Bill Text: HI HB2254 | 2012 | Regular Session | Amended

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Bill Title: Pretax Transportation Benefit; Statewide

Spectrum: Partisan Bill (Democrat 7-0)

Status: (Passed) 2012-04-24 - (S) Act 045, 4/23/2012 (Gov. Msg. No. 1145). [HB2254 Detail]

Download: Hawaii-2012-HB2254-Amended.html

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STAND. COM. REP. NO. 3221

 

Honolulu, Hawaii

                  

 

RE:    H.B. No. 2254

       H.D. 1

 

 

 

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2012

State of Hawaii

 

Sir:

 

     Your Committee on Ways and Means, to which was referred H.B. No. 2254, H.D. 1, entitled:

 

"A BILL FOR AN ACT RELATING TO THE PRETAX TRANSPORTATION BENEFIT,"

 

begs leave to report as follows:

 

     The purpose and intent of this measure is to allow the chief executive of certain jurisdictions of the State, including the counties, to establish a wage and salary reduction benefit program that qualifies as a pretax transportation benefit program within the meaning of section 132 of the Internal Revenue Code.

 

     Your Committee finds that the Department of Human Resources Development currently operates a pretax transportation benefit pilot program for employees of the state government who:

 

     (1)  Are employees of the state executive branch, excluding the Department of Education, who are eligible to participate in the Employees' Retirement System of the State of Hawaii;

 

     (2)  Live and work on Oahu; and

 

     (3)  Do not have parking in a state-controlled lot with a parking payroll deduction.

 

     The pilot program is operated under the State's qualified transportation fringe benefit plan, in accordance with section 132(f) of the Internal Revenue Code, and authorized under the federal Transportation Equity Act for the 21st Century for eligible State of Hawaii executive branch employees.  This means that eligible employees may purchase public bus passes, Handi-Van fare coupons, and vouchers for the cost of their Vanpool Hawaii seat fares through payroll deductions before federal, state, and Federal Insurance Contributions Act taxes are withheld, thereby increasing their take-home pay.

 

     The savings for each employee varies depending upon the employee's tax bracket.  For example, based upon an annual salary of $24,000, an annual tax savings of $138.24, $253.68, or $181.53 can be gained through participation in the pilot transportation benefit plan for eligible employees who buy bus passes, ride the Handi-Van, or carpool via Vanpool Hawaii, respectively.  Your Committee finds that the pilot program has been successful on Oahu and should be expanded to other jurisdictions of the State.

 

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2254, H.D. 1, and recommends that it pass Third Reading.

 

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

 

		____________________________ DAVID Y. IGE, Chair