U.S. employers now view pre-tax commuter benefits as the number-one planned addition to their benefits packages, amidst a growing focus on the environment and supporting employee commuting, according to the 2007 TransitCenter Commuter Impact Survey.
TransitCenter, Inc., a nonprofit organization that promotes the use of mass transit, independently fielded the survey to 245 U.S. human resource professionals across public, private, nonprofit and government organizations.
Under Internal Revenue Code, tax-free commuter benefits programs can be offered by employers as an employee-funded pre-tax payroll deduction or as an employer-provided fringe benefit – and allow participants to set aside up to $110 a month tax-free to pay for transit and vanpool commuting costs, and up to $215 for commuter parking. Employees who participate can achieve tax savings equivalent to 30-40% of their out-of-pocket commuting expenses. Offering a commuter benefits program can also help employers lower their payroll taxes.
Compared to last year, deployment of tax-free commuter benefits programs by U.S. employers in major metropolitan areas has grown 132%, jumping from 28% in 2006 to 65% in 2007. Today, it is the number-one program that employers plan to add to their benefits package in the next year, with 17% saying they intend to implement a pre-tax commuter benefit program as compared to 5% in 2006.
The reasons cited by employers are: responding to growing employee concern about the cost of driving to work (93%), traffic congestion and drive time (84%), and carbon emissions and their impact on global warming (79%).
The 2000 U.S. Census found that over 78% of people employed in the U.S. drive alone to work – and, according to the Texas Transportation Institute’s 2007 Urban Mobility Report, lose nearly a full work week of productivity per capita annually by sitting in traffic.
TransitCenter introduced TransitChek, the nation’s first tax-free commuter benefits program in 1987 to engage employers in encouraging their employees’ use of mass transit to reduce traffic congestion and curb emissions that cause global warming. Its latest survey confirms that its mission is being heard by employers today more than ever: 84% of respondents said that their companies are concerned about the environment and global warming, and approximately two-thirds have developed initiatives to respond. The survey found that employers are addressing global warming and environmental issues in a number of ways:
· 28 percent offer commuter benefits specifically as a means to encourage the use of mass transit
· 22 percent currently partner with a green organization
· 20 percent have established an internal policy for energy conservation
· 20 percent are developing products and services that are not detrimental to the environment
· 19 percent are teaching employees how to use less energy
· 17 percent are pursuing a greener supply chain approach
Loading...