Since May, copper prices have fallen to where the melt value of a penny is now under a half cent and the nickel is just slightly higher than 5 cents — the U.S. Mint now makes money issuing pennies and almost breaks even with nickels.
The House debated on the legislation and finally voted yesterday to change the metallic composition of the penny and 5-cent nickel to a less expensive copper-colored steel.
Although the prices of copper, zinc and nickel metals in coins have declined in recent months, the penny and 5-cent nickel still cost more to make than what they're worth—resulting in a reported loss of about $100 million every year, or $1 billion over a decade.
It now costs about 1.26 cents to make the penny and about 7.7 cents to make the nickel.
House bill "H.R. 5512, the Coin Modernization and Taxpayer Savings Act of 2008" would seek to change those manufacturing costs by using copper-colored steal, which could cut the cost of making pennies down to about 0.7 cents each. But its recent passage in the House is no guarantee it'll make its way to the White House for signing.
H.R. 5512 must still go through the Senate and then the President, and not everyone is happy with the current legislation.