Commuter Check Information
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Commuter Check is a convenient way for businesses to reduce the cost of their employees' commute to work by public transit and vanpooling.  Employers purchase Commuter Check vouchers and give them to employees who can apply their value toward purchase of monthly transit passes or tokens for virtually every Bay Area transit system as well as vanpools.  Commuter Check is a "transit fringe benefit" for employees, similar to employer- Provided parking.  With Commuter Checks, employers significantly reduce employee transit fares while trimming total salary costs.

In June 1998, the Federal legislation authorizing Commuter Check was changed to allow Commuter Checks to be provided in place of existing salary (pre-tax salary reduction).  Under earlier legislation, they could only be provided as an added benefit.  This means Commuter Check now has even more benefits -- it involves no added cost to employers while it delivers real savings to employers and employees.  Provided as either a supplemental benefit or pre-tax salary reduction, up to $100 a month ($1200/year) can be given tax-free to each employee.  In the Bay Area, $20, $30, $35, and $45 denominations are available.

Who can participate?
Are any employers too large or too small for the program?

All employers, from single person offices to those with multiple locations, and from every industry category in the private, public and non- Profit sectors can participate in the program.  Small employers are especially prominent in the program.  They are very interested in low cost benefits that achieve high employee satisfaction.  With Commuter Check, any size company can provide fare discounts while avoiding the administrative burden of handling monthly passes.

How do employees use Commuter Check?

Commuter Checks are simple to use.  Employees redeem Commuter Checks for transit tickets, tokens or passes from participating transit operators.  Commuter Checks are accepted at token booths, staffed pass sales offices, retail sales outlets, etc., for any type of prepaid fare in basically the same way as cash payments.

What are the benefits of Commuter Checks?

Commuter Check has many benefits.  Employers find that the program provides an attractive benefit while not increasing overall compensation costs.  Commuter Check is extremely popular with employees, and an appropriate way for firms to indicate their concern for the environment while keeping their benefits packages competitive.  Commuter Check users have noted reduced stress from not driving, increased job satisfaction, improved on-time arrival and enhanced productivity.

There are very significant financial benefits.  Employers reduce FICA and other payroll related costs by using Commuter Checks.  With Commuter Checks, employees are compensated with a salary equivalent value that exceeds the face value and cost of the vouchers.  Up to $65 a month ($780 a year) can be provided tax-free.  Thanks to the June 1998 Federal tax law revision, employers can offer employees a pre-tax salary reduction to pay for transit fares through purchase of Commuter Checks.  This option allows employers to reduce employee transit fares by up to 40%, but entails no cost to the employer.  In fact, employers also save on payroll taxes.  Under legislation first enacted in the 1980's, thousands of employers have purchased Commuter Checks as an employee benefit provided in addition to existing compensation.

As a tax-free employee benefit, no income or payroll taxes are paid by employees or employers on transit benefits provided to employees. Due to the tax savings, most employees save over $300 in annual commuting costs, while employers save about $80 per year per employee.  This assumes a 33% combined Federal and State income tax rate; Social Security (FICA) taxes paid by both employers and employees (7.65% of salary); and unemployment, disability, workman's compensation and retirement costs driven by salary.  These savings on payroll taxes are provided to all employers, including non- Profit and public sector employers that do not pay income taxes.  Additionally, "for- Profit" employers who provide Commuter Checks as a benefit can deduct the entire cost of the program including administrative fees as a business expense.

History of Commuter Check

Transit fringe benefits have become increasingly popular over the past ten years.  The first legislation on transit benefits appeared in 1984.  The Metropolitan Transportation Commission started the Bay Area Commuter Check program in September 1991 in partnership with Commuter Check Services Corporation.  Nearly 2000 employers of all types and sizes in the private, public and non- Profit sectors have purchased Bay Area Commuter Checks and over 35,000 employees receive them every month.

Results of the program

In a Bay Area study, Commuter Check was found to have increased transit use by an average of 30% at participating employers, and in some cases, by over 100%.  Over 1/3 of the employees surveyed increased transit use by an average of 3.24 trips per week.  The Bay Area Commuter Check program received a Governor's "Keep California Moving" Award in 1992 and an award from the American Lung Association in 1997.  The program has also received marketing grants from the Bay Area Air Quality Management District.

For more information

Detailed information on Commuter Check, including how it operates, its benefits and ordering information, can be found at www.commutercheck.com.  Or, call Rides for Bay Area Commuters at (510) 893-7665 and ask for a Commuter Check Specialist or check their Commuter Check page at www.rides.org/main/commutercheck.htm.  These links opens a new browser window

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