City Desk

Federal Transit Benefits Plummet

While all eyes were turned toward the payroll tax fight (recap: House Speaker John Boehner lost, President Barack Obama won), the Examiner points out that another extension was completely overlooked: Benefits for federal employees who use public transit.

Commuters who rely on federal transit benefits to help pay for their daily trips to work likely will have to wait until at least March to get their benefits restored to current levels — if at all.The benefits are slated to drop from the current maximum of $230 per month to $125 as of Jan. 1, even as benefits for parking rise to $240.

Transit advocates had been pushing for Congress to extend the higher benefits, but the effort got lost amid the end-of-year scuffle over the payroll tax. Now, advocates have given up for this year.

"We're going to continue to push for it in the new year," said Brian Tynan, director of government relations for the American Public Transportation Association.

But he said Congress has only a few days available in January to deal with any legislation, so it likely wouldn't be picked up until at least February.

Even if approved, it would take human resources employees until at least March to implement it, APTA estimates. The benefit is given to some workers as a direct perk — including most federal workers in the Washington region — but also as pre-tax deductions from paychecks.

In addition, local riders will have to shoulder an even bigger share: Both Virginia Railway Express and Metro have proposed raising fares in July.

So this seems like a big deal. Metro officials claim that the recent drop in ridership—even as transit became more popular across the country—can be blamed on reductions in the federal workforce. It stands to reason that diminishing benefits may present even more of a hardship for the system. Sure, people have to get to work, but if the parking subsidy is going up, then more folks are likely to drive in to the city.

And that's crazy. Transit in the District relies heavily on federal workers, driving during rush hour is already a most terrible experience, and, oh yeah, public transit is better for the environment. As a public policy decision, incentivizing solo car trips while reducing benefits for transit is maybe the worst idea we've heard all year.

Photo by cuttlefish via Flickr/Creative Commons Attribution Generic 2.0 License

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Comments

  1. #1

    Everyone always misreports this. This is not about federal employees, this is an IRS rule about tax free benefits for employees. The rules limit the amount per month. Any employer (be it the Feds or a private sector employer) can offer benefits up to that amount. They can also choose to fully subsidize that benefit and give it away to employees for free, or they can set up a system where employees can pay into their own account via tax free payroll contributions, so long as they're below the monthly limit.

    So, the rule applies to all employers, including the Feds. If an non-fed employee were contributing $200 a month via pre-tax, they will see their benefits go down, too. This affects anyone getting a transit benefit, regardless of who their employer is.

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