Did a UFO Hit SFO?

Earlier this year, a Pasadena court of appeals cleared the way for San Francisco to mandate private sector employers with at least 20 employees to spend a minimum amount on health coverage for each worker or contribute to a city fund to help cover the uninsured.   It is a costly mandate and large employers are to pay at least $1.76 per hour for each worker's health care coverage.  A worker only need who 10 hours each week to qualify for coverage.

On Tuesday, San Francisco's Board of Supervisors mandated that employers with 20 or more people will be required to offer commuter benefits for which employers foot the bill.   

What is going on in SFO? Has a UFO hit City Hall?  Apparently, the costs of all of these new programs is alien to the city leaders.  Their attitude seems to be "Whatever Government Can't Afford, Mandate the Private Sector to Provide!"  Don't worry about the costs, people will blame business for high prices. Now I know why everything is so expensive in "San Fran-frisk-co."

The new ordinance gives employers three options:

• Set up a program under IRS Code 132(f) in which employees can make a pretax contribution to pay for mass transit.  The maximum monthly contribution set by the IRS for 2008 is $115 for a transit pass.
• Pay for employee's transportation expenses such as buying transit passes, for example.
• Set up a van-pooling program for employees.

The mayor has 10 days to decide whether to sign or veto the measure.  If he signs it, as expected, it will take effect around the first of the year.

While all of these ideas may sound good, why not let the employer and the people in the workplace work out transportation issues?  In a day of $4 gasoline and with skyrocketing parking costs in large cities, aren't employers wanting to keep good, dependable workers going to work out these problems?

Employers need flexibility and incentives, not rigidity and added costs.  If that isn't enough to convince you these mandates are wrong, think about the new bureaucracy at city hall and the army of new city transit auditors needed just to enforce this new mandate. 

Don C. Brunell, President (DonB@awb.org)