Citi Bike is underwater and de Blasio refuses bailout
One of the most unique features of New York City's bike share program is that it's privately funded. In most cities, bike-share programs, like other forms of public transportation, are subsidized with taxpayer money.
But according to The Wall Street Journal, Citi Bike is in debt. Alta Bicycle Share, which operates Citi Bike as a subsidiary, needs to raise tens of millions of dollars to keep the program going according to WSJ's off-the-record sources.
Citi Bike, which launched last year, has faced a number of challenges. As expected, the harsh winter resulted in a decrease in the number of day passes sold. In the first quarter of 2014, the Citi Bike had only 18 days where it sold more than 200 24-hour passes. But even on clear days, faulty and vandalized kiosks can sometimes make it hard to use the Citi Bike system. Also, the traffic flow of bikes has proven to be a challenge, as many riders may choose to commute uptown in the morning, but don't necessarily ride back south. Citi Bike now redistributes the bikes by truck overnight, adding to the cost of the system.
Confusingly, the WJS reports that Alta isn't seeking city funding, although the New York Post reports they have asked city officials "for help with the program."
One possible way to raise funds would be to raise the cost of annual memberships, which have proven to be more popular than expected. According to Citi Bike data, over 99,000 people have currently paid for the annual membership, costing $95.00 plus tax for all trips under 45 minutes.
Finding new sponsors for Citi Bike may be a challenge in light of how closely associated the program has become with its "title sponsor," Citi Bank.
However, it doesn't look like the city will approve either higher fees for annual users or the use of public funds any time soon. Mayor Bill de Blasio said Friday that the city will collaborate with Citi Bike to become more efficient, but that "at this point, city budget money is not on the table." The New York Post reports that city officials want Citi Bike to improve operations before considering higher fees for riders.
For now, it seems that Citi Bike survival will depend on making its services more attractive to visitors and other day-pass users, which cost $25.00 plus tax.
Some city council members haven't entirely ruled out public funding. “City dollars should be a last resort only if we are unable to gather interest from new private partnerships,” said Manhattan Councilman Ydanis Rodriguez.
Given the popularity of Citi Bike among the residents of New York city (assuming that's who pays for those 99,000 annual memberships), it seems unlikely that the city will allow the program to fold completely.