Schumer devises tax break to rescue failing Citi Bike

[Oceander]

NY Post

Schumer devises tax break to rescue failing Citi Bike

By Geoff Earle
April 4, 2014 | 10:59am

WASHINGTON – Sen. Schumer is riding to the rescue of struggling Citi Bike.

Schumer, a powerful Senate Finance Committee member and bike rider, tacked an amendment onto a pork-laden tax “extenders” bill that lets employers offer tax-shielded benefits for bike-sharing just as they do for subway and other commuter benefits.

The committee passed the amendment Thursday without opposition, and reported out the tax break bill with the bike share provision included.

It now heads to the Senate floor and the House, where it’s fate is uncertain.

Capped at $250 per year, the new break would let employees pay their bike share bill with pre-tax dollars — meaning that the government would be subsidizing their rides.

The current cost of an annual bike share membership is $95.

Alta Bicycle Share, which operates the program, has already indicated that annual fees will be going up.

The federal subsidy would soften the blow to riders.

Legislative action was required because the IRS has ruled that bake sharing doesn’t qualify for special tax treatment under transportation laws on the books. “A bike share program is not a mass transit facility,” the agency ruled in 2013, nixing one avenue for funding.

Despite its success, Citi Bike has run into steep financial troubles.

It has signed up about 100,000 riders, but still needs to raise millions to continue operations.

City Transportation Commissioner Polly Trottenberg said in March that the program faces “a number of financial and operational challenges.”

“Bike-share programs are a boon to commuters, the economy and clean air – and those who use them deserve the same benefits granted to those who drive cars and use mass transit to get to work,” Schumer said in a statement.

He said the bill would encourage companies to offer bike shares as perks, and will “enhance both the financial standing and the importance of these programs” – meaning it would help bail out Citi Bike.

Schumer aide Max Young indicated that the provision cleared the committee with ease. “No one’s going pick at this. It basically costs nothing because it’s so little money,” he said.

But House Republican leaders have shown little interest in taking up the tax extenders bill without broader tax reform, an effort that is already collapsing.

The “extenders” bill usually attracts support from both parties because other tax goodies benefit a litany of companies, while items like tax-free savings for college have popular support.

[Oceander]

Words fail me.  This was originally a scam intended to finance freebie bikes for city residents on the backs of unsuspecting tourists; but since they don't actually spend any time paying attention to what tourists actually do - those who want to use bikes want to use them for several hours, not 30 minutes at a time - they screwed up and created a system where the majority of users are those who bought the ridiculously cheap annual memberships.

The simple - and proper - solution is to raise the fees charged for annual memberships and increase the amount of time a day-tripper or tourist can have to use the bikes.  But then again, since when have liberals ever tried to do it properly when they can do it improperly and raid the taxpayers' pockets at the same time.

[rb224315]

And by devising a tax break to help a failing business, Schumer admits that taxes are a burden to the health of business.

This reminds me of a conversation my brother had with a coworker.  Bro said that Obama promised to undo a bunch of stuff that W had done, only to get into office and do nothing.  (I think they were talking about Gitmo, for example.)  Lib said that 0 had found out some details he didn't know when he made the promises.  Bro said "so given the same set of facts, 0 made the same decision as W, meaning that W was right all along."  Lib started stammering and making a fool of himself.  Bro said he & his other coworkers were all laughing at Lib and having great fun.  Of course, Lib would never admit that he had just vindicated W's decisions even though Lib had just said so.