April 11, 2014 | Benefits Management | Posted by Ascentis Thought Leadership
Bay Area First in U.S. to Mandate Commuter Benefits
The Bay Area of San Francisco, CA is now the first geographic area in the nation to mandate commuter benefits for employers with 50 or more full-time employees. Implementation of these commuter benefits must be complete no later than September 30, 2014. The nine counties in the Bay Area impacted are Alameda, Contra Costa, Marin, Napa, San Francisco, Santa Clara, San Mateo, Sonoma, and Solano counties.
Assistance is available through Metropolitan Transportation Commission's (MTC) 511 Regional Rideshare Program to help employers comply with the Commuter Benefits Program. SB 1339 authorizes the Air District and MTC to adopt and implement the Commuter Benefits Program on a pilot basis through the end of 2016.
Four options form the safe harbor under this new mandate, and each employer must offer at least one of these options to their employees in the nine-county area:
- Option 1 - Allow employees to exclude their transit or vanpool costs from taxable income, to the maximum amount, as allowed by federal law (currently $130 per month). Implementing a Section 132 Commuter Benefits Program meets this requirement.
- Option 2 - Employer-provided transit or van-pool subsidy up to $75 per month.
- Option 3 - Employer-provided free or low cost bus, shuttle or vanpool service operated by or for the employer.
- Option 4 - An alternative employer-provided commuter benefit that is as effective in reducing single occupant vehicles as Options 1-3.
In addition to setting up the tax-exempt Sec. 132 contributions to be excluded from taxable wages in Payroll, Ascentis can help with other impacts of the new regulations as well.
The regulations require that employers notify all affected employees of the commuter benefits they will provide. Our innovative correspondence wizard within HRIS software and employee self-service are two great options to help employers comply with these regulations.
Finally, commuter benefit records documenting the implementation of the program must be provided to Bay Area Air Quality Management District (BAAQMD) and/or the Metropolitan Transportation Commission (MTC) upon demand, so year-to-date reports of the earnings involved and/or employer cost memo deductions will be important to retain and/or generate as needed, to support audits, and Ascentis payroll software can help support this.
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