A provision to fix the disparity between mass transit and parking subsidies for federal employees and commuters nationwide could be coming soon, but will require retroactive enforcement.
Lawmakers in the Senate introduced a bill Thursday to maintain the current levels of monthly tax subsidies provided to those who ride public transportation to work. Currently, that subsidy -- which maxes out at $245 per month -- is set to decrease by almost half on Jan. 1, to $130. The parking benefit will actually increase in 2014 by $5 to $250 per month.
With many senators already heading back home for the holidays, Sen. Chuck Schumer, D-N.Y., attempted a last-ditch effort before the Senate recessed for the year to pass the legislation by unanimous consent. His efforts were thwarted, however, by Sen. Orrin Hatch, R-Utah, who said the subsidy should go through the regular Senate order, including passage in the Finance Committee.
Schumer argued even those who do not use mass transportation should favor the tax incentive, as more people on busses and trains decongests the roads. He added the two parties “can usually find more agreement on tax breaks.”
With the House already adjourned for the year, the window for a benefit fix in time for uninterrupted subsidies had already closed. Schumer vowed to “continue [his] quest” when the Senate comes back in January, which was met with a glimmer of hope for bipartisan accord.
“I will certainly try to work with my colleague throughout this process,” Hatch said.
A retroactive fix, which Schumer called “harder but not impossible,” is not without precedent. A similar gap between mass transit and parking benefits also existed in 2012, but the disparity was rectified after the fact when Congress passed the American Taxpayer Relief Act to stave off the so-called “fiscal cliff.”
That bill’s passage, however, created significant confusion over exactly how the benefit would be issued retroactively. Ultimately, the Internal Revenue Service issued guidance for the steps both federal agencies and employees had to take to receive their subsidy.
Colleen M. Kelley, president of the National Treasury Employees Union, wrote a letter to every senator asking for immediate approval of the fix.
“Many of these [federal] employees, already subject to a three-year pay freeze, unpaid furlough days and higher retirement contributions, are struggling in the current economic climate, and a reduction in these benefits would impose an additional financial burden on them,” Kelley wrote.