As penny production stops, cash transactions may be rounded in Colorado

As the United States phases out the penny, cash-paying customers may soon discover empty change jars and checkout totals with a rounded number instead of an exact amount.

In November, the Treasury Department stopped producing pennies after President Donald Trump directed the U.S. Mint to end production as a cost-saving measure.

For a small ice cream shop run by a New Zealand–born owner who grew up without pennies, the change feels familiar.

Hap Cameron, who owns Happy Cones Co. inside the Edgewater Public Market, said he found it interesting that the U.S. still used pennies when he moved to Colorado around 2014.

“I always said it’s funny in America, you know, where it’s like the home of cryptocurrencies and all this. But then we’re still writing checks and having pennies,” he said.

“In New Zealand, you go buy a coffee, it’s $6. You can have $6 and then you leave. There’s no like, ‘Oh, $6, but actually it’s like $6.84,’ because you’re adding in tax and then tip on top of that.”

Eliminating the penny is not unusual internationally. New Zealand eliminated its 1-cent and 2-cent coins in 1990 and its 5-cent coin in 2006. Australia discontinued its 1-cent and 2-cent coins in 1992, and Canada stopped producing pennies in 2012.

“I’m very excited about the penny going away — I just think it’s a good thing. I see it as progress,” he said.

First produced in the 1790s, the penny was one of the first coins minted in the U.S., and at the time, it could buy a biscuit, a candle, or a piece of candy.

However, over time the penny’s value fell as its production cost rose. Today the one-cent coin costs nearly four cents to produce and distribute, and with its discontinuation, U.S. Treasurer Brandon Beach said in November, at the U.S. Mint in Philadelphia, that the Mint anticipates saving approximately $56 million annually.

In Fiscal Year 2024, the Mint produced and shipped roughly 3.2 billion pennies, according to its website.

Billions of pennies remain in circulation and will continue to be legal tender, meaning they can still be used for transactions. However, no new pennies will be produced.

As a result, the National Retail Federation said that retailers are navigating cash payments with little clarity as the penny shortage deepens and federal guidance remains absent. The lack of direction is especially problematic in states such as Colorado, where businesses must accept cash or face penalties under a class two petty offense.

“Any retailer that accepts cash as payment will be impacted by the penny shortage. There are a number of considerations that need to be taken into account depending on a retailer’s operations, including state laws that effectively ban rounding off transactions in some states,” said NRF Senior Director of Government Relations Dylan Jeon.

“Penny circulation issues are widespread and aren’t centered in particular markets or cities. The Federal Reserve operates 165 coin distribution terminals across the country, and suspended penny services have increased due to inventory issues. Retailers remain committed to providing their customers with quality service and finding practical solutions to the phase-out of the penny.”

Even though Cameron would prefer to run Happy Cones entirely cashless because it’s simpler for business, he continues to accept cash so no customers are excluded.

“In my Edgewater Public Market shop, like 6% of our transactions are cash. I also have three ice cream trucks, and we think, like, 11% of our sales in ice cream trucks are cash,” he said.

“I continue to use cash, so everyone has the opportunity to be able to purchase.”

To prepare for a future without pennies, Cameron plans to use a simple rounding rule, posting a sign at the counter when needed to explain that totals will be rounded to the nearest nickel.

Other retailers across the country are also adopting similar strategies as Cameron.

A survey by the NRF found that businesses are taking a variety of actions to cope with the growing penny shortage while still serving cash-paying customers. Rounding to the nearest nickel has emerged as the simplest and most practical solution as it becomes harder to obtain pennies from banks and armored carrier services.

In addition, the NRF said they continue working with Congress and the administration to develop clear, consistent guidance that gives businesses and consumers the clarity and certainty they need.

While debates over regulation and cost dominate the penny discussion, views on its value remain divided, as dedicated collectors have shown that the coin is far from worthless.

Earlier this month, the U.S. Mint sold 232 three-cent sets for more than $16.76 million in a special auction hosted by Stack’s Bowers Galleries, a company that conducts live, internet and specialized auctions of rare U.S. and world coins, currency and ancient coins, as well as direct retail and wholesale sales.

The sale opened dramatically, with the first set in the first lot reaching $200,000. At the end of the auction, the 232nd and final set, which contained the last three pennies ever made, sold for $800,000.

That winning bidder also received the three dies used to strike those Lincoln cents.

“I’ve been going to coin auctions for 40 years, and I can tell you, I’ve never seen anything like this, because there’s never been anything like this,” said John Kraljevich, director of numismatic Americana at Stack’s Bowers.

Each set comprised 2025 pennies struck at the Philadelphia Mint, the Denver Mint and a 24-karat gold penny produced at the Philadelphia Mint. Every cent also featured a small, unique Omega symbol signifying the end of the cent.