In California, the San Francisco Bay Area is serious about its commuter benefits. There’s one regional law, three municipal laws and the San Francisco airport has its own regulations.
California commuter benefits laws stem from a desire to help protect the environment and reduce congestion on the roadways. Here is an overview of how these California commuter benefits programs work.
The San Francisco Bay area has notoriously long commute times and a rapidly-rising housing market. As more people are priced out of the immediate areas where businesses are located, they are finding cheaper housing — and longer commutes — elsewhere.
As of 2016, 4,100 employers had enrolled in the regional commuter benefits program alone, with approximately 1.3 million employees receiving commuter benefits.
Bay Area Commuter Benefits Program
On the regional level, Bay Area employers with 50 or more full-time employees are subject to commuter benefits regulations. The legislation was finalized by state government in 2016 and was modeled after local ordinances (below).
If a business is within the Bay Area Air Quality Management District (9 counties), it must offer one of four commuter benefits options to its employees.
The first is the pre-tax benefit. The employer allows employees to exclude their transit costs from taxable income.
Commuter Benefits Solutions administers programs like this where employees can save up to 40 percent on commuting costs, while employers can save up to 7.65 percent on payroll taxes.
Other options include employer-provided transit subsidies, employer-provided transit, or an alternative commuter benefit that is “as effective as the other options in reducing single-occupant vehicle trips (and/or vehicle emissions).”
The City of San Francisco requires businesses with 20 or more employees nationwide to comply with commuter benefits law. This includes employees who work 10 hours per week.
San Francisco requires employers to offer a pre-tax benefit, employer-paid benefit or employer-provided transportation (or a combination of all).
Also on the local level, the cities of Berkeley and Richmond have ordinances that require businesses with 10 or more employees working 10 hours per week.
San Francisco Airport
Have you ever flown in or out of San Francisco? We bet you didn’t know those friendly airport and food service employees were mandated to receive commuter benefits.
Regulations are in place in the airport that mandate tenants who has 20 employees working per week eligible for a commuter benefit.
Want to learn more about commuter benefits? Check out this infographic: