency to visually impaired persons and, in 2008, the court  ordered Treasury to take steps to provide meaningful access. Within  Treasury, the Bureau of Engraving and Printing (BEP) designs and  manufactures U.S. currency.
The Senate report accompanying the Financial Services and General  Government Appropriations Act, included as division E of the  Consolidated Appropriations Act, 2014, mandated us to review how BEP  can expedite the development, design, testing, and printing of currency  with accessibility features. In addition, the Explanatory Statement  accompanying the Consolidated Appropriations Act, 2014, mandated us  to report on strategies for minimizing the cost of developing currency with  accessibility features. Subsequently, Senator Murray asked us to review  the progress BEP has made toward meeting the district court’s 2008  order.  This report examines  (1) the status of BEP’s efforts to provide currency that is accessible for  visually impaired persons and how BEP is considering costs as part of  these efforts, and  (2) factors that may affect BEP’s efforts to make currency accessible for  visually impaired persons.
To gather information on both objectives, we reviewed agency documents  related to BEP’s efforts to provide currency that is accessible.  Specifically, we reviewed documents related to the 2002 court case and  BEP’s semi-annual progress reports to the court. We interviewed officials  from the three agencies that work together to redesign currency: BEP, the  Board of Governors of the Federal Reserve System (Federal Reserve),  and the United States Secret Service (Secret Service). In addition, to  identify and discuss the factors that may affect BEP’s approach to make  currency accessible for visually impaired persons, we interviewed  representatives of four national advocacy organizations for visually  impaired persons and four trade associations that represent financial  institutions and other companies that use cash-handling equipment, such  as ATM manufacturers. We also interviewed Bank of Canada  representatives because of their efforts to produce accessible currency.  The results of the interviews are not generalizable, but do provide insights  regarding efforts to make currency accessible to blind and visually  impaired persons. See appendix I for additional information on our scope  and methodology.
We conducted this performance audit from February 2014 to September  2014 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: According to estimates from several sources, approximately 8 to 12  million Americans live with some type of visual impairment, including  300,000 to 1.3 million who are blind. Impairment can range from  individuals with limited vision that is not correctable by glasses or contact  lenses to those who are not able to perceive objects at any distance.The number of Americans with some type of visual impairment is  projected to increase as the population ages. One of the leading causes  of vision loss is disease, such as glaucoma, cataracts, and diabetes.  Some individuals who suffer vision loss suffer physical ailments; for  example, individuals with diabetes can suffer both vision loss and a loss  of feeling in their fingers. Birth defects and accidents also can cause  vision loss, and veterans may have vision loss from wounds or trauma.
Currencies of most other countries have characteristics that make their  notes accessible to visually impaired persons. Most commonly,  countries use different-sized notes and color to distinguish different  denominations. Among nine major foreign countries surveyed by  economists at the Federal Reserve Bank of St. Louis, eight used those  two features in their currency. In addition, all nine used a tactile feature  or large, high-contrast numerals, or both. For example, the European  Union uses different-sized notes, different primary colors for each  denomination, and large numerals. The €200 and €500 notes also include  a tactile feature. Canada has incorporated a raised tactile feature in its  currency since 2001 and uses different colors and large, high-contrast  numerals. Federal Reserve officials we spoke with noted that the  existence of accessible features does not necessarily mean these  features are effective. For example, they said that they have been unable  to identify a tactile feature used by another country that remains effective  for the life of the note.
In the Order and Judgment reflecting the court’s decision in the ACB  lawsuit, the court did not specifically define meaningful access and left it  to the discretion of the Secretary of the Treasury as to how to fulfill the  requirement of the court order. The court required Treasury to provide  meaningful access no later than the date of the next currency redesign for  each of the denominations. The order also requires Treasury to submit semi-annual reports so that the court can monitor Treasury’s progress.  The order remains in effect until Treasury fulfills the requirement.
In 2010, BEP proposed a three-pronged approach consisting of three  elements it believes will provide meaningful access to currency: 1) large,  high-contrast numerals to allow low vision individuals to determine the  denomination of currency, 2) currency readers that can indicate a note’s  value, and 3) a raised tactile feature to allow visually impaired persons  to denominate currency by touch. According to BEP, it chose this  approach because no single solution would enable all segments of the  diverse visually impaired population to denominate currency with 100  percent accuracy. BEP also stated in a 2010 Federal Register notice on  its proposed approach that it would explore emerging technological  options to provide access to currency, such as smartphone applications  that can act as a currency reader.three-pronged approach and a plan to explore emerging technologies to  the court. Each of the elements of BEP’s approach is discussed further in  the next section of this report.
In 2011, the Treasury submitted its  Two elements of BEP’s approach—large, high-contrast numerals and a  tactile feature—require changes to the design of the currency. Making  such changes to currency is a complex and lengthy process, involving  three agencies: BEP, the Federal Reserve, and the Secret Service (see  table 1).
According to BEP documents, these agencies work together through an  interagency governance structure, which includes the following  committees:
Advanced Counterfeit Deterrence Steering Committee (ACD):  Comprised of senior-level officials, the ACD is empowered to make  recommendations on note design, production, and security to the  Secretary of the Treasury, who approves the final currency design.
Interagency Currency Design Group (ICD): The ICD is chartered to  initiate, authorize, and prioritize interagency activities related to note  redesign and production. The ICD provides a management framework  for the note redesign process and makes recommendations to the  ACD.
Program Approval Committee (PAC): The PAC consists of a subset of  ICD members. It is chartered to provide oversight and direction to all  note-redesign projects. In that capacity, it reviews and approves  recommendations from project teams. It also provides a forum for  members to inquire about project details and resource prioritization.
The United States has had two major redesigns of its currency since the  1930s. Each redesign involved changes to a family of notes—the $5,  $10, $20, $50 and $100 notes—and included design elements required  by statute as well as features to deter new counterfeit threats. Under  current law, the Department of the Treasury is not permitted to use  appropriated funds to redesign the $1 note. Redesigned notes retained  familiar characteristics of the notes they replaced, but included new  features or new versions of existing features that make each note distinct.  For example, while the size and location of the portrait on a note  changed, the portrait is of the same person. Figure 1 shows different  versions of portraits on the $100 note.
BEP has increasingly used distinctive features to enhance a note’s  appearance and resistance to counterfeiting. For example, BEP added a  series of individual features known as symbols of freedom to notes, such  as two images of the Statue of Liberty’s torch on the $10 note. Security  features, like the bell in the inkwell on the most recent $100 note, make  it easier for the public to identify an authentic note and are difficult for  counterfeiters to reproduce. The development of these individual and  security features occurs separately from the overall design of the note,  which includes the note layout and artwork. Once the features and the  overall design receive interagency approval, they are combined to  achieve a final product. The length of time required to redesign a note  depends mostly on the length of time it takes to research, develop, and  test new security features. For example, BEP spent nearly 10 years  developing security features for the most recent $100 note. Developing  individual features involves a less rigorous process because BEP does  not rely on them for counterfeit protection. The redesign process may also  be lengthened if the Secret Service, the Federal Reserve, or industry  members, such as banks, identify problems with the test notes they  receive before full production. If there is a problem with the test notes,  such as if notes do not function correctly in the automated high-speed  currency-counting equipment used by the Federal Reserve and many  banks, the design of a note would need to be adjusted and resubmitted  for interagency review. Although the development of features and the  development of the overall design use separate processes, agency  officials said that information is shared between the processes on an  ongoing basis. Figure 2 describes the steps in the development  processes for a redesigned note and an individual feature. The raised  tactile feature BEP plans to add to currency is following the process BEP  uses for developing an individual feature.
The Federal Reserve determines when newly redesigned notes are  placed into circulation based on the needs of the Federal Reserve Banks  and depository institutions. As a result, there may be some time between  when a redesigned note is produced by BEP and when it enters  circulation. After redesigned notes enter circulation, they co-circulate with  the previously designed notes for many years because of the notes’  longevity. For example, the Federal Reserve estimates that a $5 note  remains in circulation for almost 5 years and a $100 note for 15 years.  The newest redesigned note, the $100, began entering circulation in  2013.
section_title: BEP Has Taken Actions to Make Currency Accessible and Is Considering Costs As It Continues Its Efforts
subsections: section_title: BEP Has Made Some Progress Implementing Its Three-Pronged Approach
paragraphs: BEP has taken steps to make currency accessible to visually impaired  persons, but has not yet fully implemented any element of its three- pronged approach. Specifically, BEP is producing some notes with large,  high-contrast numerals, has begun the initial phases of the currency  reader program, and is conducting research for a raised tactile feature. In  addition to these efforts, BEP has also developed an application for  smartphones that can be used to identify the value of notes. According to  BEP officials, as of May 2014, they were in the process of design  planning activities for the next family of notes. Figure 3 shows a timeline  of events related to the court case and currency redesign.
From 1997 to 2008, BEP added larger numerals to the backs of all notes  it redesigned except the $1 and $2 notes, and from 2008 to 2013, BEP  included even larger, colored numerals in the designs of the $5 and $100  notes. The numerals are primarily designed to allow persons with low  vision to independently denominate a note. According to BEP, it will  continue to use high-contrast numerals in future currency redesigns and  is exploring ways to refine the numerals, including options concerning  attributes such as size, color, placement, and background contrast for  large numerals. Figure 4 shows notes before and after BEP added larger  numerals.
Advocates for visually impaired persons have been circumspect in their  response to the addition of large, high-contrast numerals. The  representatives stated they are supportive of the numerals because they  assist a portion of the visually impaired population. However, the  representatives noted that the benefit of large, high-contrast numerals is  dependent upon the amount of useful vision a person has and the lighting  in the environment. In addition, representatives told us that high-contrast  numerals alone are not sufficient to provide visually impaired persons  access to currency.
subsections: section_title: Currency Reader Device Program
paragraphs: BEP began the first of the three phases of its currency reader program in  July 2014. In the first phase, BEP distributed free reader devices to  eligible persons at the annual conferences of three national organizations  for visually impaired persons. In the second phase, to start in September  2014, existing participants of the Library of Congress’ National Library  Services for the Blind and Physically Handicapped (NLS) are to be  eligible to pre-order a currency reader. NLS, through an interagency  agreement with BEP, is to determine applicants’ eligibility for free readers,  process orders, and ship currency readers as a supplement to its existing  service of providing braille and audio materials free to qualified  participants. For the final phase, BEP anticipates a national rollout of its  program in January 2015, with plans to make reader devices available to  any eligible person. In June 2014, BEP’s Director said he projects  distributing between 100,000 and 500,000 readers over 3 years.  According to BEP officials, they distributed about 1,600 devices at the  three annual conferences.
BEP’s contract with the supplier requires that the reader successfully denominate notes  98 percent of the time. loud in English, emit a varying number of beeps and pitches, or vibrate for  a varying number of pulses and durations. For example, the reader can  indicate a $20 note by announcing “Twenty,” emitting two high-pitched  beeps, or vibrating for two long pulses.
According to the BEP Director, the currency reader program is a key part  of BEP’s three-pronged approach to provide access to currency, and is  designed as the one method that can provide virtually all visually impaired  persons with a means to independently denominate notes. BEP projects  spending about $35 million on the currency reader program over the next  3 years. The need for currency readers will likely continue for many years  because BEP estimates the first note with a tactile feature will not likely  be issued before 2020. BEP expects future notes to be issued, as they  have historically been, one denomination at a time over several years and  expects that notes without tactile features will co-circulate with tactile- enhanced notes for many years.
BEP officials described steps they have taken, or plan to take, to evaluate  the currency reader program’s effectiveness. For example, they solicited  feedback from the organizations for visually impaired and their members  and established a toll-free phone number for people to call with questions  or concerns about the program or address issues or problems with  devices. While these efforts are useful, they are incomplete because they  do not provide BEP information on other aspects of the currency reader  program. For example, BEP does not plan to evaluate how well the  program provides visually impaired persons with a means to  independently denominate currency. Further, BEP does not plan to  evaluate program costs or time frames, even though BEP anticipates  spending tens of millions of dollars for many years. According to BEP  officials, BEP has been focused on implementing the program instead of  evaluating it. GAO’s prior work on federal agencies that have used  program evaluation for decision making has shown that program  evaluation can allow agencies to understand whether a program is  addressing the problem it is intended to and assess the value or  effectiveness of the program. The results of an evaluation can be used  to clarify BEP and others’ understanding of how the program does or  does not address a problem of interest and to assist BEP in making  changes to improve the design or management of an existing program.  Without such an evaluation, BEP cannot determine whether the currency  reader program is reaching users as intended and providing them with  appropriate access to currency.
In general, advocates for visually impaired persons support the currency  reader program because it can help some members of the visually  impaired community. However, some advocates pointed out that many  people who are visually impaired carry several assistive devices, such as  a cane or magnification devices. A currency reader requires a visually  impaired person to carry an additional device, which can be cumbersome.  For example, representatives from one organization stated that it would  be difficult for a person to hold a wallet, banknotes, and a currency reader  device to determine the denomination of a note. In addition, some  advocates told us that because of the time it takes to use a reader, the  device does not enable a visually impaired person to identify notes as  quickly and easily as a tactile feature. Representatives from two advocacy  organizations told us their members had mixed reactions to the currency  reader devices distributed at the annual conferences. One group noted  problems with some of the devices, such as not reading notes properly  and announcing an error message even when it was not being used,  while the other group reported that members seemed satisfied.
section_title: Raised Tactile Feature
paragraphs: BEP has evaluated a range of potential raised tactile features but has not  received final interagency approval for a feature or for its characteristics,  such as its shape, denominating pattern, and location on each note. A  raised tactile feature is one that is applied to the surface of a note and  offers a contrasting feel compared to the surface around it. A BEP core  team of subject matter experts has not yet determined how to apply the  feature to notes, and it did not meet a key, internal milestone. According  to BEP’s timeline, selection of the application method, or process it will  use to create the raised tactile feature on the surface of the note, was due  to be finalized by December 2013. The tactile feature core team  researched and analyzed many potential application methods, narrowed  the choices to four for further analysis, and recommended one to the  interagency PAC based on that further analysis. BEP must receive  interagency approval from the PAC on its chosen application method in  order to finalize its selection.
The core team presented its recommended application method to the  PAC in March 2014, but the PAC did not approve it because of concerns  about the analysis used to test and compare the application methods. For  example, BEP set a requirement that a raised tactile feature allow a  person to accurately identify a note’s denomination in less than 30  seconds. The PAC noted, however, that the core team used a different  time interval when testing the application methods. The PAC directed the  core team to update the requirements for the tactile feature and revise the  test methods used to ensure they address the updated requirements.  BEP now anticipates selecting an application method by March 2015,  which would put it over one year behind its tactile feature development  schedule.
Although BEP has not received final approval for other feature  characteristics, it received interagency approval for a design of the tactile  feature’s appearance and denominating pattern for use in testing and  comparing application methods. BEP determined that a raised tactile  feature shaped as a 6mm x 4mm rectangle would be highly perceptible to  touch, compared to a range of other shapes. BEP also determined the  pattern that would be used on each denomination, as shown in figure 6,  but not where the feature would be located on a note.
Advocates for visually impaired persons told us that a tactile feature  would allow visually impaired persons to quickly determine the value of  each note without assistance and decrease their vulnerability in many  situations. Representatives from ACB said that physical changes to a  note, such as a tactile feature, are a sure way to provide independence  for visually impaired persons. In July 2014, ACB passed a resolution  reiterating the importance of not delaying the production of currency that  is accessible to visually impaired persons.
section_title: Emerging Technological Options
paragraphs: In addition to the three-pronged approach approved by the Secretary of  the Treasury, BEP developed an application (app) for Apple’s iOS  operating system and contributed to the development of an app for  Google’s Android operating system. According to BEP, the Apple iOS app  was intended to immediately provide a segment of the visually impaired  population with a means to independently denominate notes, while a  tactile feature was being developed. Officials stated that BEP will  maintain the app as long as it continues to be used.
In 2010, BEP developed an Apple iOS operating system app, called  EyeNote, which is available as a free download. Because of technology  changes to smart phones, BEP released a new version in 2013. In the  newest version, once the downloaded app is launched, the app  continually scans for a note and can identify any denomination between  $1 and $100 using either the front or back of the note. It either announces  the denomination in English or Spanish or announces the denomination  by varying a number of beeps or vibration pulses, depending on the  device used. For example, a $20 note is announced as five vibrations on  the Apple iPhone. As of August 2014 the app has been downloaded over  18,000 times. BEP also worked with the Department of Education on the  development of a comparable free app for the Android operating system,  called IDEAL Currency Identifier, which was released in 2012 and  updated in 2014.
Advocates for visually impaired persons said that while smart phones and  therefore smart phone applications can be useful, they are not widely  used among all groups of visually impaired persons, in part because of  their high cost. Some representatives said that as with the currency  reader device, an app is not beneficial in all situations and still requires  the user to take the time to open the app, scan the note, and hear the  app’s announcement.
section_title: BEP Is Considering Costs As It Implements Its Three-pronged Approach
paragraphs: We identified examples of how BEP considers costs and ways to manage  them as it implements its three-pronged approach and pursues emerging  technologies to provide access to currency for visually impaired persons.  BEP is in different stages of implementing each element of its approach,  and cost is considered in different ways for each.
subsections: section_title: Large, High-Contrast Numerals
paragraphs: According to BEP officials, including large, high-contrast numerals to  previous note designs added almost no cost to BEP, and the officials  anticipate the same for the next redesign. There was no additional cost  for special inks because BEP used the same inks that were already  incorporated into other features.
section_title: Currency Reader Program
paragraphs: BEP leveraged existing resources to manage costs for the currency  reader device program. For example, in 2013, it signed an agreement  with the NLS to determine eligibility and fulfill orders for currency readers.  NLS has an existing process for qualifying blind and visually impaired  individuals for eligibility to receive free braille and audio material and an  established infrastructure for processing customer orders and for  warehousing and shipping materials to individuals. BEP estimates that  the cost of the services provided by NLS will be approximately $1.8  million through the end of fiscal year 2015. BEP also took steps, when  purchasing currency readers, to constrain costs or limit the risk of excess  cost. For example, BEP conducted an open solicitation to ensure a  competitive procurement and sought to purchase commercially available  reader devices. BEP’s 3-year fixed-price contract to purchase readers,  which sets a per-unit cost for each year, provides flexibility in the number  of devices BEP orders because it does not know the exact number of  currency readers needed. The contract also requires the supplier to  provide the readers in packaging ready for shipping that meets all U.S.  Postal Service standards for “Free Matter,” so BEP does not incur  additional cost to prepare or ship the devices.
section_title: Raised Tactile Feature
paragraphs: Because BEP has not determined how it will apply a tactile feature to  notes, it does not have final current estimates of the costs to produce  currency with a tactile feature. Instead, BEP developed cost estimates for  each of the four potential tactile feature application methods it was  considering. feature like the raised tactile feature are associated with acquisition and  modification of needed manufacturing equipment. Estimates for these  non-recurring costs range from $1.1 million for one application method to  about $85 million for each of the other three. Estimates for recurring  costs of each application method range from $9.7 million to $14.4 million  annually.
In addition to cost, BEP evaluated the durability, usability, and risk of each application  method. equipment manufacturers. However, BEP was not able to do so  because it found that the potential costs to the Federal Reserve and  industry are dependent on the height of the tactile feature, which has not  been determined. BEP obtained information from the ATM industry on the  potential impact of an added tactile feature. The industry estimated a  range of $1.3 billion to $1.8 billion for non-recurring equipment changes to  ATMs and a range of $600 million to $3.4 billion for increased annual  transportation costs.the industry cannot make reasonable estimates until BEP announces the  specific height and application method of the tactile feature. However,  banking and ATM industry representatives also said that they will  accommodate changes to currency if they are provided sufficient time to  prepare.
section_title: Emerging Technological Options
paragraphs: In addition to the costs for its three-pronged approach, BEP has  additional costs for the development and maintenance of its EyeNote app.  BEP contracted with a developer for the initial development and project  management of the EyeNote. Officials stated that the cost of the first  version of the app was $550,000 and the newest version was $250,000.  BEP will pay an annual maintenance cost of approximately $35,000 to the  developer beginning in December 2014.
section_title: Three Factors That Could Affect BEP’s Current Efforts
subsections: section_title: Currency Is Redesigned to Prevent Counterfeit
paragraphs: According to senior Federal Reserve and BEP officials, currency redesign  primarily occurs in response to counterfeit threats and does not occur at  specific intervals. As a result, it is unknown when the next redesign will  occur. The ACD makes recommendations to the Secretary of the  Treasury on when to redesign currency based on counterfeit threat  analyses; the Secretary has the sole authority to approve note design.  The Chair of the Federal Reserve determines when a redesigned note will  be placed in circulation. In a 2013 report submitted to the court, BEP  estimated that a new note with a tactile feature would commence  circulation in 2020. In 2014 testimony, the BEP’s Director stated that a  note with a tactile feature would not be introduced before 2020. However,  Federal Reserve officials stated that the date has not received  interagency approval.
BEP’s need to address identified counterfeit threats could affect the  redesign process. BEP officials told us they are continuously developing  security features to stay ahead of counterfeiters. As previously discussed,  the length of time for redesign is, in part, dependent on sufficient security  features approved through the interagency process. Large, high-contrast  numerals and a tactile feature are not considered security features that  would be used in response to counterfeit threats.
Representatives from organizations that advocate for visually impaired  persons expressed concern about the length of time it is taking BEP to  provide access to currency. Specifically, during the court case, Treasury  stated that currency redesign occurs approximately every 7 to 10 years.  Because the court order was issued in 2008, the advocacy  representatives expected the next redesign of currency to be issued  beginning in approximately 2015 to 2018. There is no approved date for  the introduction of redesigned currency with a tactile feature.
section_title: BEP Has Experienced Challenges Developing a Raised Tactile Feature
paragraphs: Why Can’t a Tactile Feature Be Added  Now?  A tactile feature is only effective if it is  perceptible, meaning that it is easy to  differentiate it from the texture of the area  around the feature. There is no space on any  current denomination that would suffice to  provide the perceptibility. Because banknotes  already include some raised printing and have  overt and covert security features, the  introduction of a tactile feature could interfere  with the other features.  As a result, the  introduction of a tactile feature would require a  major currency redesign.
BEP has faced difficulties developing a raised tactile feature, and it has  fallen behind its estimated schedule. Developing a durable-raised tactile  feature has proved challenging internationally and for BEP. A 2009 study  BEP commissioned showed that the tactility of features used by several  other countries diminishes over time as the notes circulate. BEP has not  developed a raised tactile feature before, so it had to create an internal  structure and process for testing and evaluating potential features.  Officials stated that BEP had to test some options for application methods  externally because it did not have the equipment. This lack of equipment  lengthened the time to make a recommendation on an application  method. As discussed previously, BEP did not make a recommendation  until 3 months after its milestone date of December 2013. According to  BEP, it now anticipates finalizing an application method, which is needed  to move forward on a tactile feature, by March 2015.
BEP has had challenges in the past with the design and production of  new features, challenges that have led to significant changes to BEP’s  processes. Specifically, in 2010 BEP began producing the new $100  note, which included, among other new features, a plastic 3-D security  ribbon woven into the paper. This composite of paper and plastic is unlike  any other denomination of U.S. currency. After full production began, BEP  officials found creases in some of the notes. The creasing occurred on a  sufficient number of notes that BEP suspended production 9 months after  it had started. Testing found that there were several contributing factors,  including the paper’s moisture content, the amount of recycled material in  the paper, and the amount of time between paper manufacture and  printing. However, BEP did not discover these problems until over a year  after the problem occurred. The Treasury Inspector General determined  that BEP did not sufficiently validate its ability to produce the notes in  normal production, which may have identified technical problems earlier.  Instead, the creasing issue was not discovered until BEP had produced  1.4 billion notes, including an unknown quantity of defective notes. The  problem delayed the issuance of the $100 note by 2 years and was  resolved with assistance from the currency quality assurance program  (CQA). This program, which is funded by the Federal Reserve, seeks to  prevent the types of problems that arose with the $100 note through  formal development programs for note design, which include interagency  reviews. The development of the tactile feature is one of the pilot projects  under the CQA program.
section_title: BEP and Federal Reserve Officials Have Discussed Federal Reserve Concerns about the Current Approach
paragraphs: BEP has indicated that the Federal Reserve has raised concerns about  its current three-pronged approach to provide access to currency for  visually impaired persons. While the three-pronged approach has been  approved by the Secretary of the Treasury, who is on record as still  pursuing this approach, the court order does not require this or any other  specific approach. The Secretary has discretion over how to comply with  the court order and could modify the current approach. Senior BEP and  Federal Reserve officials stated, however, that Treasury and BEP would  need to consult the Department of Justice to determine whether any  revised approach would satisfy the requirements of the court order. ACB  would also retain the ability to challenge whether a modification continues  to comply with the court order.
Senior BEP and Federal Reserve officials told us that they have  discussed the Federal Reserve’s concerns about the potential cost impact  of a tactile feature and whether the extent of technological changes since  the 2008 court order could provide alternative options to its current  approach; however, they remain committed to providing access through  their three-pronged approach. Specifically, senior BEP and Federal  Reserve officials told us they have discussed whether high contrast  numerals, a currency reader program, and the EyeNote smartphone  app—without including a raised tactile feature on currency—could meet  the requirements of the 2008 court order. Federal Reserve officials  expressed concerns about the potential cost impact of a tactile feature on  those who handle large amounts of currency, including banks and ATM  manufacturers. They stated that meaningful access should be provided in  a way that meets the needs of visually impaired persons while being  mindful of cost. However, senior BEP and Federal Reserve officials also  stated that they are committed to providing meaningful access to  currency, and in June 2014, the BEP Director reiterated that the  development of a durable tactile feature is a priority for the agency.  Furthermore, senior BEP officials stated that BEP would need to take  multiple steps before it could consider altering the current approach. For  example, the officials said that BEP would have to fully implement its  currency reader device program to understand the efficacy of the  program. They also said that BEP would need to collect data on the  production requirements and costs of a raised tactile feature. BEP  officials clarified that while there was a discussion of the option to provide  access to currency without adding a tactile feature, no decision has been  made.
Advocates for visually impaired persons have concerns about excluding a  tactile feature. Most advocates we spoke with told us that high-contrast  numerals, a currency reader, and a smart phone app are beneficial to  some, but these efforts are not as important as a tactile feature.  According to these advocates, a tactile feature is the most effective  method to allow a visually impaired person to denominate currency  independently and quickly. In July 2014, one advocacy organization  passed a resolution stating that a currency reader device program should  not be a replacement for a tactile feature.
section_title: Conclusions
paragraphs: The visually impaired community is diverse, and there is no single way to  ensure access to currency for all visually impaired persons. In recognition  of this diversity, BEP developed a three-pronged approach to make  currency accessible to visually impaired persons. In particular, BEP has  incorporated high-contrast, large numerals on some denominations of  notes, and plans to continue incorporating them in future redesigns; it has  launched the initial phase of its currency reader program; and it has been  developing a tactile feature to be incorporated in the next family of  redesigned notes. In addition, BEP has created a free currency reader  smartphone app, which is currently available.
While these are positive steps, there is no date set for the introduction of  a tactile feature, and it will be at least several years until there is a tactile  feature on U.S. currency. Even when a tactile feature is introduced, notes  with a tactile feature will co-circulate with notes that do not have a tactile  feature. As a result, U.S. currency without a tactile feature will be in  circulation for many years. Given this time frame, it is important for the  currency reader program to be an effective interim step to provide access  to currency for visually impaired persons.
BEP has taken some initial steps to evaluate the effectiveness of the  currency reader program, a key component of its three-pronged  approach; however, these efforts do not provide BEP with complete  information about important parts of the currency reader program such as  how well the program provides visually impaired persons with a means to  independently denominate currency. Program evaluation is a critical  strategy that can allow agencies to understand whether a program is  addressing the intended problem, to assess the value or effectiveness of  the program, and to make changes to improve the design or management  of an existing program. Without a complete evaluation of the program,  BEP cannot determine whether the currency reader program is reaching  users as intended and providing them with appropriate access to  currency. The lack of knowledge means that BEP may not be in the best  position to make any necessary adjustments in the deployment of the  next 2 phases of a program that will be needed for many years.
section_title: Recommendations for Executive Action
paragraphs: To determine the extent to which the currency reader program provides  assistance to visually impaired persons while a tactile feature is being  developed and integrated into the next currency redesign, we recommend  that the Director of the Bureau of Engraving and Printing take the  following action:
Evaluate the currency reader program to include facets such as how  well the program provides visually impaired persons with a means to  independently denominate currency.
section_title: Agency Comments
paragraphs: We provided a draft of this report to BEP, the Federal Reserve, and the  Secret Service.  BEP did not take a position on our recommendation.   The Federal Reserve provided written comments, reproduced in appendix  II, in which it stated that it is important for visually impaired persons to  have access to U.S. currency. BEP and the Federal Reserve also  provided technical comments, which we incorporated as appropriate.
We are sending copies of this report to the Bureau of Engraving and  Printing, The Board of Governors of the Federal Reserve System, and the  United States Secret Service. In addition, the report is available at no  charge on the GAO website at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-2834 or wised@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made key contributions to this report  are listed in appendix III.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: The objectives of this report are to examine (1) the status of the Bureau of  Engraving and Printing’s (BEP) efforts to provide currency that is  accessible for visually impaired persons and how BEP is considering  costs as part of these efforts, and (2) factors that may affect BEP’s efforts  to make currency accessible for visually impaired persons.
To obtain information on our objectives, we reviewed relevant  documentation and written reports as discussed below. We also  interviewed officials from federal government entities directly involved in  the design and production of U.S. currency. We also spoke with  representatives from advocacy organizations representing blind and  visually impaired persons, trade associations from industries that would  be affected by changes to U.S. currency, and the Bank of Canada as  shown in table 2.
We selected the stakeholders for each group based on different criteria.  We selected four advocacy organizations that had nationally  representative membership and were part of BEP’s outreach efforts to  visually impaired persons. We selected four industry trade associations  for companies that handle currency frequently, such as banks and  vending machine manufacturers. Specifically, we selected associations  with nationally representative membership. We selected the Bank of  Canada, which is the central bank for Canada, because it incorporated a  tactile feature on its currency and established a currency reader program;  BEP officials reached out to Canadian officials specifically about these  efforts. The results of the interviews are not generalizable, but do provide  insights regarding efforts to make currency accessible to blind and  visually impaired persons.
To obtain information on both of our objectives, we reviewed BEP  documents related to BEP’s efforts to provide currency that is accessible  and interviewed officials from the BEP. We reviewed documents related  to the 2002 court case and BEP’s semi-annual progress reports to the  court. We interviewed officials from the Board of Governors of the Federal  Reserve System (Federal Reserve), and the United States Secret Service  (Secret Service).
To identify and discuss factors that may affect BEP’s efforts to make  currency accessible for visually impaired persons, we reviewed  documents and interviewed officials from BEP and the Federal Reserve.  We also interviewed representatives of 4 national advocacy organizations  for visually impaired persons and 4 trade associations that represent  financial institutions and companies that use cash handling equipment,  such as ATM manufacturers. We interviewed Bank of Canada  representatives on its efforts to produce currency that is accessible to  visually impaired persons and its currency reader device program.
We conducted this performance audit from February 2014 to September  2014 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Board of Governors of the Federal Reserve System
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, John W. Shumann (Assistant  Director), Amy Abramowitz, Ana Ivelisse Aviles, Melissa J. Bodeau, Swati  Deo, David Hooper, SaraAnn Moessbauer, Joshua Ormond, Monica  Savoy, Teresa Spisak, and Travis Thomson made key contributions to  this report.