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How to comply with the SF Transit Benefit Ordinance. Goal of workshop Attendees will leave the workshop with a clear understanding of how IRS Section 132(f) works, how to comply with the transit benefit ordinance; and have an understanding of the options available to administer their program. - PowerPoint PPT Presentation
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How to comply with the SF Transit Benefit
Ordinance
Goal of workshop
Attendees will leave the workshop with a clear understanding of how IRS Section 132(f) works, how to comply with the transit benefit ordinance; and have an understanding of the options available to administer their program.
OverviewOverview of the OrdinanceUnderstanding the IRS Section 132(f) CodeOverview of the options availableNew bicycle benefit TransLink/EZRider
“Only in San Francisco”
• SF Leads the Way
• Paid Sick Leave (All employers)
• Health Care Security Ordinance (20+ employees)
• Trend: From SF to State
SF Transit Benefits Ordinance
• August 8, 2008: SF Board of Supervisors passed Ordinance No. 199-08
• Mandate has strong support in SF business community: SF Chamber; BOMA SF, etc.
• Designed to help SF achieve its goal to reduce CO2 emissions within the City and County to 20% below 1990 levels by the year 2012
• Ordinance requires employers with at least 20 employees to offer at least one of three benefit options.
• All employees counted (full-time, part-time, temporary)
• Include employees who work outside County• Governmental entities not included
SF Transit Benefits Ordinance
SF Transit Benefits Ordinance
• Six month till compliance (January 19, 2009)
• Non-compliance– $100 for first violation– $200 for second violation (in same year)– $500 for each additional (in same year)
Transit has come a long way in San Francisco…
• 1991 – Transit benefit begins in the Bay Area ($21 Maximum allowed only as a subsidy)
• 1998 – Commuter Choice Legislation Passes allows pre-tax deduction
• 2007 – Benefit increased to $115
• 2008 – SF Board of Supervisors passes legislation
• 2009 – Additional increase in cap to $230; $20 bicycle amendment
…and so has the transit benefit.
Saves up to $190 per employee per year in payroll taxes
Creates an excellent employee recruitment and retention tool
Improves employee morale and productivity
Reduces parking lot congestion with more transit/vanpool usage
Helps reduce local traffic congestion and improves air quality
Benefits to EmployersBenefits to Employers
Saves up to $1000 a year in personal income taxes
Creates an incentive to try a more relaxing and economical commute
Using transit or vanpools helps to improve air quality and the general quality of life in the Bay Area
Benefits to Employees
Thousands of employers already participate in the Bay Area…
IRS and 132 (f)
-- Very Flexible --
2 Key Points:
-Cannot exceed maximum per month of $230
-No cash reimbursement
Three ways to offer the transit benefit:
A. pre-tax payroll deduction
B. subsidy, in addition to salary
C. a combination of the two
Two ways to set up your transit benefit:
A. Do it yourself
Less than 100 employees
You have one work site
B. Have someone else do it for you--using a third party administrator (TPA)
Larger companies
Multiple work sites
Option #1: Do it Yourself…
9 steps to setting up your program
#1 Choose the type of program #1 Choose the type of program
Debit Cards
- IRS compliance
Transit Passes
- Available from all transit agencies
Vouchers
- Universal acceptance
#2 Get management approval #2 Get management approval
#3 Identify key personnel #3 Identify key personnel
#4 Create and distribute survey/enrollment form#4 Create and distribute survey/enrollment form
#5 Tabulate surveys#5 Tabulate surveys
#6 Arrange for payroll to establish a deduction code#6 Arrange for payroll to establish a deduction code
#7 Order passes/vouchers/debit cards#7 Order passes/vouchers/debit cards
#8 Distribute benefit
to employees
#8 Distribute benefit
to employees
#9 Update your personnel policy handbook#9 Update your personnel policy handbook
Option #2: Have someone else do it for
you
Selecting a Third Party Administrator
#1 Research options #1 Research options
The Department of the Environment has a list of vendors
#2 Meet with a representative #2 Meet with a representative
Make sure to understand costs, timeframes, and your responsibilities
#3 Sign agreement#3 Sign agreement
The benefit can be used for all transit and vanpools in the greater Bay Area
including….
Also consider including bicycling—it is now covered
up to $20 a month!
Also works with
Translink!
“The mode of transportation that you choose has a greater effect on the
environment than any other decision you make as a
consumer.”
-Union of Concerned Scientists