WASHINGTON — A commemorative coin set for release next year by the U.S. Mint likely won’t have strong enough sales to raise the $5 million in surcharges that could go to the U.S. Marshals Museum in Fort Smith, according to coin experts.
The experts say only a handful of commemorative coins offered in the last decade have sold out while others have had lackluster sales. Collectors, they say, have been discouraged by a slow economy and weak returns on investments from commemorative coins.
“There are just too many of them made and they haven’t performed that well,” said Anthony J. Swiatek, a professional coin dealer and author of “The Encyclopedia of the Commemorative Coins of the United States.”
Congress authorizes commemorative coins through legislation, setting the themes, the variety of coin — gold, silver or copper-nickel — and production totals. Typically, two designs are minted each year with surcharges paid to a designated charity as long as enough coins are sold to cover production costs.
The results have varied.
In 2013, the 5-Star Generals commemorative coins raised more than $2.2 million while the Girl Scouts USA Centennial didn’t clear costs — leaving its charity with no payout. Surcharges distributed from the seven commemorative coins released in 2010 and 2012 averaged $2.67 million, with the 2010 Boy Scouts of America Centennial coin at the top raising $3.5 million.
Commemorative coins fared better in the previous decade, averaging $4.2 million. At the top was the American Bald Eagle in 2008, which raised $7.76 million in surcharges. A 2007 coin commemorating the 50th anniversary of desegregation at Little Rock Central High School raised the least at $1.9 million.
Louis Golino, a columnist for CoinWeek.com, said he doubts the U.S. Marshals coin will sell enough to raise $5 million for the museum but likely will raise several million.
“In recent years, most commemorative coin programs have not sold very well, which has reduced the surcharges generated,” he said.
But strong sales can happen depending on the general theme of the coin, its design and the marketing effort during the year it is available for sale, Golino said.
“A theme that has broad appeal and a strong design is much more likely to generate a lot of surcharges,” he said.
Golino says he believes the U.S. Marshals coin has an iconic design that will appeal to many buyers. In his estimation, it could sell enough to generate as much as $4 million in surcharges.
In 2012, Congress enacted a law creating a set of three coins to honor the U.S. Marshals Service on its 225th birthday in 2015 with a limit of 100,000 gold $5 coins, 500,000 silver dollar coins and 750,000 copper-nickel clad half-dollar coins.
Six other commemoratives since 2000 also have included gold, silver and copper-nickel coins. Most often the commemoratives are limited to gold and silver, or only silver dollars.
Adam Stump, a spokesman for the U.S. Mint, said commemorative coins are on sale for a single calendar year with an initial production run based on historic sales data. The U.S. Mint then will request additional production runs based on actual sales.
The law, which was introduced by Rep. Steve Womack, R-Ark., sets a $35 surcharge for the gold coin, $10 for the silver dollar and $3 for the half-dollar with the first $5 million raised going to the U.S. Marshals Museum, which is expected to cost $50 million. Any additional surcharges would be paid to other named organizations.
Treasury Secretary Jacob J. Lew has not made a final decision on the coin designs. He recently received recommendations from the Citizens Coinage Advisory Committee and the Commission of Fine Arts.
U.S. Marshals Museum President and Chief Executive Officer Jim Dunn said they plan to aggressively market the coin to collectors as well as fans of the U.S. Marshals Service and other law enforcement agencies.
“Projections have been in the area of $4 to $5 million, but it will depend on independent marketing efforts that we make in cooperation with the three other beneficiaries of the coin,” Dunn said. “Our plan is to aggressively pursue marketing of the coins.”
Dunn said he also believes the recommended designs for the coins are all strong and is hoping they appeal to coin collectors. He noted that the National Baseball Hall of Fame commemorative coins available this year are selling out — offering some hope that design and subject can overcome a sluggish economy.
The $5 gold coins, which were for sale for around $425, have sold out. The U.S. Mint also has sold out of the silver dollar coins, which were priced around $50. It still has half-dollar copper-nickel clad coins available for a price of about $24 each.
The baseball coins, however, had a lower ceiling than the Marshals coin on how many could be minted, topping out at 50,000 gold, 400,000 silver and 750,000 copper-nickel clad.
Swiatek said the baseball coin generated enormous excitement because of a unique design. It features a domed surface, reflecting the curve of the ball and mitt, which is a first for the U.S. Mint. The value initially skyrocketed for the gold coin; one sold on eBay on March 31 for $3,995. They are now selling for as low as $725.
“It’s run its course already,” he said.
Swiatek said such a roller-coaster ride for the baseball coin could sour collectors from purchasing the U.S. Marshals coin. He also noted that the economy has made it harder for collectors to afford a $425 coin that contains a quarter-ounce of gold.
“People who would buy in the past are not doing so now or they are being very selective,” he said. “I would love to see the museum become a reality, but I just do not see much collector interest.”
The museum plans a ceremonial groundbreaking for the 52,260-square-foot museum on Sept. 24, 2014, the 225th anniversary of the Marshals Service. President George Washington established the Marshals Service, the first federal law enforcement agency, in 1789.