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HomeMy WebLinkAboutFS 2010-04-20 Item 2B - Policy - Travel Policy UpdateINFORMATIONAL MEMORANDUM TO: Mayor Haggerton Finance and Safety Committee FROM: Shawn Hunstock, Finance Director DATE: April 14, 2010 SUBJECT: Updated Travel Policy ISSUE The City's current travel policy does not allow for a per diem, or payment in lieu of documented receipts, for travel expense reimbursement purposes. This necessitates the traveler keeping each and every receipt for travel expenses, submitting those receipts in an approved manner to Finance, the Finance department checking the receipts against the reimbursement claim, handling and filing of the receipts, and storage of them at the records storage facility for the appropriate length of time. Not infrequently travelers will misplace a receipt and not get reimbursed for that expense, or they will have to take time out of their day at work to contact the business to try to get a replacement receipt. In addition to lost receipts, the Finance department often sees receipts that are not itemized, especially with restaurants. This lack of itemization means it is not clear what the City is reimbursing the employee for. The reimbursement could potentially include the cost of alcohol and other items not allowed for under City policies. Finally, the reimbursement amounts contained in the current travel policy are not consistent with amounts established by the federal General Services Administration as allowable reimbursements for federal grants, among other purposes. BACKGROUND The City's current travel policy has, since at least 2000, provided for actual expense reimbursement of up to $12 for breakfast, $15 for lunch and $27 for dinner. An itemized receipt is necessary before an employee will be reimbursed for meal expenses. DISCUSSION City of Tukwila Jim Haggerton, Mayor The new travel policy incorporates many changes over the existing policy, including the following: Allows for reimbursement to employees for meals at the allowable federal rate, as determined by the General Services Administration (www.gsa.gov). Clarifies when an employee is considered to be in travel status. Clarifies when an employee is eligible for meal reimbursement. Clarifies that, in accordance with IRS Regulations, amounts paid over the per diem rates are included in compensable wages as a fringe benefit. INFORMATIONAL MEMO Page 2 Lists the conditions under which an employee might be eligible for lodging reimbursement even when not in travel status. Lists the types of expenses that are not eligible for reimbursement. An employee requesting reimbursement based on the per diem rate will not be required to submit to Finance actual receipts. While this might result in the employee receiving an amount greater than the actual cost of the meal, the per diem method will result in significant cost savings to the City based on the time currently spent by the traveler and Finance staff in handling receipts, verifying that the total of all receipts matches the expense reimbursement claimed, and storage and archiving of the receipts. RECOMMENDATION No recommendation, item is for informational purposes only. ATTACHMENT Travel Expenses While on City Business, 03 -06 C: ItemplXPGrpWisellnfoMemo NewTravelPoiicy 1. doc Subject: POLICY AND PROCEDURE Index: TRAVEL EXPENSES WHILE ON CITY BUSINESS FINANCE Number: 03 -06 Effective Date: Supersedes: Page 1 of 1 Staff Contact: Date: Approved by: 06/2010 03 -06, dtd 1/1/03 Finance Director 04/2010 1.0 PURPOSE: To establish a policy and procedure related to obtaining travel authorization, advance travel funds, and expenditure or reimbursement authorization for expenses incurred in conduct of business of the City. 2.0 ORGANIZATIONS AFFECTED: All departments and divisions. 3.0 REFERENCES: RCW 42.24, IRS Rev. Rul. 2006 -56, IRS Rev. Proc. 2005 -67 4.0 POLICY: 4.1 It is the policy of the City of Tukwila to reimburse City employees, elected and appointed officials, and members of boards and commissions for reasonable and necessary expenses incurred in the conduct of their business on behalf of the City. Eligible meal reimbursements shall be made on a per diem or itemized basis (see below for eligible meal reimbursements). All other eligible expenses, including lodging and mileage, shall be reimbursed on an actual expense basis only, and must be accompanied by invoices and/or receipts showing proof of payment. Reimbursement for necessary and reasonable expenses will be made by application and in compliance with this policy and Chapter 42.24, of the Revised Code of Washington. All persons are to use good judgment and discretion, limiting expenses with the best interests of the City foremost in mind. Excessive or unnecessary expenses will not be approved or reimbursed. It is expressly prohibited to use City travel funds for personal purposes. This policy is intended to comply with IRS regulations concerning accountable business expense reimbursement plans, which do not require inclusion of reimbursed expenses in compensatory earnings, subject to employment taxes and inclusion in W -2 wages. 4.2 Payment in advance of travel expenses may be made subject to and in compliance with Chapter 3.04, Tukwila Municipal Code, Advance Travel Expense Revolving Fund. An advance for approved anticipated travel expenses will not be paid when total estimated expenditures are less than $50.00. Meals. Meals will be reimbursed at either 1) actual documented cost, or 2) the current prevailing per diem rate. The City will generally not reimburse meals at an amount greater than the per diem rate. An employee can be reimbursed for less than the per diem amount upon submittal of itemized receipts. To the extent, if any, that this policy and the reimbursement amounts included conflict with any bargaining unit contracts, the contracts will be used to determine reimbursement. Claims for reimbursement according to union contracts are not eligible for payment of per diem, but will instead be based on documented, itemized receipts at amounts in accordance with union contracts. To the extent that reimbursement is made for any meal above the amounts provided for by location by the U.S. General Services Administration, such excess will be included in compensable wages of the employee, in accordance with regulations issued by the Internal Revenue Service for accountable fringe benefit plans, and included in the employee's W -2 wages. When the actual documented costs are reimbursed, receipts, proof of payment documentation, or certification in the case of lost or non available receipts are required for all reimbursements. Such documentation shall be provided to the Finance Department within five (5) business days of returning from travel. The above amounts specifically include the cost of the meal, incidental expenses, sales tax and customary tip or gratuity. In the case of actual cost reimbursement, travelers will make every attempt to request a receipt from the vendor if they do not have one. In the rare occasion when a receipt can not be produced by the vendor, a certification from the employee of the amount paid, payee, and business purpose, will be allowed in place of the original receipt if approved by signature of the department director. The amount claimed will be reimbursed only if the original receipt is provided, unless a certification signed by the director is submitted with the Travel Expense Reimbursement Form. Employees shall be reimbursed for the cost of meals, including a reasonable tip (no more than 15% unless automatically billed by vendor), using the following guidelines for standard locations: Breakfast 11 Lunch 14 Dinner 21 Total 46 4.2.1 The maximum amount for meals is $46 for all standard locations within the continental USA, except for those identified as high cost locations (as defined by the U.S. General Services Administration, available at www.gsa.gov /mie). Note: The maximum reimbursement amount, as of April 15, 2010, for King County (if in travel status) is $71. The reimbursement per meal in King County is $18 for breakfast, $21 for lunch, and $32 for dinner. Note that travelers should check the GSA web site for the per diem rate in effect during their time of travel. 4.2.2 The City will reimburse up to the maximum food allowance specified for the destination while the employee is there and during travel to and from that location when: The employee stays overnight. When the employee is not paying for lodging and is staying with friends, family, or colleagues. When the employee has been in travel status and is not staying overnight. The traveler must be in travel status for more than three hours before or after their normally scheduled shift. The three hours may be any combination of time before and/or after your normal working hours on the day in question. The provisions contained herein apply to meal reimbursements while in travel status only, and do not apply to meals purchased when not in travel status for official City business. Such meal purchases are covered by other Finance policies. 4.2.3 An employee is considered to be in travel status, for travel expense reimbursement purposes only, when: Traveling on behalf of the City, Traveling three hours beyond the employee's normal work hours, and More than 50 miles one way (most direct route) from either the official duty station or official residence, exclusive of commuting between the official duty station and official residence. 4.2.4 If an employee is traveling overnight, or meets the three hour rule, the City may reimburse the employee for meals according to these general guidelines: Regardless of when an employee's normally scheduled shift starts, when entering into travel status by departing from your official duty station or official residence: o Before 8:00 a.m., an employee may be reimbursed for breakfast, lunch, and dinner. o After 8:00 a.m. until 2:00 p.m., an employee may be reimbursed for lunch, and dinner. o After 2:00 p.m. until 6:00 p.m., an employee may be reimbursed for dinner. An employee may go into travel status up to two hours before a domestic flight and up to three hours before an international flight. Whether an employee flies or drives, the employee should depart in time to observe the start time of the City business while taking into consideration that the most economical travel option must be selected. o For example: If a conference starts on Monday at 8am in New York, it would be a reasonable expectation that the employee goes into travel status on Sunday to arrive in New York in time to observe the start time of the conference. When an employee comes off travel status by returning to the official duty station or official residence: o Before 12 noon, the employee may be reimbursed for breakfast. o After 12 noon breakfast and lu After 6:00 p.m., dinner. until 6:00 p.m., the employee may be reimbursed for unch. the employee may be reimbursed for breakfast, lunch, and For the day you leave on your trip, use the per diem schedule specified for the location where you will spend the night. For the day you return from your trip, use the per diem schedule specified for the last location where you stayed overnight. 4.2.5 The City does not reimburse for certain meals: Meals during normal work days. These types of expenses are not travel related and are addressed by the City's meal reimbursement policy. Meals included in the price of lodging, such as full breakfasts at a B &B (bed and breakfast). The City will not pay for separate meal expenses if the cost of the hotel or B &B includes a meal. Airline meals or "continental breakfasts" will not be considered a full meal, meaning the employee will be reimbursed at the per diem amount for that meal. Meals included in a registration fee. For reimbursement of meals related to travel for conference or training attendance, a copy of the agenda or program must be attached to the Travel Expense Reimbursement Form before meals will be reimbursed. A "continental breakfast," though, is not considered a meal and will be reimbursed even if the cost of which is included in the registration fee. Any meal provided, regardless of whether or not consumed, at the function the employee attended. 4.3 Airfare. Employees are required to select travel options that are most economical to the City. An acceptable way to identify the lowest available coach fare is to document, via a travel agency or an online booking web site, comparable fares for at least three different commercial air carriers. 4.3.1 Employees must choose the most direct travel between their official duty station or official residence. If an employee wishes to divert to another location as part of their travel itinerary, this must be at the employee's expense. An employee would be required to provide proof of the cost of a direct flight, which the city will pay for, as compared to the booked itinerary. 4.3.2 The city will not pay for travel expenses of a spouse, domestic partner or any other non employee traveling with an employee, except as discussed below. 4.3.3 The city will pay for non employee travel in only a few circumstances, such as prisoners or applicants for city employment. To be eligible for city reimbursement, the travel must be in the city's best interest. 4.4 Mileage. City employees are encouraged, whenever possible and vehicles are available, to use City motor pool vehicles for local travel. If an employee drives their own vehicle on City business, the employee is reimbursed the applicable mileage rate for each mile driven. The mileage rate reimbursement includes the wear and tear on the car, the cost of gas and insurance. 4.4.1 Separate "point -to -point mileage" (driving to one destination using the most direct route) from "vicinity mileage" (driving to several destinations): Point -to- point: Use Mapquest or other online map services to calculate point to -point mileage. Employees must include supporting documentation (i.e. a Mapquest or the car mileage and rates table printout) for reimbursement. Mapquest driving mileage will not be accepted between locations where ferry service provides the most direct route. Vicinity miles: Use the odometer reading to calculate vicinity mileage (eg. picking up samples, visiting various sites within a central destination, conducting interviews, etc.) and include a mileage log with your Travel Expense Reimbursement Form. 4.4.2 Driving instead of flying. If the employee chooses to drive instead of flying, the employee may be reimbursed point -to -point mileage for a personal vehicle or cost of a rental car plus gas (from official duty station to temporary duty station only) up to the lowest available coach fare for the same trip as evidenced by a comparable itinerary. Employees may also receive meals and lodging per diem according to these guidelines. Use the per diem for the location where the employee sleeps. The employee is responsible for their own car insurance. If the employee is in an accident, the employee's insurance carrier is the primary coverage. Since employees must select travel options that are most economical to the City, the employee must provide documentation, in the form of fares for comparable itineraries, showing the cost of driving to be less than the cost of airfare. 4.4.3 Commuting expenses. Daily transportation between an employee's official residence and the official duty station is not considered "travel status" and therefore a personal obligation and is not reimbursable. If an employee goes on or off travel status on a day they are regularly scheduled to work, and they do report to work, the employee is reimbursed only for mileage between the official duty station and the airport. For instance, an employee that drives from SeaTac airport to their official duty station, then home would only be reimbursed for mileage between the airport and work. 4.5 Lodging. Employees may be reimbursed for lodging when traveling on City business, when the destination is more than 50 miles (most direct route) from the closer of either the official residence or official duty station, and the stay is in a commercial lodging facility. Employees are encouraged to take advantage of any and all discounts available to them, including asking for "governmental" rates. 4.5.1 A commercial lodging facility is a business, non profit or governmental entity that provides lodging accommodations for a fee. A commercial lodging facility other than a hotel must be supported by a tax ID number or a published advertisement. The facility must be available to the general public to qualify as commercial lodging (i.e. listed with a rental agency, newspaper ad, etc.). Reimbursements for lodging at private residence not supported by a tax ID number or a rental listing are not allowed under State and City policies and procedures. 4.5.2 The maximum amount for lodging is $70 per night for all standard locations within the continental USA, expect for those identified as high cost locations (as defined by the U.S. General Services Administration, available at www.2sa.gov). Employees must provide documentation from the GSA web site, attached to the travel expense reimbursement form, for their destination. 4.5.3 An exception to the maximum lodging reimbursement will be made in the case of an employee who stays at a conference hotel, if the employee does not also rent a car while travelling. The exception will be in lieu of rental car reimbursement, and will be for up to 150% of the lodging per diem amount listed on the GSA web site. 4.5.4 A listing of lodging establishments honoring the lodging per diem amounts listed on the GSA web site can be found at www.fedrooms.com. 4.5.5 Employees may be reimbursed for lodging within 50 miles of the official residence or official duty station under one of the following conditions: The employee is attending back -to -back late night/early morning meetings and you have prior written approval from an authorized person. The employee is acting in a custodial or leadership role and must, as part of the employee's duties, lodge with prisoners or other non employees, and the employee has prior written approval from an authorized person. The employee needs to stay in a commercial lodging facility to avoid driving in severe inclement weather, and the employee has an approval letter from an authorized person. The employee's department determines that the employee performs critical functions and must remain at the workstation during emergency situations and the employee has an approval letter from the department director, City Administrator or Mayor. 4.6 Miscellaneous travel expenses. The following expenses are eligible for reimbursement if they relate to the conduct of official city business, are necessary and reasonable business expenses, and if consistent with efforts to minimize the cost of travel for city business: Taxi Airport shuttle Parking Ferry tolls Internet access, if necessary to complete official city business Bus fare Employees are encouraged to use mass transit, where available and feasible, in an effort to minimize travel expenses. 4.7 Unallowable travel expenses shall include, but are not limited to: Laundry, cleaning or valet services (except for uniformed employees otherwise allowable according to labor agreements). Laundry or cleaning is allowable, up to $15.00, for overnight stays in excess of five consecutive days. Alcoholic beverages and tobacco. Entertainment, including in -room video rentals. Personal phone calls or telegrams. First class, or business class, airfare when economy or coach class is available. Meals and lodging in lieu of other meals and/or lodging when these items are included in the registration fee. Room service above the allowable meal per diem amount. Fines, forfeitures, tickets or penalties. Expenses of a spouse, domestic partner or any other non employee unless otherwise specifically allowed. Travel insurance. Gambling expenses. All other personal services such as barber, etc. 4.8 When the per diem method is used for meals, a Travel Expense Reimbursement Form must be completed and submitted to the Finance Department within five (5) business days of returning from travel. 4.9 If authorized staff desire to have their family members or guests accompany him/her on any City related travel, the authorized staff shall do so at their own expense. At no time will the City pay for additional expenses incurred in relation to family or guest accompaniment. Any change in itinerary made solely for the benefit of the employee will be done at the employee's expense. Employees must identify on the receipt expenses related to their travel if receipts include expenses for non employee travelers as well. 4.10 When travel costs and/or registration or other fees have been paid by the City on behalf of the authorized staff, and that the authorized staff fails, without good cause to attend the event, said staff shall reimburse the City the amount paid by the City. Questions of good cause shall be determined by the Department Director, City Administrator or Human Resources Director. 4.11 Operating city owned vehicles requires a valid Washington State driver's license. When using a personal vehicle for City business, proof of a valid Washington State driver's license and valid insurance is required. 4.12 The City shall pay for the least costly and/or appropriate mode of transportation to the destination. For conferences offered at various locations, management reserves the right to require employees attend the closest conference location, if available, to minimize travel costs. 4.13 Where feasible, groups of employees traveling together will utilize carpooling methods to minimize the cost of commuting expenses. 4.14 The City shall not reimburse more than the reasonable cost of travel. 4.15 All out -of -state travel must be pre- approved by the Mayor or City Administrator before the commitment of liability against the City of Tukwila for payment. 4.16 Definitions 4.16.1 Authorization All travel expenses must be approved by someone other than the traveler. This should be a direct supervisor, manager or director. 4.16.2 Coach class The least expensive airline accommodation, also known as "economy class" or "tourist class." 4.16.3 Commercial carrier A company in the business of providing transportation for passengers on a commercial basis. For instance, airlines, railroads, etc. 4.16.4 Commercial lodging facility A business, non profit or governmental entity that provides lodging accommodations for a fee. 4.16.5 Continental breakfast A light breakfast generally consisting of juice, bread or pastry and a hot beverage such as coffee or tea. May also include fruit. 4.16.6 Economical Direct financial, work related costs that occur at the least cost to the City and which the City is responsible to pay. 4.16.7 High cost locations Specific cities or areas identified in the per diem tables by the General Services Administration for which per diem rates for food and lodging are higher than the standard rate. (See www.gsa.2ov/). 4.16.8 Incidental expenses Fees and tips given to doormen, baggage carriers, bellhops, hotel maids, and for other personal services provided. This is not a miscellaneous expense. An allowance for incidental expenses is already included within the daily subsistence rate for the area of travel. 4.16.9 Official residence The city, town or other location where an employee maintains a residence which is used as a primary domicile by the employee. 4.16.10 Official duty station The city, town or other location where the employee's office is located, or the city, town or location where the employee's work is performed on a permanent basis. 4.16.11 Per diem The allowable amount covering meals, incidentals and lodging while in travel status. Following is a breakdown of common Meal and Incidental Expense reimbursement amounts: Breakfast 11 $13 $14 $15 $16 $18 Lunch 14 15 17 18 20 21 Dinner 21 23 25 28 30 32 Total 46 $51 $56 $61 $66 $71 4.16.12 Per diem (travel) advance Requested by City travelers a minimum of one week prior to departure. Eligible expenses for a travel advance include meals, incidentals and lodging. 4.16.13 Regularly scheduled work day An employee's established, on -going work hours, such as Monday through Friday, 8:30 a.m. to 5:00 p.m. 4.16.14 Temporary duty station A fixed location where an employee has been temporarily assigned to work for a specific period of time for less than one year. 4.16.15 Transportation expenses Those costs covering: Travel by commercial carriers, such as bus, train, ship and airplane. Travel by privately -owned motor vehicles, such as cars, motorcycles, vans and trucks. Travel by rental motor vehicle. Any combination of the above. 4.16.16 Traveler An employee, or authorized non employee, that is in travel status while on official City business. 4.16.17 Travel status An employee is in travel status when all the following conditions are met: Travel is on behalf of the City, for official City business. The employee's travel occurs more than three hours beyond (before or after) the employee's regularly scheduled work day. Travel occurs more than fifty miles one way (most direct route) from either the official duty station or official residence, excluding commuting between the official duty station and official residence.