These SmartBenefit changes are baffling
Here's the announcement on Metro's Web site they were reacting to.
Today, Metro sent out more information about the changes, which take effect Jan. 1. The transit authority says the changes are necessary to help employers comply with new IRS rules requiring that transit benefits be disbursed and monitored separately from other value stored in their employees' SmarTrip cards.
So transit benefits and parking benefits need to be stored in two distinct electronic accounts in a central location. The card itself will store only value directly added by the employee, Metro says.
The good-sounding part for riders is that they won't have to line up each month at the vending machines to add the SmartBenefits value to their SmarTrip cards. That will happen automatically as they go through the fare gates or tap the fare boxes on buses.
The maximum value that a rider can add to a card will remain at $300. Then this new category, the centrally stored value of transit and parking benefits from SmartBenefits, will be limited to $230 each. (IRS rule for 2009: "Employees may exclude from income $230 per month in transit benefits and $230 per month in parking benefits -- up to a maximum of $460 per month. Employees may receive benefits for commuter transportation and transit passes and benefits for parking during the same month; they are not mutually exclusive. These qualified transportation fringe benefits are excluded from an employee's gross income for income tax purposes and from an employee's wages for payroll tax purposes.")
Up to this point, it doesn't sound like much to worry about. In fact, it sounds helpful. But here's the part riders are focusing on: At the end of each month, any unused benefits will be credited back to the employer. Metro says employees who contribute a portion of their pre-tax salary to the SmartBenefits program should contact their employers to determine how the employer will handle any unused portion of their pre-tax contribution.
Metro is going to sponsor some seminars for employers on how to deal with this. How about some seminars for the private employees who use SmartBenefits? We're talking about their money.
Here's the other downer in the Metro announcement: Because of the need to focus on complying with the IRS rules, Metro says, it has to delay other upgrades. That includes the upgrade -- so long awaited by many of you -- to make bus and rail passes available on the SmarTrip card or to let riders add value to SmarTrip cards online.
So the deadline for those services continues to slide. Instead of having them by the end of this year, it's likely to be fall 2010.
This is not good. It's just going to cause more confusion and anger among riders. They'll be confused at first. Then when they realize what's happening, they'll be angry. I wish Metro would consider this in the context of what it's trying to achieve regarding the long-term health of Washington's transit system. Metro needs us to understand the system's financial needs, and perhaps the need to support a fare increase and an increase in taxpayer-supported subsidies to the transit authority.
Fat chance understanding those high finances at the same time we're trying to figure out our fare cards.
By the way, those seminars for employers to learn about the new program are scheduled for Nov. 4, Dec. 2 and Jan. 12 at Metro headquarters. Tell me: When you ask your employer to change your SmartBenefit contribution, how long does it take your employer to implement the change?
This is the Metro communication problem all over again.
October 27, 2009; 1:33 PM ET
Categories: Metro | Tags: Dr. Gridlock, Metrobus, Metrorail, SmarTrip, SmartBenefits
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