Transportation Equity Act would make transportation fairer but more importantly, smarter

Earlier this month Councilmembers Allen, Cheh, and Nadeau introduced a bill that would, in effect, pay a lot of DC workers to bike or walk to work. It would make commuter benefits fairer, but more importantly, smarter in that they would reduce pollution and congestion; improve land use and health; and make roads safer. 

The Transportation Benefits Equity Act would require employers who offer parking benefits to employees to give them the option of taking a "cash out" instead or pay a fee. More specifically, they could take an equivalent amount as the transit benefit, the bicycle commuter benefit, cash or one of these benefits and cash. 

For bike commuters it means they could take the first $20 of parking benefit equivalent as the bicycle commuter benefit and the rest as cash. Pedestrians would have to take the whole thing as cash, which is worth a little less because it's all taxable then, but that's because there is no federal pedestrian commuter benefit.

The fee option would allow employers to pay a $100 Clean Air Compliance fee for each employee "offered" the parking benefit instead of offering the cash out. Now I'm not sure about the reason for this part or exactly how it would work. If every employee is offered a parking benefit, then it would seem they would need to pay the fee for each employee, even for those who choose to walk. The math on when that would be cheaper than allowing employees offered parking to opt for cash instead has got too many variables (# of employees offered parking vs. # that take another benefit, cost of parking in the area) for me to immediate see whether a lot of employers would take it or not, so I wonder if Council has any idea. Strategically speaking it might lead more employers to offer no parking benefit - which would have the same effect or better. 

Regardless, the fee would still help cyclists, pedestrians and transit users as it would go to a Transportation Demand Management Fund, which could be used for promoting, improving access to, and educating the public about alternative transportation; reducing SOV trips and developing transportation innovations. Still, I'm left foggy on why this option is included. 

There's also a reporting requirement about the number of employees and what benefits they were offered and utilized. [Which reminds me, does anyone know if the IRS has reported on how many people are utilizing the Bicycle Commuter Benefit and how much it costs? 8 years after passage I'd like to see if it's more or less than was expected.]

As the Post points out the policy has a fairness element

The change, [CM Charles Allen] said, would address a fairness issue for the workers who sometimes turn down a valuable perk because they don’t drive or who are forced to take it because otherwise they can’t get the benefit any other way.

Which is true, but is less important than the fact that it is just smart policy. In fact one could argue that it would be even smarter to offer a LARGER benefit to those who walk or bike than those who drive because of all the negative externalities associated with driving (pollution, congestion, road safety, etc..) and the positive externalities of active transportation (namely, improved public health). Though it might be harder to argue that it is "fair".

A similar idea for federal employees was kicked around in 1993 and WABA argued at the time that this was a smarter policy.

the fundamental goal is to clean the air, and I believe that there is nothing that meets that goal on a per dollar basis better than including bicycles in the subsidy.

The Post also notes that there are good policy reasons for this.  

Advocates for flexible benefits cite research suggesting that traffic congestion is associated with perks, such as free parking, and that financial incentives for non-solo drivers could help cities move toward more diverse commuting.

In the District, experts say a parking cash-out program could be part of the equation to achieve 75 percent of all trips on sustainable transportation, and it would benefit city residents the most because they are more likely to have easy access to other travel options, such as Capital Bikeshare, bus and Metro.

About 40 percent of D.C. residents drive to work, according to data from the District Department of Transportation, while 39 percent take public transit, 15 percent walk and 6 percent bike.

It is unclear how many companies offer free or subsidized parking, but a city survey of 191 employers in 2016 found that 34 percent offer free parking and an additional 18 percent offer a parking subsidy, according to DDOT.

A similar program has worked well in California

A survey of 5,000 commuters and their employers in downtown Los Angeles showed that free parking at work increased the number of cars driven to work by 34 percent, he said.

In California, legislation enacted in 1992 requires that employers with 50 or more employees who offer free parking must also give workers the option to take an equivalent cash allowance instead. But the law did not set any penalties for noncompliance.

The DC bill does propose penalties

Studies of firms in Southern California that offer parking cash-outs found the share of commuters who drove to work alone fell from 76 percent before the cash option to 63 percent afterward,

 According to another study, solo driving to work fell by 17 percent.

Carpooling increased by 64 percent. Transit ridership increased by 50 percent. Walking and bicycling increased by 33 percent. Commuter parking demand fell by 11 percent.

These mode shifts reduced total vehicle miles traveled for commuting by 12 percent, with a range from 5 to 24 percent for the eight firms. To put this reduction into perspective, reducing VMT for commuting by 12 percent is equivalent to removing from the road one of every eight automobiles used for driving to work. In total, cashing out reduced 1.1 million VMT per year.

Cashing out reduced total vehicle emissions for commuting by 12 percent, with a range from 5 to 24 percent for the eight firms. To put this reduction into perspective, reducing vehicle emissions by 12 percent is equivalent to eliminating vehicle emissions for automobile commuting from January 1 to February 13 every year.

average commuting subsidy per employee increased from $72 a month before complying with the cash-out requirement to $74 a month after complying

But DC's law will be more expansive that CA's

Analysts noted that more outreach was necessary and that the eligibility rules were so narrowly drawn that the law applied to only about 3% of the 11 million free parking spaces provided by employers statewide.

I hope that DC's law will apply to the DC government too. I've been hounding them about not offering the Bicycle Commuter Benefit for years. On the BAC's legislative committee, we made a list of every bill we could think of that would improve cycling, and them we ranked them by political possibility. This one came up very near the bottom, so I'm pleasantly surprised to see this get proposed. 

Other than my questions about the purpose of the Clean Air Compliance fee, my other thought is that DC could make this even better by making the cash portion of this (paid to cyclists and pedestrians) tax deductible on DC taxes. This would do no good for MD or VA commuters, nor would it completely balance out the advantage drivers and transit riders get because their benefit is completely untaxable, but it would make the law closer to "fair" (at a cost to DC).

I'm also not sure if this would apply to the federal government, as sometimes it seems that these regulations and such do not, it would ironic if not, since they were going to go it alone ~25 years ago. 

Anyway, this is a big deal for DC and it comes after a year that, from a bike legislation perspective, was the most successful in decades, so it would be great to see it pass. 

Comments

[Crickey7]

It's astonishing how many people characterize steps like this (or any funding to transit) as social engineering. As if the billions poured into free roads, the shaping of the physical form of the auto-oriented American city, the housing financing system that promoted low density single family detached housing and the many hidden subsidies for drivers aren't social engineering. No, instead people say--with a straight face--that that is "freedom", and bikes, with their nominal subsidizing, are "socialism". Oy.

[fongfong]

Agree, of course. Chuck Berry's passing reminds us again of the reason for his success, and it was to portray to teenagers what coming of age in America of the 1950s was all about. A not insignificant part of it was the freedom to drive in songs like "Maybeline," "You Can't Catch Me," and "No Particular Place to Go." Those baby boomers who grew up on Rock and roll have been the policy makers for years, and that car-centric view of America takes time to erode.

Neither Chuck's focus on the car or his Mann Act violations makes him any less of a genius to me.

[washcycle]

Right, the only reason this is even an issue is that we always assumed that employer-paid parking was tax exempt (though that wasn't encoded in the law until the 1984 Tax Reform Act). This was an exception to how things were done before because usually you could only count fringe benefits as tax exempt if they were deductible if paid for by the employee. So if your work gave you a uniform, you wouldn't have to declare that as income, because if you'd bought it you would have deducted the expense as a work expense. But parking couldn't/can't be deducted as a work expense if you pay for it yourself. Still, we carved out an exception and incentivized more driving. Parking cash outs look to undo the damage of this carve out.

[Zack Rules]

How interesting! I receive the fed bicycle benefit, $20 per month which does not come close to covering my costs. I have always wished that the bicycle benefit would simply equalize with the parking/transit subsidy of $255, speculating that it would lead to a boon in bike shop business! But the cash out would be even better, hope it applies to feds (the paid family leave bill did not).