WASHINGTON — A penny-pinching member of Congress is taking aim at the cost of producing 1-cent coins.
Rep. Steve Stivers, R-Ohio, has introduced the Cents and Sensibility Act to require pennies to be made primarily from American steel.
No worries, however, about the nation losing one “red cent.” Steel pennies would be dipped in copper and look the same.
Stivers has also introduced similar legislation to change the composition of the nickel, the STEEL Act (for Saving Taxpayer Expenditures by Employing Less Imported Nickel Act).
The legislation is needed, Stivers said, because the cost to produce pennies and nickels now exceeds their face value.
“In these times of fiscal strain, Americans could save millions by simply changing the composition of our coins,” Stivers said in a fact sheet distributed to House colleagues in support of the legislation.
A penny, which consists of 97.5 percent zinc and 2.5 percent copper, cost 2.41 cents to produce last year, up from 1.79 cents the previous year, according to the U.S. Mint. A nickel, which is 75 percent copper and 25 percent nickel, cost 11.18 cents to make, up from 9.22 cents.
The measures are similar to legislation that passed the House in 2008 but languished in the Senate, even though proponents said it could save taxpayers $100 million a year.
Then-U.S. Mint Director Edmund C. Moy expressed concern to lawmakers at the time that requiring steel pennies “eliminates any consideration of other alternatives that may prove more cost effective.”
He said that legislation mandating the use of certain materials could make the Mint vulnerable to volatile metal prices and suggested that Congress leave it to determine the composition of coins.
Under 2010 legislation, the Mint is studying changes to the metallic content of coins in an effort to save money, with a report due to Congress by the end of the year.
Stivers and co-sponsors of the bill hail from a steel-producing state.
“At a time when too many of our products are being manufactured in other countries, we should at least be able to buy those products with money produced using materials made in America,” Rep. Tim Ryan, D-Ohio, a co-sponsor, said in a statement. Stivers said that much of the copper, zinc and nickel used in coins comes from Canada.
George Vary, executive director of the International Zinc Association of America, said, “This is the dead horse that keeps getting beaten,” adding that similar legislation has been introduced before when the price of zinc went up but lost steam after it went down.
In 1943, pennies were made out of zinc-coated steel because of World War II demand for copper.
The Mint produced 4.9 billion pennies last year.
The legislation comes as a separate effort has been launched in Congress to phase out the paper dollar in favor of a more durable dollar coin.
Stivers’ bill has been assigned to the House financial services subcommittee on domestic monetary policy and technology.