San Francisco Bay Area employers, it's time to add another benefit and reporting requirement to your list. In an effort to reduce greenhouse gas pollution and encourage people to get out of their cars, employers within the nine San Francisco Bay Area counties who have 50 or more full-time employees, in the prior calendar month, will be required to offer commuter benefits to their employees.
The nine San Francisco Bay Area Counties include Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, western portion of Solano, and southern portion of Sonoma county.
What benefits must be offered to employees?
Employers must select one of the four options below and implement the program by September 30, 2014:
1) Pre-tax Benefit – Allow employees to exclude transit or vanpool fare from taxable income up to the maximum amount allowed by the IRS (in 2014 the limit is $130 per month)
2) Employer-Provider Subsidy – Employer covers the employee’s transit or vanpool fare up to $75 per month
3) Employer-Provided Transit – Employer provides free or low-cost bus, shuttle or vanpool transportation services for employees from their home community to the worksite
4) Alternative Commuter Benefit – Employer provides commuter benefit that is as effective as the other three options in reducing single occupant vehicles. Alternative benefits may include benefits for carpooling, bicycling, telecommuting, and compressed work week schedules.
What is a full-time employee and who is covered by this benefit?
A full-time employee is defined as an employee who works, on average, 30 or more hours per week in the previous calendar month. Employers will need to use this definition to determine whether they're subject to this requirement.
A covered employee is an employee who worked, on average, 20 or more hours per week within the previous calendar month. Employers are required to offer the commuter benefit to all covered employees.
What are employers required to do now?
Employers need to comply with this new requirement by September 30, 2014. Employers must do the following:
- Designate a Commuter Benefits Coordinator - this will likely be the employer's current in-house benefits administrator
- Select one of the four approved commuter benefit options
- Submit a registration form to the Air District/MTC via the program website specifying which commuter benefit the employer selected
- Notify all covered employees of the commuter benefit options so they can make their elections
- Update the Air District/MTC annually on the program
- Document the implementation of the commuter benefit
- Respond to the Air District/MTC for program evaluation
We recommend that employers work with their employee benefits consultant to review their options, implement their program, and build a process so they can be confident in their program's compliance.
Employers that do not comply by the deadline can be subjected to a financial penalty.
Where do we go for questions?
The Bay Area Commuter Benefits Program is new and the Air District and MTC are still working through some of the implementation details. Employers can use www.511.org
as a resource for program requirements. Throughout the year, the website will be updated with more educational materials to assist employers with their compliance.
For additional information visit www.511.org
or review the program in detail here
The Bay Area Commuter Benefits Program is the result of California Senate Bill 1339, signed into law in October 2012, which authorizes the Metropolitan Transportation Commission (MTC) and the Bay Area Air Quality Management District (Air District) to jointly adopt a commute benefit ordinance that will reduce air pollution and traffic congestion.