I figured this out a while ago.

The main reason that we keep using pennies is the local sales tax formula. The formulas and charts calculate to the penny; therefore retail businesses must calculate their bills to the penny.

Municipalities enforce sales tax aggressively. Businesses get in trouble if they collect a different amount than they report on their tax records.

Retiring the penny would require co-ordination from sales tax agencies. Since these agencies are filled with small-minded bureaucrats, this is unlikely to happen.

!BEER