NLC Supports Employee Transit Benefits

August 26, 2013

By Leslie Wollack

The Transit Parity Act, a bipartisan bill that was introduced in Congress in June, would ensure that commuters have the same employer provided pre-tax benefits whether they travel by car or by public transportation.   The commuter transit benefit is set to expire in January 2014. Until then, transit riders will receive the same commuter tax benefits as drivers, if this option is offered by their employers.  This benefit allows employers to provide $245 per month in pre-tax benefits for commuters.    

Without Congressional action, the transit benefit would be reduced to $125 per month, costing transit commuters up to $1,440 a year in additional tax burden.  The Transit Parity Act would cap both the transit and parking benefits at $220, keeping the benefit deficit neutral and not favoring one form of commuting over another.

"With rising gas prices and highly congested streets, we should be encouraging New Yorkers to use more public transportation, not push them back into their cars. Without parity, we create an incentive to drive and put an unfair financial burden on New York City's hard-working families and residents who rely daily on public transportation. It is only fair that the pre-tax benefit be made permanently equal, no matter how one commutes to work, and that is why I have introduced the Transit Parity Act," said Representative Michael Grimm (R-NY), a co-sponsor of the bill, in introducing the legislation with his colleagues.

Supported by NLC, transit advocates, and many employers, the Transit Parity Act would save money for transit commuters and encourage use of alternative transportation in an effort to reduce traffic congestion and air pollution.   

Certainty for employers and employees allows cities to plan more effectively for investment in subways, buses, vanpools and streetcars.  "By helping protect commuters' choices, and preserving equity between those who drive and those who take transit or vanpool," said bill co-sponsor Rep. Earl Blumenauer (D-OR), "we can avoid a tax increase on millions of families, and continue to give workers the option to use a transportation mode that increases economic productivity, reduces congestion and is friendlier to the environment."

“Mass transit benefits our environment, reduces wear and tear on our roads and bridges, eases traffic congestion and saves energy.  We must continue to look for ways to make commuting by transit as affordable and attractive as commuting by car," said Rep. James McGovern (D-MA), another co-sponsor of the bill. In a similar statement, co-sponsor Rep. Peter King (R-NY) noted that "Transit parity provides an incentive for millions of working Americans to use mass transportation, which reduces our dependence on foreign oil and eases traffic congestion on our roads."

The law to establish parity between drivers and transit users was adopted in 2009 as part of the American Recovery and Reinvestment Act but the provision expired in 2012, leaving only the benefit for drivers in place.   Congress restored the parity for 2013 as part of the "fiscal cliff" legislation in January.  

NLC supports the legislation and encourages its members to ask their elected representatives to sign on as co-sponsors to help support public transportation and affordable commuter options in their communities.