The program must grow to be successful
Put the brakes on bike-sharing subsidies and bailouts
In the real world, if
a company were unable to pay down its debt, the bank would not volunteer to
give it more money. Unfortunately, Toronto's City Council seems exempt from the
laws that govern the rest of the world.
City bureaucrats now want taxpayers to bailout Bixi, at an unknown cost. Montreal taxpayers have already bailout its parent company, PBSC, to the tune of $108-million.
While Bixi is a privately owned company, its financial statements are not available to the public. We do know that it was given a $4.5-million loan in 2011, but taxpayers were assured the city was merely guaranteeing this loan for capital costs and it would be repaid within 10 years. Leaked reports however show that the company has lost nearly $400,000 in its first two years, has failed to reach its sponsorship targets, and still owes over $3.7-million from its initial loan.
Taxpayers should not be responsible for bailing out poorly run and mismanaged ventures. On behalf of taxpayers who would rather see our money go to comprehensive transit strategies, the CTF says let Bixi fail.
Candice Malcolm is Ontario director of the Canadian Taxpayers Federation
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