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New Transit Program Called ‘Win-Win’ for Many Commuters and Employers


garodnick transit benefits

CM Garodnick, right, with reps from Riders Alliance & DCA (photo via @DanGarodnick) 


Almost half a million New Yorkers will be able to save upwards of $400 a year on their public transportation expenses after a new Commuter Benefits Law goes into effect January 1. The law expands pre-tax transit benefits to more New Yorkers by requiring businesses with 20 or more full-time employees working in New York City to offer the program.

Over “450,000 New Yorkers who do not have access to the tax benefits today because it is not being offered to them” will benefit from the law, City Council Member Dan Garodnick, who sponsored the bill, told Gotham Gazette. Commuters who buy a 30-day Metrocard every month will save about $443 a year, according to a report by the Riders Alliance, a grassroots campaign that helped to get the commuter benefits law passed.

A monthly card currently costs $116 every 30 days for unlimited rides on the city’s subways and buses; totaling about $1400 per year. The transit benefit can be used for additional transportation options, though, it is not limited to the MTA. Eligible commuters will be able to access several options through their employers depending on the transit they use.

The law is roundly viewed “as a win-win for employees and employers,” Julie Menin, Commissioner of New York City’s Department of Consumer Affairs (DCA) told Gotham Gazette, as it “allows employers to save on their payroll taxes, and also saves employees a significant amount” by allowing them to use their pre-tax income to pay for transportation expenses. DCA will oversee implementation of the commuter benefits law and is administering a marketing campaign so that workers and employers know about its start date.

Employers can save more than $100 per year per employee in tax liability, so the more employees who sign up for transportation benefits, the more the employer can save, according to DCA.

“We designed this to be applicable only to businesses of a certain size, which are most likely to already have the ability to process employee benefits,” Garodnick said. “We also recognize that when you take pre-tax dollars off of the payroll it reduces a company’s own tax burden. So it becomes a positive for them too. I think it is a very minimal obligation on businesses.”

The law also comes with some safeguards for businesses, including a six-month grace period to implement the law, meaning employers will not be subject to penalties until after July 1, 2016. If employers have not complied with the law by July 1, they have an opportunity to do so within 90 days. After that, DCA will impose penalties for those not complying.

Additionally, if businesses can prove that complying with the Commuter Benefits Law would significantly harm the business’ finances, the business can qualify for a financial hardship exemption, excusing them from complying with the law. In that case, employees of such companies would simply be out of luck when it comes to accessing transit benefits.

The new law will not “cost [businesses] money - it’s just an administrative cost,” Nicole Gelinas, senior fellow at the Manhattan Institute, told Gotham Gazette. “You have this cost taken out of your paycheck before you pay your taxes, it does save the employees a bit of money and it encourages transit.”

“I think employers have too many mandates,” Gelinas said, “but, considering that larger employers are already paying a benefits administrator, in terms of mandates, this is not that onerous and it saves money…a lot of employers want to offer this anyway because it’s good for morale.”

Gardonick, Menin, and Gelinas all say they have not heard any criticisms of the law, which will make more employers take advantage of an existing federal tax benefit that allows businesses to offer its workers $130 a month of pre-tax income for transportation.

Wil Fisher, a Rider’s Alliance member, told Gotham Gazette his employer already offered the commuter benefits program. “In addition to helping folks, it’s very easy to deal with, the way it’s set up with my employers. You just sign up once and it’s there - it’s like a pay raise I don’t even have to think about.”

“I’m saving about $500 a year, it’s been a very clear help to me,” said Fisher, who joined Garodnick and the Riders Alliance at Union Square on Sunday, Dec. 13 to promote the program. The Riders Alliance set up a big pink calculator in Union Square which passersby could use to estimate their transit savings (a calculator is also available online).

The law allows full-time employees to use pre-tax income to pay for certain commuting expenses up to the maximum amount permitted under federal law. As a part of the massive federal spending bill passed by Congress Friday morning, the maximum amount will be raised to $255 per month, up from $130, meaning employees can spend $255 worth of untaxed earnings to purchase qualified transit expenses, including subways, light rails, trains (including Amtrak), buses (including coach buses and Greyhound), ferries, and vanpools. The benefit will come in various forms depending on the type of transit a commuter uses - some will be able to obtain their monthly MTA passes through the program using pre-tax money, others will receive a card with money on it that can be used to purchase certain transportation.

Commuters who spend $130 or less per month on transportation expenses will get the same amount of savings under the new federal law as they previously did. New Yorkers who take more costly modes of transportation to and from work, such as express buses or commuter rails, will benefit from the federal increase.

As Gelinas indicated, besides saving New Yorkers money, the commuter benefits law has other positive effects. “It promotes mass transit use,” Menin also said, which can cut down on carbon emissions. And, it helps offset MTA fare hikes that hit commuters every two years.

According to a report from the Riders Alliance, about one million people who live and work in New York currently do not have access to transit benefits. The commuter benefits law will allow at least 450,000 more New Yorkers to access these benefits, which an estimated 750,000 transit riders who live and work in New York already have access to.

In that case, because only businesses with 20 or more employees are required to offer the benefits, some half a million New Yorkers will still be left without access to transit benefits after the commuter benefits law goes into effect. However, those employees are still eligible to participate in the commuter benefits program, and can still ask their employer to set up the transit benefit for them.

Organizations with 20 employees or fewer may refuse, as the law does not require them to offer the benefits, in which case those employees would not have access to the same transit savings as others.

Smaller businesses may feel that administering the benefits program is too costly, whereas larger businesses typically already have a benefits administrator. Smaller businesses could pay a third-party vendor to administer the program, entities which charge administrative fees that can range from $4-6 per participant per month, according to DCA.

***
by Meg O’Connor, Gotham Gazette
@GothamGazette, @MegOConnor13

The Week That Was in New York Politics, Dec 14-18


week in review bus readers

photo: Stanley Kubrick via Museum of the City of New York


Gotham Gazette's Week in Review, Friday December 18

PHOTOS OF THE WEEK: Mayor de Blasio and NYPD Commissioner Bratton, via WNYC's Brigid Bergin; Members of de Blasio's new "HomeStat" team, via @BilldeBlasio

BdB Bratton via Brigid Bergin

BdB Home Stat team ABNY

TOP FIVE STORIES OF THE WEEK:

1. Home-Stat: On Thursday, Mayor de Blasio unveiled a major new plan to track and combat street homelessness. The new program, called Home-Stat, will involve tracking the street homeless population in real time, canvassing Manhattan streets daily, expansion of a police unit dedicated to homelessness, and individualized case management for each person living on the streets.

2. 421-A Negotiations Reach Impasse: Discussions between labor leaders and real estate developers to extend the controversial 421-a tax abatement program meant to encourage affordable housing are at an impasse, with sources characterizing the discussions as “dead.” In June, State lawmakers decided to leave the future of the expiring program contingent upon an agreement between labor and business, yet there has been no movement in the negotiations for some time. [Read: Negotiations to Extend Important Affordable Housing Tax Break Said to Reach Impasse]

3. City Homelessness Chief Steps Down: Gilbert Taylor, New York City's top official in charge of homeless services, resigned on Tuesday following which Mayor de Blasio announced a comprehensive review of all homeless services agencies and programs. He is the second official overseeing homelessness programming to leave this year, after Deputy Mayor Lilliam Barrios-Paoli, who oversaw homelessness and health care, resigned this summer. HRA Commissioner Steven Banks is currently running HRA and DHS while working with First Deputy Mayor Tony Shorris.

4. Cuomo FOIL Saga: Following the conviction of former State Senate Majority Leader Dean Skelos and his son Adam last Friday, Governor Cuomo called for the state legislature to push ahead on ethics reform. But just hours later, he vetoed two bills which would have sped up Freedom of Information Law responses from the Executive branch and required the state to pay court costs incurred by FOIL users whose requests a judge finds have been improperly denied. After pressure from good government groups, the governor did quickly issue an executive order on Saturday, then held a FOIL meeting with those groups on Wednesday.[Read: Vetoing FOIL Bills, Cuomo Points Finger at Legislature, Issues Executive Order & Cuomo's FOIL Order Has More Limited Scope Than Vetoed Bills]

5. Ethics After Skelos, Silver: The convictions of two legislative leaders on federal corruption charges within a span of 13 days have spurred renewed calls for public ethics reforms. U.S. Attorney Preet Bharara said on Monday the convictions should result in widespread reforms, and that his office still has “lots of investigations open.” A new Siena poll finds a strong majority of New Yorkers want ethics laws passed to clean up corruption in the state government. [Read: Assemblymember Blake Decides Against New Consulting Job & Skelos Conviction Greeted With Calls for Immediate Action on Reform]

THIS WEEK'S NUMBERS:

  • 3 troubled public schools in Brooklyn will be closed by the city at the end of the school year, the New York Times reports.
  • 92% of city teachers earned high marks in the newest round of evaluations, Chalkbeat reports.
  • $2.4 billion increase in State school aid requested by the state Board of Regents, the Times Union reports.
  • $20,200 in campaign contributions to Mayor de Blasio from Glenwood Management, a real-estate firm involved in the corruption scandals involving two disgraced Albany legislative leaders, will be returned, the New York Post reports.

THE GLORY AND THE GOAT:

It was a good week for New York’s state judges, as a panel tasked with examining compensation levels approved a set of recommended pay raises that will boost their salaries for the first time in years.

It was a bad week for NYCHA leaders, as a series of revelations regarding the housing authority’s struggles were revealed, including a report showing that NYCHA had failed to screen those convicted of violent crimes, that there is at least one sex offender in one out of every four developments, a report from Comptroller Scott Stringer alleging that another natural disaster like Superstorm Sandy could leave nearly half a million people living in NYCHA developments at “extreme risk,” and a federal judge agreeing to appoint a special monitor to ensure that NYCHA finally deals with the toxic mold problem in its aging apartments.

THE FLASH:

  • Around this time 75 years ago, on December 14, 1940, Mayor Fiorello LaGuardia marked the opening of the Sixth Avenue subway during a ceremony at the 34th street station. The new line included F, B, and D trains and ran from West 4th Street to 50th Street.
  • Around this time 144 years ago, on December 15, 1871, political boss William Tweed was indicted on more than 100 counts of fraud and misdemeanor charges for pocketing millions in taxpayer money.
  • Around this time 13 years ago, on December 16, 2002, a major transit strike was avoided after the Transport Workers Union and the MTA spent days negotiating to reach a deal to keep the city’s transit system running.
  • Around this time 115 years ago, on December 17, 1900, the immigration processing center on Ellis Island opened. In the decades that followed, millions of new Americans were processed at the center before beginning their new lives in America.

GOTHAM GAZETTE HIGHLIGHTS OF THE WEEK:

Negotiations to Extend Important Affordable Housing Tax Break Said to Reach Impasse, by David King

Assemblymember Blake Decides Against New Consulting Job, by Ben Max

Assembly Reform Group Will Miss Own Deadline, by David King

Reforms to City Campaign Finance System Advance Ahead of 2017 Election Cycle, by Samar Khurshid

Vetoing FOIL Bills, Cuomo Points Finger at Legislature, Issues Executive Order, by David King

Cuomo's FOIL Order Has More Limited Scope Than Vetoed Bills, by David King

Hope Knight to Join City Planning Commission at 'Exciting Time' by Ben Max

A Plan for More Senior Affordable Housing, by Bobbie Sackman (opinion)

New York Leads on Climate Action, by Heather Leibowitz (opinion)

MORE FOR THE WEEKEND:

On Friday, Mayor de Blasio appeared on the Brian Lehrer Show on WNYC to talk about the city's new initiative for combating homelessness, Home-Stat: Homeless Outreach & Mobile Engagement Street Action Teams; and his first two years in office in sum.

On Monday, U.S. Attorney Preet Bharara appeared on the Brian Lehrer Show to discuss his office’s work prosecuting former State Senate Majority Leader Dean Skelos, Skelos’ son and former Assembly Speaker Sheldon Silver.

In State of Politics, Zack Fink details former State Senate Majority Leader Dean Skelos' history of supporting, then reneging support for campaign finance reform, and discusses the potential for reforms in the upcoming legislative session. 

***
NOTE TO READERS: we hope you enjoy this new Gotham Gazette weekly feature - please share it if you do; on Twitter, use our handle @GothamGazette.

If you have feedback on this feature for us, you can email editor Ben Max: This email address is being protected from spambots. You need JavaScript enabled to view it.

Watch Sunday evening for our latest Week Ahead in New York Politics, which gives you a preview of key issues and events to be aware of for the week about to start. In the meantime, catch up on the latest original reporting from Gotham Gazette here. And have a great weekend!

***
by Meg O'Connor and Ben Max

Reforms to City Campaign Finance System Advance Ahead of 2017 Election Cycle


cm king alatriste

City Council Member Andy King (photo: William Alatriste)


As the federal trials of Albany lawmakers further reveal the corrupting influence of money in politics and spending on the 2016 presidential race ramps up, New York City officials continue to refine local laws meant to limit the ways in which cash affects voting.

Already renowned for its campaign finance system that offers public matching funds for participation in a program with relatively low donation caps, the city is moving on reforms ahead of the next widespread municipal elections, set for 2017.

A package of eight bills introduced to the City Council in November seeks to strengthen the city's campaign finance laws and insulate elections from the consequences of the Supreme Court's Citizens United decision. While good government advocates approve of the package, they hoped for faster and more far-reaching change.

"We're trying to protect and improve New York's landmark campaign finance program," said Council Member Ben Kallos, chair of the governmental operations committee and prime sponsor on three of the eight bills in the package.

The bills "will protect New York City's landmark small-dollar matching campaign finance system from an onslaught of dark money and special interests in City elections," according to a statement from Council Member Andy King's office - King is the sponsor of one of the new bills.

The proposals would implement a number of recommendations made by the New York City Campaign Finance Board (CFB) in its 2013 post-election report. Of the CFB's 14 recommendations, two have already been made into law, strengthening disclosure of independent expenditures and banning certain anonymous campaign communications.

The current legislative package addresses eight additional CFB recommendations. Among the more significant of the proposals is a bill that would move the first payments of public funds to an earlier date, in June instead of August, to give candidates better footing ahead of the crucial primary campaign period.

Two bills fortify rules for entities that do business with the city, attempting to limit how much influence entities with business before the city can wield in elections. The first would preclude matching public funds for contributions bundled by individuals such as lobbyists who have business dealings with the city.

The second would improve disclosure by ensuring that companies that have an ownership interest in firms that work with the city are added to the "doing business database." Currently, the rule applies only to individual owners of businesses, and limits the contributions they can make. This bill would expand these limits to parent companies.

The other proposals in the package also address various technical aspects of elections such as voter guides, debate eligibility, and contributions from non-registered political committees.

"This package of bills increases protections against the impact of 'pay-to-play' contributions," said Eric Friedman, assistant executive director for public affairs, New York City Campaign Finance Board. Friedman said the matching funds program has been a success for more than 25 years and is regarded as a national model because "it has been adapted to meet the challenges of the evolving political system." He said these bills would make the system simpler for candidates and also more transparent for the public.

Strengths of the city's campaign finance laws are also, in part, weaknesses. The system can involve onerous paperwork, said Prudence Katze, research and policy manager at Common Cause New York, a good government organization. "It would be great to see a streamlined way of distributing money to make it less onerous for candidate committees as well as provide more transparency for the CFB and the public," she said.

Katze approves of the direction the Council is taking and thinks that these proposals will help clarify rules around campaign contributions. But she is skeptical of how quickly the Council can act on them.

"Just because bills are introduced doesn't mean laws are going to be passed," she said. "It remains to be seen."

She also hopes to see some technological rather than legislative fixes that would encourage campaigns to comply with the laws. For instance, charge cards that allow campaigns to disburse and easily track expenditure of public funds.

CFB's Friedman said they were already looking at measures, including something similar to Katze's proposal, to make it easier for candidates to navigate the system and for the public to dig into spending data. He even mentioned a system to help candidates process credit card contributions that would be rolled out soon.

Rachael Fauss, director of Public Policy at Citizens Union, another government watchdog, said the administrative reforms proposed in this package are important for a more efficient system and that it responds to changing political dynamics. However, she believes that the issue of independent expenditure has not been fully addressed. "We got disclosure laws before 2013 and we know how much was spent in the last elections," she said, "and to not acknowledge that misses an opportunity."

Citizens Union advocates for increases in candidate campaign spending caps and public matching caps as a measure to balance the scales against independent outside expenditures. Fauss said this is a complicated political issue. "Council members might not want to do this because it looks like it benefits themselves," she said, although hoping that there would be discussions on the issue led by the Council.

"These proposals make good common sense and they're important but they're missing one big piece. We know what the problem is and we need to look at solutions," she said.

Friedman agreed that independent spending was a significant issue in the 2013 elections and would have to be watched closely in 2017. "Going forward, we want candidates to continue to feel that the public matching funds program provides them the ability to run a campaign," he said, agreeing that an increase in spending and matching caps was one way to accomplish this in light of growing spending by entities other than candidate campaigns. On the other hand, he said it could also lead to the argument that more money was being brought into the election. "It's a conversation we need to have because outside spending isn't going away," he said.

Council Member Kallos also supports increasing public matching funds, but in order to minimize the role of large individual contributions. "Currently, even after candidates receive full matching funds, they are only 64 percent of the way to the spending cap, and we often see the remaining 36 percent of funds coming from large contributions," he said.

"The spending cap gives upstart candidates a chance against campaigns that can raise a lot of money from large contributions," Kallos added. "As the CFB's report showed, independent expenditures have not been winning campaigns, and strengthened disclosure from legislation passed by Council Member Brad Lander through the Government Operations Committee should serve to further limit their effectiveness."

The New York Public Interest Research Group came out in favor of all the proposals put forward. Senior attorney Gene Russianoff said one bill, which would ban public matching funds for bundlers who work with the city, is a particularly important one. "They made a mistake not amending the law in 2009," he said, referring to the last time the city passed significant changes to campaign finance law. "Now I think they're making up for it."

But Russianoff is disappointed with the Council's time frame. If signed into law, the bills will go into effect for the 2017 election cycle, but the longer it takes to enact new rules, the more time bundlers, contributors, and spenders have to play by the current ones.

"One of the problems is that time is running out and reforms that wouldn't have been so controversial in the past become complicated," Russianoff said. According to him, reform efforts are usually "on the defensive" either in a post-election climate or in the run up to the next election. "Our biggest argument to the [City Council] Speaker and her staff was, 'it's now or never.'" By 2017, he believes that "influence peddlers" will have ample time to get their work done, finding loopholes to have their contributions grandfathered in, among other means.

Russianoff also mentioned that the texts for all the bills state January 1, 2016 as the date they will go into effect - a timeframe virtually unmeetable at this point. The governmental operations committee held its last hearing of the year on Monday, Dec. 14, and the legislative package was not on the agenda. The bills will be heard at a committee hearing "early next year," according to Council Member Kallos, after which they may be tweaked before a committee vote, then a full Council vote, and on to the Mayor's desk for signature.

Council Member Lander believes that "New York City campaign finance rules are a total pain in the ass and totally necessary for democracy." Lander is a passionate supporter of stronger campaign finance regulation and was a prime sponsor on one of the two bills based on CFB recommendations that became law. He has also signed on to all the proposals in the new package.

Lander wishes independent expenditures could be banned, which could only happen if the Supreme Court's Citizens United decision is made void through a constitutional amendment. (Currently, 16 state legislatures across the country have called for a constitutional amendment through resolutions and signed letters. With the signature of only one more state senator, New York will be the 17th state to do so.)

"Till then, we're stuck with putting lipstick on a pig," Lander said. He said the package of legislation would help, in particular the bill related to bundled contributions, which would level the playing field for candidates opposed by heavy independent spending.

In terms of making the system less complicated for candidates, the CFB employs staff and holds information sessions to walk campaigns through the process. "We can't require less compliance but we can make it as positive to comply as we can," Lander said, acknowledging the complicated nature of the system. He is confident that the current proposals will move through the council "fast enough."

Council Member Kallos shares this optimism. "I imagine my colleagues in the Council have an interest to hear the voice of the people," he said, "over the voices of special interests."

***
by Samar Khurshid, Gotham Gazette
@samarkhurshid  @GothamGazette



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