Commuter benefits in Hawaii: what the state law does and does not require

Hawaii Revised Statutes §46-16.2 is the enabling statute that authorizes each Hawaii county to adopt its own commuter benefits ordinance. The statute is not a statewide mandate: an employer is covered only if its county adopts an ordinance, and as of September 2026 we are not aware of a county ordinance in force. If a county does adopt one, the statute sets the menu of acceptable benefit options: a pretax election under the federal commuter benefit rule (§132(f)), an employer-paid subsidy, or employer-provided transportation.

Some benefit vendors describe Hawaii as a mandate for employers with more than 20 employees. The statute itself contains no employer threshold, so check with your county before assuming you are covered.

What a county ordinance would require

If your county adopts an ordinance, covered employers must offer at least one of these:

1. A pretax election for transit, vanpool, or bicycle commuting costs, up to the IRS monthly limit ($340/month transit and $340/month parking in 2026).
2. An employer-paid transit or vanpool subsidy.
3. Employer-provided transportation in a vanpool, bus, or shuttle.

What the law does not require

The statute is explicit that it does not require employees to change how they commute, and it does not override existing collective bargaining agreements. Employers may offer more generous benefits.

Eligible Hawaii transit

Eligible transit includes TheBus and TheHandi-Van on Oahu and the county transit systems on Maui, Hawaii Island, and Kauai. Vanpool and qualified parking near worksites (garages, lots, meters, and parking apps) also qualify.

Why Hawaii hourly employers choose Alice

Hawaii's economy is dominated by tourism, food service, retail, and healthcare, all heavily hourly. Traditional pretax providers make you pay up front and manage enrollment and payroll yourself. That doesn't fit here.

Alice is purpose-built for hourly and frontline teams. Alice has no up-front employer cost and no manual open enrollment to manage. Employees don't pre-fund. The employer keeps a reserve amount in its Alice plan account; it belongs to the employer and is not a fee.

Setup starts with one call. Alice connects to 30+ payroll providers, including ADP, UKG, Paylocity, Paycom, Paychex, Toast, and others.

Talk to sales

Talk to sales: sales@thisisalice.com or (929) 552-4625.

For the full list of eligible commuter expenses, see What parking and transit expenses are eligible? Eligibility is set by IRC §132(f).

Figures shown are for the 2026 plan year and are set by the IRS. Limits are indexed annually by the IRS.

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Alice does not provide tax, legal, or financial advice. Consult your own tax preparer, lawyer, or financial advisor for guidance specific to your situation.