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Chinese bike share company to leave Seattle after city approves program, steep permit fees

Ofo, the Chinese-based and heavily funded bike share program, said the City Council’s decision on Monday to impose an annual $250,000 permit fee for bike share companies wishing to operate in Seattle was too much. (Photo: KOMO News)

SEATTLE - Ofo is out. The Chinese-based and heavily funded bike share program said the City Council’s decision on Monday to impose an annual $250,000 permit fee for bike share companies wishing to operate in Seattle was too much.

Without even mentioning the fee, the council voted unanimously 8-0 to make the pilot program permanent, establishing a cap of 20,000 bikes shared by four companies.

Currently, Ofo, which own the yellow bikes, was permitted to run a dockless, leave anywhere bike sharing operation along with Limebike, which owns the green bikes and Spin, which owns the orange bikes.

"The exorbitant fees that accompany these new regulations -the highest in the country - make it impossible for Ofo to operate and effectively serve our riders,” Lina Feng, General Manager of Ofo Seattle said in a statement on Monday. “As a result, we will not be seeking a permit to continue operating in Seattle.”

This follows a weekend of confusion after Ofo sent an email to some of its customers saying they were shutting down operations in their city. That email was intended for markets where Ofo was going to cease operations, but Seattle wasn’t one of them until Monday.

San Francisco-based and venture capital-backed Limebike said it is staying on, telling KOMO News, it's happy with its ridership numbers in Seattle, but will continue to work with the City to see if the $250,000 fee is justifiable.

“We been having conversations with the city of Seattle about what’s appropriate, they sort of said what they think, we are going to continue to discuss with them,” said Issac Gross, Limebike Seattle General Manager

RELATED | Commuting alternative or eyesore? Inside Seattle's bike share dilemma

The companies will be limited to 4,000 bikes each, 5,000 if they provide adaptive cycles to accommodate disabled riders.

But there will be no helmet requirement, which didn’t sit well with Richard Adler, who represented Zack Lystedt and co-wrote legislation that changed the concussion protocol in youth sports.

“The city has set itself up as a prime target,” said Adler, who believes the city is opening up itself for lawsuits from bike share customer if they are injured in an accident and the city allowed the companies to rent bikes without a helmet.

The fees could raise upwards to $1,000,000 for the city each year. Most of the money will go to administrative costs including $370,000 for the equivalent to 1.5 fulltime positions to run the program for the city.

Proper parking of the bikes is an issue for many, including several members of the disabled community that spoke to the council.

About $400,000 of the fees will go to construction roughly 200 bike corrals, similar to one constructed in Ballard.

The corrals and painted boxes in the spaces between the curb and sidewalk where bike share users are urged, but not required to park their bikes.

But, the rules that will hold the bike share companies accountable for enforcement of property parking have not been written yet.

“Members of this community will be at the table to design an enforcement strategy that will address the concerns they raise,” said Seattle Councilmember Mike O’Brien, the bike share bill sponsor.

The pressure is on the Seattle Department of Transportation, who must come up with the rules. As an incentive, O’Brien was successful in passing an amendment that said SDOT would only get half of the fee money until it comes up with the rules.

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