Cambridge City
MA

Committee Report
CRT 2019 #18
REPORT ACCEPTED AND PLACED ON
Mar 18, 2019 5:30 PM

A communication was received from Donna P. Lopez, City Clerk, transmitting a report from Vice Mayor Jan Devereux, Chair of the Transportation and Public Utilities Committee, for a public hearing held on March 6, 2019 to discuss how Transit Benefit Ordinances are being used in other cities to further sustainable transportation goals, and whether Cambridge could benefit from implementing a Transit Benefit Ordinance.

Information

Department:City Clerk's OfficeSponsors:
Category:Transportation & Public Utilities

Attachments

  1. Printout
  2. Tranportation_3.6.2019_3.18.2019

Body

TRANSPORTATION & PUBLIC UTILITIES COMMITTEE MEMBERS

Vice Mayor Jan Devereux, Chair

Councillor Dennis J. Carlone,

Councillor Quinton Zondervan

Councillor Craig A. Kelley

Councillor Alanna M. Mallon

In City Council March 18, 2019

 

The Transportation & Public Utilities Committee held a public hearing on March 6, 2019 at 1:03 P.M. in the Sullivan Chamber.

 

The purpose of the hearing was to discuss how Transit Benefit Ordinances are being used in other cities to further sustainable transportation goals, and whether Cambridge could benefit from implementing a Transit Benefit Ordinance.

 

Present at the hearing were Vice Mayor Devereux, Chair of the Committee, Councillor Carlone, Councillor Mallon, Councillor Siddiqui, Councillor Kelley, Councillor Zondervan, Director of Transportation and Environmental Planning, CDD, Susanne Rasmussen, PTDM Officer, CDD, Stephanie Groll, Sustainability Planner, CDD, Jennifer Lawrence, Director of Traffic, Parking and Transportation, Joseph Barr

and City Clerk Donna P. Lopez. 

 

Also present were Jason Pavluchuk, Policy Director, Coalition for Smarter Transportation, Melissa Zampitella, TransAction Associates, Peggy LaPaglia, 295 Devonshire Street, Boston, representing the Boston Carmen’s Union Local 589, Michael Moriarty, Enterprise, 248 Mishawum Road, Woburn, Jacqueline Maille, Inside Sales Manager, Edenred Commuter Benefits Solutions, 265 Winter Street, Waltham, Stephen Kaiser, 191 Hamilton Street, Peter Valentine, 37 Brookline Street, Saul Tannenbaum, 16 Cottage Street, John Attanucci, 608 Huron Avenue, Jim Gascoigne, 77 Gray Street, Arlington and J. Grant Hauber, Managing Director, Hauber Global Advisors, 321 Walnut Street, Newtonville, MA.

 

Vice Mayor Devereux convened the hearing and explained the purpose.  This is an opportunity to learn about Transit Benefit Ordinances and discuss next steps.  Cambridge has been focused on identifying and implementing wide-ranging strategies to encourage sustainable transportation.  Cambridge residents and workers have high access to transit, but how can the City encourage higher usage.  She spoke about trends that make it harder to reach the City’s VMT (vehicle miles traveled) reduction goals.  TNC’s have added more cars to the road, instead of decreasing VMT and encouraging sharing.  She spoke about the need to work with the taxi industry and TNC’s to determine how they can be used to reduce congestion.  She spoke about the proposed MBTA fare increase, and the fact that when fares go up, ridership goes down.  Perhaps a Transit Benefit Ordinance could be effective in maintaining transit affordability for employees, so ridership won’t be as impacted.  She introduced Mr. Pavluchuk from the Coalition for Smarter Transportation who will discuss the Transit Benefit Ordinance.  She stated that Transit Benefit Ordinances have been put in place in a number of other cities.  Cambridge will be one of the smaller communities to use this ordinance and could be the first in Massachusetts.

 

Mr. Pavluchuk gave a presentation (ATTACHMENT A) on behalf of the Coalition for Smarter Transportation and provided written information about a transportation fringe benefit ordinance (ATTACHMENT B).  He emphasized that technical innovation, when used properly, can reduce congestion.  He stated that state funding for transportation is not forthcoming.  He stated that the goal is to educate policy makers and the general public to better understand the woes of congestion are rooted in policy.  Cambridge is a leader in the active transportation and transportation demand management space.  Given the City’s current leadership in this field, the Transit Benefit Ordinance will fit in well in Cambridge.  He stated that the Boston was recently named the most congested region.  He spoke about lost time spent in traffic.  Up to 164 hours per person are lost stuck in traffic per year.  Not only does this result in lost family time and worker productivity, it touches all areas of the economy, including increased prices for food, due to congestion impacts on food transport.  He stated that transit benefits are a way for employers to provide a tax deferred benefit to employees.   The tax savings for employers may be extensive.  This is a way for employees to use up to $265 per month of pre-tax earnings for transportation.  He spoke about the ease of administering a transit benefit for employers.  The MBTA offers its own program, Perq, for administering transportation fringe benefits.  He spoke about what is covered under a Transit Benefit Ordinance.  It includes both public transit and vanpools.  He noted that commuter rails do not serve everyone, so it’s important to be able to offer vanpools as an alternative for those outside rail service zones.  He stated that these ordinances work at the end of the day.  He spoke about a Transit Center study that found that 18% of commuters changed their commute method when a transportation benefit is offered.  This degree of mode shift is typically unheard of.  San Francisco was the first city to implement an ordinance, nearly a decade ago.  The ordinance in San Francisco removed 44,000 vehicles per day from the road.  In San Francisco, there was already a high exposure to TB programs before the ordinance; 45% of employees had transit benefits provided in one form or another.  A big change in behavior was not expected to result from the ordinance, but the mode shift percentage was much larger than assumed.  This policy had a huge effect on increasing commuter transit ridership and on decreasing emissions.  It started as a pilot program and was reauthorized with the support of all the chambers of commerce in the city.  Employers have a large savings because they do not have to pay the 7.65% payroll tax.  He spoke about the parking expenses employers face, and the fact that this is a way to reduce employee parking and reduce those expenses.  He stated that the average employer savings is $243 per employee.  He stated that the ordinances that have passed in New York, Washington, DC and San Francisco were supported by the business community.  This is an ordinance that does not hurt and has a savings to employers.  He spoke about the ordinance helping those who do not have access to transit.  This will help build in transit for working individuals.  This is a gateway for employers involved in employee transit and there is a reduction in vehicles used.  The worst hazard to the environment is single occupancy vehicles. He compared the ordinance for other communities.  The reasons that the ordinance was begun are varied.  He stated that there has not been opposition to the ordinance where it has been implemented.  However, he stated that community engagement is needed beforehand.  He spoke about the size of employers to who must comply with the ordinance could be as low as 20 employees, but in some cities, it is only applicable to larger companies; each community is different.  He spoke about how part-time, seasonal workers are handled under the ordinance, and the need to follow current rules and regulations in place.  He stated that enforcement is key and needs to be realistic and fair.  He stated that New York has a whistleblower enforcement mechanism.  A hotline is available to report employers with more than the required number of employees who do not provide a transit benefit.  The hotline is publicized widely.  Fines can be paid to a transit fund to help reinvest in transit.  He spoke about effective dates and building in buffer times for employers to comply with the ordinance before enforcement begins. 

 

Councillor Carlone stated that the cities referred to are bigger than Cambridge, and so the figures would be a bit lower.  He asked if Cambridge needed state approval to introduce this ordinance.  Mr. Pavluchuk stated that he did not have a firm answer.  He stated that Boston is considering a Transit Benefit Ordinance and action in Cambridge could kickstart the process of getting one passed there or in Massachusetts generally.  This is an unfunded mandate and there is an administrative cost for employers.  Councillor Carlone asked if the Coalition for Smarter Transportation is a non-profit organization.  Mr. Pavluchuk responded in the affirmative; it is a nonprofit 501(c)(4) organization and has applied to become a 501(c)(3).  Councillor Carlone asked Mr. Pavluchuk if he is willing to share other example ordinances.  Mr. Pavluchuk stated that they are on his website, in the “Tools” section.  His organization’s goal is to disperse as much information as possible.

 

Councillor Mallon spoke about the recently added ordinances in Seattle, New York and Los Angeles.  She asked if a Transit Benefit Ordinance could be incorporated as an addition within the current Parking and Transportation Demand Management (PTDM) ordinance.  Ms. Rasmussen noted that the PTDM applies to businesses who create or reduce parking and have authority to do so through the ordinance.  She stated that the Vehicle Trip Ordinance might be more appropriate for a possible amendment to add a Transit Benefit Ordinance.  Councillor Mallon stated that it would be great to have a report on the businesses who already offer a transit benefit in Cambridge and whether their own payroll administers the benefit or the MBTA does.

 

Ms. Groll stated that the PTDM and Special Permit projects the City monitors have an average of about a 40% SOV use rate.  These PTDM and Special Permit projects cover abound 40% of the Cambridge workforce.  The City requires a pre-tax transit benefit as a standard feature for large PTDM projects and many Special Permit projects.  She noted that this is a requirement that is in place for all new projects.  She stated that there are 82 projects of which 40 are required to offer a pre-tax MBTA pass via a payroll deduction or to sell MBTA passes on site.  She noted that there are five companies that voluntarily offer a pre-tax MBTA pass via a payroll deduction.  This represents 6% of the 82 projects offering a transportation benefit program that are not required to do so.  She stated that of those required to offer a pre-tax payroll deduction this represents 44,000 employees in 188 companies.  There is priority and reduced rate parking for vanpools.  If companies work with the MBTA Perq program, it is seamless, and the Charlie cards are reloaded automatically.  She stated that regarding a proposed Transit Benefit Ordinance it has not been contemplated and research would need to be done.  She spoke about focus groups and feedback from employers.  She added that the drawback is the cost of administration. The business community feels that there are many requirements put on them and this would be one more.  Enforcement would be difficult and additional staff may be required.  She suggested the City could offer incentives to comply rather than punishment.

 

Councillor Kelley asked to clarify that the employer’s average savings per employee was $243 per year.  Mr. Pavluchuk confirmed and stated that there is also an annual employee savings of $1000 for each employee.  Councillor Kelley asked why motorists and transit riders should be reimbursed and not cyclists.  Mr. Pavluchuk stated that bicyclists could be reimbursed a certain amount per mile, and any ordinance could be expanded to cover people on bikes.  The bike benefit was part of a Federal tax reform bill this year and it was poorly worded.  Tax incentives were removed for employers and employers could offer tax incentives to employees.  Employers can write off tax incentives to employees.  Councillor Kelley wanted the definition changed from bicycle to include anything on wheels other than a car.  He asked whether TNC’s could be added to this in some specified way, since the T stops running late at night.  Mr. Pavluchuk stated that under federal law there is a loophole because commuter vanpools require just 6 riders.  Under federal law, Uber and Lyft can provide late night services under the transit benefit if the vehicle carries at least 6 passengers.  Most vehicles max out at 4 passengers, but there are some exceptions.  He stated that he is not supportive of opening the door fully to TNC’s for the transit benefit.  Councillor Kelley emphasized that vanpools will not work for late riders and we need to acknowledge that the users will have specific needs.  Even if a commuter rides transit one way, and takes a TNC or other alternative home, this is helping eliminate a SOV from the road, and is better than nothing.  Mr. Pavluchuk suggested using licensed MBTA drivers operating a smaller vehicle in the late-night hours and covering a larger location, similar to The Ride.  Vice Mayor Devereux suggested that taxicabs and their drivers be included as a supplement to late night vanpooling or transit.

 

Councillor Zondervan stated that the state bill does include bike share.  He asked about what is being done for part-time employees with Transit Benefit Ordinances and their 1099 forms.  Mr. Pavluchuk stated that under federal law, independent contractors are not required to be provided the transit benefit.  This would not be on a pre-tax basis. 

 

Councillor Mallon asked whether there was opposition to the ordinance in San Francisco and asked about suggestions for community outreach.  Mr. Pavluchuk suggested working with Chamber of Commerce and local businesses as this discussion begins.  He added that the Transit Benefit Ordinance can build on what already exists here.

 

At 2:02 PM Vice Mayor Devereux opened public comment.

 

Peggy LaPaglia, Vice President of the Amalgamated Transit Union (ATU) Local 589, known as the Boston Carmen’s Union.  The union supports the Transit Benefit Ordinance for the Boston region, as it would lead to more commonwealth residents taking public transportation.  Boston ridership has decreased and the MBTA is increasing fares, which will lead ridership to drop more.  She stated that Local 589 stated that a decrease in the fare will increase the ridership.  Under federal IRS code, a transit benefit can be provided to employees.  Riders cannot afford the fee to ride the MBTA, especially as it increases even more.  The tax benefit is a win-win for all.  She hopes this could help achieve parity between transit and parking benefits.  She stated that a Transit Benefit Ordinance is good public policy.  Her comments are attached (ATTACHMENT C).

 

Michael Moriarty, Enterprise, stated that he oversees the Enterprise vanpool program in the Northeast.  The vehicles are driven by one of the members of the vanpool and are for commuters who live at least 10 miles away.  He stated that Enterprise provides the vehicle and maintenance and offers a full turnkey service.  This is the sixth largest vanpool program in the nation.  There are about 100 vans operating in the Boston area.  This area is trending toward a higher percentage of people who used to drive SOV’s trying commuting with vanpool.  He stated unlike other areas, the MBTA and the Commonwealth don’t have formal vanpool program in place, making it more expensive.  Enterprise is working with partners at Mass DOT to push for return of the vanpool subsidy.  He stated that the most successful use of the vans is to federal sites because they are fully subsidized by the Federal Transportation Incentive Program.  He spoke about the Transit Benefit Ordinance as an effective tool to reduce the cost of transportation.  He stated that a Transit Benefit Ordinance is one way to bring down cost of transit and vanpooling by as much as 33%. His comments are attached (ATTACHMENT D).

 

Jacqui Maille, Edenred Commuter Benefits Solutions, stated that her company is the leader in offering this pre-tax benefit nationwide. She described the pre-tax funds and subsidies for employees.  She stated that her role is to get this program up and running for the employers and make it as easy as possible to implement and run.  Edenred is also the firm that runs the MBTA Perq benefit.  Edenred is based locally, in Waltham.  She stated that this is an easy benefit to administer.  Employees contact their company and passes are mailed to employees.  Employers need to ensure the accuracy of the employee’s name and address and current employment status.  Edenred provides a payroll report to the employer.  On commuterbenefits.com there is a formula for the savings.  She stated that where a benefit is offered, ridership is increased.  Her comments are attached (ATTACHMENT E).

 

Stephen Kaiser, 191 Hamilton Street, noted that those cities operating Transit Benefit Ordinances are all suffering with a poor transit system.  In terms of sustainability of the MBTA, the goal is good to get motorists out of their cars onto transit.  The system is suffering from overcrowding.  He stated that trains run on time evenly spaced would improve ridership.  He stated that actual counts are less because they are not run on time.  He wanted this included in the Ordinance for Cambridge.  He preferred the state run MBTA.  He stated that a City ordinance on transit he would have the City staff have the

authority and to direct City staff to do planning for transportation to alleviate bunching and the Grand Junction Path. 

 

John Antonucci, Transit Lab, MIT, stated his support for the Transit Benefit Ordinance.  The transit pass costs about $80 here (note: the price will go up this summer) and the savings to employers and employees is much less than what was cited; it is one-third less.  The cost of an MBTA pass is not as high as transit passes in other cities, and even if an employee needs a commuter rail pass, it won’t be as expensive as in these other cities.  He noted that the cost savings won’t be quite as dramatic here, but that he didn’t doubt there would still be a benefit in Cambridge.  He stated that Cambridge and Boston are ahead of average in terms of the number of employees already covered by transit benefit.  The transit pass has a history in this area.  Regarding mode share, he urged the City to look at the PTDM Ordinance and upgrade the ordinance and to look at a wider range of transportation benefits in the ordinance, not just a transit benefit.  Require employers who provide subsidized parking to provide that subsidy in an equal amount to all employees who don’t park, in other words, those who take transit or bike.  Kendall Square has the two largest employers and one provides free parking and a transit benefit and the other provides no free parking.  He stated that at the employer with no free parking, 30% of employees drive SOV’s, whereas at the employer with free parking and transit, it’s 63% SOV’s.  He spoke about equity. 

 

Jim Gascogne, Charles River TMA, 77 Gray Street, Arlington, suggested leveling the playing field as much as we can and task all businesses with doing the bare minimum to encourage sustainable transport for employees.  He stated that there are good impacts from the PTDM and wonders how those measures can be rolled out to all employees in Cambridge.  He stated that free parking has bad impacts, he admits he drives too much because he has free parking.  Cambridge has great economic growth and employers want to retain the best employees.  This ordinance will help businesses recruit and retain employees.

 

Saul Tannenbaum, 18 Cottage Street, stated that he is a member of Transit Advisory Committee but was not speaking for the TAC.  He stated that many employees have offered transit benefits.  The ordinance should be passed, and it is the right thing to do to get the remaining employers on board.  The more comprehensive and necessary change may be to look at and modify the PTDM ordinance.  He spoke about equity regarding transit benefits.  When there is a new building built there is a transit benefit negotiated for the first year and then it is dropped.  Employee and tax focus benefits are for higher paid employees.  He stated that 1099 employees and lower paid employees must also be considered for transit benefits.  Who would benefit the most should be considered, and that is the equity piece of this issue.  He urged taking parking minimums for developments out of the Zoning Code.

 

Grant Hauber, Hauber Global Advisors, stated that a Transit Benefit Ordinance should be implemented.  He also spoke about a real need to implement congestion pricing for the region.  He spoke about the need for a Home Rule petition and that Cambridge’s public good is its space and how it controls its space.  Parking spaces are a tax because the space is being used by others.  This will push more toward transit benefits.  Cambridge is unique because of the influx of development to use this process.

 

Peter Valentine, 37 Brookline Street, spoke about gravity and an orderly way.  He lets gravity decide and gravity says “Yes” to this idea.

 

At 2:36 PM Vice Mayor Devereux closed public comment.

 

Councillor Zondervan agreed with the idea of congestion pricing and to begin charging TNC’s a surcharge on using the City’s space.  It could be a surcharge on the TNC’s own pre-existing congestion pricing.

 

Councillor Kelley liked the idea of revisiting and expanding the PTDM Ordinance.  He is, however, struck by the fact that there is difficulty with increasing the price for Cambridge resident parking stickers, and is frustrated that prices do not reward those who live in the City without cars. He doesn’t know how realistic it is for the city to tackle congestion pricing.   Encouraging people toward transit will have an impact.

 

At this time Vice Mayor Devereux made the following motion:

 

ORDERED:                            That the City Manager be and hereby is requested to instruct the                                                         City Solicitor to provide the City Council with a preliminary                                                         opinion on whether Cambridge can adopt a Transit Benefit                                                                       Ordinance without the need for a Home Rule Petition.

 

The motion carried on a voice vote of five members.

 

At this time Vice Mayor Devereux made the following motion:

 

ORDERED:              That the City Manager be and hereby is requested to instruct the Assistant City Manager for Community Development to provide the City Council with a recap report on how the Parking and Transportation Demand Management Ordinance is being used anecdotally, what the participation rates and trends are, and how it’s administered.

 

The motion carried on a voice vote of five members.

 

At this time Vice Mayor Devereux made the following motion:

 

ORDERED:                            That the City Manager be and hereby is requested to confer the              

Assistant City Manager for Community Development to instruct the Transit Advisory Committee to report back on moving a Transit Benefit Ordinance proposal to an action plan.

 

The motion carried on a voice vote of five members.

 

Ms. Rasmussen spoke about the feedback and stated that this will not be a short-term turn around.  

 

Vice Mayor Devereux stated that Cambridge is and will continue to be a leader in encouraging sustainable transportation, and momentum is building.  This is not an all-encompassing solution, but it is a relatively easy measure that could have a real impact.  Passing an ordinance like this in Cambridge would be an important action.

 

The following communication was received from Charlie Ticotsky, Policy Director, Transportation for Massachusetts, urging that the tax code should be used to encourage people to use public transportation (ATTACHMENT F).

 

Vice Mayor Devereux thanked all those present for their attendance.

 

The hearing adjourned at 2:45 P.M.

 

                                                                      For the Committee,

 

                                                                      ________________________________

                                                                      Vice Mayor Jan Devereux, Chair

                                                                      Transportation & Public Utilities Committee

 

Meeting History

Mar 18, 2019 5:30 PM Video City Council Regular Meeting
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3 ORDERS ADOPTED BY AFFIRMATIVE OF NINE MEMBERS

RESULT:REPORT ACCEPTED AND PLACED ON