The U.S. Mint, in a federal cost-saving measure, officially ended penny production on November 12, 2025. This concluded a 232-year history, where the final production cycle cost for each coin amounted to 3.69 cents. The end of the penny marked the beginning of new operational headaches. For New York credit unions, those headaches are compounded by statutory and regulatory uncertainty, pending legislation, and practical constraints that make handling cash more complicated than it should be.
The Current Issue: More Than Just Heads or Tails
The numbers tell the story: the Federal Reserve Bank of New York suspended penny orders on September 22, 2025, joining over half of the Fed’s 170 coin distribution terminals nationwide in halting penny services. For New York credit unions, this means no new pennies are coming, and existing inventory must be carefully managed and strategically deployed.
Unlike the gradual phase-outs seen in other countries, America’s penny elimination has been abrupt and largely unplanned. Treasury initially projected production would continue into early 2026, but penny blanks ran out months ahead of schedule. This has left financial institutions scrambling to adapt in real time without clear federal guidance or regulatory frameworks.
New York’s Legal Landscape: Navigating Uncertainty
Here’s where New York credit unions face a particular challenge: the absence of clear regulatory guidance on how to handle the penny shortage creates legal uncertainty. Unlike some other states where businesses have begun implementing rounding practices, New York institutions operate without specific authorization for such measures.
The good news? Relief may be coming. On November 14, 2025, the New York State Senate introduced Senate Bill S8580, dubbed the “New Yorkers for Common Cents Act.” This proposed legislation would require merchants to round cash purchases to the nearest five cents using a specific framework:
- Totals ending in 1, 2, 6, or 7 cents would round down
- Totals ending in 3, 4, 8, or 9 cents would round up
- Transactions of 4 cents or less would be exempt
- Non-cash payments would remain exact to the penny
S8580 represents the most comprehensive state-level response to the penny crisis. But until it becomes law, New York credit unions must navigate the shortage without clear statutory authority to implement rounding practices and without any existing NYDFS regulations on point, though the bill would empower DFS to issue them.
Federal Developments to Monitor
While New York grapples with state-specific challenges, several federal legislative proposals could help create a national standard:
The Common Cents Act (S. 1525 and H.R. 3074). The most comprehensive federal response comes in the form of bipartisan legislation known as the Common Cents Act, co-sponsored in the Senate by New York’s Kirsten Gillibrand which would among other things:
- Authorize cash transaction rounding to the nearest five cents
- Allow continued production of numismatic (collector) pennies if profitable
- Preempt state laws that conflict with federal rounding standards
This legislation represents the most likely path to national standardization, potentially resolving a patchwork of state laws currently complicating the transition.
Make Sense Not Cents Act (S. 1554) takes a different approach by letting market forces naturally phase out penny usage rather than mandating rounding.
The Currency Optimization, Innovation, and National Savings (“COINS”) Act (H.R. 1401) proposes a more cautious approach with a 10-year suspension of penny production and a study of consumer and business impacts.
H.R. 1270 would suspend production of both pennies and nickels for 10 years while requiring, among other things, studies on coinage efficiency and a review of consumer payment behavior changes.
While Congress deliberates, federal agencies have issued limited guidance.
Practical Next Steps for New York Credit Unions
- Develop Penny Policies: Create interim operational policies for managing penny shortages and member requests while federal or state guidance remains pending.
- Implement Collection Programs: Consider member penny collection initiatives to address immediate inventory needs like penny collection jars at teller windows, cross-promotional opportunities with local businesses, and community engagement through penny drives.
- Prepare Member Communications: Prepare clear communications explaining how rounding works, when it applies, and what members can expect.
- Prepare Systems: Assess technology readiness for potential rounding implementation under either state or federal frameworks.
Looking Forward
The penny may be going away, but the need for clear guidance, fair practices, and member-focused leadership isn’t. Credit unions that navigate this moment thoughtfully won’t just weather the shortage; they’ll prove their value through clarity, fairness, and member-centered decision-making.
After all, in times of change, people need institutions they can trust to help them make cents (sorry, couldn’t resist) of it all. That’s exactly what credit unions do best.
Final Thought
If rounding legislation passes, does that mean my $.02 will officially be worth $0.00?
Until Next Time
From the big picture to the fine print, we’ve got you covered. Thanks for reading, and CU in the next post.
Reach out to me at jeremy.newman@nycua.org Let’s talk.