The Tax Relief Action to Cut Commuter Carbon: Berkeley Municipal Code Chapter 9.88
Effective since November 2009, Berkeley Municipal Code 9.88 requires employers with ten or more employees to provide a commuter program to encourage employees to use public transit, vanpools or bicycles.
Berkeley’s Tax Relief Action to Cut Commuter Carbon, or TRACCC, gives employers several options – businesses can offer their employees pre-tax Commuter Benefits as a payroll deduction, provide a subsidized benefit or offer a combination of the two.
A commuter program can reduce business and employee taxes by tapping into federal tax breaks on transit, vanpooling and bicycle commuting expenses. Employers can save up to 7.65% on payroll taxes, and employees up to 40% on their commute costs. A Commuter Benefits program works like other pre-tax plans, such as retirement, dependent care and medical reimbursement, except that it’s much simpler.
Many businesses work with their payroll provider or a third-party administrator to manage their program. Others choose to administer their program in-house, purchasing transit tickets or vouchers each month for their employees.
The TRACCC Ordinance
Before November 2010, all employers in Berkeley with 10 or more employees (full-time, part-time, or temporary – anyone who works an average of 10 hours per week or more in Berkeley) must offer one or more of the following options:
- Pre-tax Transit: Employer provides a payroll deduction program under existing Federal Tax Law 132(f), which allows employees to use up to $255 per month in pretax wages for transit or vanpool expenses.
- Employer Paid Transit Benefits: Employer pays for employees’ transit, vanpool or bicycle commuting expenses.
- Employer Provided Transit: Employer offers workers free shuttle service on a company-funded vehicle between home and workplace.
Additional resources available online on the City of Berkeley’s Commuter Programs and Public Transportation page:
- Instructions on establishing an employee commute program
- Workshops and webinars
- Vendor contacts
- Sample enrollment forms
An Ordinance of the City Council of the City of Richmond Adding Chapter 9.62 of the City of Richmond Municipal Code Instituting a Commuter Benefit Program
The program in Richmond is essentially identical to the one passed in Berkeley, with the exception of the name. Richmond’s ordinance is also for employers with 10 or more employees. Click here to read the Richmond Ordinance in its entirety.