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A new way to think of the Bike Plan: It's all business

Posted by Jonathan Maus (Publisher/Editor) on February 11th, 2010 at 1:26 pm

Many local bike folks (myself included) have been trying to think of ways to talk about the 2030 Bike Plan that clearly explain why it's so important, without getting into all the wonky details. On that note, I came up with an analogy today (just before going on camera with a local TV station) that I want to share.

Think of the Bike Plan as a business plan. Everyone knows what those are right (if not, check Wikipedia).

So here's the analogy: PBOT has this amazing product (a bike network) that they know will revolutionize Portland -- but without a plan, they're just like every other entrepreneur with a big, crazy dream. Before they can even approach investors, start hiring employees, expand the product line, reach out to new customers, and so on -- they must have a plan.

PBOT is the company, a connected and safe bike network is the product, members of City Council (and Metro and the U.S. Congress, and so on) are the investors, and the stockholders are regular citizens like you and me.

Heck, we can even do a S.W.O.T. analysis:

  • Strengths: Tremendous ROI, we have the best and brightest bike researchers on staff, there is already a significant and loyal market ready to consume it, and the product has been thoroughly tested in real-life conditions.
  • Weaknesses: It requires difficult cultural and behavioral changes to both our society and the existing bureaucratic status quo.
  • Opportunities: To create a city where it's easier and safer for everyone to get from A to B.
  • Threats: Complacency, politics, lack of funding.

The more I think about it, the more I like it: The 2030 Bike Plan is the City of Portland's business plan for an exciting new product that will transform our city and soon spread to markets nationwide.

Great! Now let's pass this thing and get down to business. After all, PBOT and their investors will not want to disappoint their stockholders.

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  • Anonymous February 11, 2010 at 1:38 pm

    Jonathan,
    This is a great way to look at it. I wish you had thought of this before you were spinning the spin about the cost of the plan on Monday. Oh well, we all learn. This is a much better way to handle what the plan actually is, rather than arguing over what the cost is. Good thinking.

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  • Ian February 11, 2010 at 3:24 pm

    Hey that's a great way to re-frame the discussion. Really, this is cool. It presents your view in language that people understand who are not necessarily into bike culture. I think this approach should really be expanded upon.

    I don't like the weakness section. I can see how it's important and relevant, however, it seems like you are creating obstacles for the plan which aren't necessarily present. You could rephrase it as a new approach/program/policies that don't have precedent/experience/history to implement the plan smoothly, or something like that. That way it takes language that creates a large barrier (cultural barriers) and turns it into something manageable: "Hey this is just a new thing. It's not a bad thing or difficult thing, It's just new."

    Again, kudos for the idea.

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  • Steve Hoyt-McBeth February 11, 2010 at 3:49 pm

    Great metaphor, Jonathan.

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  • Matt Picio February 11, 2010 at 4:13 pm

    I like the wish list metaphor better, personally. The plan is a wish list, like an Amazon.com Wish List. It says what you'd like people to spend money on if they have money to spare. Just because I have a wish list with $400 worth of books doesn't mean it's going to cost my friends and family $400 - it just means that if they have an extra $400 they want to spend on me, those will be the things I said I wanted them to buy.

    Everybody understands a gift list - not everyone understands a business plan. (though I think that's a good analogy, too)

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  • Brad February 11, 2010 at 4:40 pm

    I'll play investor (taxpayer).

    Please quantify your projected ROI in real dollars, specifically, what financial gain will I see for my risk? Can you assure me that I will see less congested streets? Lower health insurance rates? Less air pollution? Easier transportation of the other goods and services that I rely on? That the costs of those goods and services will not be negatively impacted by your proposal?

    Your plan claims to convert 25% of the total consumers in this marketplace into loyal, repeat customers. Is this realistically attainable? What is the methodology used to determine such high demand? Can those statistics be independently verified should I conduct my own market anaysis? If you fall short of that conversion rate, what is your secondary plan meet the ROI targets? Can you sustain your operations with only half the amount of consumers? If you fail to meet expectations, how will you raise additional investment capital? Most importantly to me, are you willing to scale back your ambitions to mitigate investor losses should your plan fail to resonate with enough consumers?

    Worst case: are you and your other partners completely committed? If I back this, I am not going down with the ship if you screw this up. I will cut my losses at the first sign of trouble.

    Based on your SWOT, there are a lot of aspirational items and blind assumptions that would give any decent venture capitalist pause for concern.

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  • Phil Hanson February 11, 2010 at 4:51 pm

    To address the "W" part of your S.W.O.T. analysis, Jonathann, those "... difficult cultural and behavioral changes to both our society and the existing bureaucratic status quo" are going to happen--thanks to global climate change and the rapid decline from Peak to Post Oil--regardless of whether or not contingency plans are implemented to deal with those unavoidable problems. Still, the smart money goes to the "forewarned is forearmed, be prepared" crowd. It might hurt, but having the necessary infrastructure in place means it won't hurt as much.

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  • Lazy Spinner February 11, 2010 at 5:53 pm

    Phil,

    Suppose that you are right about Peak and Post Oil, will we need all of this bike infrastructure? If there are far, far fewer motor vehicles on the roadway then the streets can be effectively shared or many turned over to bikes. In that case, we just "wasted" over $600 million.

    Or is it realistic that gasoline will be replaced with something else or that we are SOOOO in love with cars that we'll pay any price to drive them? Less cars on the road to be sure but still too many for safe shared streets?

    My objection to this plan is that we are going to build a bunch of bike stuff that will be sort of useless in 2030. I'd much rather see some smart high speed bike "freeways"(MUPS, bike arterials) built and loads more sharrows. My feeling is that the roads will essentially belong to bikes, transit, and the rich/business by 2030 thanks to the factors you mention. This plan seems predicated on the notion that we will need more bike infrastructure because just as many, if not more, cars will be prowling the roads twenty years from now. Not a strong or courageous stance by city leader's in my mind. Just expensive bet hedging for short term political gain.

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  • Roger Geller February 11, 2010 at 6:36 pm

    Brad (#4),

    Let me see if I can address some of your questions about Return On Investment.

    Going back to the late 1990s the Federal Centers for Disease Control identified converting automobile trips to bicycling or walking trips as the "first target" to increase physical activity among the population at large. Given that inactivity and poor diet together are the second leading modifiable factors associated with premature death (tobacco is #1), the CDC certainly seems to feel that bicycling will improve health, and in so doing, reduce expenditures on health care.

    This has also been the experience of other countries. The best data of which I'm aware is from Denmark. The City of Copenhagen has reported that they save $1 in health care costs for every mile traveled by bicycle. Odense (also in Denmark) realized a 200% return in investment through savings in health care for every dollar invested in their bicycle systems.

    A recent report from the Health Effects Institute found a causative relationship between automobile exhaust and increased incidence of asthma (especially childhood asthma) for people who live within 300-500 meters of a busy street. They also found evidence of causation between automobile exhaust and other respiratory illnesses, hardening of the arteries and heart illnesses. Thirty to 45% of North America's population lives within 300-500 meters of busy streets. The Health Effects Institute has been around since 1980 and is funded 50:50 by the Environmental Protection Agency and the worldwide motor vehicle industry, so it's research results are generally considered to be balanced and impartial.

    There are other likely cost benefits from bicycling that have not been as well quantified. For example, I don't understand the economic effect of a 33% rate of obesity among children. What does it mean that this is the first generation that may not live as long as their parents? It's enough of an issue that Michelle Obama is now focused on it.

    In terms of the transportation benefits we should consider the example of the Hawthorne Bridge. That bridge today carries 20% more vehicles (motor vehicles and bicycles) than it did in 1990. Fortunately, the number of cars on the bridge has not changed. That 20% increase has all been bicycles. Most transportation models will predict that over time, with increased population growth and increased economic activity the demand for mobility (i.e. traffic) will increase. Had that 20% increased traffic demand on the Hawthorne Bridge been motor vehicles, then the bridge would no longer work. To make it work we'd have to invest millions widening the intersections at either end and perhaps putting more travel lanes on the bridge itself. In reality, we wouldn't have been able to afford that so the cost would instead be increased congestion and traffic jams. This is the type of thing that makes goods and freight move slower and raises costs. However, because the 20% increase has all been bicycles, the bridge today carries more people and works as well for cars today as it did 20 years ago.

    When we look at our own experience and those of similarly-sized cities around the world we believe that a 25% bicycle mode split is attainable. The biggest barrier to bicycling is fear: fear of automobiles. If we can create conditions--as they have in Amsterdam and other cities--where 25% of all trips by septuagenarians can be made by bicycle (which is what they have there), then truly anybody can ride in safety and comfort. What we find is that there is a large proportion of the population that enjoys bicycling. They find it to be inexpensive, healthy and fun and it thrills them to see their children able to have fun and be healthy, too.

    As we've built bikeways in Portland we've seen Portlanders respond by riding. We believe that if we build more and better bikeways, then more people will ride. We have a fairly robust means of measuring ridership and we're pretty transparant about our information.

    Based on the potential return on investment it seems that it makes sense to expand upon the prudent investments we've made over the years. These are investments that have already yielded tremendous ROI. Seems like a good path to continue to follow.

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  • Options Guy February 11, 2010 at 7:44 pm

    Re: # 8 -

    What he said.

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  • BikeR February 12, 2010 at 12:39 am

    I like Brad's ROI questions. Some of the "return" is quality of life, which circuitously means attracting educated people/families, which attract business, which provides economic stimulus for the community (not the Obama kind). Roger had some other good ROI facts. The health angle is interesting. I wonder if health insurance companies provide lower premiums to firms who encourage cycling, or to firms who can demonstrate they have a higher than average number of bicycle commuters, or daily exercisers.

    I also think the bike plan does not need to concern itself with issues such as climate change, peak oil, etc. unless it can demonstrate that these issues will lead to an economic environment (e.g., carbon tax) where driving cars becomes prohibitively expensive and significantly increases cost of living. Think global but make policy local.

    In any business plan you have to make forecasts for future costs. I think it is reasonable to debate these forecasts. Oregon in the past has made some good longer term decisions before other states (bottle bill, or moving I5 from downtown). The bike plan shall be successful in an environment where health insurance companies can discriminate, and individuals pay the real cost of their energy and transportation use. Can we expect these to happen? I think we should and we should work to create this environment.

    ROI is easier when costs and product price is known, but still a good framework. Thanks Jonathan.

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  • 9watts February 12, 2010 at 9:01 am

    "the bike plan does not need to concern itself with issues such as climate change, peak oil, etc. unless it can demonstrate that these issues will lead to an economic environment (e.g., carbon tax) where driving cars becomes prohibitively expensive and significantly increases cost of living."

    (1) All policy must concern itself with climate change and peak oil.
    (2) Climate change and peak oil will make driving cars prohibitively expensive. They will also, I predict, upend the current and all too familiar cultural view of cars as the real and proper way to get around, and bikes and feet as lesser, lower status modes. When the causal links between cars and climate change sink in, those who are still driving will be seen as the pariahs. It may take a decade, but we'll get there.

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