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40 Comments

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Cycle Toronto Wants the City to Buy Bixi and Expand It

The bike-advocacy group says Bixi Toronto needs some municipal investment to help it thrive.

Photo by Mi*Li, from the Torontoist Flickr Pool

Photo by Mi*Li, from the Torontoist Flickr Pool.

Yesterday, we learned that Bixi Toronto is having trouble sustaining itself financially, possibly because the bike-share system is still too small to attract a healthy user base. Now, Cycle Toronto (formerly known as the Toronto Cyclists Union) is calling on the City to resolve the problem by opening up its wallet.

The weird thing about Bixi Toronto is that the City hasn’t actually invested any significant amount of money in it. The whole system was provided by a private not-for-profit called the Public Bike System Company, which was founded as an offshoot of Montreal’s parking authority. To set up Toronto’s Bixi system, PBSC took out a $4.5 million loan, with the City as a guarantor. The idea, at the time, was that the company would pay off its own debt, mainly with user fees. There was never any money dedicated to expanding the system.

Cycle Toronto, in a press release issued earlier this morning, suggests that the best way of getting Bixi Toronto out of its financial hole is for the City to buy it by paying off the remaining debt (which would cost about $3.9 million). The City could then spend taxpayer money on expanding the geographic boundaries of system, so it could serve more users.

“It costs the City roughly $1 million for a new bus,” says the release. “For the cost of 15 buses, we can purchase the program and expand to 3,000 bikes.” There are currently 1,000.

Following through on this idea would have the added benefit of uncoupling Bixi Toronto from PBSC, which has had some financial troubles of its own. Even so, we probably don’t need to tell you that this won’t be an easy sell at City Hall. Who wants to be the first to broach the topic of publicly funded bikes with Mayor Ford?

In any case, the arrangement between the City and PBSC will have to change somehow. Right now, the City’s plans are confidential, but we should know more next month.

CORRECTION: June 25, 2013, 2:20 PM This post originally said that the Public Bike System Company took out a $4.8 million loan to fund Bixi Toronto. In fact, while the City agreed to guarantee a loan of up to $4.8 million, PBSC only borrowed $4.5 million.

Comments

  • tyrannosaurus_rek

    What? No. As sympathetic as I may be towards cycling and cyclist issues, the city would be better off with those 15 buses than shoring up a failing bike rental company.

    • SteveKupferman

      Well, the City wouldn’t just be shoring it up. It would be the proud OWNER of a troubled bike rental company. So there’s that.

      • mark_dowling

        More like a franchise surely? If PBSC itself went under would that cause a problem in maintaining and expanding Bixi Toronto?

  • HotDang

    Cycle Toronto has its heart in the right place, but they don’t base their decisions on good political strategy. They do too many hail-marys and don’t go for the easy wins often enough. See: Jarvis.

  • GBCINQUE

    A small group of Cycling Socialists want rest of city to pay for their perpetually money losing pet project.

    • HotDang

      What you say may be true, but it doesn’t necessarily make bixi a bad idea or a bad investment. Consider if bixi was abolished and all bixi users switched to using cabs or car2go; you might well have enough congestion that it would cost the city more than the 3.9 to deal with it.

  • andrew97

    The only good reason for the city to own it would be to subsidize it. So the question is, should bike rentals be subsidized in Toronto? I say no.

  • Phil

    Just what the city needs, another failing business to support.

    • tomwest

      If it’s reduced it’s $4.8m loan to $3.9m in the short time it’s been opertaing, then it can’t be doing that badly…

      • torontothegreat

        By stealing from Peter to pay Paul? Borrowing money from one municipality isn’t an indicator that “it can’be doing that badly…” in fact it’s quite the opposite.

  • mark_dowling

    Here’s what I think will happen: Astral will say “we’ll buy Bixi Toronto and operate the )bikes if you give us yet another egregious variance from our contract for video gizmos and sidewalk blocking perpendicular ad boards and extend the contract a further 10 years”. It’s hard to see a non-governmental party with pockets deep enough and whose business model would not be vetoed by Astral’s contract terms as they currently exist.

    Here’s my back of the envelope suggestion: Metrolinx steps in with an operating subsidy sufficient to keep the doors open and the City’s loan repayment ticking over and a capital grant *fully* underwriting conversion of all existing stands and memberships to Presto, on condition that Adam Vaughan and Gord Perks commit to finding Section 37 money to fund the capital cost of sufficient additional bike stands to form a network reaching GO Bloor and GO Exhibition. Presto gains a presence in downtown Toronto without having to negotiate with TTC to do it and more 905ers can immediately access bikes at GO stations (although that does introduce some logistical challenges in keeping sufficient bikes for the morning/evening surges at Union and around the Ex). On the flip side Bixi riders without Metropasses could tap into TTC at Union and other Presto enabled subway stops (http://ttc.ca/Fares_and_passes/Fare_information/Presto_Fare_System/index.jsp)

    • dsmithhfx

      “more 905ers can immediately access bikes at GO stations (although that
      does introduce some logistical challenges in keeping sufficient bikes
      for the morning/evening surges at Union and around the Ex).”

      And do what, ride them home and keep them overnight?

      • tyrannosaurus_rek

        Ride them from said stations to their workplaces’ nearest drop-off stand, and back again at 5.

      • mark_dowling

        Keeping sufficient supply around main train stations in the AM rush and having sufficient docks available in the PM is a big logistical challenge for operations like London’s Boris Bikes.

    • torontothegreat

      It wouldn’t be Astral. By then it’ll be Bell and I don’t think Bell is going to be pushing the CRTC or variance envelope on the (former) Astral properties for a while…

  • EricM

    Cycle Toronto, formerly the Toronto Cyclists Union. Glad to see with the re-branding they have stuck to their crazy. I like bike lanes and I like Bixi but these folks make everyone who makes the choice to cycle (I do to work every day) and advocate for it look like crazy people. Sad.

  • duncanscityride

    Is there some sort of wall around Toronto that blocks people who live here from looking beyond its borders? Bike share is public transit, period. The new owner of the system needs to be vested in providing an accessible public service (accessibility is improving for bike share systems globally). Metrolinx or the City of Toronto are both prime candidates. However, this isn’t the only option. In Paris, an advertising company runs the system and the city provides space (and most importantly cycling infrastructure). Each year the city receives a cheque from the advertising company. Astral, as incompetent as they may be, is another buyer that should be prepping an offer.

    • OgtheDim

      Its public transit in a very very small box of a much much larger city. If it is going to be run as a public service, it needs to be thought through.

      Bixi isn’t.

      • rich1299

        But it could be if expanded, I;d love to use it but its nowhere near where I live.

    • mark_dowling

      The likes of JC Desaux cannot enter the Toronto market the way that they have in places like Dublin, because their business model is precluded by Astral’s Street Furniture Contract. (Thanks again for that one, David Miller)

  • http://twitter.com/Artful_Roger Roger Beharry Lall

    mmmm.. now that I’m not as big a fan of. I love Bixi, and city should support them (discounts, tax, access, etc.)… but buying them outright… don’t (trust) city to run it.

    would much rather see city use limited funds to build infrastructure – eg. network of more bicycle lanes, ‘complete roads’, parks w trails, etc. etc. Vs. running a rental service, bike parking, or other things more aligned to private enterprise.

    • RobertB

      You’re right. The city couldn’t even organize setting up half a dozen non-hot dog stands without bankrupting the licencees.
      If renting bicycles in volume at outrageous prices was really a business, they’d already be in place.

  • Dogma

    Good luck on that one under the current regime at city hall. Don’t they know that bikes are the enemy? I just don’t see this happening given the perverse political climate towards bikes and cycling in Toronto.

  • scottld

    First off we need to know WHY it is not at least breaking even. THEN we decide what to do.

    • dsmithhfx

      Simple: it’s not getting enough ridership in the winter.

  • RobertB

    Didn’t Montreal just bail them out for 100 million dollars? That’s 20,000 dollars a bicycle.

  • http://twitter.com/mjrichardson_to Mark J. Richardson

    I am a member of BIXI in Ottawa and Toronto…but even I am unsure of having the City take BIXI on to it’s books.

    My average ride is about 2 KM / 8 Min around the core where $3 for a short TTC ride doesn’t make sense.

    Yes, all public-transit “loses” money (if you only look at the fare-box)…but BIXI is still really individual transit. How would I feel about the City of Toronto buying Car2Go or AutoShare (for example)…?

    If there are City $$$ available, better it goes to the TTC to serve a greater number of Torontonians.

    Interest-Rates are low, BIXI (or some other co-op style owner) should be able to develop an business-model to increase their geographic footprint in Toronto and generate more revenue.

    • Gareth Davies

      Great comments, but I am not sure it’s a money generator…this IS public transit so it comes at a cost. That’s probably why Montreal was okay paying the cost. It’s zero-emissions public transit, that also excersizes your citizens and brings in tourism (see: Montreal).

      • torontothegreat

        If it’s public transit why is it a privately held company that owns it and is now trying to pawn it off on the public because they can’t sustain themselves?

  • iSkyscraper

    Read the venom on the Toronto Sun comment boards. There is no point discussing this while the War on Bikes is being waged full throttle.

    Go on vacation somewhere nice until spring 2015, when Ford is gone and bikes can once again bloom. In the meantime ride a Bixi bike in some other city with more than 1,000 bikes and lots of happy users, like New York, Chicago, Minneapolis, Boston or DC. Toronto is only a sad place these days.

    • Testu

      Or, just leave Toronto entirely.

      There’s a reason those comments exist and it’s the same reason Ford was elected in the first place. You can’t count on Ford being turfed in 2015, he still has quite a bit of support and unless there’s a single good candidate to oppose him in 2015 he could easily win simply because the “left” vote is split between a bunch of poor candidates.

      The FYGM crap he keeps spewing about no taxes for services, “gravy”, and bikes are for chumps, resonates pretty well with a very large part of the population, they also happen to be the part of the population that bothers to go out and vote.

      • dsmithhfx

        I don’t hold to the single-opponent condition. Fairly recent polls had him losing in three and four way races against centre-rightists (e.g., Stintz, Tory), and centre-leftists. And don’t count on Ford not springing yet another egregious faux pas or six before the election. Even if he doesn’t, a plurality may well be just sick of his monkeyshines being broadcast around the world on a weekly basis.

    • Angry Admin

      There is no war on bikes. Just that cyclists cry wolf and think things should go their way and are unwilling to compromise.

      • tomwest

        Three words: Jarvis bike lanes.

  • Gareth Davies

    Bike Sharing is part of every modern big city (see: London, New York, LA, Chicago, Montreal, Ottawa, the list goes on). If you want to be a world class city and build transit, Bike Share is now a key part of the big city mix.

    HOWEVER, it’s not surprising it has not taken off as projected in Toronto. Infrastructure and congestion are major barriers to cycling in this city (not to mention streetcar tracks). That is why people think cyclists are ‘crazy’ because it looks like an extreme sport when you are riding in Toronto.

    Scaling the system would probably work well considering the appetite for it in places like the Danforth, Leslieville and Beaches. Not to mention Ronsesvalles.

    Businesses are supporting BIXI and so should you: http://cycleto.ca/businesses-bixi-expansion-sign-support

    • Angry Admin

      wrong, less than 100 “big cities” have bike sharing. there are thousands of cities around the world.

  • Angry Admin

    1) Get a third sponsor.
    2) Raise the annual membership
    3) Raise the per hour rate
    4) Raise the per 24 hr period rate
    5) Raise the per 72 hr period rate
    6) Raise the rates.

    If you can’t pay your expenses with 1,000 bikes. You won’t be able to pay 3,000 bikes. Those 2000 extra bikes will have their own expenses.

  • saldebus

    I just read the Montreal article and it states that they are refusing to open the BIxi accounting books..which makes me think that we’re potentially looking at another CEO who is paying himself and his staff too much. As a business owner myself, I want to see the books before I support a buyout..and of course then maybe we could have a real public buyout where the public could invest in this company. Look at how much money the 407 generates…taxpayer money that was lost to a private company buyout.

  • mariposaman

    It is reasonable to assume if Bixi cannot be viable with 1000 bikes, that 3000 bikes would just make it 3 times more unprofitable. If a private company cannot make it financially it should go bankrupt. If Toronto wants a bike share program it must decide if it is to become part of public transportation and subsidize it as necessary like it does roads, buses and subways. Strange that Cycle Toronto wants the public to pump millions into a failing business model, yet wants to continue the ban on ebikes in Toronto which would cost zero dollars to include in the transportation mix. How about allowing folding bicycles on the subways during rush hour with a special car. I would hate to see Bixi go, but with the present cost cutting Mayor, I doubt a huge subsidy is in the works.

  • joshua

    15M for 3,000 bikes.. that’s 5 gs for a bike. Whe15M for 3,000 bikes.. that’s 5 gs for a bike. Am I the only one that thinks that’s a little absurd? Which well connected businessman is raking in the dough here?