House passes Common Cents Act to end penny production and allow nickel rounding
The House of Representatives passed the Common Cents Act on Monday for the second time, ending the production of pennies and permitting merchants to round cash transactions to the nearest nickel when they lack exact change. The Treasury Department estimates that ending penny production will save $56 million each year.
Under the bill, pennies remain legal tender but the Mint will no longer produce them for circulation, although they may still be struck as collectible coins. The Senate version includes an amendment by Senator Elizabeth Warren that requires the Treasury to notify Congress of any future currency discontinuation and to provide a transition plan. After the Senate amended the bill in August, the House assigned it a new bill number and now anticipates a Senate vote next week, according to the National Association of Convenience Stores.
“If the federal government is spending nearly four cents to make a penny worth one cent, something is broken, House Republicans are proving that common sense still has a place in government by cutting waste and protecting taxpayer dollars,” Lisa McClain, Representative (R-MI) said.
“This legislation gives businesses the consistency they need to handle cash transactions fairly and efficiently while minimizing disruption for consumers,” National Grocers Association said.
Earlier in July, the House had approved a nearly identical bill to eliminate the penny, but the Senate’s addition of an amendment in August forced a second vote. The amendment, sponsored by Senator Warren, mandates that the Treasury inform Congress of any future currency changes and outline a transition plan.
What we know
The House of Representatives on Monday passed the Common Cents Act, eliminating U.S. production of the penny and giving merchants leeway to round to the nearest nickel on transactions when they don’t have exact change.
It was the second time the chamber had passed such legislation.
The department estimated $56 million in savings by ending penny production.
The final batch of pennies was struck last November, nine months after Trump directed the U.S. Treasury to stop making pennies, citing their cost inefficiency.
Now, the legislation is expected to be voted on again by the Senate next week, according to one retail trade group, NACS, that has been following the legislation.