[Congressional Record Volume 149, Number 44 (Wednesday, March 19, 2003)]
[Senate]
[Pages S3999-S4000]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SCHUMER (for himself, Mr. Warner, Mr. Sarbanes, Mr. 
        Kennedy, and Mrs. Clinton):
  S. 661. A bill to amend the Internal Revenue Code of 1986 to equalize 
the exclusion from gross income of parking and transportation fringe 
benefits and to provide for a common cost-of-living adjustment, and for 
other purposes; to the Committee on Finance.
  Mr. SCHUMER. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 661

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Commuter Benefits Equity Act 
     of 2003''.

     SEC. 2. UNIFORM DOLLAR LIMITATION FOR ALL TYPES OF 
                   TRANSPORTATION FRINGE BENEFITS.

       (a) In General.--Section 132(f)(2) of the Internal Revenue 
     Code of 1986 (relating to limitation on exclusion) is 
     amended--
       (1) by striking ``$100'' in subparagraph (A) and inserting 
     ``$190'', and
       (2) by striking ``$175'' in subparagraph (B) and inserting 
     ``$190''.
       (b) Inflation Adjustment Conforming Amendments.--
     Subparagraph (A) of section 132(f)(6) of the Internal Revenue 
     Code of 1986 (relating to inflation adjustment) is amended--
       (1) by striking the last sentence,
       (2) by striking ``1999'' and inserting ``2003'', and
       (3) by striking ``1998'' and inserting ``2002''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2003.

     SEC. 3. CLARIFICATION OF FEDERAL EMPLOYEE BENEFITS.

       Section 7905 of title 5, United States Code, is amended--
       (1) in subsection (a)--
       (A) in paragraph (2)(C) by inserting ``and'' after the 
     semicolon;
       (B) in paragraph (3) by striking ``; and'' and inserting a 
     period; and
       (C) by striking paragraph (4); and
       (2) in subsection (b)(2)(A) by amending subparagraph (A) to 
     read as follows:
       ``(A) a qualified transportation fringe as defined in 
     section 132(f)(1) of the Internal Revenue Code of 1986;''.

  Mr. SARBANES. Mr. President, I am pleased to join with my colleagues 
in introducing the Commuter Benefits Equity Act of 2003. This measure 
is another important step forward in our efforts to make transit 
services more accessible and improve the quality of life for commuters 
throughout the Nation.
  All across the Nation, congestion and gridlock are taking their toll 
in terms of economic loss, environmental impacts, and personal 
frustration. According to the Texas Transportation Institute, in 2000, 
Americans in 75 urban areas spent 3.6 billion hours stuck in traffic, 
with an estimated cost to the Nation of $67.5 billion in lost time and 
wasted fuel, and the problem is growing. One way in which Federal, 
State, and local governments are responding to this problem is by 
promoting greater use of transit as a commuting option. The American 
Public Transportation Association estimates that last year, Americans 
took over 9.5 billion trips on transit, the highest level in more than 
40 years. But we need to do more to encourage people to get out of 
their cars and onto public transportation.
  The Internal Revenue Code currently allows employers to provide a 
tax-free transit benefit to their employees. Under this ``Commuter 
Choice'' program, employers can set aside up to $100 per month of an 
employee's pre-tax income to pay for the cost of commuting by public 
transportation or vanpool. Alternatively, an employer can choose to 
offer the same amount as a tax-free benefit in addition to an 
employee's salary. This program is designed to encourage Americans to 
leave their cars behind when commuting to work.
  By all accounts, this program is working. In the Washington area, for 
example, the Washington Metropolitan Area Transit Authority estimates 
that over 200,000 commuters take advantage of transit pass programs 
offered by their employers. That means fewer cars on our congested 
streets and highways.
  Employees of the federal government account for a large percentage of 
those benefitting from this program in the

[[Page S4000]]

Washington area. Under an Executive Order, all Federal agencies in the 
National Capital Region, which includes Montgomery, Prince George's, 
and Frederick Counties, Maryland, as well as several counties in 
Northern Virginia, are required to offer this transit benefit to their 
employees. The Commuter Choice program is now being used by an 
estimated 130,000 Washington-area Federal employees who are choosing to 
take transit to work.
  However, despite the success of the Commuter Choice program, our tax 
laws still reflect a bias toward driving. The Internal Revenue Code 
allows employers to offer a tax-free parking benefit to their employees 
of up to $190 per month. The striking disparity between the amount 
allowed for parking--$190 per month--and the amount allowed for 
transit--$100 per month--undermines our commitment to supporting public 
transportation use.
  The Commuter Benefits Equity Act would address this discrepancy by 
raising the maximum monthly transit benefit to $190, equal to the 
parking benefit, and providing that the benefits will be adjusted 
upward together in future years. The Federal Government should not 
reward those who drive to work more richly than those who take public 
transportation. Indeed, since the passage of the Intermodal Surface 
Transportation Efficiency Act of 1991, Federal transportation policy 
has endeavored to create a level playing field between highways and 
transit, favoring neither mode above the other. The Commuter Benefits 
Equity Act would ensure that our tax laws reflect this balanced 
approach.
  In addition, the Commuter Benefits Equity Act would remedy another 
inconsistency in current law. Private-sector employers can offer their 
employees the transit benefit in tandem with the parking benefit, to 
help employees pay for the costs of parking at transit facilities, 
commuter rail stations, or other locations which serve public 
transportation or vanpool commuters. However, under current law, 
Federal agencies cannot offer a parking benefit to their employees who 
use park-and-ride lots or other remote parking locations. The Commuter 
Benefits Equity Act would remove this restriction, allowing Federal 
employees access to the same benefits enjoyed by their private-sector 
counterparts.
  The Washington Metropolitan Region is home to thousands of Federal 
employees. It is also one of the Nation's most highly congested areas, 
ranking fourth in per capita congestion. This area has the third 
longest average commute time in the country. It is clearly in our 
interest to support programs which encourage Federal employees to make 
greater use of public transportation for their commuting needs.
  The simple change made by the Commuter Benefits Equity Act would 
provide a significant benefit to those Federal employees whose commute 
to work includes parking at a transit facility. For example, a commuter 
who rides the Metrorail to work and parks at the Rockville park-and-
ride lot pays about $45 monthly for parking, on top of the cost of 
riding the train. A private-sector employee whose employer provides the 
parking benefit in addition to salary could receive $540 a year tax 
free to help pay these parking costs. Federal government employees 
should be allowed the same benefit.
  I support the Commuter Benefits Equity Act because it creates 
parity--parity in the tax code between the parking and transit 
benefits, and parity for Federal employees with their private-sector 
counterparts. Both of these improvements will aid our efforts to fight 
congestion and pollution by supporting public transportation. I 
encourage my colleagues to join me in supporting the Commuter Benefits 
Equity Act.
                                 ______