A story in today's New York Times (Mixed Signals: Driving to Work as a Tax Break, William Neuman, August 16, 2007) shares that on the one hand while the U.S.DOT is giving out grants to get people out of their cars, on the other hand the IRS is giving tax breaks to help people pay for the cost parking when they drive to work. And people are just catching on to this discrepancy? Us TDM people have been screaming about this mixed signal for years.
The federal tax code allows commuters to use up to $215 a month in pre-tax wages to pay for their parking at work or employers can provide up to $215 a month in a tax-free (to the employer and the employee) benefit. The transit/vanpool benefit is $110. From the article:
"It is perverse," said Jeffrey M. Zupan, a senior fellow for transportation at the Regional Plan Association in New York. "If you're going to institute pricing measures (referring to Mayor Bloomberg's congestion pricing plan) that are intended to reduce the amount of driving, you don't want to keep in place other measures that encourage people to drive. What you want is a set of policies that work together... You're almost exactly counteracting one federal policy with another. We really shouldn't be doing that."
Agreed! And we get excited about the potential for $20 a month for bike commuting (House Passes Energy Bill, Includes Bike Commuters (August 14, 2007). The same thing is apparent in our own region where people are talking about congestion pricing, HOT lanes and other ideas to help battle traffic congestion. All of this is countered by a federal policy that favors driving and parking with tax breaks. Its time the tax break for parking for SOV drivers is ended.
Chris Hamilton is the Commuter Services Chief for Arlington County, manager of CommuterPageBlog and a biking/Metro commuter from Rosemont in Alexandria.
The discrepancy between the parking benefit, $215/mo, versus the transit /vanpool benefit, $110/mo is too wide, IMO. The two amounts should be closer. The reason for the parking benefit, I suspect, is to give employers in expensive parking areas (cities like DC, NY) more equal footing to compete for employees with employers in the suburbs, where parking is usually free (and hence the tax benefit is not applicable)
The $20/mo for bike commuters is unnecessary and should be repealed, as biking costs no money to utilize, unlike the above two choices.
Of course, different people will have different opinions regarding the "proper" amounts of benefits until the end of the time. To be fair to all groups, perhaps the Fed should simply eliminate ALL of the above tax benefits for commuters above, and instead, direct that money to further help build, maintain, or improve highway, transit, and bike paths.
After all, paying me $20/mo is not sufficient incentive to get me to risk my life biking to the nearest Metro station, if it's not safe to do so. However, creating a safe bike path just might get me to look into it. As for not having showers at work or adverse weather, well, there's not much the government can do about that.
Posted by: Commuter 182 | August 19, 2007 at 02:12 AM