City Council
Report
City Council Meeting: March 9, 2021
Agenda Item: 7.B
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To: Mayor and City Council
From: Edward F King, Director, Mobility (BBB)
Subject: Introduction and First Reading of Ordinances Extending the First Shared Mobility Device Pilot Program, Repealing the Second Pilot Program, and Amending SMMC to Remove Prohibition of Class I and Class II E-bikes on the Beach Bike Path
Recommended Action
Staff recommends that the City Council:
1) Introduce for first reading the proposed ordinance that: (a) amends Santa Monica Municipal Code Section 3.21.090 to extend the maximum term of the first Shared Mobility Device Pilot Program from April 30, 2021 to March 31, 2022; (b) repeals Section 3.22 of the Santa Monica Municipal Code relating to a second Shared Mobility Device Pilot Program; and (c) amends Santa Monica Municipal Code Section 3.12.600 to remove the prohibition of Class I and Class II electric bicycles on the Beach Bike Path.
2) Direct staff to solicit and negotiate a contracted model for shared mobility services in Santa Monica and direct staff on outcome priorities to guide the contract negotiation process.
Executive Summary
Santa Monica launched its first shared mobility pilot program for private companies in September 2018, which was designed to test entirely new areas of policy, regulation, operation, and enforcement for privately-operated shared mobility businesses.
Following the pilot evaluation report in January 2020, Council directed staff to create a second pilot program that was set to launch on July 1, 2020. Due to COVID-19, Council extended the first pilot to April 30, 2021 and postponed the second pilot program. Like all aspects of life, shared mobility has been impacted by COVID-19 in a number of ways:
• Jump and Lime left the Santa Monica market, reflecting the trend of some companies downsizing and withdrawing from certain markets. 2 of 15
• COVID-19 has slowed movement across all transportation modes. Between 2019 and 2020, shared mobility ridership is down 77%, parking transactions are down 52%, BBB ridership is down 59%.
• Companies are reducing staff, devices, and operations to cope with financial stress.
• Pay-as-you-go user prices have increased to $1 to unlock and $0.39/minute. • Other cities are extending programs or shifting from permitting to contracting models to mitigate affordability concerns and volatility of service for customers. • Cities are rethinking fee structures to drive user rates lower and help shared mobility businesses though this difficult time.
Bird and Lyft have continued to operate in Santa Monica with reduced device numbers and increased cleaning and safety protocols. These services have served as critical transportation that helps support the more local/ outdoor lifestyle caused by the pandemic, by giving people another option for short trips around town while adhering to pandemic safety guidelines. Occurrences of haphazard parking and bad rider behavior have dropped, and complaints related to shared mobility fell by 85 % in 2020 compared to 2019.
The pandemic will continue to disrupt daily life and business for the next several months, including causing uncertainty within the shared mobility industry. Staff recommends that the program shift to a contracting model with shared mobility companies in order to mitigate some of this volatility. In comparison to the current permit model, contracting provides a stronger foundation for cities and companies to work together toward improved outcomes achieved through defined service level standards, incentives, penalties, and fees. Staff recommends prioritizing outcomes related to the stability of local access, equitable distribution of devices, affordability, and diverse outreach. Council input is requested on these priorities to guide next steps and help to resolve tradeoffs when they arise.
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In support of this recommendation, staff proposes amending Santa Monica Municipal Code (SMMC) Section 3.21.090 to extend the term of the first Shared Mobility Pilot Program to March 31, 2022 and repealing Section 3.22 that enables the second permitbased Shared Mobility Pilot Program. The extension will allow staff to complete a procurement process to select shared mobility partners and to negotiate the terms of a shared mobility contract agreement while also maintaining continuity of current services with Bird and Lyft.
Staff also recommends amending Santa Monica Municipal Code Section 3.12.600 to remove the prohibition of Class I and II electric bicycles on the Beach Bike Path. In 2018, the prohibition of these e-bikes on the Beach Bike Path was brought to Council to be clarified because of congestion caused by new e-scooter and e-bike sharing and safety concerns. Since then, the City has doubled the beach path capacity north of the pier and implemented geo-fencing technology that keeps shared e-scooters and e-bikes off the path. Many people still use their privately-owned e-bikes and other devices on the path. This amendment will reopen the beach path to the growing number of people riding Class I and II e-bikes for commuting and recreation.
Background Timeline
Meeting Date Description
September 2017 Bird, Inc. e-scooter sharing launched in Santa Monica.
June 26, 2018
(Attachment A)
Shared Mobility Pilot Program and fees to develop a new area of policy, regulation, operation, and enforcement for shared mobility devices in the City were approved.
August 28, 2018
(Attachment B)
Shared Mobility use of public right-of-way (PROW) fee to create infrastructure to improve the safety for riders and citywide streets was approved.
September 17, 2018 The Shared Mobility Pilot Program launched with Bird, Jump, Lime and Lyft who were selected through a competitive
process.
November 12, 2019
(Attachment C)
Staff returned to Council to present pilot program
outcomes. The program showed high ridership and utilization, 4 of 15
but challenges remained in rider behavior, PROW
management, and regulating the emerging industry.
January 28, 2020
(Attachment D)
Staff was directed to create a second shared mobility pilot program to build on the successes of the program and better address the persistent challenges.
February 11, 2020
(Attachment E)
The term of the first pilot program was extended and a
Request for Applications (RFA) to select shared mobility operators for the second pilot program was released in March 2020.
May 12, 2020
(Attachment F)
Due to the COVID-19 pandemic, the second pilot program
was postponed and the first pilot program was extended until April 30, 2021. The Share Mobility PROW fee was revised.
March and May of 2020 Lime and Jump, respectively, terminated service in Santa Monica The remaining operators (Bird and Lyft) reduced their fleet size, increased cleaning, and safety protocols for their devices, and continued to operate as essential transportation during response and recovery efforts.
November 2020 Lyft launched e-bikes that were originally permitted but not initially launched.
Discussion
Since the 2015 launch of the City-owned Breeze Bike Share, shared mobility services have been a valued component of Santa Monica’s local transportation options. Shared mobility services can be ideal for Santa Monica because they provide flexibility, are usable year-round, and feel safe for many people on the 100-mile bike network that was built in the last 10 years.
New need for shared mobility partnership was created in November 2020. The City sunset Breeze Bike Share due to considerable new financial constraints caused by COVID-19, and the need to replace bikes due to wear and technology changes.
This ended the operating contract and generous title sponsorship from Hulu.
Shared bikes served millions of necessary trips and paved the way for how shared 5 of 15
mobility could operate and give users a convenient, reliable, and affordable shared mobility option.
The Shared Mobility Pilot Program was developed to test shared electric scooters and bikes operated by private companies, using a flexible approach that could be responsive to community needs, technological advancements, and an evolving industry.
Ridership of shared mobility devices was strong from the first month of the pilot program, starting at 200,700 trips in November 2018, and reaching 344,700 trips in August 2019. Riders generated a total of 3,050,000 trips in 2019. In rider surveys conducted in January and June 2019 and December 2020, 49% and 42% of respondents respectively reported that for their most recent scooter trip, they would have otherwise traveled in a car (either drive alone or another car like Uber/Lyft). Santa Monica residents accounted for 35% and LA County residents accounted for approximately 40% of survey respondents in all three surveys.
Impacts of COVID-19 on Shared Mobility
Due to COVID-19, movement across all transportation modes has temporarily dropped.
Between April and November in 2020 compared to 2019, the City has seen a drop in parking transactions of 52%, BBB ridership of 59%, and of shared mobility ridership of 77%. Yet, Santa Monica remains a strong shared mobility market. E-scooters and bikes complement the growth in solo outdoor activities of COVID-19, and emphasis on local 6 of 15
essential business activity and support for business recovery. The devices give residents another option to access local businesses for quick trips.
The core of regular users that has come to rely on these services are continuing to ride, even with the pandemic’s overall drop in shared mobility ridership. 42% of the respondents from the most recent rider survey reported that they ride about the same amount as they did before the pandemic started. 33% of respondents reported riding more than once per week and 48% reported riding occasionally but less than once per week.
The total number of devices permitted to operate in the City decreased from 3,250 to 2,000 during the pandemic due to Jump and Lime terminating service. This has ushered in a period of improved conditions in the field, better alignment with administrative capacity, and enforcement efficiency. During this time of slowdown, the City has experienced a decrease in bad rider behavior and haphazard parking, which is largely driven by the reduction in overall ridership, particularly among the tourist population and first-time riders. Between April and December 2020, there was an 85% decrease in the number of Santa Monica Works complaints about shared mobility services from the same time period in 2019.
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Looking Forward on Shared Mobility
Looking forward, Santa Monica will continue to be impacted by private sector company volatility as the industry adapts to financial challenges in the next year. Companies are still largely dependent on private investment to sustain operations and are having to adjust to reduced capital and investor demand. As ridership and rider revenue slowed, many shared mobility operators have had to downsize and/or change operations. This includes decreasing staffing and service levels and withdrawing from some markets.
These trends are causing cities to consider adjustments to regulatory and partnership structures in order to ensure long-term reliable, consistent, available, and affordable service.
Many cities are extending pilot programs or postponing the launch of new programs due to current events. For example, San Francisco, San Diego, and Washington D.C. recently approved extensions of their current programs. Other cities are shifting their programs from permitting to contracted models to address operations cost and affordability concerns and improve safety and reliability outcomes. For example, following a second pilot program, Portland, Oregon has recommended moving to 2-3- year contracts with one to three companies, and Denver is in contract negotiation with two companies to operate both e-scooters and e-bikes.
Some cities that are continuing shared mobility permitting are exploring adjustments to fee structures like shifting from per-device to per-trip fees or requiring performance bonds in lieu of large annual fees. Cities that are considering contracted models for shared mobility are exploring options to negotiate revenue generation and costs with selected partner operators. For example, the Portland bike share system is largely funded by a $2 million/year title sponsorship, of which 77% is paid to the operator to cover operating costs, and 23% is used by the city to promote the program and subsidize low-income rate programs.
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Shifting to a Contracted Shared Mobility Services Model Contracting provides a stronger foundation for cities and companies to work together toward outcomes defined in the contracts in comparison to the current permit model.
Council received an extensive review of the pilot permit program on November 12, 2019 (Attachment C) and, while shared mobility demonstrated popularity and transportation value, challenges remained in reliability, affordability, and access for customers among other issues. Contracts can ameliorate some of these issues through service level standards, incentives, penalties, and fee adjustments.
Staff recommends pursuing the contract model option through a solicitation and negotiation process. Doing so would shift the current shared mobility pilot program permit structure to a contracted structure akin to the Breeze Bike Share operations model, which would procure one or more vendors to provide shared mobility services under contract with the City.
The contracted model would be sought in order to:
• Stabilize local access by deepening the City’s partnership with companies For shared mobility to be a viable transportation option that supports local living, it must be reliably available for everyday users. Under the permit model companies compete for market share and have to weigh market viability with level of local investment in service. For customers who depend on these services for their transportation needs, such uncertainty and fluctuation can leave them stranded. Companies operating under contract have a longer-term commitment to operations than permitted entities, which enables them to prioritize long-term investment in the market, which could include newer devices, innovative technology (i.e. sidewalk riding tech), transit integration opportunities, docking station infrastructure, and diverse payment plan products. More company investment and a deeper partnership with shared mobility companies may also lighten administrative oversight and enforcement efforts required to ensure regulation compliance in a permitted system.
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• Increase local influence on usage rates, equity programs, and maintenance standards enforceable through service level agreements (SLAs) While Bird and Lyft offer low-income payment plans for qualified community members, the standard e-scooter and e-bike per-minute user rate remains costly for regular riders. Today both Bird and Lyft charge $1.00 to unlock the device and $0.39 per minute to ride e-scooters. A Lyft e-bike is slightly cheaper at $1.00 to unlock and $0.34 per minute. Under the current Shared Mobility Pilot Program permit structure, the City does not set rider rates or equity efforts and could not without a contract or other binding action. Under a contract model the City could ensure dependable quality service by negotiating contract terms that pertain to affordably, equity, engagement, operational service levels, penalties, and contract termination.
• Address operations cost concerns through negotiated revenue sharing, sponsorship opportunities, or reduced operations fees
Transportation services typically do not net revenue, and are subsidized through federal, state, and local taxes. The City-owned Breeze System was operated under a 5-year contract and supported by user revenues, sponsorship revenue, and a small amount of City funds. As shared-mobility companies are withdrawing from cities due to financial strain, cities who want continued operations are reducing fees and some requirements in exchange for increased service levels, reduced user rates and increased equity programs. Santa Monica set the standard for shared mobility fees and insurance requirements and is now at the very top of the cost spectrum of comparable cities. Currently operators pay Annual Operator and Per Device fees, which pay for staff time to administer and enforce compliance with the pilot program Administrative Regulations, and a Per Trip PROW fee to support infrastructure to improve the safety for riders and citywide streets. While the fees have been necessary to support the creation of green lanes and pilot program staff and enforcement, consideration of costs and new revenue streams such as sponsorship may be needed to achieve other priorities (like greater equity and lower user rates) going forward. Any financial 10 of 15
changes or negotiated financial terms of a contract would be brought back to Council for approval.
Staff recommends amendments to the Municipal Code to extend the first shared mobility pilot program for 11 months from April 30, 2021 to March 31, 2022 and repeal the second pilot program. Should Council approve the pilot extension and direct staff to pursue a contracted model, over the next 11 months Staff would:
• work with Bird and Lyft to ensure a continuous shared mobility service through the remaining term of the shared mobility pilot program • develop a scope of work for contractual shared mobility services based on Council outcome priorities
• complete an RFP solicitation process to competitively select 1-2 operators • negotiate contract terms with selected operators
• return to Council for authorization to execute the contract(s) Operator Selection Priorities
Staff would structure the procurement selection criteria around clearly defined performance expectations with a focus on the outcome priorities previously identified for the second shared mobility pilot program that are described below. Staff recommends Council give direction on which outcomes are most important in order to help guide the procurement and contract negotiations processes. Staff will seek to optimize community benefits coming out of the program and Council direction will assist when financial challenges emerge, and tradeoffs need to be considered.
Criteria Category Outcome Priority
Reliability and Access Device distribution and rebalancing operations that provide equitable access to riders throughout the City
and enable riders to depend on the system. Includes
maintenance to avoid blocking ADA clearance, transit
stops, driveways, etc.
Customer Affordability Affordable fares for daily use and commitment to fare stability, provide reduced rates for income-qualified
customers, and discount programs.
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Outreach and Education Regular education about safety, rules, and riding etiquette, outreach to and engagement with BIPOC,
lower-income and under-represented users.
Sustainability Sustainability goals and plans that ensure low emissions/ energy consumption operations, long device
life expectancy, and end of life device recycling
practices.
Customer Service Strength of customer service operation including hours of operation, phone/web services, mobile-app
notifications, and on device communications.
The procurement will continue to seek improvements in device quality and advanced safety features/technologies that can help to drive safe operations, improve rider behaviors, and reduce occurrences of haphazard parking, such as geo-fencing, parking incentives, “lock-to” features, and in-app messaging. Potential vendors will be required to provide the city with system data compatible with the Mobility Data Specification (MDS) and General Bikeshare Feed Specification (GBFS) data application program interfaces (API), and monthly reporting. The terms of the contractual agreement would need to be negotiated with selected vendors. Any revenue and/or sponsorship sharing terms will be coordinated with the Public Private Category Sponsorship program that was approved by Council on January 26, 2021. Staff would return to Council for any ordinance amendments, budget related actions, and authorization to execute the contract(s).
Alternatives and Future Considerations
Second Shared Mobility Pilot Program: As an alternative to shifting to a contracted model for shared mobility, Council could direct staff to proceed with the second pilot program as was planned before the start of the pandemic. This would also involve a solicitation and selection through a Request for Applications (RFA), and selected operators would be regulated by SMMC Section 3.22 and the second pilot program Administrative Guidelines. Staff would implement the equity distribution requirements defined in Section 3.22 but would not have authority to negotiate user rates to improve affordability. Companies would operate through a permit, which has no penalty for early withdrawal from the market. Enforcement of the program would be limited to the tools 12 of 15
available through traditional permit warnings and citations. For this alternative, Council would need to extend the first pilot program (Section 3.21.060) and postpone the second pilot program start date (Section 3.22.090) for a minimum of six months to allow enough time to solicit applications and select participating operators, without losing continuity of service of the current operations.
LA Metro Bike Share: Rather than providing bike/ e-bike share services as part of the Shared Mobility Pilot Program, the City may consider participating in the LA Metro public bike share system. The current structure of Metro Bike Share requires cities to pay 50% of capital cost and 65% of operating cost, which is a multi-million-dollar investment beyond reach in current financial conditions. However, LA Metro is currently exploring options for restructuring the program to encourage partner cities to join. The Metro Bike Share and operator contract will terminate in June 2021. Metro has indicated their interest in working with Santa Monica as a partner of the regional bike share system, however there is no indication yet what the financial terms would be. The Pilot program extension will allow staff time to consider this option and better understand the implications of this opportunity on how Santa Monica may provide bike share services in the long-term.
Class I and Class II Electric Bicycles on the Beach Bike Path E-bike usage and ownership has steadily increased over the past several years, and nearly all local bike shops in Santa Monica now sell and/or offer e-bike rentals. E-bike riders report an interest in reducing physical exertion and overcoming challenging topography, along with the desire to replace car trips and increase health. E-bikes are making it possible for more people to ride a bicycle, many of whom are incapable of riding a standard bicycle or do not feel safe doing so.
In 2015, the California Legislature passed AB 1096, which updated Vehicle Code provisions related to e-bikes, including permitting Class I and Class II e-bikes (20 mph maximum speed), on Class I bicycle paths, such as the beach bike path, unless otherwise prohibited by local municipalities. The bill designated three classes or types of e-bikes:
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E-Bike Classification Max Speed Type of E-assist Speedometer Required
Class I E-bike 20 mph Low-Speed PedalassistNo
Class II E-Bike 20 mph Low-Speed
Throttle-assist
No
Class III E-Bike 28 mph Higher-Speed
Pedal-assist
Yes
When the first Shared Mobility Pilot Program was adopted in 2018, SMMC Section
3.12.600 was amended to clarify language that explicitly banned all motorized devices from the beach bike path including all types of e-bikes. At that Council meeting, Staff proposed that Council could consider an exemption for e-bikes in order to support the burgeoning local industry, and because it is difficult to distinguish between regular bikes and e-bikes. Ultimately, Council decided to include all e-bikes in the prohibition because of oversaturation of e-scooters and other types of devices on the beach bike path, and safety concerns regarding narrowness/ congestion of the path at that time. Council was interested in leaving open the possibility to revisit an exemption for e-bikes on the path at a later time.
Since the initial prohibition, staff has received occasional inquiries from community members regarding an exemption to allow e-bikes on the beach path and the beach path has seen substantial change.
• The City has completed the North Beach Bike Path project, which has separated cyclists and pedestrians, expanded the capacity of the beach path north of the pier, and incorporated high-visibility pedestrian crossings to reduce conflicts. • The number of shared mobility operators and devices has decreased. • Shared mobility operators have implemented geo-fencing technology that stops shared e-scooters and e-bikes entering the beach path area and has nearly eliminated the shared devices from the path.
Because of these changes, Staff recommends amending Santa Monica Municipal Code Chapter 3.12.600, to remove the prohibition of Class I and II electric bicycles on the 14 of 15
Beach Bike Path. Higher speed Class III e-bikes would continue to be prohibited by State law. This amendment will reopen the beach path to the growing number of commuters and recreational cyclist that are turning to lower-speed e-assist bikes as their mode of choice.
SMPD has raised safety concerns regarding the potential for excessive speed on the beach, and the challenge to distinguish among the different types of e-bikes. The speed limit on the beach bike path is 20 mph, however there are no speed limit signs posted.
Currently, all e-bikes are required to have a label that describes its types, speed, and motor wattage. Class III e-bikes are required to have a speedometer. If Class I and II ebikes were to be permitted on the path, some training would be needed for enforcement personnel to distinguish Class III e-bikes from Class I and II, and targeted enforcement actions to help educate the public should be considered.
Financial Impacts and Budget Actions
In September of 2020 the permitted shared mobility companies paid the Annual Operator and Annual Per Device cost recovery fees, which pay for staff time to administer and enforce compliance with the pilot program. Should Council extend the Pilot Program, permitted companies will continue to pay monthly per trip PROW fees through the program term, and annual cost recovery fees in September 2021. There is no immediate financial impact or budget action necessary as a result of the recommended action. Based on Council direction, staff will include any potential budget impacts in the FY 21-22 proposed budget.
Prepared By: Kyle Kozar, Bike Share Coordinator
Approved Forwarded to Council
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Attachments:
A. Staff Report 3126 - June 26, 2018 (Web Link)
B. Staff Report 3134 - August 28, 2018 (Web Link)
C. Staff Report 3615 - November 12, 2019 (Web Link)
D. Staff Report 3877- January 28, 2020 (Web Link)
E. Staff Report 4000 - February 11, 2020 (Web Link)
F. Staff Report 4089 - May 12, 2020 (Web Link)
G. Proposed Ordinance
H. 3/3/2021 Email from Councilmember de la Torre to Climate Action Santa Monica I. Written Comments