House passes bailout bill; bike commuter tax benefit becomes law

Blumenauer unveils Gas Price Relief Act-2.jpg

Blumenauer at the unveiling of his
Gas Price Relief Act, one of many
pieces of legislation that included
a bike commuter tax break
over the years.
(Photo: J. Maus)

What a long, strange trip it’s been for Congressman Earl Blumenauer and his Bike Commuter Act.

The House Democrat is a former City Commissioner of Transportation in Portland (1987-96) and he was at the helm during Portland’s Golden Age of biking — a time when we laid down much of our bikeway network infrastructure that is now the envy of many cities.

Blumenauer carried his commitment to biking into the halls of Congress and has worked the system relentlessly to pass bike-friendly legislation like the bike commuter tax benefit. Calling it a “matter of equity”, his idea is simple; give bike commuters the same respect and recognition in the tax code already given to folks that drive and take public transit.

This morning, the House voted to pass a controversial, $700 billion bailout package for Wall Street (263-171). In order to assure passage in the House (they rejected the bill the first time around), the Senate included a large package of “tax extenders” into the bill that they passed earlier this week. Among the tax breaks was the bike commuter provision.

“I’m disappointed that the Senate also added a number of provisions to the bill… which take us in the wrong direction in our battle against climate change… I will continue to fight to deal with the consequences of added debt and poor energy investment choices.”
— from Blumenauer’s official statement about the bailout

So, after seven years of toil, Blumenauer’s Bike Commuter Act is finally going to become part of the U.S. tax code, and because of the way Washington politics works, he was forced (by his conscience) to vote against it.

It’s too bad that it had to happen this way.

Not only is it part of a bill that many folks still think is a sham (another Oregon Democrat and ardent supporter of bicycling, Peter DeFazio, also voted “no”), but because it passed along with a host of other “special interest” tax breaks that had absolutely no connection to the accompanying bill, it will likely only add to the perception that the biking issue is just a silly piece of pork.

====

— For full coverage of the efforts to pass the Bike Commuter Act, see the BikePortland.org archives.


UPDATES:
— Here’s an excerpt from a statement about his “no” vote just posted by Blumenauer:

“…There are some extremely important provisions in the bill for which I have fought during the past two years. For example, the bill extends the production tax credit for wind energy and investment tax credit for solar energy. It includes legislation I drafted to provide a tax credit for the purchase of small wind turbines. And it provides tax fairness so employers can offer the same transportation fringe benefits for bicyclists that they offer to employees who commute by car and public transit.

…The bad news is that, at a time when our national debt is at its highest point in over 50 years as a percentage of GDP, Senate Republicans chose not to pay for most of the good things in this bill. I�m disappointed that the Senate also added a number of provisions to the bill that will provide incentives for coal-to-liquids and oil-shale fuels, which take us in the wrong direction in our battle against climate change…

I will continue to fight to deal with the consequences of added debt and poor energy investment choices…”

Jonathan Maus (Publisher/Editor)

Jonathan Maus (Publisher/Editor)

Founder of BikePortland (in 2005). Father of three. North Portlander. Basketball lover. Car driver. If you have questions or feedback about this site or my work, contact me via email at maus.jonathan@gmail.com, or phone/text at 503-706-8804. Also, if you read and appreciate this site, please become a paying subscriber.

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Al from PA
Al from PA
16 years ago

Earl, I have long respected you from afar and wished we had a congressman like you here in our PA district, instead of a Republican retread. Now I think you’re crazy man, crazy.

Icarus Falling
Icarus Falling
16 years ago

Equity?

There is no equity in providing a tax break to only a small percentage of cyclists, instead of pushing to provide it to all bicycle commuters, regardless of who they work for.

Equity still means something along the lines of equal, doesn’t it? Anyway last time I looked.

4 years that could have been better spent. IMO.

I do like Earl, just not this bill.

Tim
Tim
16 years ago

This is why our country will not be around in 10 years.

We are on the verge of bankruptcy and a bill that the house rejected one week ago when it was 700 billion was passed today at 800 billion with a ton of ear marks.

I HATE the fact that the bike commuter act was in this bill and I HATE every person who voted for a bill with this pork.

Good Job to Earl for sticking to his guns and voting “no.”

Martha R
Martha R
16 years ago

Ugh. I also hate that this is the way that the bike commuter act got passed. I also am glad to be represented by Earl.

I’ve been following the bike commuter act for a while, but am not entirely clear about how and when it will get implemented. Jonathan — you’re probably working up a post on this already, but I’d like to know the “what does it mean for me?” side now. Do I need to prod my employer to add this as a benefit? If so, what do they need to know?

BeerdedOne
16 years ago

I urge all of you to watch Rep. DeFazio’s comments on this legislation, find it at thegreatunwind.com. We are in serious trouble.

Peter
16 years ago

y’all got some cool congress critters. that bill is absolutely criminal. it’s possibly the worst disaster for freedom and democracy since the patriot act.

Jonathan
Jonathan
16 years ago

Like Martha R I’d love to know how and when I can take advantage of this delicious pork. More information please!

Adams Carroll (News Intern)
16 years ago

“I’ve been following the bike commuter act for a while, but am not entirely clear about how and when it will get implemented.”

Martha R,

I just got off the phone with a Blumenauer staffer and the reality is that no one really knows how/when this will be implemented.

Under normal circumstances, it would take several months at least for this to be figured out… and now with the crazy budget situation we’re in.. who knows.

this has just been authorized… but the funds have not been appropriated and how it will be written into the tax code is still to be decided.

best I can say at this point is stay tuned. i’ve asked Blumeneauer’s office for more information and will share it as soon as i can.

Snowflake Seven
16 years ago

Thank you Rep. Blumenauer for your efforts and for sticking to your “no” vote.

Unfortunately out here in Beaverton your Rep is David Wu. And he flipped, voting for this bill today. I am disgusted.

Darren
Darren
16 years ago

The fact the Bushies couldn’t keep this financial black hole under wraps until after the election is one indication of how serious it is. I’m sure more of the damage they have done to this country will come to light soon enough.

Dear next President, please rise to occaision. If you don’t The US is history, over, done.

Earl, the bike bill is nice, but honestly, I think we got bigger issues to deal with. It won’t bother me if it takes a while to figure out how to implement.

Dan
Dan
16 years ago

For those who are interested, here is section 132(f) of the tax code:

http://www.metrostlouis.org/GettingStarted/TryTransit/section132.asp

This is modified by HR1424 (sec 211):

http://thomas.loc.gov/cgi-bin/bdquery/z?d110:H.R.1424

I’m certainly no expert, but it seems to me that your employer can pay you up to $240/year for commuting by bicycle. The company can then reduce their taxable income by $240/commuter.

kg/f
kg/f
16 years ago

i urge you to read http://www.dunwalke.com. we are in serious trouble.

canuck
canuck
16 years ago

Remember it’s the house and the senate that made the laws that allowed this to happen, not the President.

The President only has the power to veto, which can be overturned by the house and senate.

brettoo
brettoo
16 years ago

This bike rider thanks Reps. DeFazio and Blumenauer for their tough but wise votes. Bike riders are not single issue narrow minded types – we understand the big picture, and this is a bad bill with a few good things that would probably ahve been added soon anyway and signed by President Obama.

steve pappert
steve pappert
16 years ago

Dan has got it right. what this bill is suposed to do is change section 132(f) of the tax code. That section allows your employer to give you a parking space with a value up to a certain limit I think its like 500 $ a year or a public transit pass, also up to a certain value. (I left my tax code at school) The employer can deduct this as an expense and lower their tax burden and the employee does not have to report this gain as income. So both parties save a bit of money and the IRS loses a little bit of money.
I think the change from this bill is to allow a business to maintain a bicycle storage area/lockers or maybe buy you a cheep bicycle or bicycles for employee use or maybe coupons for tune ups. It seems like if you rode every month of the year your employer could give you 240$ in this type of benefits and write it off and the employee would not have to pay income tax on this.
I think some smart thinking companies will take advantage of this, but I think most will be the companies that are already giving these kinds of benifts, whether they can wright it off or not. But the good thing is that all you employees that are already getting this will no longer have to stay up late worrying about an audit because you did not try to calculate the amount you gained from your employment as a result of that nice bike storage and locker. HA!

Dan
Dan
16 years ago

Thanks Steve,

I think they can also choose to give you $240 cash per 132(f)(3). That’s what I’ll be asking for!

John
John
16 years ago

How does his apply to 403b companies (non-profits)?

Peter
16 years ago

Remember it’s the house and the senate that made the laws that allowed this to happen, not the President.

This was Bush’s bill.

The President can, and certainly has in this case, exerted a great deal of influence over the crafting of legislation. Bush’s appointee, Treasury Secretary Paulson, is part of Bush’s cabinet, and ‘serves at the pleasure of the president’. If Paulson didn’t do what he was told, he’d be out on his butt. Paulson was the main architect of this dictatorial piece of legislation – the ‘financial rescue plan’ he put forward to be adopted into law. The first version of that plan may go down in history as the most fascist piece of legislation proposed during the entire Bush reign. Congress just added some protections for the incumbents.

Joe
Joe
16 years ago

I contacted his office and offered my support for his position. This bill came out of nowhere and was pushed down our throats in a time of “crisis” without considering alternative mechanisms for dealing with the economic mess our current lack of regulatory oversight (thanks to the Bush administration) has led us to..

Matthew Denton
Matthew Denton
16 years ago

I think that the bailout was a bad idea. And I like the bike commuter tax benefit…

However, my question is, given that they put this sweetener in for Blumenauer and probably him alone, and he didn’t vote yes anyways, does that mean the next time something like this comes up, (and it will,) the leadership won’t put sweeteners in for him, because, he has demonstrated that he has principles and won’t take the sweeteners? Or alternatively, will they put more in next time, under the hope that he only has so many principles?

I’m hoping for the later, but I fear the former. And I’m glad that Blumenauer has principles, I just don’t want the leadership to figure that out…

Lisa G.
Lisa G.
16 years ago

So did the eight-year extension of investment credits for solar energy, and the tax breaks for wind, geothermal and other alternative sources make it through?

John
John
16 years ago

Before jumping to conclusions… Who provided the pressure to include the bike benefits?

The reason I ask is that there are a variety of reasons to include this; from Earl’s viewpoint, to someone who realizes that wallpapering a conservatively derided bailout with bike benefits would generously paint cyclists everywhere with the pork brush. I would simply suggest that some might see other benefits related to this turn of events, and it might be helpful to know who spurred the action. Maybe we’re planned to be more prominently strapped to the front of the conservative freight train? Maybe not?

Matthew Denton
Matthew Denton
16 years ago

Lisa G. #21:

Yes, the solar credit is extended 8 years. I believe wind is only extended 1 year, but there is a new ground source heat pump credit, (30%, capped at $2k)

And they removed the $2k credit cap on solar panels, but that doesn’t take effect until Jan 2009. (Which means I could have gotten an extra $3.4k if I had waited until next year instead of getting them this year. Sigh.)

Coyote
Coyote
16 years ago

Earl and DeFazio should probably leave the Democratic party. It no longer represents us or them. The ca-ca has hit the fan.

Phoebe
Phoebe
16 years ago

One thing to remember in all this bailout mess, is that nearly all of the ‘sweeteners’ had *already* been passed by the Senate with a vote of 93-2. The House simply hadn’t voted on them yet. These were not new things.

I’m hoping I can convince my employer to get a couple of bike lockers. My supe won’t let me bring my bike inside…