1

Mass transit tax break could provide numerous benefits

Bay Area Rapid Transit riders exit a train at the Powell Street station in San Francisco.

TEXT OF STORY

JEREMY HOBSON: Looks like the Senate will have no trouble approving the tax cut compromise today. A vote last night to advance the deal was 83 to 15. House Democrats will meet behind closed doors tonight to discuss the deal. Now as with any legislation whose pricetag exceeds $800 billion, there are some contents we haven't heard much about. One is a tax benefit for commuters. That was part of the 2009 stimulus package. The idea is to mass transit riders write off the same amount as people who pay to park their cars at work.

Marketplace's David Gura has more.


David Gura: The tax break gave commuters a new incentive to use mass transit. They could deduct up to $230 per month for bus rides, train fare and van pools.

Jay Winters is with the Center for Urban Transportation Research. He says studies have shown this kind of benefit does change how people behave.

Jay Winters: There was an increase in transit rider-ship. In some cases, transit rider-ship more than doubled.

And that kind of growth can be even more valuable than building new infrastructure that doesn't create jobs right away. Rachel Weinberger is a professor at Penn.

Rachel Weinberger: Any time you spend money on transit, that's money that stays in the local economy.

She says increased demand means bus drivers and maintenance workers keep their jobs. And they usually spend their money where they live. So, does it make sense to extend the tax benefit?

Weinberger: There's no downside. And if it actually is effective, then there's a potential tremendous upside.

Fewer cars on the road. Less pollution. And more commuters using mass transit.

In Washington, I'm David Gura for Marketplace.

About the author

David Gura is a reporter for Marketplace, based in the Washington, D.C. bureau.
Log in to post1 Comment

How do u claim this benefit if your employer doesn't participate in the pre- tax transit program ?

With Generous Support From...