Inside City Hall: Will a bankruptcy in Canada take the spin out of Baltimore’s bikeshare?

New uncertainty surrounds mayor's plan for a network of "smart" bikes for tourists and residents

citibike ny

The Citibike program in New York has been plagued by software problems.

Photo by: AFP/Getty Images

Mayor Stephanie Rawlings-Blake’s hop on the popular “bikeshare” bandwagon has suffered an unexpected jolt with news of the bankruptcy of the program’s software and hardware maker.

Bike-share bigwig Bixi filed the Canadian equivalent of Chapter 11 protection on Monday, reporting that it owes creditors nearly $50 million, including at least $38 million to the city of Montreal, its home base.

Among other things, Bixi supplies the solar-powered kiosks, “smart” bicycles and software to Alta Bike Shares, which in turn is the sole-source contractor for the 250 bikes slated to carry tourists and residents around Baltimore’s waterfront and downtown.

After several false starts, the mayor was hoping to launch the system this May, following on the heels of Washington’s successful Capital Bikeshare and the less-than-acclaimed Citibike program in New York City.

Financial Feuds and Software Delays

Both the D.C. and New York systems are run by Portland-based Alta, with hardware and software provided by Bixi, a company that exploded on the scene five years ago with sleek modular “docking stations” and sophisticated software allowing day-trippers and year-around members alike to access bikes at one location and drop them them off elsewhere.

It turns out from court-related documents that Bixi and Alta had been feuding for awhile. Alta wants $11 million from Bixi because of program delays, while Bixi seeks $5.3 million in IOUs from Alta. Implementation of the software that keeps track of the rental bikes has become problematic in several cities.

For example, the New York system, now encompassing about 5,000 bikes at 330 stations, was delayed for months last year because of software issues. The roll out of an another 4,000 bikes at 270 more stations, which would substantially increase Citibike’s usefulness to city commuters, has yet to be announced.

High Tech but Money Losing

More broadly, there’s a big problem in the bikeshare world.

Despite their popularity among city planners and mayors – who consider the short-hop rental bikes an environmentally-friendly way to reduce traffic congestion and enhance tourism – suppliers and vendors have been unable to build a sustainable financial model outside of outright public subsidies.

Baltimore’s experience is indicative of the political and monetary hurdles.

Sharing bikes to curb cars – Baltimore gets ready for “smart bikes” (3/28/11)
City puts brakes on bikeshare program, citing costs (4/5/11)
Baltimore bikeshare program revived, 300-bike network possible by next fall (11/9/11)
Bikeshare program inches forward (5/8/13)

In early 2011, Mayor Rawlings-Blake pushed for the relatively-modest goal of installing 250 rental bikes at 25 stations.

She backed away when it became potential political fodder during the mayoral primary. (Why was the city sponsoring bikes for tourists when it was closing down rec centers for children was the argument.)

Negotiations Fail

After sweeping into office in November 2011, the mayor, through the Board of Estimates, gave B-cycle LLC exclusive rights to negotiate a bikeshare concession as long as it did not require a city subsidy. The idea was that the Denver-based company would run the program through sponsorships by local businesses and win grants from non-profits.

Negotiations ended with no agreement with B-cycle, but then came a $881,300 grant last May from the Maryland Department of Transportation as part of its Cycle Maryland initiative. The grant would pay for Phase 1 of “Charm City Bikeshare,” the name invented by boosters.

The city Department of Transportation thereupon entered into a sole-source agreement with Alta Bikes to get the program launched by this May.

No Comment from City

How the Bixi bankruptcy will impact the city’s plans is unclear.

DOT officials contacted by The Brew today have not yet responded to our questions. Nor has Alta, except for a notice on its website saying that its operations will not be affected by the Bixi bankruptcy.

Chris Merriam, executive director of Bikemore, a cycling advocacy group, cautioned that the city should carefully assess its options. “We greatly appreciate the mayor’s support, but we don’t want this program to be launched before it’s ready.”

Merriam said a major sticking point continues to be how to support the program without public funds. “I think Bikeshare needs to be considered a piece of public infrastructure, just like the [Charm City] Circulator.”

Meanwhile, the city of Montreal, which controls Bixi, hopes to greatly reduce the company’s debt and reopen a reorganized firm by this summer. But all of this will take some more public money, Montreal’s mayor concedes.

Be sure to check our full comment policy before leaving a comment.

  • Lizzie 58

    I guess that it will come out soon enough whether the City DOT paid any City funds to Alta over and above the $881,300 in State funds. And if the State funds are mired in a bankruptcy or a messy legal situation, does the City have to refund the State money? I will bet dollars to donuts that the City DOT lost taxpayer money here.

    All over the City today, people were asking why the City DOT could not get the major roads in the City plowed like the State and the counties. Personally,
    the performance of the City DOT during this snowstorm was the worse that I have seen in decades. Pretty much the consensus was that the Administration and DOT decided to do little snow plowing and salting in order to save money.

    • trueheart4life

      Agree … Lots of neighborhood street remained un-plowed this afternoon and some major streets still had snow partially obstructing traffic.

    • Matthew Riesner

      Lizzie, I agree with your statement. The city needs to get its basics correct before venturing to new ideas. I saw exactly what you are saying about the roads being poorly plowed. I recently moved to Catonsville and commute in on Rt. 40 (Edmondson Avenue), which had all lanes completely clear (and some even dry) this morning to the city line where I was met by a single lane road which still had a layer of slush. This is not a secondary road, this isn’t even a primary road, this is a highway and one of the city’s busiest commuter routes.

      As far a bikeshare goes, the city and counties need to work on expanding the bicycle road network in a seamless manner and maintain it at the same level of maintenance as the roads before a bikeshare should be implemented. We need more secure ways to store our bicycles when we are at work or out on the town. I have lost a few bikes when at work and all of those bikes were locked . Furthermore, I don’t know how large a program like this needs to be since you can buy an adult bicycle at Walmart for less than $100.

  • trueheart4life

    Will this administration ever select a contractor who is capable of getting the job done or are all the contractor selections based on campaign donation potential?

  • Gerald Neily

    Bikeshare is a perfect concept for our city leaders, based solely on its hype value – an upscale program based on a common folk theme. It’s David Brooks’ “bourgeois bohemian” concept as morphed into Richard Florida’s “creative class”. And if and when the hype value becomes spent, it’s easily dropped, unlike a multi-billion dollar light rail Red Line that hugs the waterfront.

    Why deal with bikes that are smarter than our politicians? Kim Trueheart had the right approach. First, make our neighborhoods livable, and that will lead naturally to a bike-friendly city.

  • asteroid_B612

    Maybe the City could ask Xerox or Brekford Corp. or United Way of Maryland or Noridian Healthcare Solutions to take over the contract. Or better yet, maybe BDC could put it out for a re-bid.

  • Aaron Mirenzi

    at first I was all gung-ho about bikesharing in Baltimore. Although when I thought about it, the bike infrastructure just isn’t there yet. a good example would be trying to follow the Jones falls trail from harbor east to midtown. theres a gap between Baltimore and madison steets which is basically absent of infrastructure.

    it would be useful for bikers who already understand the best bike routes in the city. but for newbies, I think they would have a difficult time negotiating certain parts of the city.

  • AllieB

    It’s true that the infrastructure isn’t there yet, it’s the same in most cities. But I firmly believe if we begin to place these programs they will build it. BikeShare’s aren’t just about saving gas and the freedom of biking, its about mobility for all. One of the great upsides to new transportation services like BikeShare, Car2Go- and apps like RideScout which aggregate them (love it)- is they offer alternatives for people who don’t own vehicles. Just read a great article by RideScout CEO Joseph Kopser on his blog ( about the democratization of transportation, and all companies like his and BikeShare are doing for people. I would def check it out. Really opened my eyes to the hidden benefit of bikeshares.

    • Gerald Neily

      Allie, the “infrastructure” we need is actually great bike-friendly neighborhoods. What you call “democratization” has been translated in Baltimore to mean “subsidization”, which might be necessary but is not part of that grassroots digital entrepreneurial spirit we’re always hearing about (your link doesn’t work). As Brew readers know, subsidization in Baltimore has been inherently a top-down non-grassroots secretive process.

    • asteroid_B612

      AllieB: Bikesharing is basically a program for middle class whites, tourists, and hipsters.

      In a city like Baltimore, which is 70% black and desperately poor, “democratization of transportation” should somehow provide meaningful benefits to the majority of the population, shouldn’t it?

  • ushanellore

    Like Obama Care,
    Bike Share dreamy on paper
    done in by software

    perfect idea
    for the satire Portlandia
    not for Baltimore

    plagued by violence
    tourists should skip the gimmicks
    that could get them killed

    hurt by a fast car
    on biker unfriendly roads
    crushed to death like toads.

  • inventropolis

    bikeshare good, but bixi is kodak, attari, the edsel all wrapped up into one…. if you are spending taxpayer money, shouldn’t you do so responsibly?

  • Bob Friendly

    Yes, the mayor will bungle this, as she does virtually everything else. But thankfully, we don’t really need to rely on crony politicians anymore to make a good bike rental system in Baltimore. That’s a very 2005-era thinking. We now have several sites and applications that aim to fill the role of “AirBnB for bikes,” and simply googling for p2p bike rental will return a few options. Most of those systems have at least a couple bikes in Baltimore, and as more people get frustrated with the mayor’s ineptitude, I imagine that more people will seek out these alternatives, further strengthening the system.

More of the Daily Drip »

Below the Fold

  • December 15, 2014

    •   “Ha ha, so not a surprise.” “Shocking…not!!” We get applause but also the occasional eye-roll these days for our accountability reporting – like last week’s piece about how tax cuts promised by the mayor as a selling point for Horseshoe Baltimore probably won’t happen, thanks to the casino’s lower-than-expected revenues. We get where the […]