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green@work : Magazine : Back Issues : Nov/Dec 2007 : CSR

Corporate Social Responsibility

On the Road to Going Green
More employers are choosing commuter benefits.

by Larry Filler

Environmental concern in the workplace is finding its way to the somewhat unexpected area of employee benefits. Recent surveys indicate that employers are updating their benefits programs to encourage employee activities that reduce greenhouse gas emissions. In fact, commuter benefits are fast-becoming employers’ leading initiative to help curb global warming.

Commuter benefits are not new to the benefits arena, but are rising to the fore as employers increasingly focus on the environment, enhancing workplace productivity, and supporting employees with their cost of commuting. Developed 20 years ago by the nonprofit organization TransitCenter, Inc. to reduce traffic congestion and air pollution, commuter benefits are now the number-one planned addition to employers’ benefit packages, according to the 2007 TransitCenter Commuter Impact Survey. The survey finds that today, 44 percent of employers in major U.S. markets offer a program, up 57 percent from 2006. And of the nearly two-thirds of employers that say they have green initiatives underway, commuter benefits rise to the top, with 28 percent saying they are implementing a program to encourage employees to use mass transit rather than drive to work.

How Commuter Benefits Work
Under the Internal Revenue Code, it is possible to use up to $110 a month tax-free to pay for mass transit and vanpool commuting costs, and up to $215 a month for commuter parking. Employers can offer the benefit as an employee-funded, pre-tax payroll deduction or as an employer-provided tax-free fringe benefit. Participants can achieve tax savings equivalent to 30 to 40 percent of their out-of-pocket commuting expenses. Offering a commuter benefits program can also help employers lower their payroll taxes.

Getting Cars off the Road

Commuter benefits programs have a proven, positive influence on mass transit ridership. A 2005 report issued through the Transportation Research Board of the National Academies finds that employing commuter benefits resulted in up to a 60 percent increase in the number of mass transit riders among benefits recipients.

Using mass transit instead of driving has positive effects on the environment, the economy and overall quality of life. In 2005, mass transit use in the U.S. reduced carbon emissions by over 6.9 million metric tons and saved 1.4 billion gallons of gasoline, according to the American Public Transportation Association (APTA). The Texas Transportation Institute reports that mass transit saved 541 million hours of travel time in 2005.

This year, APTA revealed that using mass transit is the most significant contribution an individual can make in reducing one’s carbon footprint. Riding mass transit instead of driving to work eliminates on average 4,800 pounds of carbon per year. This is almost twice the carbon savings achieved from adjusting home thermostats, more than 10 times that of using lower-wattage light bulbs, and 14 times the savings from switching to a high-efficiency appliance.

A Simple Way to Make a Significant Difference

We all have a stake in the environmental future. As employers, we can change how we do business, reach our customers and structure our products and services to pave the way for a greener tomorrow; so too can we evolve our individual practices. From reducing traffic congestion in our communities, to converting more employees from drivers into mass transit riders, commuter benefits can be a simple way to take an environmentally and fiscally friendly step forward.

Larry Filler is the president and CEO of TransitCenter, Inc.



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