News surfaced this week that BIXI, which allows users to rent bikes from downtown stations on an hourly basis, is having trouble paying its bills.
Startup funding for Toronto’s BIXI program, which launched in May 2011, came from a 10-year, $4.8 million loan guaranteed by the city. The idea was the loan would pay for the bikes and stations until the service could support itself through user fees and sponsorship deals.
A city report released this week said BIXI’s loan balance was at $3.9 million in December and that the service was struggling to cover costs. The seasonal nature of the service was also causing cash-flow problems, according to the city report.
Kolb said despite its troubles, BIXI has proven popular with Toronto residents and tourists who use the bikes for short trips downtown. The service has topped 1.3 million trips and has about 4,600 members who use its fleet of 1,000 bikes.
“It’s become an important feature for Toronto,” said Kolb, executive director of the advocacy group Cycle Toronto.
Kolb said part of BIXI’s problem is that its stations don’t expand beyond a limited section of the downtown core bordered by Bathurst Street in the West, Bloor Street to the north and Parliament Street in the East.
Cycling advocate wants 'bold expansion'
He said BIXI stations at the periphery are often empty of bikes.
“We want to see a bold expansion plan that will bring more users into the fold," said Kolb.
Minnan-Wong, however, said he doesn’t believe the city should put more money into the program until BIXI can find a way to operate in the black.
“We don’t have that type of money to flush down the toilet and to lose,” he said. “I’m not a fan of the city taking over BIXI. I get a real uncomfortable feeling saying that the only way to get out of a financial mess is to spend more money.
"I’m of the view that a service you can find in the Yellow Pages shouldn’t be in the blue pages, the government pages.”
In an effort to protect the city from any financial impact, staff has prepared a confidential report on the options the city may pursue toward revising its agreement with BIXI.
The executive committee will consider that advice at a meeting next week.