News: CJ Exclusives

Scooter company raises prices, blames Raleigh City Council

CJ file photo
CJ file photo

People in Raleigh who ride electric scooters will probably notice their trips costing more.

Bird, which operates many of the e-scooters dotting downtown, has added a $2 transportation fee in response to recent City Council regulations.

Last year, the Raleigh City Council decided to implement an annual $300 per e-scooter charge for any company that wants to operate e-scooters in the city. The money is supposed to go toward enforcing the city’s rules on e-scooter use.

No other city has charged as much per e-scooter as has Raleigh. The average charge per e-scooter is between $20 to $30. Some cities charge as much as $100 per e-scooter. Cities often also charge a company a permit fee to operate in the city.

At first, the Raleigh City Council floated a $150 per e-scooter charge — an already high amount compared to other cities — but ended up doubling it to $300. City Council member Dickie Thompson suggested the increase.

Thompson didn’t respond to a request for comment.

The council also decided to limit the number of e-scooters permitted in the city to 1,500. Each company is allowed to deploy up to 500 e-scooters. If the maximum number amount of e-scooters are deployed, the city could take in $450,000.  

“The $2 per ride transportation tax riders must now pay to ride Bird is the direct result of Raleigh City Council forcing e-scooter providers to pay extraneous fees,” Sam Reed, director of government partnerships at Bird said in an emailed statement.

The City Council requires that e-scooter companies have insurance, maintain staffed operations in the city, and provide monthly and annual reports on rate structures. E-scooters are limited to where they can park and at what time they can be deployed downtown.

Last summer, Lime, another e-scooter company, and Bird deployed e-scooters in Raleigh without City Council approval.

E-scooter companies were given the choice to either comply with the regulations or leave the city. Lime and Bird decided to stay.

This is the first time Bird has implemented a transportation fee in response to regulations from a local government.

“Our hope is that Raleigh City Council will eliminate its high fees and its arbitrary cap on sustainable transportation offerings so that all residents, not just those who can afford the tax, can once again enjoy Bird as a truly affordable option in their community,” Reed said.

Gerry Cohen, former legal counsel to the General Assembly, questioned the legality of the City Council fee on e-scooters.

While the state authorizes cities to levy a tax on cars — somewhere between $30 to $60 — Cohen said it hasn’t authorized a tax on e-scooters.

“If the fees are being stockpiled and are dumped into the city general fund and aren’t being used to regulate scooters, then it becomes a tax,” Cohen said. “If the amount of money raised mostly exceeds the amount spent regulating the scooters, then it’s a tax, and it’s not authorized.”

Cohen said the city could possibly extend a tax on vehicles to include e-scooters, but it would have to be significantly less than $300.

City Council member Stef Mendell tweeted that the council imposed the fee to offset the administrative and enforcement costs.

“At the time we took action, we said we would review after we get some experience,” Mendell tweeted.

Cohen said it doesn’t look as though the City Council did any work prior to passing the new regulations to determine where the money would go, what it’s going to cost to regulate e-scooters, and for what the money would be used.

“It seems like they’re putting the cart before the horse,” Cohen said.