A bipartisan group of Senators has re-introduced a bill which seeks to improve the circulation of $1 coins and remove barriers to their use, which would eventually set the stage for the $1 coin to replace the $1 Federal Reserve Note as the only $1 monetary unit issued and circulated by the Federal Reserve System.
The bill S. 1105: Currency Optimization, Innovation, and National Savings (COINS) Act was introduced on June 6, 2013 by Senators Tom Harkin of Iowa, John McCain of Arizona, Mike Enzi of Wyoming, Tom Coburn of Oklahoma, and Mark Udall of Colorado. In the 112th Congress, similar bills had been introduced by bipartisan groups in both the House of Representatives and Senate, but failed to become law.
The new bill contains the same provisions as the previous bills. The Board of Governors of the Federal Reserve System would be required to sequester all $1 coins minted and issued from 1979-1981 and in 1999. This refers to the Susan B. Anthony Dollars, which were highly unpopular with the public due to the potential for confusion with the quarter dollar denomination.
The sequestered coins would not be returned to circulation, but may be released at face value in bulk quantities to dealers in collectible coins and countries that have adopted the United States Dollar as their base unit of exchange. After one year, the coins would be declared obsolete although they would remain legal tender.
The Board of Governors of the Federal Reserve System would also be required to undertake efforts to improve the circulation and remove barriers to the circulation of the $1 coin, including outreach and education programs.
Quarterly reports would be required to be issued to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate covering the status of the sequestered $1 coins, efforts and the degree of success of the efforts to improve circulation of $1 coins, and a specific efforts to improve the circulation of $1 coins bearing the Native American design.
Once $1 coins have achieved sufficient market penetration, the bill describes the transition process from using $1 bills to $1 coins in circulation.
A deadline is established as the earlier of the date on which the number of $1 coins placed in circulation exceeds 600,000,000 annually or the date that is 4 years after the enactment of the Act. Upon reaching the deadline, Federal Reserve Banks may not order any additional $1 bills, but may for a limited time continue to place into circulation bills on hand or deposited as long as they are fit for circulation.
A specific exception is made that $1 Federal Reserve Notes may continue to be produced and issued to meet the needs of collectors.
In order for the COINS Act to become law, it must be approved by the Congress and signed by the President. The bill has been referred to the Committee on Banking, Housing, and Urban Affairs.