[jyl]

"Who is paying for bike share in New York?
Bike share in New York City is funded by sponsorship agreements, and, once the system launches, revenues from users. Sponsorship and revenues will cover the entire equipment and operations cost of the system. NYC Bike Share is not receiving any taxpayer or federal-aid dollars to establish and run the bike share system. In fact, the City expects that the system will make money. The City and NYC Bike Share will split all profits."

"How much is the sponsorship worth, and how long is it for?
The sponsorship agreement between NYC Bike Share and Citi runs for five years. Citi’s contribution as the title sponsor is $41 million. MasterCard is sponsoring the payment systems, and will outfit the stations with advanced, contactless PayPass payment points. In addition to this hardware, MasterCard is contributing $6.5 million. Citi’s brand appears on all 10,000 bikes, 600 stations, membership keys and the NYC Bike Share website. MasterCard’s logo will appear on the station kiosks, and on printed receipts."

The deal provides 6,000 mobile billboards for Citicorp, hundreds of logos on stations, and the system is named "Citibike". In an ad market as expensive as Manhattan, is that worth $8MM/year to Citi? Maybe. Anyway, they are paying it. MasterCard is a $6.5MM sponsor as well and, imagine this, the stations do not take American Express.

They've sold 40,400 annual passes so far at $95/each, so that is $3.8MM in revenue. They are running roughly 2,000 24-hour passes and 100 7-day passes sold per day, at $9.95 and $25 respectively, or $22K/day so $0.6MM/month. How much revenue will they make for a full year? At very least, $7.4MM - that assumes they sell not a single additional annual pass this year, and that 24-hour and 7-day passes are sold for only six months of the year. Realistically, they will make considerably more than that - the system has been up and running for only a few weeks, after all.

So call it $8MM/yr from Citi, $1.3MM/yr from MasterCard, $7.4MM/yr from revenue, total of at very least $17MM/yr of income.

Will that pay the operating expenses? I haven't seen a budget for the system (surely one is out there online somewhere?) but we know it employs 200 people locally in NYC, mostly bike mechanics and the rebalancer guys who load bikes in vans and move them between stations, I think those are fairly low-wage jobs. Sure, there are IT guys and management too, but I'd think the bulk of the operating expense is that 200 employee number - so use it as a starting point for educated guesses.

NYC's system initially covers only Manhattan below 60th and closer parts of Brooklyn. That was the region where they thought the usage would be highest and the system most likely to be financially viable, without ongoing public funding. I think how it goes there will determine if the system ever gets extended to uptown or the other boroughs. I am not sure I see a need for the system to be everywhere in NYC, frankly.

Whether we get a bikeshare in Portland will depend on sponsorship and the ability to break even without public funding. Portland is bike-crazy but the local bike advocacy groups will want public funds spent on bike lanes, cycle paths, etc - infrastructure - not on a bikeshare system. As we're not a media market like NYC, I wonder if we'll get a $3MM sponsor to step up.