By David Provost for CoinWeek …..
Author’s Note: My intention for this series of “stories” is to present lesser-known information about the US commemorative coins series derived from my original research in the records of Congress and/or the reports and correspondence of the individual coin sponsors. The information presented will not simply be a reworking of the information presented in the standard reference works on the series. I sincerely hope you enjoy the backstories presented in this series and I welcome your comments and suggestions.
Part I of this article on Los Angeles Olympics Coins can be found here. Part II can be found here, Part III here, Part IV here, Part V here, and Part VI here.
* * *
The Senate Committee on Banking, Housing and Urban Affairs took up the House-amended version of S.1230, the bill calling for commemorative coinage in support of the 1984 Los Angeles Olympics, on June 10, 1982. The amended bill was written by Representative Frank Annunzio (D-IL11), Chairman of the House Subcommittee on Consumer Affairs and Coinage and leading advocate for a limited Olympic coinage program to be managed by the United States Mint.
Though the House overwhelmingly passed Annunzio’s version of S.1230, Senator Alan Cranston (D-CA) opened the session with remarks that made it clear that he had not yet given up the fight for his original bill:
“[W]e will concentrate our attention on the problem of providing the best, most effective coin program possible for the 1984 Los Angeles Olympic Games. I, for one, would like to make sure that the Olympic committees receive the maximum amount of revenues that Congress can generate through a commemorative program.”
Cranston was also critical of the House’s actions regarding S.1230, noting that, unlike the Senate version of the bill, the House amendment did not guarantee any revenue for the Olympic committees and that its delay had “added to the economic woes of both the Olympic committees.”
With a potential eye toward compromise Cranston continued:
“Our task … is not to engage in a squabble with the House, but to invite them to join us in creating an even more generous bill than the one they have sent.”
He looked to take a stand, however, on one of the key elements of the bill he had introduced more than a year before – the use of private marketers.
“I must say to my good friends in the House, that any Olympic coin program must include a mechanism using the expertise of private marketers. It does not make sense not to use people who will promote this product to its fullest … there is a much larger market for the coins than the Mint can reasonably handle. Private marketers can fill this gap. To this end, I will be looking for a way to include private marketing in the coin program”
Such comments positioned Cranston as an opponent not ready to yield on the central element of his original proposal. The use of private marketers to sell the Olympic coinage had proven to be the lightning rod issue for Annunzio and his supporters and had been its most divisive element for more than a year. Cranston’s comments were more bark than bite, however, as he would not be able to sway his colleagues to support engaging in yet another battle with the House.
Committee Chairman Edwin “Jake” Garn (R-UT) was unavailable at the start of the hearing, but his opening statement was entered into the record; it echoed Cranston’s remarks. He pledged support for the use of private marketers and was critical of the Mint’s ability to manage a successful Olympic coin program:
“An important feature of the Senate-passed bill was the provision for the private advertising, marketing, and delivery of the coins, rather than have the Treasury or other Government agency sell the coins. Why private marketers? To sell more coins – to raise more money for the Olympics. Past Government sales of any coins have demonstrated that the Government was not capable of selling a large number of coins in a relatively short period of time. The Government is unlikely to sell 54 million coins with 25 designs [the Senate bill], or even 52 million with 3 designs [the House amendment], within a few years.”
Angela Buchanan, Treasurer of the United States, was the first witness called to testify. She reaffirmed the Treasury Department’s commitment to Olympic commemorative coins and noted that while the Department had previously supported the Senate’s 17-coin version of S.1230, it was now fully supportive of the version amended by the House.
Calling it a “fine coin program,” Buchanan commented:
“It is structured so as to eliminate concerns of abuse and designed to raise substantial moneys for the Olympic cause.”
She then outlined the Mint’s preliminary marketing plan for the coins. As expected, the Mint’s primary sales channel would be through its extensive mailing list of 1.7 million names. Buchanan noted the list’s exceptional average response rate of 60% and called it “without doubt, the premier numismatic listing in the world and a powerful tool to be used in the marketing of these coins.” (Note: Typical direct mail response rates are less than 5%, with many rates closer to 1%.) She also discussed the potential for using the United States Postal Service and banks as outlets for coin sales.
Nevertheless, Buchanan was quick to note the Treasury’s belief “that the internal efforts of the Mint must be complemented by private marketing organizations to ensure that the coins gain widespread distribution within the United States and overseas.” For this reason, the Treasury sought revisions to the bill’s language regarding the marketing of the coins and preferred to give the Secretary more discretion in setting strategies.
Occidental Petroleum, one half of the proposed “Coin Group” that was to market the Olympic coins under Cranston’s original bill, was represented at the hearing by Angelo Leparulo, an executive vice president with the company. He entered into the record a scathing statement by Armand Hammer, Chairman and CEO of Occidental, which noted:
“I offer today the expertise of myself and my associates in the matter of marketing these types of coins, but I stress to you that as a result of the misrepresentations in the discussions in the House, which resulted in a bill which is in our opinion not workable and possibly misleading, Occidental Petroleum Corp. has no interest in the program. Our interest at this time is in the Olympic athletes, the city of Los Angeles of which we are a corporate citizen, and the correction of some very bad legislation which has no chance of success and which damages the Olympic program as a whole.”
Without directly referencing the methods used by Annunzio, Hammer continued:
“Regrettably, most of the opposition to the bill during the House debate did not consist of a reasoned discussion of legitimate points of difference, but rather strident, irresponsible, and inaccurate characterizations of the nature of the issue. More attention was given to vitriolic attacks upon Occidental and me personally than to the merits of the alternative versions of the act. The net result is that the House appears to have voted on the basis of a wave of negative emotion generated by false charges, rather than on the basis of adopting a bill that will best serve the interest of our Olympic athletes.”
Staying true to his criticism of the House, Hammer provided a concrete list of reasons why he believed the proposed bill would fail. He cited the lack of guaranteed revenue for the committees, the very small number of coin designs, and the use of what he believed were “unrealistic” denominations (i.e., $1 and $10) that would create selling-price-to-face-value multiples of 25 or larger – which the general public would be unwilling to pay. He also considered the large number of coins authorized (50 million silver dollars and two million gold eagles) too many for so few design types and believed they would “destroy demand for the coins.”
Col. Donald Miller, Executive Director of the US Olympic Committee (USOC), was the next to testify. He expressed the Committee’s urgent need for the funds to be generated by the commemorative coins and outlined how the delay in approving a bill had already caused its debt to increase to $3.3 million and forced it to curtail its training and support programs for US athletes.
Because of its dire financial situation, Miller announced that the USOC had backed off on its support of the Senate’s bill and now supported the House version of S.1230. It did so because it believed “that any bill which radically departs from the House version has little chance of passage” and that the US Mint could be successful in marketing the more limited program proposed.
Harry Usher, Executive Vice President of the Los Angeles Olympic Organizing Committee (LAOOC), followed Miller. Usher began by noting that as the LAOOC lacked numismatic expertise, it “particularly liked the original S.1230 which would have used professionals experienced in the coin business to distribute, advertise, market, and manage [our] program.”
He recalled how the Committee had repeatedly compromised on the original 29-coin scope of the bill in order to address individual concerns and reach a consensus between the Treasury Department, the House, and the Senate. Usher acknowledged, however, that the actions of the House had left the LAOOC with no alternatives but to accept the amended S.1230 and to urge its immediate passage.
As with past hearings, the session also included a panel of numismatists. Present to testify were Q. David Bowers, Arthur Friedberg and Chester “Chet” Krause.
Bowers, then Vice President of the American Numismatic Association (ANA), was the first to speak.
Representing the ANA, Bowers commented:
“While the Annunzio-sponsored legislation is not precisely what it [the ANA] would have sponsored, it comes the closest to what they consider to be an excellent situation.”
Friedberg voiced his support for the amended bill; more so because of the urgent need to get a coin program approved than because of his preference for it. He presented suggestions for improving the bill’s language to the Committee in the areas of bulk discounts, international marketing, and a mechanism for changing course if initial sales prove lacking. The latter suggestion amounted to an extensive re-write of the bill that would have re-introduced much of the language deleted by the House during its debate on S.1230.
Krause focused his remarks before the Committee on the parallels he saw between the large coin program originally proposed by the Senate and the marketing of some world commemorative coins. He noted how the Franklin Mint began selling medals in the mid-1960s and quickly moved to a model of selling them as a series as opposed to selling them as individual pieces in order to maintain the sales relationship with collectors as long as possible and maximize revenue. The Franklin Mint eventually applied this model to the production and sale of coins for other countries by creating denominations beyond those that traditionally circulated in the countries and by producing large, multi-coin commemorative sets.
Krause viewed such an approach as a “dead-end street,” and, based on his extensive experience as a publisher of world coin catalogs, believed that “when you have a lot of designs offered year after year, they do not sell.” Because of this, Krause viewed any proposal calling for a large number of coins that featured non-traditional denominations as a mistake and one that would not gain favor with collectors.
In the end, though many suggestions regarding the bill’s language were made by the witnesses from the government and the numismatic community, the Senate Committee reported the bill without amendment.
On July 1, 1982, Senator Theodore Fulton Stevens (R-AK) stood in the Senate and asked that the Committee on Banking, Housing and Urban Affairs be discharged from further consideration of the House-amended version of S.1230 and that it be presented for consideration. With no objection heard, the full bill was read.
Committee Chairman Garn was then recognized and commented, “I view with great reluctance and disappointment the passage of the House-passed version of S1230.” After reminding his colleagues of the scope and benefits of the original Senate-passed version of the bill, he proceeded to criticize the amended version. He stated his belief that the Mint was incapable of selling the 52 million coins called for by the bill using its previous methods, and that it lacked the marketing expertise needed to reach a new, broader audience. Garn also criticized the small number of coin designs specified in the bill noting, “a big response to this coin program has been precluded by the small number of coins.”
He was resigned to the fact that the battle was over, however, and concluded his remarks by stating:
“Despite my reservations with this legislation, I believe that we should continue the Olympic coinage tradition and have a coin program. The Olympic committees support even this small program. The passage of time, coupled with the complete intransigence of the House to cooperate in putting together a more realistic program, dictate that this version of the bill is the only game in town. I hope that it will do something for our Olympic efforts.”
Stevens then moved that the Senate concur in the House amendment. The motion was agreed to and a motion to reconsider was laid on the table. Annunzio had cleared the penultimate hurdle in making his vision of an Olympic coinage program a reality. All that remained was the signature of President Ronald Reagan. Though he was an early supporter of Cranston’s original version of S.1230, Reagan signed the amended version into law on July 22, 1982.
Production and Legacy
With the Olympic Commemorative Coin Act signed, the intense pressure to generate revenue for the Olympic committees was immediately shifted onto the US Mint. It had only months to create coin designs, prepare marketing material, seek out international marketing partners, and design packaging materials as well as gear up for large-scale production.
The designs created by the Mint were largely panned by the media and collectors upon their release and the backlash was the catalyst for another hearing before Annunzio and the House Subcommittee on Consumer Affairs and Coinage. After an often intense hearing that found Annunzio highly critical of its efforts, it was agreed that the Mint could move forward with its proposed designs with the understanding that modifications were necessary to improve their overall quality; they were each ultimately approved for use.
Sales officially opened on October 15, 1982 and were generally slow during the opening months. They continued to gain momentum throughout 1983, however, as domestic and international marketing efforts became more fully realized. In the US, the coins enjoyed a multimedia campaign that included direct mail as well as print, radio, and television advertising. Significant public relations activities were also used to support the program throughout its sales period. As the Games neared in 1984, sales continued to increase and “skyrocketed during the torch relay and television coverage of the Games.”
By the time sales were closed on January 18, 1985, 2.22 million 1983-dated and 2.25 million 1984-dated silver dollars were sold (just over 4.472 million in total) with the majority (76%) being Proof coins. Sales of the 1984 gold eagles totaled more than 573,000 over the same period; in contrast to the silver dollars, only 34% of the sales were for Proof coins.
While these sales figures are a far cry from the 50 million silver dollars and two million gold eagles authorized by the Act, they did represent approximately $73.4 million in revenue for the Olympic committees.
Would the additional coin designs and private marketing model outlined in the original version of S.1230 have generated a higher sales total? Would more money have been raised for the Olympic committees? It’s impossible to say with any certainty due to the many variables involved. The results of the recent Olympic coinage programs marketed for the 1976 Games in Montreal and the 1980 games in Moscow, however, would seem to argue against substantially improved results.
What can be said is that more money was raised for the committees via Annunzio’s plan than was guaranteed by the private marketing model originally proposed. It was also demonstrated that the Mint was, in fact, capable of managing a large-scale coin program and reaching beyond its collector-focused mailing list to generate sales.
In retrospect, though it was a difficult and contentious path from initial proposal to enacted law, the Olympic Commemorative Coin Act of 1982 was truly a landmark bill for the modern US commemorative series and essentially set the rules for all of the programs that have followed:
• It established the US Mint as the primary marketer/distributor of the commemorative coins approved by Congress.
• It maintained the use of traditional US coinage denominations for commemorative coinage.
• It created the fund-raising surcharge model that has been used for each subsequent program.
• It closed the door on private marketing groups being given exclusive rights to sell US legal tender on behalf of a sponsor.
• It set the precedent for the acceptable size of US commemorative coin programs that has been followed for all but, ironically, the 1996 Atlanta Olympics series.
• It maintained the integrity of the US Mint and the US coinage system.
• It helped ensure that the sponsors of each coin would be the direct beneficiary of the profits/surcharges derived from coin sales rather than a third party.
• It ensured that the financial abuses and market manipulations suffered by collectors during the classic era of US commemorative coins (1892-1954) would not be repeated.
Without Frank Annunzio’s determined (and sometimes controversial) efforts to prevent the 1984 Los Angeles Olympic coins from being sold and distributed by a private marketer, the modern US commemorative series would likely have developed along a very different path – one that may very well have been to the detriment of collectors and reminiscent of the 1930s and the “boom and bust” days of US commemorative collecting.
The Contemporary Market
Today, the silver and gold coins commemorating the 1984 Los Angeles Olympics are among the most readily available coins of the modern US series. As a result, they are also among the lowest priced, with little to no market price differential based on year and/or mintmark.
For several years following their release, however, the silver dollars struck at the Denver Mint traded at a significant premium – two or three times the asking price of a Philadelphia-struck coin. This was largely driven by the purchase options made available to collectors at the time, which enabled a false promotion of scarcity within the marketplace.
In 1983 and 1984, the Mint sold individually-packaged examples of the silver dollars that were struck at the Philadelphia Mint; these were the only uncirculated dollars sold as singles. To acquire an uncirculated dollar coin struck at either the Denver or San Francisco Mint, a collector needed to purchase one of the Mint’s higher-priced P-D-S Uncirculated sets. The combination of individual sales plus set sales made the “P” silver dollar the most common uncirculated coin of the set.
While the “set only” Denver and San Francisco dollars had the same mintage, the Denver coin developed a stronger perceived scarcity within the marketplace. This was due to the large number of Proof coins that were also struck at San Francisco in both years. Available individually and in Prestige Proof Sets, collectors had multiple options to obtain an “S” dollar each year but only one way to acquire a “D” silver dollar (as part of the three-piece set). This “one option” for the “D” dollars temporarily drove their market price up versus the other dollar coins.
Over time, collectors realized that none of the coins were truly scarce and the market prices for all issues have generally found equilibrium, though some dealers continue to price individual Uncirculated coins struck in Denver or San Francisco at a small (~10%) premium.
© Copyright D. Provost 2021. All rights reserved. Used with permission.