WeHo Pedals Program Falls Far Short in Generating Revenue

city of west hollywood bike sharing
WeHo Pedals (Photo by Joshua Barash)

WeHo Pedals, West Hollywood’s bike share program, has fallen fall short of projected revenue from riders and advertisers and sponsors.

A report from the city’s Community Development Department states that “In the first 16 months of operations, while operating as a geographically isolated system and without a permanent system sponsor, WeHo Pedals is not yet on a path to become financially self-sustaining.”

“The revenue received over the last twelve months only covers 33% of the system’s operational costs ($344,750 a year); excluding city employee costs,” the report states. The city also has incurred $155,800 in city staff expenses, bringing the total cost of the program to $500,500.

The report says total revenue generated by the memberships and rides equaled only 13% of the revenue projected for the program. When advertising and sponsored revenue is factored in, the program generated only 19% of the projected revenue. That left the program with a loss of $386,799, which doesn’t include city’s initial capital investment of about $500,000.

The bike share program, launched in August 2016, has 150 “smart bikes” at 21 stations, 19 in West Hollywood and two at the Grove shopping center. The program is operated by CycleHop LLC, which plans and operates bike share programs throughout North America. The “Smart Bikes” used in the system are manufactured by Social Bicycles, which uses wireless technology to allow riders to use a smartphone app to reserve bikes, pay for using them and track and share ride data with friends online.

People can rent the bikes by the hour for $7 or buy monthly or annual memberships. The monthly plan costs $25 and gives one 90 minutes of ride time a day. The annual plan costs $99 and also provides 90 minutes a day or ride time. There is a $7 monthly plan for students and also special plans for low-income people.

While the WeHo Pedals program has fallen far short of its financial objects, the WeHo Pedals annual report calls the program a success based on its ridership numbers, which it says “have shown that there is a healthy appetite for bike share as a mode of transportation in West Hollywood.”

According to that report, the program has 1,656 active users, with the vast majority (1,479) using the pay-by-hour method to use the bikes. There are 98 people with annual memberships, 33 with monthly memberships and 46 with student memberships. The number of riders has increased steadily since the launch of the program, but the number of paid memberships has not.

The annual report says that WeHo Pedals users made 16,743 trips in 2016, travelling a total of 24,685 miles.

CycleHop’s contract with the city calls for it to secure an overall, long-term sponsor for the bike share program. An example of such a sponsorship would be Citibank’s decision in 2013 to sponsor New York City’s bike share program, which is known as Citi Bike.

CycleHop now has contracted with Premier Partnerships, to help it find sponsors. Premier negotiates sponsorships for stadiums such as the Rose Bowl Stadium and theatres such as Grauman’s Chinese Theatre.

“Based on the fact that there are currently no prospective sponsors in negotiation, and the limited window of opportunity for inclusion in the calendar year budget cycle, the sponsorship team does not expect that the program will be able to garner a title sponsor in FY2018,” the report states.

Because of that, city staffers are working with CycleHop to find short-term sponsors. Google was one such sponsor in November of last year, and Paul Frank was another in December, with the city getting $31,000 in net revenue. Paul Frank is the comic illustrator whose popular images have inspired a brand that includes clothing and musical instruments.

“If CycleHop does not have a title sponsor or comparable sponsorship program in contract negotiation by the end of the 2018 fiscal year, staff may recommend an amendment to the CycleHop contract for the city to contract directly with an alternate vendor to procure a sponsor for the system,” the report states.

Another source of continuing income is the sale of advertising space on panels located at 11 of the bike share stations. Sales of the ad panels are managed by Outfront/Decaux as part of the city’s bus shelter contract. Over the past 12, those sales have totalled $49,803.

The Community Development Department will ask the West Hollywood City Council on Tuesday to approve a revenue sharing and operations agreement between West Hollywood and other regional bike share partners including the cities of Santa Monica, Beverly Hills and UCLA for an integrated regional bike share system, to be called Bike Share Connect.

“The integration will create a seamless experience for WeHo Pedals riders traveling within and between these partnering jurisdictions without being limited by the individual system boundaries,” the proposal says.

The department also will ask the City Council to consider “an emerging bike share technology called ‘dockless’ or ‘free-floating’ bikes that are operated by private vendors and require no public funds for capital or operational costs.

“In order to properly address the benefits and challenges of this new bike sharing model, the Council may wish to either conduct a pilot program to define terms and conditions to control operation of potential private bike share vendors in the city, or prohibit such operators in West Hollywood altogether.”

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Randy
Randy
3 years ago

@SaveWeHo, not everyone can partake in those “whataboutisms.” I can’t use some of those transportation benefits unless I’m 62 years old (that’s not “everyone”). I won’t use the dog park, because I don’t have a dog (that’s not “everyone”). I’m not going to take the shuttle to Hollywood and Highland if I have no reason to go there, although I suppose I could, if I found a reason. Just like some people aren’t going to use the bike share program, because they choose not to, not because they “can’t.” And then there are some that “can’t.”

SaveWeho
SaveWeho
3 years ago

@Randy It always amazes me with people and their “whataboutisms”. All those other programs you listed everyone can partake in. I’m not against bikes, but to spend 500k on a program when you can buy your own bike is wasteful spending. I would rather have that money put into safety, more streetlight crosswalks, money for late night safety patrols, more affordable housing…..you get what I’m saying.

Randy
Randy
3 years ago

@SaveWeho, you said “I don’t think public funds should go towards benefiting only one part of society.” Should they then dismantle the “Cityline X” or the “PickUp Line,” since that is mainly used by commuters and nightlife partiers? The former doesn’t benefit those that aren’t commuting from Hollywood and Highland. How about “Dial a Ride”, the “Bus Pass Subsidy” program, or the “Taxi Assistance Program,” which is only for people 62 and over? The new dog park isn’t very useful to me, since I only have a cat. I hope you get my point. As far as the bike share… Read more »

SaveWeho
SaveWeho
3 years ago

@Randy “there is no reason that West Hollywood cannot be a bike-friendly city” I 100% agree with you. But I don’t think $500k a year is a wise use of money when that money can go towards a more universal form of transportation. Not all of us are young or healthy enough to bike and do errands like you or @Karen. There is an aging population and disabled population where this kind of bike riding is not even possible. Put that money in a small mass transit project that helps everyone. I don’t think public funds should go towards benefiting… Read more »

J Simmons
J Simmons
3 years ago
Reply to  SaveWeho

I agree. Maybe 500k for Free WiFi for the city/residents, or some kind of subsidy or discount on cable/directv high monthly fees. Something universally applicable to virtually all or most WeHo residents.

Ida Claire
Ida Claire
3 years ago

These bikes should be removed from public sidewalks. They area offensively ugly sight, make the whole environment look junky, not to mention having that putridly ugly green color shoved in your face everywhere you go. They are simply an added blight to an already congested area. Besides, Santa Monica Blvd is a very dangerous street to ride a bike on. I think West Hollywood copied Santa Monica or somewhere with this project, which is what they usually do – wait till another city comes up with an idea then copies it. Santa Monica has some beautiful bike riding streets &… Read more »

Keep WeHo Pedals
Keep WeHo Pedals
3 years ago

Keep WeHo Pedals. It takes time to start up initiatives to change people’s behavior. Someday I hope we end up like the Netherlands where most end up bicycling.

It’s good for the environment. It’s good for our overall health. It’s good in keeping down traffic congestion. All of these concerns should be evaluated in the cost of keeping this program.

Personally, I use WeHo Bikes to run errands and to get to appointments within the city. I use the car if I have to go outside of the WeHo perimeters.

Randy
Randy
3 years ago

To clarify, when I said “Maybe if there were more of us on the road, they would? Maybe people wouldn’t continuously keep this “car is king” attitude?,” I was referring to SMB, not Fountain. Fountain will never be wide enough to safely accommodate cars and cyclists.

As Karen said, let people make their own decisions here.

Randy
Randy
3 years ago

@SaveWeho, whatever your criticisms of the bike share program are, West Hollywood is still not “spread out.” No city that is 1.9 square miles could be. I could ride from one end of the city to the other, east to west, and then north to south, in well under 30 minutes. Probably faster than I could drive, during rush hour. And yes, I happen to be one of those people, like Karen, who has gone out for errands and groceries, on a bicycle. If there are multiple errands to run, it can be super convenient. Better than walking, driving, or… Read more »

Let the spinning continue
Let the spinning continue
3 years ago

@ Karen O’Keefe: It would be useful for you to realize that you just “might” be the exception here as you feel compelled to perpetuate the same argument. Although you may indeed have just the right type o agility, keenness and lifestyle that merges with extensive bike use while perhaps not a bikeahoholic, efforts to jam a square peg into a round hole repeatedly seems an extraordinary effort. While not condoning any type of “nanny state” it is appropriate to consider if this financially failing concept is wise or foolish for the general public and look outside your own safety… Read more »

Karen O'Keefe
Karen O'Keefe
3 years ago

SaveWeho’s claim: “You cant do errands, groceries or ‘go out’ with a bicycle. Its sole purpose is for ‘fun’.” Reality: There is no secret setting on a bike that prevents it from being used as transportation, which is exactly what I use mine for. I don’t like exercising solely for the sake of exercising. Exercising for transportation (ie biking) is lovely. I bike to do errands in our tiny city all the time. I bike to Target, to Pavilions, to Ralph’s, to get my haircut, to go to the library, to Runyon Canyon, and to City Hall and the City… Read more »

shawn
shawn
3 years ago

So for $500,5000 (not including the $500,000 start up cost), people took 16,473 rides. That comes to a cost of $29.89 a ride that the city is spending. That doesn’t seem like a good investment. If you include the $500K startup cost, it brings it close to costing the city $60 a ride.

Also, 16,473 rides for the year, equates to 45 rides a day. So for $500,000 45 people on average are riding a bike.

At what point does the city throw in the towel and use that $500,000 on something more useful?

J Simmons
J Simmons
3 years ago
Reply to  shawn

But the City giving up on their “great idea” which cost so much, will probably have to go the way the City manages it’s ideas …. Keep throwing tons of money on top of the overpriced initial price the city believed acceptable. Hopefully, for once, a boondoggle and massive wased investment will CUT THE CITY LOSSES rather than another 500k, which in weho means probably twice that amount when all is said and done … If the don’t CUT THE LOSSES ASAP … Breaking with the traditional wasting of money that could be used to benefit residents.

Let the spinning continue
Let the spinning continue
3 years ago

One would think that last night Councilmember Lauren Meister said it all: bought a $99. membership, took one trip down Melrose and decided it was too dangerous. After the discussion last night, she folded. The rationale was really troubling. Not much concern for safety, major concern for the environment in a situation where it is unlikely that cycling, as a means of primary transportation, would be successful. Logic escaped everyone. Another unrealistic financial debacle. But hey, lets push this on all the unsuspecting tourists through the hotels….folks that have not a clue about out traffic. As Manny said: “a pipe… Read more »

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