Bailout passes with Bicycle Commuter Act attached; Bush signs it

Update: Jan. 2, 2009Claim your bicycle commuter tax benefit now

The Bicycle Commuter Act that gives companies tax breaks for offering fringe benefits to bicycle commuters was passed by the House of Representatives on Friday as they approved the $700 billion financial bailout plan by a 263-171 vote.

President Bush signed the bailout into law right away.

The Bicycle Commuter Act gives employers $20 a month tax relief for each employee who bicycles to work. It covers the cost of employer reimbursements to employees for buying, improving or repairing a bicycle or paying for bike parking. It starts in 2009.

It was first introduced some seven years ago by Congressman Earl Blumenauer of Portland. The Democrat opposes the bailout and voted against it on Friday, putting himself in the inenviable position of voting against his pet project.

See: “Questions about Bicycle Commuter Act answered”

Analysts had said $110 billion worth of tax breaks and spending provisions were added to the bailout bill to gain support from opponents in the House. The gambit apparently worked, as enough Congressmen changed their “no” votes to allow the bailout bill to pass.

The group Taxpayers for Common Sense spotted the section on the Bicycle Commuter Act in bill passed by the Senate on Wednesday. It is estimated to cost $10 million.

It's an extension of a transportation fringe benefit law that give tax breaks to employers for setting up car pools, van pools, and other plans for reducing traffic congestion. According to the taxpayer group, the bicycle commuter act encourages employers to reimburse bicyclists for

“the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee's residence and place of employment.”

(See the Transportation Fringe Benefit to Bicycle Commuters in the bailout bill.)

The League of American Bicyclists issued the following statement:

“After seven long years, the bicycle commuter tax provision has finally passed both the House and Senate as part of the financial bailout package. President Bush said that he would quickly sign the $700 billion bailout bill.

“Thanks to all of you around the country who have contacted your congressional leaders over the years, and also thanks to Congressman Blumenauer and Senator Wyden for their continued insistence on having this benefit provided to bicycling Americans. Keep checking back here as we work on the implementation process.”

Andy Clarke, president of the League, told Bicycle Retailer:

“It's definitely a day to celebrate just this one little thing that has been achieved after seven years,” Clarke said. “It may not be a total game changer—it's still a relatively small break—but it gets us closer to the kind of treatment that cyclists in the U.K. and other parts of the world have had for years.”

At his website Congressman Blumenauer explains his decision. It reads, in part:

“While some positive steps forward have been made, I could not support this economic recovery bill.

“There are some extremely important provisions in the bill for which I have fought during the past two years.  … 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 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.”

The Outside Blog talked to Blumenauer about the bike bill last week and polled readers about their reaction. Seventy-five percent said the $20/month would cover their bicycling expenses or encourage them to start commuting by bicycle.

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