Home to the Space Needle, great seafood, and plenty of tech companies — Seattle, Washington is a wonderful city to live in. Starting January 2020, it’s going to get even better once a law goes into effect making it mandatory for businesses of 20 or more employees to offer commuter benefits. Can’t wait to ring in the new year? Neither can the many commuters who call Seattle home.

Seattle is using public transit more than ever before with a record 48.4% of commuters taking transit and only 25.4% driving alone to work. The people of Seattle are responding to the city’s investment in alternative transportation methods and expanding upon transit that’s been in place.

Background on commuter benefits

Commuter benefits are a tax-free offering that allows employees (and employers) to save money on their commutes. Starting in 2020, federal law allows for each employee to add up to $270 a month for applicable transit, vanpool, or parking that’s taken out pre-tax — saving them money every month.

How do employers benefit? Fewer payroll taxes. Companies can save up as much as 7% on taxes when employees decide to take advantage of commuter benefits. Not only that, but you can also expect to have a higher employee retention rate when you support your staff where it counts: their commutes.

benefits that can be offered

Commuter benefits in Seattle currently cover transit via bus, bike, train, ferry, rideshare, and parking. There are a couple of ways companies can leverage parking through commuter benefits if it’s made available to employees. Why are we talking about parking for employees? Parking doesn’t come cheap — even if it’s free, it’s never really free.

There are currently more than two parking spots for every person living in Seattle, but it somehow still feels like you can never find one. That’s because people want to find the cheapest and most convenient spots around town. If you park in a garage for work, monthly payments will be anywhere from $125-$320 (compared to a $2 daily bus ride). That’s not including what you pay for gas, maintenance, and the mental toll of sitting in bumper-to-bumper traffic.

Employers can use commuter benefits to encourage better habits and ultimately produce happier and healthier employees. Starting a carpooling system can limit the number of single-occupancy vehicles on the road while also getting your team to the office faster. Additionally, you can do a parking cash-out program to grant your employees cash for not using a parking spot.

Developing a Strategy

Although it hasn’t been mandatory in the city, many Seattle-based tech companies have already been offering comprehensive commuter benefit plans to their employees. Xinova provides a transit stipend for their employees, while others like Valant offer a fully subsidized Orca card.

Job seekers are pickier when looking for the right company because companies want to retain the top talent (which is mostly millennials, currently). With this increased competition comes better benefits for employees. Sure, this can include kegs in the office and ping pong tables, but what people really care about is being supported by a company when it comes to their work-life balance.

That balance really hangs in the commute. INRIX’s annual report from 2018 estimated that Seattle drivers traveling during rush hour congestion lost nearly 140 hours to sitting in a car. That’s a lot of time to not be doing anything other than lifting your foot on and off a break pedal.

The city has also been debating the use of congestion pricing, but hasn’t landed on any concrete plan. Cities like New York have been testing congestion pricing to limit the amount of traffic entering their downtown areas. However, there isn’t yet a fully developed plan in place that provides everyone with alternative options to driving alone, which ends up disproportionately hurting low-income families and people of color.

The overall point

There are many things for every city to consider when trying to mitigate traffic. Something that can help with this is commuter benefits! Being in the top 10 for traffic means Seattle’s transportation landscape is going to be changing, and it’s seen bikeshare and ridesharing services explode in the past year.

The more people continue to demand alternatives to cars, the more we can expect to see urban infrastructure develop. Want to learn more about commuter benefits? Check out our free ebook!