Bike Share Backstory: Inside the Wrangling That Saved the System

When the city announced the bike share program last fall, the intention was clear: creating a system of 10,000 bikes and 600 stations in parts of Manhattan and Brooklyn at no cost to taxpayers.

The system, it was explained, needed to be large to make it work — the more potential users could depend on finding bikes in a variety of locales, the more it would be an actual public transportation network

But when the Citibike system was presented Monday – named after its lead sponsor Citibank, which inked a $41 million, five-year contract along with Mastercard, which chipped in $6.5 million – it was somewhat less extensive than promised at first.

Under the plan, the bike share program would not serve the Upper West Side, Upper East Side, Park Slope, Cobble Hill or much of Brooklyn beyond Bergen Street until next year.

“It will be a phased-in deployment,” Sadik-Khan said at Monday’s press conference. “I mean, we can’t just airdrop 10,000 bikes in. It will be between August and spring of 2013 that we’ll have the deployment of the full system.”

Sadik-Khan declined to explain why or when the decision to stagger expansion was made.

But speaking with elected leaders, officials and several sources familiar with negotiations over the bike share contract, a story has emerged of a far more rocky road to a sponsor than Monday’s news conference would suggest.

It took the city months to secure a sponsor, sources said. And the Citibank contract was signed only two weeks ago — far later than officials had hoped. Without the contract, there wasn’t the upfront capital to get the bikes produced.

And that, multiple sources confirm, was the major reason for the delay in getting the bikes to some neighborhoods.

City Council member Gail Brewer, who represents the Upper West Side, said she was told only recently told there would be 7,000 bikes rolled out initially and the balance would come next spring.

“I got a call sometime last week, that’s when I first heard of it,” she said.

Down to the Wire

When the city announced that Alta Bicycle Share would be operating the bike share it made one in a series of promises: there would be no cost to New York taxpayers.

That would make New York the only large-scale system in the country to be entirely privately funded.

“We’re getting an entirely new transportation network without spending any taxpayer money,” Bloomberg said at Monday’s press conference. “Who thought that could be done?”

Apparently, there were a lot of doubters.

Puma was approached, and Adidas (New Balance has sponsored Boston’s “Hubway.”) So was American Express, sources said. None has responded to requests for comment.

“All the usual suspects,” said one source familiar with the negotiations. “The list of companies who could spend this kind of money just isn’t that long. And it was unprecedented to raise that kind of capital for an unproven system”

By February, officials were beginning to sweat. If New York didn’t find a sponsor, the city could be on the hook to Alta — or worse, officials told associates, the bike share program could be imperiled.

Alta’s business plan was confusing, sources say, making it hard to reel in the big money. In late winter, the city involved its Economic Development Corporation in the planning, adding some business gravitas to the discussions. (The EDC is a quasi city agency that usually hands out loans to entities willing to locate or create jobs in New York.)

Citibank Signs On

Ed Skyler, Bloomberg’s former Deputy Mayor for Operations (and Sadik-Khan’s old boss), is a top Citibank executive. Citibank was lured in.

But everyone, from the mayor on down, credits the transportation commissioner with the get.

“I never worried,” Bloomberg said, “because Janette went after it. And anyone who knows Janette knows if she sets her mind to it it’s going to get done.”

Eventually, Citibank was sold.

“We think this is a very innovative program that makes people’s lives easier, that’s what we do, that’s what we do as a bank,” Vikram Pandit, Citibank’s CEO told WNYC Monday.

He added, “This is a program supporting bikes. Bikes are environmentally friendly, they’re good exercise. There’s always controversy — but on balance we think this is a great program.”

Bike share boosters are, for the most part, expressing just the faintest disappointment at the delay in bringing bike share to the full footprint.

“The reality of implementing an entire transportation network from scratch for a city as large and complicated as New York will obviously require a careful approach,” said said Paul Steely White, chief of transportation advocate group Transportation Alternatives.

Steely White, Brewer and others are willing to cut the city some slack — willing to give credence to what the city says.

“We said we would find a sponsor, and we did,” mayoral spokesman Marc LaVorgna said. “We’re doing something that’s never been done before.”

When the bright blue bikes were unveiled Monday at City Hall plaza, there were smiles and claps. And the idea of “Citibike” seemed to convey exactly what the city wanted — these bikes are for transportation, for getting around the city. These are urban bikes. And they are intimately tied with the city’s economic future.

“A perfect outcome,” Sadik-Khan told WNYC.