Document ID: DOT-OST-2012-0213-0001
Agency: dot
Document Type: Notice
Title: Return of Excess Transit Benefits
Posted Date: 2012-12-31T05:00Z

[Federal Register Volume 77, Number 250 (Monday, December 31, 2012)]
[Notices]
[Pages 77180-77181]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-31384]

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary of Transportation

[Docket No. DOT-OST-2013-0213]

Notice of Transportation Services' OMB Designation, timely return 
of excess transit benefits to the Treasury, and stakeholder 
notification of the minimum internal controls

AGENCY: Office of the Secretary, DOT.

ACTION: Notice.

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SUMMARY: On April 27, 2012, the Office of Management and Budget (OMB) 
designated the U.S. Department of Transportation's (DOT) Office of 
Transportation Services (TRANServe), located within the Office of the 
Assistant Secretary for Administration, as the lead Federal Agency by 
to facilitate the timely return of any excess transit benefits 
accumulating on vanpool companies' accounts to the Treasury and to 
prevent the future accumulation of excess transit benefits, among other 
things. As the lead Federal agency, TRANServe is directed to inform 
commercial vanpool companies of the Federal internal controls that now 
govern the Transit Benefit Program to prevent future accumulations, and 
assist in the timely return of the current excess transit benefits. 
Thus, the following notice sets forth the process for returning excess 
transit benefits, as well as the minimum internal controls that have 
been developed for operating a compliant transit benefit program as it 
relates to van pools.

FOR FURTHER INFORMATION CONTACT: Ms. Denise P. Wright, Business Office 
Manager, and for information regarding Funds Recovery contact Ms. Craig 
Bellet, Working Capital Fund--Office of Financial Management 1200 New 
Jersey Avenue SE., Washington DC 20590.

SUPPLEMENTARY INFORMATION: 

I. Background

    On April 21, 2000, Executive Order 13150 directed all federal 
agencies to develop a transportation fringe benefit program that 
offered qualified Federal employees the option to exclude from taxable 
wages and compensation employee commuting costs incurred through the 
use of mass transportation and vanpools. Since their development, these 
transit benefit programs have become an important tool in addressing 
urban roadway congestion. However, they were only designed to subsidize 
employees' costs for using public transportation to travel between 
their residence and place of employment. These benefits are calculated 
on a monthly basis as required under 26 CFR 1.132-9, and as such, 
employees are not permitted to accumulate benefits in excess of their 
actual monthly commuting costs or to use accumulated benefits to offset 
commuting costs in subsequent months. Furthermore, overestimating 
transit costs, giving or selling transit benefits to others, or 
purchasing transit benefits from unauthorized sources is prohibited. 
Employees who misuse transit benefits are subject to appropriate 
administrative action, including discipline and disqualification from 
the Federal Transit Benefit Program.
    In 2011, the Office of Management and Budget (OMB) was advised that 
excess transit benefits may have been accumulating in programs that 
allow transit benefits to be used for vanpool services between 
employees' residences and their places of employments. On April 27, 
2012, OMB directed that these excess funds be returned to the U.S. 
Department of the Treasury and that federal agencies strengthen 
internal controls to ensure compliance with the Federal Transit Benefit 
Program. To accomplish these directives, OMB designated the DOT, Office 
of Assistant Secretary for Administration, as the lead Federal agency 
to inform commercial vanpool companies of the Federal internal controls 
that govern the Transit Benefit Program and to assist in the timely 
return of the Federal funds. Pursuant to the OMB direction, TRANServe 
is responsible for the recovery of the excess transit benefit provided 
to van pool riders including both customers of TRANServe and those 
riders who received the transit benefit through other channels. 
TRANServe has also worked with senior leadership of the relevant 
Federal agencies to further define the necessary controls that should 
be in place to operate a compliant transit benefit program. The process 
for recovering the existing excess funds, as well as the controls that 
have been developed to prevent future excess accumulations, is 
described below.

II. Funds Recovery Process

    This section presents the process for the timely return of the 
Federal funds. Pursuant to 26 CFR 1.132-9, qualified transportation 
fringe benefits are calculated on a monthly basis. Therefore, employees 
are not permitted to accumulate fare media in excess of their actual 
monthly commuting costs or to use accumulated fare media (acquired with 
tax-exempt subsidies) to offset commuting costs in the future. In this 
instance, accumulated fare media in excess of the actual monthly 
commuting

[[Page 77181]]

costs means Federal funds held on account over and above the certified 
eligible monthly amount, which have the potential to be used to offset 
commuting costs in the future. Van pool providers and/or operators that 
have retained funds in excess of the allotted monthly amount must 
return the excess funds by April 27, 2013 or 120 days from date of this 
notice, whichever is greater. All excess funds should be returned via 
the Web site www.pay.gov. To remit payment via www.pay.gov, in the 
``Find Public Forms'' search box, type ``DOTWCF'' in the search field 
and select ``DOT OST Working Capital Fund Miscellaneous Payments'' from 
the query list. Complete all fields with the requested information. In 
the ``reason for payment'' field, select ``other'' and enter the 
following statement in the information box: ``Unused van pool funding 
by federal participants.'' At the same time the funds are returned via 
www.pay.gov, the following information should also be transmitted via 
email to TRANServe@dot.gov, to assist the responsible agency in 
auditing transaction activity: \1\
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    \1\ Pursuant to 5 CFR 1320.3(h), this is not considered to be 
information as defined under the Paperwork Reduction Act, 44 U.S.C. 
chapter 35.
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    i. Name and location of vanpool operator
    ii. Funds origin, to include agency and location
    iii. Dollars segregated by agency
    The email subject line should state ``Pay.gov Van Pool Funds 
Remittance.'' Also include a copy of the emailed receipt you receive 
from www.pay.gov. Van Pool providers and/or operators shall encrypt the 
data in order to protect it during transmission. Once received, DOT 
shall handle the data in accordance with the security controls 
identified in the DOT's System of Records Notice, DOT/ALL 8 Employee 
Transportation Facilitation, 65 FR 19482 (April 11, 2000).

III. Minimum Internal Controls

    To ensure that funds are not accumulated in excess of the allotted 
monthly amount, we have also worked with other federal agencies to 
develop the following internal controls for the management of the 
Federal Transit Benefit Program. These controls will ensure effective 
and efficient operations, reliability of financial reporting, and 
compliance with applicable laws and regulations. The controls are 
provided as tools to help federal transit benefit program and financial 
managers achieve results and safeguard the integrity of their programs. 
Federal agency program administration should be built around these core 
principles and monitored accordingly. The internal controls listed are 
general controls and agency policy and procedure may be more 
prescriptive with the following internal controls serving as the 
minimum standard. For the purposes of this notice with respect to the 
minimum internal controls, the following definitions are applicable:
    Federal Van Pool Driver--an individual owner or transportation 
servicer of a qualified IRS van pool and/or a Federal employee 
operating a vehicle. The Federal Van Pool Driver may be the primary 
member listed for qualified parking.
    Federal Van Pool Operator--an individual having primary 
responsibility as identified through a contractual relationship with 
the Van Pool Provider. The Federal Van Pool operator may be the primary 
member listed for qualified parking.
    Federal Van Pool Provider--an entity which contractually offers the 
use of a vehicle (van) to a Federal Van Pool Operator meeting the van 
pool qualifications set forth in 26 CFR Sec.  1.132-9 26.
    The minimum internal controls include the following:
    1. The agency transit benefit program must provide the ability for 
all participants to adjust the monthly transit benefit amount.
    2. With respect to van pools, the agency transit benefit program 
manager should verify that the van pool is registered or certified by 
the local transit authority, where applicable. While agency transit 
benefit program managers have no authority to require van pool 
registration or certification by local transit authorities, some State 
and local transit authorities require van pool registration and 
certification. This administrative process should be leveraged to 
ensure statutory and regulatory compliance as well as transit authority 
compliance.
    3. The agency transit benefit program manager should maintain a 
list of van pool vendors utilized by agency participants, to include 
the name of the driver or operator, van pool business name, address, 
and phone number. The list of van pool vendors, with driver and 
operator identified, should be cross referenced and validated to ensure 
consistency and accuracy with the agency van pool participants 
receiving the transit benefit. Van pool operators or drivers are to 
provide this information directly to the agency transit benefit program 
manager.
    4. Van pool drivers and operators who use qualified parking 
consistent with 26 CFR 1.132-9, or are named on a workplace parking 
permit, are not eligible to receive the transit benefit. However, the 
allowable cost for the driver and/or operator may be covered as part of 
the operating expenses attributed to the van pool.
    5. The transit benefit cannot be used to hold a seat on the van 
pool in the event of participant absence. All participants must utilize 
the van pool for commuting to and from work at least 50% of eligible 
work days.
    6. The van pool must seat a minimum of 6 passengers (not including 
the driver), and must have at least 50% of the adult seating capacity 
of the vehicle (not including the driver) used for the transportation 
of employees to and from work representing 80% of the usage of the van.
    7. The agency transit benefit program manager must be provided a 
published price list by the Federal van pool driver or operator, which 
is applicable to all riders (federal and non-federal). As established 
by the Federal van pool driver or operator, the published costs should 
include all necessary fees. Updated price lists should be provided to 
the agency transit benefit program manager as prices are changed or 
modified.
    8. In the event a transit program receives a rider subsidy from a 
transit authority, the appropriate participant offset must be applied 
to the individual monthly benefit amount.
    9. A van pool invoice or receipt is required to document the actual 
commuting cost for individual van pool participants.
    The internal controls described above should prevent individuals 
from accruing transit benefits in excess of the allotted monthly 
amount, as required by 26 CFR 1.132-9.

    Issued in Washington, DC on December 27, 2012.
Marie Petrosino-Woolverton,
Director, Office of Financial Management & Transportation Services.
[FR Doc. 2012-31384 Filed 12-28-12; 8:45 am]
BILLING CODE 4910-9X-P