Congress has found that more than 70 percent of the population of the United States is located in rapidly expanding urban areas that generally cross the boundary lines of local jurisdictions and often extend into at least 2 States, that the welfare and vitality of urban areas, the satisfactory movement of people and goods within those areas, and the effectiveness of programs aided by the United States Government are jeopardized by deteriorating or inadequate urban transportation service and facilities, the intensification of traffic congestion, and the lack of coordinated, comprehensive, and continuing development planning. Congress further made findings that significant mass transportation improvements are necessary to achieve national goals for improved air quality, energy conservation, international competitiveness, and mobility for elderly individuals, individuals with disabilities, and economically disadvantaged individuals. ( Source TITLE 49 United States Code, Section 5301) Available from Legal Information Institute. CHAPTER 53 - MASS TRANSPORTATION

Recent changes in the federal Internal Revenue Service Code covering commute benefit options provide incentives for transit, vanpooling, and parking benefits.  These provisions, amended by the Transportation Equity Act for the 21^st Century (TEA-21) (title 9 section 910, PL 105-178), are contained in the Internal Revenue Code Section 132(f). Under current law, qualified parking benefits, transit benefits and vanpool services are not subject to Federal taxes (up to specified limits).  Employers may also offer Parking Cash Out, where employees can trade employer-paid parking spaces for cash or other qualified benefits.  If the employee elects the cash option, it is taxable for that employee.

These tax changes mean that employees can receive the specified benefits for their work commutes in addition to compensation or in lieu of compensation (or a combination of the two) up to $175 monthly, $2100/year, for parking at or near work site and transit facilities, up to $65 monthly, $780/year, for public transit, and up to $65 monthly, $780/year, for vanpool services  (Federal tax-free). For transit and vanpooling, this amount will increase to $100/month for taxable years beginning after December 31, 2001.

Amounts in excess of the Federal limits are subject to Federal income and payroll taxes.  In addition, States may apply taxes even when the Federal government does not. The relationships between tax benefits and how a benefit is offered to the employee are well summarized by the EPA in a publication entitled How Benefits Are Offered.   The details, as with other tax benefits and deductions are extremely important, and you should consult with your professional tax advisor.

The primary law covering transit in the United States is Title 49, UNITED STATES CODE, Chapter 53, Mass Transportation, as amended by the "Surface Transportation Extension Act of 1997" (P.L. 105-130), the "Transportation Equity Act for the 21st Century," "TEA-21," (P. L. 105-178), and the "TEA-21 Restoration Act," (P.L. 105-206, 112 Stat. 685).

The United States Code, Title 49 is available from Legal Information Institute here. A revision markup, with the changes to date may be downloaded in ADOBE® Acrobat format here. Title 49 and other related laws are available from the Federal Transit Administration here.

The stated mission of the Federal Transit Administration is to " Provide Leadership, Technical Assistance And Financial Resources For Safe, Technologically Advanced Public Transportation Which Enhances All Citizens' Mobility And Accessibility, Improve America's Communities And Natural Environment, And Strengthen The National Economy". The National Transit Library is quite impressive.

The National Transit Database (NTD) was designed to collect and disseminate uniform public mass transportation financial and operating data for use by all constituencies of the transit industry and is intended to support public investment decisions and to provide information for mass transportation service planning.

Title 49 United States Code Section 5335(a) requires a National Transit Database to help meet the needs of individual mass transportation systems, the United States Government, state and local governments, and the public for information on which to base mass transportation service planning, the Secretary of Transportation is required to maintain a reporting system, using uniform categories, to accumulate mass transportation financial and operating information and using a uniform system of accounts. The reporting and uniform systems shall contain appropriate information to help any level of government make a public sector investment decision. The Secretary may make grants under Section 5307 only if the applicant and any person that will receive benefits directly from the grant are subject to the reporting and uniform systems.

Each year, almost 600 transit operators report to the Federal Transit Administration on transit activities in more than 400 urbanized areas. Nationally, 85,000 transit vehicles, 7,000 miles of rail track, 2,000 rail stations, and 1,000 maintenance facilities are included in these reports. The National Transit Database (NTD), as the repository for this information, serves as the primary tool to support transit operational and financial decision making on a national level.