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The Benefits Industry Buzz: Commuter Benefits

Commuter Benefits

Typically, at this time of year, there is often a lull in the benefits discussion. January plans have moved into a routine and things are running pretty smoothly. Time for benefits personnel to take a break?…Not so much. For many benefits personnel, the discussion has merely shifted from health benefits to commuter benefits. And for good reason. There are a number of outside factors impacting the market, namely Transit Ordinances.

While San Francisco took the lead implementing a transit ordinance in 2009, employers are now really taking notice. Both New York and Washington D.C. are set to implement transit laws on January 1, 2016. There is much speculation that other key markets will be soon to follow.

New York City

Effective January 1, 2016, every employer with 20 or more full-time employees working in the City of New York (including the 5 boroughs) will be required to offer a qualified pre-tax transportation benefit.

Washington D.C.

Effective January 1, 2016, every covered employer with 20 or more employees must provide one of: (1) Pre-tax election transportation benefits, (2) employer-paid transportation benefit or (3) employer-provided transportation at no cost. Learn More

Bay Area Commuter Benefits Program

As of September 30, 2014, employers with 50 or more employees full-time across the nine county San Francisco Bay Area are required to offer one of four programs designed to reduce the number of single occupancy vehicles on the road, including the option to offer a pre-tax transit program. Learn More

San Francisco Commuter Benefits Ordinance

Adopted in 2009, businesses with a location in the City of San Francisco with 20 or more employees nationwide are required to offer one of the following: (1) Pre-tax election transportation benefits, (2) employer-paid transportation benefit or (3) employer-provided transportation at no cost. Learn More

While each of the transit ordinances have their own nuances, there are some key points that seem present across all markets:

  1. Failure to implement a qualifying program will result in civil penalties. The amount and frequency of the penalties varies but typically ranges from $100 to $250 per violation, with some as high as $800 for a violation.
  2. A pre-tax mass transit program meets the requirements of all ordinances. While some markets offer alternative options for meeting the requirements, simply implementing a pre-tax mass transit program, like the Beniversal Commute Program, will satisfy an employer’s commuter benefits program requirement.

To discuss any of the transit ordinances in more depth or to find out how to comply, please contact us.