COEUR d'ALENE — Despite concerns that it's the equivalent to a government handout, the city of Coeur d'Alene is moving forward with a bikeshare program.

After a lengthy discussion, the Coeur d'Alene City Council approved an agreement last week between the city and Zagster — a Massachusetts-based company that has implemented more than 140 bikeshare programs in communities across the country — stating the city will provide the company with a list of potential sponsors for the program in the community. Before councilmembers began their discussion, Alex Castagno, who owns the Coeur d'Alene Bike Company, said he doesn't oppose the idea of a bikeshare program.

"But it feels like it could negatively impact the business," Castagno said during public comment, adding that his shop makes a good amount of its income renting bicycles to tourists. "The pricing has to be structured correctly."

Bikeshare programs allow residents to visit a kiosk, or other fixed locations, and pay to check out a bike in a variety of ways. The Zagster program, for example, allows people to use an application on their smartphones to connect with the kiosk and unlock a bike of their choosing. Users of bikeshare programs are then able to return the bike at a kiosk located closer to their final destination.

Coeur d'Alene Trails Coordinator Monte McCully told the city council that Zagster intends to bring 40 bikes to the Lake City, to be stationed at six kiosks that will be installed in public rights of way.

Should the city pursue a bikeshare program with Zagster, McCully said, the company would install all of the necessary infrastructure, provide bikes, provide repair and rebalancing contracts and their own tech support. However, if the company does not find enough willing sponsors in the city, McCully said the city will not accept the program.

McCully called Castagno's concerns valid while stressing the focus of the program is not on tourists, but commuters.

Councilman Dan Gookin said he was concerned about the language of the agreement, particularly the portions that mentioned Zagster working with the city to locate sponsors.

"How is it not costing us money?" Gookin asked.

"My understanding is that they're responsible for raising the sponsorship funds and we just provide them with a list," McCully replied.

Councilwoman Kiki Miller shared Gookin's concerns and said, although the council was being told the city would only provide Zagster with a list, the language of the agreement made it appear the city was on the hook for more time and money related to finding sponsors.  

Continuing his line of questioning, Gookin then compared the agreement with Zagster to corporate welfare — a phrase commonly used to describe government agencies supporting a private company. Providing the company with the rights to install kiosks in public rights of way, Gookin said, does not create a level playing field for those renting bikes in the city.

Prior to the council voting on the agreement, the language of which was edited to further solidify the city would only provide Zagster with a list of leads, Mayor Steve Widmyer said the city was intent on working with local bike stores throughout the process.

"We have to be sensitive to people already here trying to make their living doing the same thing," Widmyer said. 

The edited agreement passed on a 4-1 vote, with Gookin voting against and Councilman Dan English absent. Should Zagster successfully find sponsors in the city, the next step will be for city officials to establish a pricing structure for people who wish to use the program.