The Transit Ridership Incentive Program (TRIP) will provide up to $1,700 to Chicago's Cook County businesses that enroll employees in a pre-tax transit benefit program. Commuters can save between 30% and 40% on their commuting costs by purchasing transit fares before taxes.
The incentive program has $250,000 made available through the American Recovery and Reinvestment Act (ARRA), and the limited funds will be disbursed to employers on a first come, first served basis.
"With the rising cost of gas, public transportation is the most common-sense approach today. This latest initiative makes it easier and even more cost-effective to travel by bus or train," said Joe Costello, Regional Transportation Authority (RTA) executive director.
Employees typically earn their income, are taxed, and then purchase transit to get to work. Those enrolled in a pre-tax transit benefit program can purchase transit fare before being taxed, which lowers the amount of their taxable income. The transit program is not unlike making contributions to a 401(k) retirement plan. Depending on their transit costs and tax bracket, employees can lower their tax burden by hundreds of dollars per year.
In addition to saving people money, the program encourages people to commute via mass transit, which is typically cheaper and less polluting than driving. Transit riders can save significantly by using public transit instead of driving. Fares for the CTA, Metra, Pace, Amtrak and the Northern Indiana Commuter Transportation District are eligible for pre-tax purchase.
Funding for TRIP is made possible by ARRA through its Energy Efficiency and Community Block Grant program. The Cook County Department of Environmental Control is administering the program in coordination with the Center for Neighborhood Technology and the RTA.