How the City of Phoenix Is Adapting to the Federal Discontinuation of the Penny

With the federal government discontinuing the penny, cities across the country are adjusting how they handle cash payments. Here in Phoenix, we are implementing a clear, consistent, and customer‑friendly process to ensure residents can continue to make smooth cash transactions—without needing one‑cent coins.

These changes follow Arizona House Bill 2938 (HB 2938), which established statewide rules for handling cash totals when pennies are no longer available. The law, now in effect, requires what’s known as Swedish rounding: adjusting the final cash total (after taxes and fees) to the nearest five‑cent increment.

How Rounding Works
Only the final total is rounded—never individual item prices, taxes, or fees.
• If the total ends in 1–2 cents → round down
• 3–4 cents → round up
• 6–7 cents → round down
• 8–9 cents → round up
• 0 or 5 cents → no change

For example:

• $12.03 becomes $12.05
• $7.06 becomes $7.05

The maximum difference on any transaction is just two cents.

Does This Affect Card Payments?
No. Rounding applies only to cash transactions. Payments made by card, check, debit, mobile device, or EFT remain exact.

Why Is This Being Implemented?
With pennies no longer in circulation, rounding ensures fairness, consistency, and simple transactions for both businesses and customers. It also prevents mismatched totals when change cannot be returned in penny increments.

What You’ll See at City Facilities
All City of Phoenix departments and municipal vendors will have posted signage explaining: “Cash transactions are rounded to the nearest five‑cent increment pursuant to state law.”

Whether you’re paying for a Parks and Recreation class, an airport concession purchase, or a city service, your experience should feel seamless—just without pennies.

If you have questions, staff at any point of sale are ready to help.