Technical corrections only. The changes between v3 and v4 are limited to administrative updates reflecting the bill's procedural status as it moved from the House of Representatives to the Senate, including the addition of the House Clerk's name. No substantive policy changes were made to the bill's text.
Common Cents Act
- Sponsor
- Rep. McClain, Lisa C. [R-MI-9]
- Committees
- Financial Services Committee (primary)
- Last action
- Jul 15, 2026
Bottom line
The 'Common Cents Act' aims to increase efficiency and reduce costs by eliminating the penny and introducing cash rounding rules, while requiring assessments of its impact on coin distribution and vulnerable communities.
What it actually does
This bill directs the Secretary of the Treasury to cease production of one-cent coins for general circulation, though they would remain legal tender and could be produced for numismatic purposes. It also permits cash transactions to be rounded up or down to the nearest five cents when exact change is not available, with specific rules for rounding. Additionally, it allows the Secretary to modify the composition of the five-cent coin to reduce production costs and requires the Federal Reserve Board to develop a strategic plan and reports on coin distribution stability and the impact on vulnerable populations.
Proponents argue
Supporters argue that ceasing penny production and implementing cash rounding will significantly reduce the cost of minting coins and the logistical burden of handling low-value currency for businesses and financial institutions. They contend that the penny has lost much of its purchasing power and costs more to produce than its face value, making its continued circulation economically inefficient. The rounding mechanism is presented as a practical solution to facilitate cash transactions in a penny-less economy, with provisions designed to ensure fairness.
Opponents contend
Critics may argue that eliminating the penny and introducing rounding could disproportionately affect low-income individuals, who often rely more on cash transactions and for whom small, cumulative rounding losses could be significant. Concerns might also be raised about the potential for consumer confusion or perceived unfairness in rounding practices, even with guidelines. Some may also lament the loss of a traditional coin and its symbolic value.
The bill is concise and its core provisions are clearly laid out, making it accessible for an informed reader to understand its main impacts within a reasonable timeframe.
Section 2
Ceasing Production of One-Cent Coins and Modifying 5-Cent Coin Specifications
This section directs the Secretary of the Treasury to stop producing one-cent coins for general circulation, though existing pennies will remain legal tender and new ones can be made for collectors. It also grants the Secretary authority to change the composition of the five-cent coin (nickel) to reduce manufacturing costs, potentially using a zinc core with a nickel outer layer, provided such changes do not significantly impact coin-accepting machines.
Supporters argue
Proponents argue that ceasing penny production is a fiscally responsible move, as the cost to mint a penny often exceeds its face value, leading to taxpayer losses. Modifying the nickel's composition offers further cost-saving potential. This change streamlines the currency system, reducing the burden on the Mint and the financial sector.
Critics contend
Opponents may argue that while cost savings are desirable, the symbolic value of the penny and its historical significance should be considered. Some may also express concern that changes to coin composition could lead to public confusion or resistance, or that the cost savings might not be as substantial as projected.
Tradeoffs
The provision balances the economic efficiency of ceasing production of a low-value, high-cost coin against potential public sentiment and the minor disruption of changing a long-standing currency element. It also seeks to reduce costs for the nickel while ensuring functionality with existing infrastructure.
Section 3
Cash Transaction Rounding Rules
This section establishes a voluntary system for rounding cash transactions to the nearest five cents when exact change is not available. It specifies that amounts ending in 1, 2, 6, or 7 cents may be rounded down, while amounts ending in 3, 4, 8, or 9 cents may be rounded up. Small transactions of $0.01 or $0.02 can be rounded up to $0.05. Special rules ensure rounding favors the customer when a business pays a customer, and employers must round up when making cash payments to employees if they choose to round. These rules do not apply to non-cash transactions.
Section 5
Strategic Plan and Reports on Coin Distribution Stability and Impact
This section requires the Federal Reserve Board to develop and publicize a strategic plan within 90 days to manage the transition away from pennies, focusing on maintaining coin distribution stability and evaluating commercial coin terminals. It also mandates that the Secretary of the Treasury assess the impact of these changes, including rounding practices, on low-income communities, older consumers, and unbanked/underbanked individuals, providing recommendations to Congress. The Fed Board must then submit follow-up reports at 6, 18, and 30 months to evaluate the plan's progress and any emerging stresses.
These subsections provide specific rules for rounding in situations where a person (e.g., a business) is paying a customer, or an employer is paying an employee in cash. In both cases, if rounding occurs, it must be in favor of the customer or employee (i.e., rounded up for employees, rounded up for customers if the business is paying them, or rounded down for customers if the customer is paying the business).
Section 3(b) and 3(c)
Why it matters:This is standard legislative practice to include specific edge cases and protective measures within the broader framework of a new policy. It ensures comprehensive coverage and addresses potential fairness concerns.
Case for: Supporters argue these specific rounding rules are crucial for ensuring fairness and protecting individuals in situations where they are receiving cash payments, preventing businesses from systematically benefiting from rounding down. This builds trust in the new system.
Case against: Critics might argue that these specific rules add complexity to an already new system, potentially leading to confusion for businesses and employers trying to implement the rounding correctly. However, there is no strong organized opposition to these specific fairness provisions.
Estimated impact: These provisions ensure that any rounding in specific payment scenarios (business-to-customer, employer-to-employee) defaults to favoring the individual, mitigating potential small losses for these groups.
This subsection clarifies that nothing in the Act or any order under it should be interpreted to excuse noncompliance with any Federal, State, Tribal, or local law concerning minimum wage, overtime pay, or paid leave requirements.
Section 4(c)
Why it matters:This is a standard legislative practice to prevent unintended consequences or misinterpretations of new laws that might inadvertently conflict with existing labor protections. It's a protective measure.
Case for: Proponents argue this clause is essential to ensure that the new rounding rules do not inadvertently create loopholes or excuses for employers to violate established labor laws regarding wages and benefits. It provides clarity and maintains existing worker protections.
Case against: There is no significant case against this provision, as it serves to uphold existing legal protections and prevent unintended negative consequences for workers.
Estimated impact: This provision ensures that the rounding rules do not undermine or supersede critical labor protections, maintaining the status quo for minimum wage, overtime, and paid leave.