It’s clear we need to back-pedal on costly Mobi plan

Benefits to community don’t justify steep costs, a group of economics students says.

In July 2016, the City of Vancouver launched Mobi, a bike-share program designed to increase daily bicycle use and “fill a gap in the transportation system” while moving toward the greater goal of a “green” city, as Mayor Gregor Robertson put it. And while Mobi may appear to deliver benefits, the mayor’s vision for clean two-wheeled transit may not be all that it seems. It turns out that those benefits come with a high price tag and high risk.

The City of Vancouver is funding a private company, Vancouver Bike Share Inc., to the tune of millions of dollars over the next five years to operate Mobi. The city will receive an undisclosed percentage of revenue for each bike used during the first five years of the bikeshare operation. Mobi secured a sponsor last December, with Shaw committing to a five-year partnership. Shaw agreed to pay Mobi an undisclosed amount of money and provide Wi-Fi at many stations in exchange for Shaw branding on all bikes and stations.

With only 1,500 bicycles, the startup cost of $5 million, paid by the taxpayers of Vancouver, is steep. On top of this cost is $800,000 in forgone revenue from metered parking annually to make space for the bike racks, as well as an additional $500,000 a year in subsidies for staffing and other costs. Of course, we’re told making a profit is not the purpose of the program. Vancouver’s general manager of engineering, Jerry Dobrovolny, has said mobility, not profit, is the goal of the bike share.

While the City of Vancouver is largely funding Mobi out of tax proceeds, Toronto signed a sponsorship deal in 2014 with TD Bank to “cover all operating costs” for Bike Share Toronto. Ottawa also recently launched VeloGo and does not provide funding. Vancouver has 150 bike stations and 1,500 bikes, while Toronto operates 270 stations and 2,750 bikes, and Montreal operates 540 stations and 6,250 bikes. Ottawa has just 28 stations.

Busing or even purchasing a bike are cheaper and more efficient options for most lower-income commuters.

Initially, Mobi was targeted toward lowerincome commuters. However, since Mobi’s launch, the rates have increased. Currently, Mobi’s rates are $9.75 for a 24-hour pass, $75 for a three-month pass, and $129 for a one-year pass (the initial price of the one-year pass was $99). This is a high price to pay for bikes that allow only 30 minutes of access at one time, so it clearly caters to the well-to-do. Busing or even purchasing a bike are cheaper and more efficient options for most lower-income commuters.

Some Mobi stations are not located where consumers — at least those for whom the program was purportedly designed — need them. Recently, Mobi opened five new stations in the Stanley Park area, and plans to expand toward Third Beach and English Bay Bathhouse. These areas are largely populated by tourists and recreational bike users rather than commuters. Around Stanley Park, taxpayer-subsidized Mobi unfairly competes with bike shops that rent bikes to support their businesses and provide jobs.

The City of Vancouver is under contract with Mobi for the remainder of the five-year period that began in 2016. Once the contract is up, the city should terminate it and stop funding Mobi. The test phase launched with 1,300 founding members, and Mobi anticipated it would have 10,000 users at its one-year anniversary. On that date, it had 6,300, far short of its goal. The program now has 6,400 members. For the city to break even on this investment, Mobi would need to experience much larger growth rates than it has shown to this point and, based on performance reports, achieving an adequate rate of growth is unlikely.

By the end of the contract, Vancouver will have invested at least $10.5 million in Mobi, money that could have been better used elsewhere. The city’s promotion of bike use through Mobi has failed to deliver sufficient benefits to the community to justify its costs. It is evident that in 2021 Vancouver should no longer fund a city bike share program.