Transit Benefits Modernization Act

Summary: Transit Benefits Modernization Act  This bill amends the Internal Revenue Code to treat the use of a transportation network company by federal employees during the period beginning on the date of enactment of this bill and ending on December 31, 2018, as a qualified transportation fringe benefit that is excluded from an employee's gross income.  A &quot;transportation network company&quot; is a corporation, partnership, sole proprietorship, or other entity that uses a digital network to connect riders to drivers affiliated with the entity in order for a driver to provide transportation services to a rider.  During the period beginning on the date of enactment of this bill and ending on December 31, 2018, any agency that provides transit benefits to employees must provide benefits for using digital transportation companies within the Washington Metropolitan Area in the same manner as benefits are provided for using public transportation services in the area.  A &quot;digital transportation company&quot; is any transportation network company or car-sharing service (a membership or non-membership based service primarily designed for shorter time or shorter distance trips where individuals are charged per mile or per hour, or both, for vehicle usage). To elect to receive benefits under this section, an employee must agree in writing not to accept any other transit or parking benefit offered by any agency with a transit benefit program while receiving the benefits under this section. The amount of transit benefits provided to an employee under this section may not exceed the monthly average transit benefit received by the employee during the six-month period immediately preceding the month during which an election is made.

SECTION 1. SHORT TITLE; FINDINGS.

    (a) Short Title.--This Act may be cited as the ``Transit Benefits 
Modernization Act''.
    (b) Findings.--Congress finds the following:
            (1) The Washington Metropolitan Area Transit Authority 
        (``WMATA'') provides approximately 2.3 million Metrorail and 
        Metrobus trips per year across the National Capital Region to 
        Federal employees, commuters, and millions of visitors to the 
        Nation's capital.
            (2) Approximately 40 percent of WMATA peak-hour commuters 
        are Federal employees.
            (3) WMATA began building its rail system in 1969, currently 
        serves 91 stations, and has 117 miles of track.
            (4) The Federal Transit Administration (``FTA'') and the 
        National Transportation Safety Board have found significant 
        safety concerns resulting from a backlog of deferred 
        maintenance.
            (5) WMATA has designed a plan, called SafeTrack, in an 
        effort to address this backlog of deferred maintenance.
            (6) SafeTrack would close the system earlier on weekends 
        and expand weekday maintenance by reducing the number of rails 
        in use at certain stations from two to one.
            (7) The plan includes 15 ``Safety Surges'' with around-the-
        clock single tracking or segment shutdowns that will impact 
        rush hour commutes.
            (8) FTA's review of SafeTrack's first two ``safety surge'' 
        areas found a number of defects in the plan's execution.
            (9) SafeTrack is scheduled to conclude in March 2017.
            (10) During SafeTrack, WMATA is encouraging customers to 
        utilize other commuting options, including ride-sharing 
        services.
            (11) WMATA has indicated that service disruptions will 
        continue to occur following SafeTrack as routine maintenance is 
        needed.
            (12) The Federal Government, which is negatively affected 
        when employees cannot easily commute to and from work, has an 
        interest in assisting employees with alternate commuting 
        options.

SEC. 2. PROVIDING A FRINGE TRANSIT BENEFIT FOR USE OF TRANSPORTATION 
              NETWORK COMPANIES.

    For purposes of section 132(a) of the Internal Revenue Code of 
1986, the use of a transportation network company by Federal employees 
as provided for in this Act shall be treated as a fringe benefit which 
qualifies as a qualified transportation fringe for the period 
established in section 3(a) of this Act.

SEC. 3. TRANSIT BENEFITS FOR FEDERAL EMPLOYEES FOR THE USE OF DIGITAL 
              TRANSPORTATION COMPANIES.

    (a) In General.--During the period beginning on the date of 
enactment of this Act and ending on December 31, 2018, any agency that 
has a program, including a program established under section 7905 of 
title 5, United States Code, or Executive Order 13150 (April 21, 2000; 
65 Fed. Reg. 24613), to provide transit benefits to employees of the 
agency shall provide transit benefits to employees who use the services 
of any digital transportation company within the Washington 
Metropolitan Area in the same manner as such agency provides transit 
benefits to employees who use public transportation services within the 
Washington Metropolitan Area.
    (b) Requirements.--
            (1) Election.--Unless otherwise statutorily authorized, an 
        employee may receive transit benefits under this section only 
        if the employee agrees in writing to not accept any other 
        transit or parking benefit offered by the head of any agency 
        with a transit benefit program while receiving the transit 
        benefits under this section.
            (2) Limitation.--The amount of the transit benefit provided 
        to an employee under this section during any month for the use 
        of services provided by any digital transportation company may 
        not exceed the amount of the monthly average transit benefit 
        received by the employee during the 6-month period immediately 
        preceding the month during which an election is made under 
        paragraph (1).
            (3) Implementation.--Transit benefits under this section 
        shall be provided in a manner substantially similar to the 
        manner in which transit benefits are provided to employees who 
        use mass transportation services. The head of any agency with a 
        transit benefit program may consult with any digital 
        transportation company and any other head of any agency with a 
        transit benefit program to establish the procedures necessary 
        to provide transit benefits under this section.
            (4) Substantiation.--The head of any agency with a transit 
        benefit program, the Secretary of the Department of 
        Transportation, and the Secretary of the Treasury shall, in 
        connection with the establishment of a process for implementing 
        the transit benefit for any digital transportation company, 
        work with any such digital transportation company in 
        establishing a process to substantiate the use of transit 
        benefits by Federal employees using the benefit for services 
        provided by a digital transportation company each month.
    (c) Definitions.--In this section--
            (1) the term ``Washington Metropolitan Area'' means the 
        District of Columbia; Montgomery, Prince George's, Frederick, 
        and Charles Counties in Maryland; Arlington, Fairfax, Loudon, 
        and Prince William Counties in Virginia; and all cities now or 
        hereafter existing in Maryland or Virginia within the 
        geographic area bounded by the outer boundaries of the combined 
        area of said counties;
            (2) the term ``digital transportation company'' means any 
        transportation network company or car-sharing service;
            (3) the term ``car-sharing service'' means a membership or 
        non-membership based service primarily designed for shorter 
        time or shorter distance trips where individuals are charged 
        per mile or per hour, or both, for vehicle usage; and
            (4) the term ``transportation network company'' means a 
        corporation, partnership, sole proprietorship, or other entity 
        that uses a digital network to connect riders to drivers 
        affiliated with the entity in order for a driver to provide 
        transportation services to a rider.