Change is coming: Albuquerque retailers prepare for life without pennies

The federal government will stop producing pennies next year, ending a more than 200-year run for the nation’s lowest coin denomination. The penny’s mark on Albuquerque is small but not insignificant — retailers say they’ll probably just have to change prices to multiples of five.

“I’m glad that pennies are going away. I wish all coin change would go away,” said Mike Phillips, owner of Keller’s Farm Stores, a pair of local Albuquerque markets.

Phillips said the discontinuation of the one-cent piece will affect business “a little bit,” and that they’ll have to decide to round transactions up or down. The business uses pennies and quarters more than any other coin, he said.

“It’d be nice to not have to deal with them,” Phillips said.

For businesses and the federal government alike, the penny may often be more trouble than it’s worth. For the 19th consecutive year, it cost the government more than one cent to make a penny. Last year, the U.S. Mint spent 3.7 cents to produce each penny for a total gross cost of about $117 million.

Since the late 1980s, Congress has been considering legislation to eliminate the penny due to cost concerns. Canada, New Zealand, Australia and the Bahamas have all eliminated their penny equivalents in the last four decades.

Albuquerque’s Little Bear Coffee, which has four locations across the city, processes “a fair amount of cash transactions,” said co-owner Jacob Fox, so the business hasn’t yet decided if they’ll be rounding prices up or down.

“It logistically changes some things about how we’re going to be able to accept payment from customers,” Fox said. “But I don’t know that I see it as being an inherently bad or good thing. It’s just a little bit different.”

Even when pennies go extinct from the U.S. Mint, they remain legal tender, and businesses will still accept them as payment, said Eric Harrison, spokesperson for Nusenda Credit Union.

Harrison said current guidance to credit unions from the Federal Reserve has been limited, but Nusenda will continue to have pennies available for customers and doesn’t anticipate any shortages in the foreseeable future.

Sunward Federal Credit Union receives coin deliveries from the Federal Reserve and the U.S. Treasury, and hasn’t seen any indications of a potential penny shortage thus far, said Sunward’s Chief Experience Officer Matthew Reidy.

“We don’t have any concerns as of today with maintaining appropriate levels for our coins. But the reality is that they will continue to phase out, and they will be seen less and less in circulation,” Reidy said.

Smith’s 24 New Mexico grocery stores will continue to accept pennies, said Tina Murray, spokesperson for Kroger, Smith’s parent company.

“If using cash for payment, we kindly ask customers to consider providing exact change,” Murray said.