San Francisco Bay Area: Employers must now comply with Regulation 14 Rule 1.
What is Regulation 14 Rule 1?
Regulation 14 Rule 1 is an initiative mandated by the Bay Area Air Quality Management District which requires a commuter benefit program in place for all employers of 50 or more full-time employees in the nine-county San Francisco Bay Area. The regulation is a result of SB 1339 which was signed into law by Governor Brown requiring a pilot project to be in effect until January of 2017. According to the text of the bill, SB 1339, the State believes that by requiring large employers to offer this program, it will encourage the greater use of mass transit and vanpools. For those employees who already commute to work using mass transit, it will offer them significant tax savings. Participating employers will also reduce their tax burden.
If you have 50 or more employees in the Bay Area, what do you need to know?
As of October 1, 2014, Employers are required to comply with Regulation 14 Rule. In order to be in compliance, you will need to do the following:
1. You must register your company. Go to https://commuterbenefits.511.org/step1 to do so.
2. You must choose a Commuter Benefit option:
a. Pre-tax program (the most common Commuter Check option)
b. A subsidy program of up to $75 per month, based on the value of the local bus pass
c. A company-provided shuttle program
d. An alternative program, subject to approval by the Air District
3. You must assign a Commuter Benefits Coordinator. This is the person responsible for completing the registration process and will be the only person with access to this registration process. You’ll need to submit an initial registration within six months of the rule adoption. Employers can only register with an Employer ID. This ID has been provided in a letter to the company headquarters contact.
4. You must alert and market commuter benefits program to your employees.
5. You must monitor the transit benefit cap (currently $255 per month) and, if you choose the subsidy option, the maximum subsidy amount.
6. You must re-register every year.
7. You must keep records of your program for 3 years.
Once this is done, your company or organization will be in compliance. If you need any assistance in understanding any of these steps, please call us 800-531-2828 or listen to the recording of our informative webinar now.
I Just Found Out About this Requirement. What do I do?
The deadline to register and provide commuter benefits was September 30. However, the Bay Area Air Quality Management District is providing a 30-day grace period for employers to register for the Program. This means you have until October 31 to register, select your commuter benefit option, notify your employees and provide the benefit. You should act now to put your commuter benefits program in place, as the process does take time to implement.
This bill is based on legislation passed seven years ago by the City and County of San Francisco which mandates that companies with 20 or more employees offer transit and vanpool benefits to their employees. The most striking aspect of this legislation is that it actually had the support of the San Francisco business community. The San Francisco Chamber of Commerce, the Golden Gate Restaurant Association and the Building Owners and Managers Association (BOMA) all saw the inherent benefit for their members to participate in a program that saves payroll taxes, income tax for their employees, reduces traffic congestion, and lessens air pollution.