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Record No: CB 119329    Version: Council Bill No: CB 119329
Type: Ordinance (Ord) Status: Passed
Current Controlling Legislative Body City Clerk
On agenda: 10/1/2018
Ordinance No: Ord 125684
Title: AN ORDINANCE relating to employment in Seattle; requiring certain employers to offer employees the opportunity to use pre-tax earnings to purchase commuter benefits, other than parking, in accordance with federal law; adding a new Chapter 14.30 to the Seattle Municipal Code (SMC); and amending Sections 3.15.000 and 6.208.020 of the SMC.
Sponsors: Mike O'Brien
Supporting documents: 1. Summary and Fiscal Note, 2. Presentation 08/07/18, 3. Presentation 09/05/18, 4. Presentation 09/18/18, 5. Proposed Amendment (added; 9/18/18), 6. Signed Ordinance 125684
CITY OF SEATTLE
ORDINANCE __________________
COUNCIL BILL __________________
title
AN ORDINANCE relating to employment in Seattle; requiring certain employers to offer employees the opportunity to use pre-tax earnings to purchase commuter benefits, other than parking, in accordance with federal law; adding a new Chapter 14.30 to the Seattle Municipal Code (SMC); and amending Sections 3.15.000 and 6.208.020 of the SMC.
body
WHEREAS, Internal Revenue Code (IRC) Section 132(f) authorizes qualified transportation benefits to be excluded from gross income subject to federal taxes for both the employer and employee; and
WHEREAS, under IRC 132(F), an employer can offer pre-tax payroll deductions for their employees, allowing employees to allocate up to $255 per month from their paycheck for buses, light rail, ferry, water taxi, and vanpool commuting; and
WHEREAS, requirements for businesses to offer qualified transportation benefits under IRC 132(f), also known as Commuter Benefit Ordinances, have been implemented in at least six jurisdictions around the country, including San Francisco, New York, and Washington, DC; and
WHEREAS, these payroll deductions allow employees to save between 20 percent and 40 percent of their transit commuting expenses; and
WHEREAS, an employee earning in the 22 percent tax bracket ($38,700-$82,500) and opting for a $100 per month ORCA pass would save $356 a year in federal income tax and payroll tax, and a minimum wage earner would save $236/year; and
WHEREAS, transportation is currently the second highest household cost after housing, disproportionately affecting cost-burdened households in Seattle; and
WHEREAS, employers save nine percent of the amount of payroll deducted from their employees' gross pay, generally making pre-tax transit benefits a cost-neutral way for businesses to reduce the burden of commuting for their employees; and
WHEREAS, the Berkeley Chamber of Commerce has praised its jurisdiction's commuter benefits ordinance a...

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