Clock Expires for Mass Transit Benefit Fix

Federal employees will see a dramatic decrease in their mass transit benefits beginning Jan. 1, bringing the subsidy down to pre-2009 levels.

With the House now on recess until 2014, time has run out for legislative action to restore parity between the public transportation and parking benefits. Because the mass transit benefit for 2013 included a one-year extension as part of the American Taxpayer Relief Act -- also known as the fiscal cliff deal -- the subsidy will decrease from this year’s maximum of $245 per month to $130.

The parking benefit, however, was lifted permanently and receives annual cost-of-living adjustments, meaning it will actually increase by $5 to $250 in 2014. A similar gap between mass transit and parking benefits also existed in 2012, though the disparity was eliminated retroactively by the fiscal cliff deal.

In March 2009, as part of what is colloquially known as the economic stimulus package, feds received a significant transit boost, from $115 to $230 per month. Not all employees have been eligible for the heightened benefit; each agency is free to set its own maximum up to the federal limit. Individual employees can only receive -- and write off for tax purposes -- a subsidy in the amount they spend on transportation each month. 

The change will affect all commuters whose employers offer transit benefits, not just federal employees.

Bills in both the Senate and House attempted to remedy the parking and public transportation gap, though neither bill has made it out of committee.