Brian Hutchinson: Vancouver the latest to underwrite wobbly bike-sharing dream

— Miami-based businessman first came to this city in 2012, to attend a global bicycle planning conference. Bicycles are a big deal in ; certain downtown streets and a major commuter bridge have been reconfigured to accommodate them, and Mayor is seldom seen outside without his trusty velo.

During a break, Squire did what many visitors do. He went to a busy intersection near Stanley Park, hired a bike from one of several rental shops and took a spin around the park’s fabled sea wall.

He loved it. Vancouver, he realized, had “all the right ingredients” to support his own fledgling interest: bike-sharing.

For reasons that remain unclear, Canadian cities are head-over-wheels with the heavily subsidized practice. Montreal, Toronto, even Ottawa have bike-sharing programs. Their municipal governments have underwritten the dreams — and wobbly financial arrangements — of two-wheel transportation impresarios, spending tens of millions of tax dollars on services that might look nice in theory, but aren’t really needed.

Bike-sharing programs typically place equipment at strategically located docking stations in urban centres, allowing people the opportunity to spontaneously grab bikes and return them to other locations at their convenience, for nominal fees. Most rentals last an hour or less, and distances travelled are minimal.

The programs are not aimed at tourists; rather, they are meant to complement local transit systems. In theory, customers disembark from commuter trains or buses, pick up bikes from bike-sharing docks, peddle a few blocks to their workplaces or their residences, then complete their transactions, leaving the equipment for the next person.

But critics say bike-sharing competes unfairly with established, traditional companies that rent out equipment by the hour or by the day.

Montreal spent tens of millions of dollars on a disastrous bike-sharing experiment that required a bailout two years ago, after piling up enormous debts. Toronto’s municipally owned bike-sharing outfit is debt-ridden. Launched in 2010, by the (NCC), Ottawa’s original bike-sharing program flopped three years later. So badly, the NCC wouldn’t respond this week to basic questions about it.

Peter J. Thompson/National PostPeter J. Thompson/National PostBixi rental bikes stand ready for users on University Avenue at King Street in Toronto.

Next stop, Vancouver. Late last month, the city announced it had made an arrangement with Squire and a Canadian subsidy of his privately held, U.S.-based company, . Vancouver will pay CycleHop $5 million to install about 1,500, one-size-fits-all rental bicycles with “sanitized” helmets at 150 docking stations around town, in locations to be determined later.

The city will also spend $1 million on “start-up funding” for the program, and another $500,000 annually for “City staffing, signage and way-finding costs.” To make room for the docking stations, Vancouver will give up municipally owned parking spaces, foregoing about $400,000 a year in the process.

“We feel the city got a really good deal,” says Squire, who has similar arrangements in several American centres. “We bear all the operating costs” for the program, he added. CycleHop’s initial investment is expected to be about $3 million, which may be covered in full or in part by local sponsorship agreements.

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CycleHop is looking for a corporate partner to cover its expenses, in exchange for the right to place logos on the bike-sharing equipment. CycleHop is not permitted to source other forms of ad revenue. Why? Because, besides asserting itself among the world’s greenest cities, Vancouver is now “ad-sensitive,” say city staff.

It’s already filled to the gills with bicycles and biking infrastructure. More is coming. Last week, Mayor Robertson announced the city will buy a nine-kilometre stretch of old rail track from Canadian Pacific Railway Ltd., for $55 million. It’s to be used as a green transportation corridor for pedestrians and pedalists. A new “Greenway Project Office” will oversee the design. New and better bike lanes are being planned to mesh with the corridor.

There’s no guarantee the new, subsidized bike-sharing program will complement Vancouver’s existing and proposed systems, and the city can’t promise its agreement with CycleHop will endure past its initial five-year term. Even Squire acknowledges that bike-sharing can be a precarious business. “We’ve seen other companies come and go,” he says.

So has Vancouver. The city thought it had found a bike-sharing partner in 2012, when it identified another company as its “preferred operator.” Despite the fact city staff were aware the company was experiencing “serious financial problems” that had them “looking into (its) financials,” discussions proceeded. That is, until the bike-sharing outfit went bankrupt.

The city’s agreement with CycleHop is longer than the deal it had contemplated four years ago. In most other respects it is similar: another unnecessary green gamble, all risks assumed by Jane and Joe Taxpayer.

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