By Victoria Wicks
A proposal to allow residents to use gold and silver coins as legal tender failed to pass the House Commerce and Energy Committee on Wednesday. Witnesses, including two legislators, testified that the proposed law allows security at a time when the value of the U.S. dollar is uncertain. But a state revenue department spokesman says there’s nothing stopping anyone from using gold and silver now.
Representative Dan Kaiser and Senator Dan Lederman were joined by a young businessman from Jefferson, South Dakota, in supporting House Bill 1100.
Steven Jones says he’s looking for a secure place to put profits: “Seeing that we can take a commodity of a physical piece of silver, a silver coin that’s minted by the federal government, and store that in our own possession, gives everybody a peace of mind that I can hold onto this, and it’s mine. I can pass it down.”
Proponents of the bill want gold and silver coins to be valued according to weight, and to be able to offset debts and taxes at that increased value.
David Wiest with the Department of Revenue says a bank or business would compensate the face value of a coin, even old gold and silver coins, and isn’t equipped to know the current weight value. He says if a business person wanted to accept gold or silver from Jones, there’s nothing prohibiting that transaction.
“If you wanted to pay him with silver coins, gold coins, five cows, two mules, or whatever, that’s certainly something that you can contract between you and Mr. Jones to do so. So there’s nothing that prohibits you from doing that,” Wiest says. “But what you are not doing, you see, is you’re not defining legal tender, which is what this bill does.”
Representative Jim Peterson says the bill is a political statement, and he says when the state tries to make political statements contrary to federal law, the state sometimes is sued.