August 31, 2016

August 31, 2016 | Commentary on Transportation

The feds should stay out of the bike lane

Capital Bikeshare riders owe D.C. taxpayers a big “thank-you.” Though the bikeshare charges riders membership and usage fees and recently began selling advertising, that revenue covers only 70 percent of the system’s operating costs in the District — and that doesn’t include the cost of the bikes or station docks. The D.C. Department of Transportation makes up most of the deficit, meaning that D.C. taxpayers fork over 65 cents every time someone takes a trip on a bikeshare.

But a bill in Congress would put Americans on the hook for covering bikeshare programs even if they don’t live anywhere near one. The Bikeshare Transit Act, introduced in January by Reps. Earl Blumenauer (D-Ore.) and Vern Buchanan (R-Fla.), would categorize bikeshare programs as mass transit, qualifying them for a portion of the roughly $10 billion set aside for transit every year in the federal Highway Trust Fund.

As if the federal government weren’t already involved in far too much, this proposal would expand its reach even further, to cover yet another inherently local activity. Once bicycle programs receive continuous funding, why not scooters, Segways or unicycles?

Aside from relentless federal mission creep, providing federal funding for bikeshares poses problems that should concern transit advocates and even ardent bikeshare supporters.

First, there’s the uncomfortable fact that the tax dollars sent to bikeshares would come from gas taxes. This means bikeshares would become dependent on the very drivers the service is intended to lure away from their cars and onto bikes. Ironically, bikeshares would need more gas guzzlers on the road to get more funding.

Second, there’s the question of whether bikeshares are viable, cost-effective means of transportation rather than amenities. Capital Bikeshare riders traveled about 6 million miles in 2014. That amounts to just 0.3 percent of the nearly 2 billion passenger miles traveled on Metro’s bus and rail services.

Then there’s the issue of cost and incentives. Capital Bikeshare hemorrhages money. In 2014, it lost more than $1.7 million from operations in the District (excluding the cost of the equipment itself). Its operating costs per passenger mile are 55 percent higher than Metrorail’s, which is remarkable because bikeshare passengers themselves — rather than unionized government employees who account for the bulk of Metro’s costs — operate the vehicles and serve themselves at bikeshare stations.

These costs are important to consider because a free stream of federal money unlinked to local performance would not give bikeshares the incentive to minimize operating costs or expand responsibly. Because bikeshare operating costs go to repairing the fleet and reshuffling bikes across the system, overeagerness to expand the system with federal money could have grave effects on costs and quality.

These undesirable side effects of federal funding are evident in the heavily subsidized Metro system, which has seen service and safety deteriorate on its older lines as billions are spent expanding the Silver Line. Why would anyone want to emulate that business model?

Furthermore, fully half of Capital Bikeshare members had annual household incomes of more than $100,000 — far more than the D.C. median of $69,000 and nearly double the national median of $53,000 . Instead of subsidizing a community perk for the affluent, wouldn’t federal money be better spent improving mobility for low-income Americans, who overwhelmingly rely on cars and buses to get to work?

The point is not that bikeshare programs are inherently bad. Rather, it is in the clear interest of taxpayers everywhere — and the systems themselves — to keep the funding of bikeshares a local matter. Why not look to New York’s Citi Bike program — which is funded with private capital and local sponsorships — as a model for expanding bikeshare programs nationwide? For bikeshare enthusiasts who want quality service, these locally focused options seem far preferable to dependence on federal gas dollars.

About the Author

Michael Sargent Research Associate
Thomas A. Roe Institute for Economic Policy Studies

Related Issues: Transportation

First appeared in The Wasington Post.