Covered employee:

An employee who averaged at least 20 hours of work per week in the previous calendar month within the geographic boundaries of the Bay Area Air Quality Management District (see below)—excluding seasonal or temporary employees who work 120 days or fewer in a calendar year.

Covered employer:

All public, private, and non-profit employers with an average of 50 or more full-time employees per week working for pay within the geographic boundaries of the Bay Area Air Quality Management District (see below).

Areas with specific requirements:

• City & County of San Francisco: Requires 20 or more employees nationwide
• San Francisco International Airport: Requires 20 or more employees nationwide
• City of Richmond: Requires 10 or more employees nationwide
• City of Berkeley: Requires 10 or more employees nationwide

To be compliant—and to be listed on the official record of compliant companies—you must follow the city's or state’s commuter benefits requirements.

→ Download the full list of compliant companies and see if you are on it

For Bay Area employers to comply, they must:

1. Offer commuter benefits using one of four IRS-approved options:
   • Pre-tax payroll deductions (up to $325/month) for transit or vanpool costs
   • An employer-paid subsidy equal to the cost of a San Francisco Muni “A” Pass (includes BART)
   • Employer-provided transportation, like a shuttle or van service
   • Or any combination of the above
2. Register with the city and maintain ongoing compliance by completing 8–12 setup steps, conducting quarterly reviews, keeping records, and submitting annual updates to avoid fines.

Financial penalties in the Bay Area are determined on a case-by-case basis and are subject to civil penalties under California Health and Safety Code §65801, Section §§42402, ranging from $1,000 to $10,000 per day. For larger companies, ongoing violations can escalate rapidly, making non-compliance a costly risk.

For the Bay Area, the nationwide IRS tax-free limits for commuter benefits apply. For 2025, employees can allocate up to $325 per month for transit and $325 per month for parking, reducing taxable income.

• Pre-tax savings: Employees can lower their taxable income by setting aside funds for transit and vanpool expenses.
• Employer tax benefits: Businesses save an average of 7.65% per employee on payroll taxes.
• Direct transit subsidies: Employers can provide up to $325 per month per employee in tax-deductible transit benefits.
• Additional incentives: Some cities and states offer grants, tax credits, or subsidies for implementing commuter benefit programs.

The mandate spans across all nine counties within the Bay Area: Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, Sonoma.