Wednesday, April 3, 2024

Post 44: Micromobility Revisited

 In late 2020 and early 2021, I wrote a series of three posts titled “Adventures in Micromobility.”  They detailed a relatively new category of transportation that utilizes lightweight vehicles such as scooters and bicycles – especially electrified ones.  At the time, those devices were receiving a lot of publicity and public discussion, primarily because they were being deployed through an innovation known as “sharing services” where an e-bike or e-scooter could be rented for short, urban trips for a fee that was generally less than $10.  Those posts – type “micromobility” into the search box if you’re curious – are still largely on point, but things have changed enough that I thought a second look would be worthwhile.

In particular, there have been three significant shifts in micromobility that deserve investigation and discussion.  First, the relationship between the major players in the micromobility industry and the cities in which they largely operate has moved from adversarial and chaotic to something that is generally cooperative and business-like.  In the early years, scooter sharing companies would open up for business without any warning or municipal approval by simply placing hundreds of scooters at locations throughout the target area.  In 2018, the City of San Francisco issued a cease and desist order to Bird, Spin and Lime shortly after they had launched their e-scooter business because the city had received over 1,900 complaints.  Most cities now have regulations in place that typically require the scooter sharing companies to obtain a license from the city, share revenue and usage data, and operate within strict guidelines.  And scooter sharing companies, to their credit, have generally complied and have dropped their act-now-seek-permission-later business tactics.

Second, ownership patterns and user demographics have changed substantially.  At first, the industry was dominated by the large sharing companies, and new companies were seemingly being formed each month as entrepreneurs raised millions in venture capital.  Those days are largely gone and many of the early players have either merged with other companies, pulled out of the less lucrative markets, or gone bankrupt.  Although a few sharing companies still remain (and are at least approaching profitability), many of the sharing services are run by either not-for-profit entities or by partnerships between a for-profit company and a governmental or quasi-governmental agency.  

As the “sharing” part of the industry has pulled back, what has come to the forefront is the individual ownership of both e-scooters and e-bikes.  Teenagers (and even pre-teens) are adopting both types of devices as a way to expand their mobility without depending upon their parents.  A wide range of delivery workers have found e-bikes to be a productive transportation option that provides benefits in dense urban areas that go beyond what a car-only approach can provide.  Seniors are viewing e-bikes as a fountain-of-youth type of device that restores the fun of biking without the need to be in great shape.  What hasn’t changed, however, is that micromobility usage still skews heavily toward the more affluent (and white) segments of the population.

Third, innovations in both e-scooter and e-bike design have absolutely exploded.  Potential buyers are faced with a dizzying array of choices in form, performance, appearance and price.  Traditional manufacturers and retailers are still active, but many new manufacturing start-ups have entered the micromobility industry, often focused on just a few products that serve a specific niche.  Many of these start-ups are using a direct-to-the-consumer marketing strategy which broadens their reach and appeals to younger generations. 

Honda Motocompacto
Even traditional transportation companies that have never been in the micromobility business before seem compelled to participate.  Witness, for example, the oddly designed Honda Motocompacto which you can buy from participating Honda dealers for $995.  Honda has always made motorcycles, of course, but the Motocompacto has a top speed of just 15 mph and is designed to fold into a carrying case that is roughly 4” x 21” x 29” in size – distinctly unlike any other Honda product.  

Or consider that BMW, the maker of luxury motor vehicles, felt the need to market a luxury electric scooter for urban environments and extremely hip clientele.  The BMW CE 02 sits low to the ground on 14-inch wheels, has a maximum range of 60 miles, and starts at nine grand.  The product is so unique that BMW doesn’t use the term e-scooter but rather the made up term “eParkour” which apparently blends “street art” and “the design for a new generation.”  At least that is what the BMW marketing people think.

Anyway, the point is that micromobility transportation is a hot market at the moment, at least for certain segments of the population.  My goal for the remainder of this post will be to give you a glimpse of not only what has happened recently, but where I think the industry is going (or perhaps should go).  I am going to focus solely on the electrified portion of the micromobility arena because that is where the excitement is.  Human powered bikes (and even skateboards) are still popular and play a role in transportation but have not changed much in the past couple of years.

Blurring Boundaries

One of the problems with rapid innovation is that product definitions that were once reasonably distinct and well understood become very blurry.  New products have been introduced that overlap with other product categories, particularly in terms of performance.  This makes the development of regulations for licensing and operation extremely difficult and the result has been a quagmire of laws that vary from city to city and appear to be largely unenforced.  

An attempt to bring order to the chaos was made in 2014 when PeopleForBikes, an industry trade group, started promoting an e-bike classification scheme which has subsequently been adopted by the majority of e-bike manufacturers.  The system groups e-bikes into three classes based upon operational capabilities and top speed. [1]

Class 1 bikes are pedal-assist designs where the motor provides power to assist the rider only when the rider is pedaling.  Typically, these bikes have torque or cadence sensors that add assistance in proportion to how hard or how fast the rider is pedaling.  In addition, the electric motor provides assistance only up to a maximum speed of 20 miles per hour.

Class 2 bikes are also limited to an assisted top speed of 20 miles per hour but come equipped with a throttle that can control power from the motor whether the rider is pedaling or not.  Most Class 2 bikes have both pedal assist sensors and throttles.

Class 3 bikes have a motor-assisted top speed of 28 miles per hour (and must have a speedometer) but they may or may not have a throttle.  Many states have adopted laws that govern how different classes of bikes can be operated, but the rules governing Class 3 bikes tend to be particularly fractured.  California, for example, doesn’t allow Class 3 bikes to have a throttle.  New York, on the other hand, allows throttles but only if they are limited to a maximum assisted speed of 20 MPH.  

More than 30 states have adopted regulations based on these three categories which sounds great in theory but which breaks down in practice.  For example, Class 3 bikes are generally prohibited from riding on bike/hike trails that mix bike riders and pedestrians.  Unfortunately, most Class 3 bikes are visually indistinguishable from Class 2 bikes and many Class 3 bikes have settings that can limit them to Class 2 speeds which makes them legal on bike/hike trails in most jurisdictions.  You can see why enforcement would be problematic.

In addition, there are bike companies that simply ignore the entire classification system and produce e-bikes that go beyond the 28 MPH maximum speed.  Even bikes that in theory are constrained to Class 2 or Class 3 standards can be easily hacked to remove those restrictions by simply watching a YouTube video or two.  Moreover, the details of bike regulations vary from state to state, are not widely publicized, and are sometimes overridden by city or county requirements.  All in all, the number of bike riders who know the laws in their home city is probably modest and the number who bother to research the laws in other places before they travel is probably minuscule.  

Finally, none of this applies to e-scooters which became popular after the classification system was developed.  Since e-bikes and e-scooters have similar operational characteristics you would think that someone would develop an expanded system that includes both types of devices, but that has not happened.  Consequently, e-scooters often fall into a legal gray zone where deciphering what rules apply is challenging at best.

As a remedy to all this confusion, I’m going to propose my own classification system and, at the end of this post, my own regulatory framework to govern e-bike and e-scooter operations.

E-Scooter (Moped).  This type of vehicle (which I will refer to as an e-moped) is intended to be ridden in the street in mixed traffic and consequently comes equipped with headlights, taillights, turn signals and a horn.  Its form is similar to a Vespa-type scooter and it does not have the ability to be pedaled.  It would be distinguished from a motorcycle based upon its power or top speed (whatever each State uses to distinguish between the two).

E-Scooter (Kickscooter).  This is what most people commonly think of when the term “e-scooter” is discussed (and it is the term I will use for this post).  It has two or three wheels (12 inches in diameter or less), a platform that allows the rider to stand, a vertical post with handlebars for steering, and a throttle for controlling the power to the electric motor.

E-Bike (Pedal Assist Only).  This is a two- or three-wheeled vehicle that has pedals for moving the bike forward and an electric motor for assisting that forward movement.  A throttle is not allowed and the amount of assistance provided by the motor must be related to speed or effort used by the rider in pedaling.

E-Bike (Throttle Enabled).  This is a two- or three-wheeled vehicle that has pedals for moving the bike forward as well as an electric motor that can either assist the pedaling process or move the e-bike forward without pedaling.  Some type of throttle is part of this type of e-bike.

Note that these definitions are simple and physical so that determinations can be made visually.  I have avoided criteria based on speed or power because they are too hard to verify and are likely to become outmoded as technology improves.

Recent Developments

Although micromobility in general has been growing, that growth has not been uniform across all four product categories.  Similarly, the prospects for the future are not the same either.  Below is my take on how each micromobility type has fared recently and what to expect over the next couple of years.

E-Moped.  This product type is booming in Asia and to a somewhat lesser extent in Europe, but has not become particularly popular in the US.  This e-scooter format (excuse me, e-moped) is available for purchase, generally between $2,500 and $8,000, but dealers are limited.  My original post on e-mopeds included a first-person review of an e-moped sharing service in Brooklyn operated by Revel.  They have since ended that venture and have shifted primarily to a ride hailing service that uses EVs exclusively.

My guess on why e-mopeds are not more popular is that they offer almost no performance advantages over throttle-enabled e-bikes and yet are likely to cost considerably more.  There is also the problem of charging in which e-mopeds get stuck in a bit of a no-man’s land.  They generally cannot use the charging stations that are available for electric cars, and their increased size and weight make them less convenient to charge at home than an e-bike.  In Asia, e-mopeds have successfully developed swappable battery stations located throughout major metropolitan areas, but US cities are likely too spread out for that strategy to work here.

Most e-mopeds are limited to no more than 28 or 30 mph so that they can be driven with just a standard driver’s license, but that also limits their usefulness, especially in spread out midwestern cities where traffic on major streets typically travels at 35 to 45 mph.  There are products that go much faster (and thus trigger the need for a motorcycle license), but thus far haven’t been produced at high volumes.  My guess is that this will remain a niche product for the foreseeable future.

E-Scooter.  E-scooters in kickscooter form are far more common and are what most people think of when e-scooters are discussed.  This product type burst onto the scene in 2017 as the focus of a new breed of dockless sharing services by Bird, Lime, Spin and others, and by 2019 was commonplace in major cities across the country.  As with many forms of new technology, the early euphoria generates a great deal of both hyperbole and consternation.  New scooter sharing services were popping up in city after city with promises of revolutionizing urban transportation and many people found them to be both fun and useful.  Meanwhile, pedestrians, shop owners and automobile drivers generally cursed the haphazard way in which e-scooters were being driven and parked.  

As with most new technologies, the euphoria eventually fades, start-ups consolidate into a few long-term players, and operations are adjusted to reduce the most common complaints.  The focus shifts from growth-at-all-costs to professional management and eventual profitability – and not many companies can make that transition.  For example, in September of 2023 Bird bought out Spin, one of the early pioneers in the industry.  Three months later, in December of 2023, Bird (once valued at over $2 Billion) announced that it was filing for bankruptcy.  While the company is still operating and may eventually re-emerge in a slimmed down form, it is a stark reminder that early notoriety and market share don’t always translate into a company that can survive in the long run.

The number of rides reported by scooter sharing services boomed for the first few years but have tailed off as of late.  The most recent report on micromobility by the National Association of City Transportation Officials (NACTO) reveals that total scooter sharing rides are down 10 percent from the previous year and down 35 percent from the peak year of 2018.  The COVID pandemic obviously had an impact, but scooter sharing has not bounced back the way that bike sharing has, which means that scooter sharing companies have had to adapt to a “new normal” in terms of ridership and revenue expectations. [2]  Part of the problem is that e-scooters appear to be more prone to accidents than e-bikes – small wheels and high speeds make road imperfections dangerous – and the cost per trip tends to be higher for scooter sharing than bike sharing.

Apollo Pro E-scooter

What has saved the day for e-scooter manufacturers has been the rise of private ownership.  Rather than renting from a sharing service, people are simply buying their own e-scooter and keeping it with them for the entire trip.  Lightweight scooters can easily be folded up and carried onto mass transit, and beefier scooters are fast enough and comfortable enough to be used for relatively long, end-to-end rides.  For example, the Apollo Pro pictured here has dual motors, dual brakes, a sophisticated suspension, a top speed over 40 mph, a range of roughly 50 miles, and a price over $3,000.  These are scooters that are fast enough to be ridden in traffic in many urban environments and yet “bike-like” enough to use bike lanes and bike trails where available.  At the same time, they are seen as environmentally friendly and small enough to be walked into an office building, taken up the elevator, and parked by your desk.  

Despite the recent downward trend, I expect scooter sharing numbers to level off and perhaps even increase slightly in the future.  Scooter sharing services make sense in pedestrian-rich environments like a downtown area, a tourism district, or a college campus.  This is particularly true if there are bike lanes or bike trails that scooter riders can safely use and if scooter systems are integrated into a partnership with the city, the transit system and other micromobility providers.  Integrated systems are much more likely to be both profitable and well received by the public.  Meanwhile, private ownership is likely to increase and to be seen – particularly by the younger generations – as a replacement for trips in a car.  In the end, e-scooters in all their forms are likely to continue making urban transportation greener, more flexible and less congested.

E-Bike (Pedal assist only).  The U.S. (and much of the western world) is getting older.  E-bikes have proven to be hugely popular with this growing group of seniors, many of whom had given up their traditional bikes because they required too much effort to deal with hills, distance and wind.  In particular, the pedal assist form of e-bike feels very much like riding a traditional bike but with an ease and speed that seem almost magical.  Many bike sharing services are including e-bikes in their rental mix because of their popularity.  Sharing companies that have both types of bikes often find that the e-bikes are used at least twice as much on a rides-per-bike basis.  Bike share ridership has gone up by 33 percent in the U.S. and Canada over the past five years despite a significant COVID-related pull-back in 2020, largely due in my opinion to the rise of e-bikes.

Pedal-assist e-bikes are also popular with younger generations, particularly those whose reasons for riding lean away from exercise and toward simply having fun or toward a practical form of transportation.  Interestingly enough, despite the perceived lack of effort involved with an e-bike, several recent studies have shown that people who ride pedal-assist e-bikes often get more exercise than traditional bike riders.  The reason is that e-bike riders ride farther and more frequently.  Their heart rate might be somewhat lower but the increase in time spent biking more than makes up for that shortfall. [3]  I have owned a pedal-assist e-bike for roughly a year and my experience validates that conclusion.  

Recent innovations in this category of e-bike have been more evolutionary than revolutionary – e-bikes are simply getting better and better.  As their popularity has grown, more options are available although the number of manufacturers has not expanded dramatically.  Traditional bike brands predominate and prices tend to be relatively high.  Still, I expect sales volumes to continue to grow at a steady rate.

E-Bike (Throttle Enabled).  The real growth in e-bikes – and the real innovation in bike design – has occurred in this category.  Perhaps this is due to the preponderance of throttle-enabled e-bike manufacturers being young companies, a few of which literally started with tinkering in the garage.  Such is the case with Mike Radenbaugh, the founder of Rad Power Bikes, who cobbled together miscellaneous parts to build his “Frankenbike” that could get him to high school without breaking a sweat.  The formal business started in 2007 and is now one of the largest e-bike companies in North America.  They make a wide range of models – cargo bikes, city commuters, trail bikes, folding bikes and more – all e-bikes with both pedal assist sensors and a throttle.  Most models come with dozens of potential accessories that allow buyers to tailor the bike to their specific needs.  Other brands – Juiced, Ride1Up, Lectric, Aventon, and many more – have followed a similar creative and entrepreneurial playbook.  Throttle enabled e-bikes now outsell pedal-assist only e-bikes by a considerable margin.

Most e-bikes of this type are shipped with a Class 2 configuration setting (max 20 mph), but they are often easily readjusted to a Class 3 setting (max 28 mph).  Some bikes now come with a “race mode” that does away with speed limitations entirely, or can be easily hacked to accomplish the same thing.  Top speeds are still generally in the mid-30s, but this capability plus the option to minimize pedaling by using the throttle have essentially converted e-bikes into mini-motorcycles without any of the traditional licensing and training requirements.  No one knows how many riders take advantage of higher speeds or throttle only operation, but it is not a trivial percentage.

In dense urban areas, throttle-enabled e-bikes have become particularly popular with delivery drivers.  An e-bike is easier to maneuver through traffic, easier to park, and often just as fast as driving a car – without any need for licensing, car insurance, gas and expensive repairs.  Cargo specific designs come with ranges of around 40 miles (more with a second battery to swap in) and carrying capacities of 300 pounds or more (including the rider).  No wonder delivery services such as Doordash and Grubhub specifically recruit e-bike riders in certain areas.

All in all, throttle enabled e-bikes seem likely to continue their rapid rise in popularity.  Not only do they appeal to traditional bike riders looking for a power boost, they also have co-opted the market for moped style e-scooters.  Why buy an e-moped when an e-bike option has similar performance, more configuration options, and a lower price?

Trouble in Paradise

In many respects, the micromobility industry is thriving, but there are storm clouds on the horizon.  In particular, battery fires and accidents caused by reckless riders threaten to derail the boom before it really takes off.

The lithium-ion battery packs that power both e-scooters and e-bikes can overheat during the re-charging process, leading to off-gassing, fires and even explosions.  The problem is particularly severe if the battery pack is damaged, if the battery is cheaply manufactured (and doesn’t comply with UL standards), or if the battery is overcharged.  The resulting fires are extremely hot and can spread rapidly.  Some urban fire departments consider micromobility battery fires to be their fastest growing fire risk.

One of the simplest responses to the problem is to avoid cheap batteries and charging equipment.  Unfortunately, micromobility devices often appeal to people who are poor and rely upon the devices as their primary mode of transportation or as a delivery vehicle for their primary job.  The appeal of the cheapest possible e-bike or e-scooter means that requirements for UL listed equipment are often ignored.  More draconian regulations are likely to be the result if the problem isn’t solved in some other way.  New York City, for example, considered banning e-bikes and e-scooters from all public housing projects (although they eventually backed down) and London has banned e-scooters from being carried onto transit vehicles.

A more insidious problem is bad behavior by e-scooter and e-bike riders.  Right now, regulatory constraints on micromobility devices are relatively light in the U.S.  That could change, however, if increasing numbers and increasing speeds start to threaten the traditional domains of pedestrians and automobiles.  The problem is most acute where transportation volumes are highest or where transportation facilities are inadequate.  And while new technology frequently causes behavioral norms to change in uncomfortable ways, this situation has the potential to spiral dangerously out of control.  Let me illustrate with three recent examples.

A ban in Paris.  A few months ago, Parisians voted to ban e-scooter sharing services from their city, although privately owned e-scooters are still allowed.  The vote was overwhelming – roughly 90 percent supported the ban – although turnout was extremely low with less than eight percent of eligible voters bothering to participate.  The primary objections appear to be the result of aggressive riders routinely speeding past startled pedestrians, hundreds of e-scooter accidents including three that resulted in fatalities, and careless parking habits that cluttered crowded sidewalks.  David Belliard, a deputy mayor in charge of urban mobility, was quoted as saying “The anarchy was quite unbearable.” [4]

The ban underscores two basic issues.  The first is that e-scooters and pedestrians do not mix well.  Paris is a very walkable city and e-scooters were seen as a threat to that walkability.  The sidewalk is the traditional domain of the pedestrian and e-scooters disrupt the perceived safety of that environment because they travel at 4 or 5 times the speed of the average walker.  Move e-scooters into the street and they annoy drivers who are often driving at twice the speed in vehicles that are 20 times bigger.  The second issue is that dockless sharing systems almost inevitably create clutter in the public realm.  Most e-scooter riders try to do the right thing when they park, but a few bad actors (or a few clueless actors) can spoil the whole thing.  Dockless systems are a major convenience for the rider, but mostly a pain in the ass for everyone else.

Delivery licensing in Hoboken.  One of the enduring changes from the COVID pandemic is the popularity of food delivery services such as Uber Eats, Doordash and Grubhub.  As noted earlier, delivery via e-bike is common in more urbanized neighborhoods but it is not without problems.  Hoboken, New Jersey, is an upscale, moderately dense community right across the Hudson River from New York City.  Throttle enabled e-bikes delivering food orders are commonplace, particularly on the main drag of Washington Street.  Pedestrians and sidewalk dining are also commonplace and therein lies the rub.  The sidewalks are simply not wide enough to accommodate e-bike delivery riders, so pedestrians feel unsafe.  As a result, Hoboken is in the process of requiring that e-bike delivery drivers get registered with the city, pass a test on local laws, and wear a fluorescent vest printed with their license number.  The idea is to make them visible, knowledgeable, and responsible for their actions. [6]

This approach contains a fair amount of common sense, but the devil is in the details.  In order to be fairly enforced, the Police Department will need additional manpower that will probably need to be either on foot or on their own e-bikes.  This will not be simple or cheap, and the litmus test of this new ordinance will be whether the community is willing to pay the price necessary for its enforcement.  Second, being a food delivery driver is a low-paying job that falls largely to the low-income immigrant community.  These regulations land squarely on that group but omit the corporations behind the delivery industry.  Shouldn’t Grubhub, Uber Eats and Doordash (et al) have some responsibility?  Stay tuned as this plays out because I am confident that ordinances like Hoboken’s will be replicated across the country.

A fatality in Key Biscayne. In February of this year, a 12-year old boy riding an e-bike collided with a 66-year old woman riding a traditional bike who later died from her injuries.  Reports of the incident have not placed blame on either rider, but local city council members were quick to cite this incident as proof of the dangers of e-bikes and e-scooters.  Interestingly, the boy was wearing a helmet and sustained only minor cuts and bruises, while the woman was not wearing a helmet. [5]  Regardless, the Key Biscayne Council promptly passed a 60-day ban on all e-scooters and e-bikes from the public streets.  The City had previously banned them from public parks.  As of this writing, the ban is likely to be extended for several months while a permanent solution is discussed.  

Once again, this news item brings a couple of issues to mind.  First, teens and pre-teens have adopted e-bikes and e-scooters as a way to expand their personal mobility without much parental oversight.  As I pointed out earlier, these devices are essentially mini-motorcycles but without any training or licensing.  While mobility is generally a good thing, teens and pre-teens aren’t known for having great judgment and they have only limited knowledge of traffic laws and safe driving practices.  Second, there is a clear tendency for e-bike and e-scooter riders (of all ages) to assume that traffic laws which apply to cars do not apply to them.  Consequently, they can frequently be seen riding through stop signs or red lights, weaving between cars that are stuck in traffic, and alternating between traffic lanes, bike lanes and sidewalks depending upon which route seems fastest.  As a long-time bike rider myself, I understand the desire to maintain momentum but that does not excuse the seemingly oblivious actions of some riders.  The problem is that traffic laws were written primarily for cars and there is a need for some modifications as they pertain to bikes and scooters.  Traffic laws need to be re-imagined to take into account the reality of mixed-mode traffic and micromobility riders need to comply with the results.

A New Regulatory Framework

Finding the right balance between pedestrians, bikes, scooters and cars is going to require blending a variety of viewpoints and take a considerable amount of trial and error.  I’m going to share my thoughts on the subject but I’m certainly not going to claim that I have all the answers. 

Before I get into regulations, however, it is important to point out that no amount of regulatory adjustment changes the need for a dramatic increase in protected bike lanes – the best location for e-scooters and e-bikes.  Micromobility devices have the potential to change urban transportation in a way that is fun, efficient, and environmentally friendly.  But that potential will not be realized until the infrastructure we build supports all forms of transportation – not just the car.

First, I would propose that micromobility devices (traditional bikes, e-bikes and e-scooters) all be treated the same for the sake of regulation.  Yes, there are differences but the similarities are far more numerous.  They occupy about the same amount of space, they have about the same degree of maneuverability, they have similar braking capabilities, and the people who ride them share similar vulnerabilities in an accident.  There can be differences in speed, but not so much as to justify separate treatment.  In general, all these devices travel between 10 and 25 mph on level ground, with the vast majority in the 12 to 18 mph range.  Regulations should focus on speed and behavior, not on the specific type of device.

Second, I think cities should be able to prohibit bikes and scooters from certain streets under certain conditions, just like farmers aren’t allowed to drive their tractors on interstate highways.  This may be sacrilege to the bike riding community, but I think it would save a fair number of lives.  Streets that carry high volumes of traffic at relatively high speeds (e.g. 40 - 45 mph) would be obvious candidates because the disruptive effect of a slow-moving vehicle is so great and the potential for serious injury or death is so high.  However, cities should be responsible for having a parallel alternative route in place before the prohibition is made.  Bike and scooter riders need to be able to reach all parts of the community.

Third, sidewalks should generally be reserved for pedestrians only.  There will probably need to be a few exceptions to this rule, but pedestrians are too important in the transportation hierarchy to allow them to be threatened by bikes and scooters traveling at a much higher rate of speed.  Sidewalks have a unique role in building the character of a neighborhood or commercial district – one that should not be undermined by trying to make them do double duty as a bike lane.  I’m sure there are parents who think that a sidewalk is the only safe place for their child to ride their bike or scooter, but I disagree.  If parents can’t teach their child to ride safely in the street (including knowing which streets to avoid), then the child is probably too young to be riding a bike or e-scooter.  Where exceptions are made to this rule (a college campus, perhaps), bikes and scooters should be limited to a speed of 10 or 12 mph whenever pedestrians are present and sidewalks should be at least 8 feet wide.

Fourth, more states should adopt what are commonly referred to as “Idaho stop” laws.  This is a law that allows a bike rider (including an e-bike or e-scooter rider) to treat a stop sign as a yield sign.  The rider should slow down when approaching the intersection and yield to any cross-traffic, but otherwise would not be required to stop completely unless traffic conditions require a stop.  This type of law acknowledges the way bike riders typically ride and makes side streets far more attractive to bike and scooter traffic.  I would not, however, extend this rule to traffic signals (with the possible exception of situations where the signal does not sense that a rider is waiting and there is no cross traffic).  

Fifth, on multi-lane streets where no bike lane is available, bike and scooter riders who can maintain a speed of 15 mph or better should occupy an entire lane.  In fact, in congested city centers it might be more efficient for all traffic to move at 15 to 20 mph which would allow e-scooters and e-bikes to mix freely with other traffic.  What is clear is that it is not safe for bike or scooter riders traveling at speed to be relegated to the gutter or shoulder area while cars blow by at 35 mph.  Cars need to learn to share the road or cities need to find the money to build protected bike lanes.  At the same time, if traffic is stopped at a red light, bike and scooter riders need to stay in their lane and should not cut around cars by using the gutter or lane line areas.

Sixth, on a mixed-use trail, bikes and e-scooters should be limited to 12 or 15 mph where pedestrians are present.  In addition, they need to provide at least 3 feet of buffer room when passing a pedestrian, and provide an audible warning (voice, bell or buzzer) several seconds before passing.  I am tempted to suggest that pedestrians should be banned but such trails are so popular that I think that is unlikely to happen.  Unfortunately, they become hazardous if micromobility riders treat them as their own personal expressway.  Again, the problem is the potential speed differential between someone walking their dog or pushing their stroller at 3 mph and someone riding an e-bike at 20 mph.  Passing notifications should also apply to bike lanes if a bike or e-scooter rider is passing someone significantly slower.


I suspect that these issues will not be fully resolved any time soon.  The innovation in micromobility is going to continue and the rising popularity of these devices is going to force communities to rethink the way streets are designed and traffic laws are enforced.  The end result will be better options for everyone but the transition from where we are to where we need to be will be complicated – and unfortunately, dangerous.


1. Matt Jancer; “What Are Ebike ‘Classes’ and What Do They Mean?”; Wired; October 2023;

2. National Association of City Transportation Officials; “Shared Micromobility in the U.S. and Canada: 2022”;

3. Courtney Holden; “Can You Get Exercise Riding an Electric Bike?”; June 2021; REI Uncommon Path;

4. “Rental e-scooters cleared from Paris streets as ban comes into effect”; Le Monde; September, 2023;,The%20French%20capital%20is%20the%20first%20in%20Europe%20to%20completely,them%20would%20reduce%20%22nuisance.%22

5. Tony Winton and John Pacenti; “Ebike crash leaves cyclist dead in Key Biscayne”; February 2024; Key Biscayne Independent;

6. Carren Lissner; “E-Bike Food Deliverers Will Need License in Hoboken If Plan Passes”; February 2024;;

Monday, February 26, 2024

Post 43: The Housing Crisis -- Details, Details, Details

 The first article in this Housing Crisis series contained a variety of statistics that illustrated the degree to which the housing industry is failing to meet the needs of a fairly broad swath of our society.  It should be pointed out, however, that the housing market is not completely dysfunctional.  Housing is being produced which meets the needs of certain segments of society perfectly well.  The problem is that those segments represent a minority of the population – and a share which is getting smaller and smaller since housing costs are rising faster than income.  To illustrate this disconnect, let me share one more set of statistics represented by the following chart.

Over the past 40 years, the average size of single-family homes being built by the housing industry has steadily gotten larger (up more than 40 percent over that time period) while at the same time the average household size has steadily gotten smaller (down almost 10 percent).  To some extent, this reflects the growing affluence of the American family.  Unfortunately, the growth in household wealth has been concentrated in the top 10 or 20 percent of households, thus leaving the vast majority of middle class families struggling to afford the kind of housing options that preceding generations took for granted.  

The housing that is getting built is getting larger because developers and builders are giving up on the moderately priced segment of the housing market.  They are doing so because our cities, our financial institutions, and our social perceptions of “the good life” have systematically downplayed and disincentivized housing options that would have led to greater diversity and affordability.  Again, our current housing challenges are not the result of a single decision or trend, but rather the compounding effect of small thing, upon small thing, upon small thing.  The bottom line is that we have made building moderately priced housing more risky and less profitable.  It is no wonder that builders are shying away from that segment of the market.  

My goal with this post is to suggest ways to undo many of those small trends that have taken us in the wrong direction.  My comments are going to focus primarily on the needs of working class families who would like to own a residence with two, three or four bedrooms, and space (both inside and out) for kids and pets.  This is a segment of the population that I think has been poorly served by current housing options and yet their success is crucial to the success of our society in general – think teachers, tradesmen, mid-level managers, nurses, etc.  Many of my suggestions will apply generally to a wider variety of housing segments, but I won’t be discussing them in any detail for brevity’s sake.

Community Commitment

First, there needs to be a broad acknowledgement by cities, builders, community support organizations, and financial institutions that there is a housing problem and that a coordinated effort is required to address that problem.  Our current housing crisis is not going to be solved by clinging to the status quo.  

It is also important to acknowledge that the fundamental problem is the underproduction of housing, particularly at the lower-priced end of the market.  This is not simply a problem of lumber prices being too high, or mortgage rates going up, or inflation squeezing the middle class.  While all of those things might be true, they are out of the control of local communities and thus are simply a distraction from the real task of getting more housing built.

The reason that local commitment is so important is that some of the steps necessary to boost housing production will not be universally popular.  Change is hard, and counterproductive housing myths are widespread, which means that decision-makers are likely to be accused of “destroying the community” when in fact they are working to save it.  This is why the status quo is so powerful and why effective reform of the housing industry is so hard.

Fundamental Zoning Reform

The municipal use of zoning regulations became commonplace roughly a hundred years ago largely as a tool to address perceived damages to one class of land use caused by another class of land use, particularly in rapidly urbanizing cities.  One of the earliest examples is a 1908 ordinance in Los Angeles that prohibited wash houses (or laundries) in certain residential districts.  The presumed rationale was to protect the property values of the residential uses, although there was likely a racial component as well since laundries were typically operated by Chinese immigrants.

The first citywide zoning regulations were adopted by New York City in 1916 supposedly in reaction to the 1915 construction of the Equitable Building on Broadway – a 40-story office tower that loomed over adjacent structures restricting available light and ventilation, and supposedly overwhelming street and transit infrastructure.  Others have speculated that the regulations may have also been a way for swanky Fifth Avenue retailers to avoid being crowded out by rapidly expanding garment factories (and the hordes of low-class workers who ruined the Fifth Avenue ambiance). 

Zoning regulations have gotten much more complex over the years, but the underlying motivation and the eventual impact of the regulations remain a mixed bag at best.  There are undoubtedly strong public health, safety and general welfare benefits to be gained (e.g. preventing the proverbial smoke-belching factory in the middle of the residential neighborhood), but there is also a dark side to zoning that is too rarely acknowledged.  From the very outset, zoning was used to discriminate based on race and economic class.  Zoning has allowed us to use the municipal police power to carve out areas of the city where we can be surrounded by people who look and act the same way we do.  This is perhaps understandable given that our homes are in many cases our most valuable asset, and protecting that asset is consequently a high priority.  We have gone overboard, however, and we have convinced the general public that their investment can only be protected by maintaining highly homogeneous and unchanging neighborhoods.

It has been estimated that 75 percent of all residentially zoned land in the country is restricted to just single family residences, one of the most expensive forms of residential development. [1]   Furthermore, typical zoning requirements allow just one residence per lot and mandate a minimum lot size that often ranges between 8,000 and 20,000 square feet.  This “large house on a large lot” approach to housing may have made sense 60 years ago when households were larger and land was cheaper, but it is out of date now and is a significant contributor to our housing affordability problem.

A backyard Accessory Dwelling Unit

Some cities are pushing back on restrictive residential districts by allowing an accessory dwelling unit in the backyard, an accessory apartment in the main structure, or duplexes (or triplexes) in districts that were formerly single family only.  The result is an increase in the housing supply, an increase in the variety of housing options available, and a new opportunity to build wealth for property owners.  The impact on the value of existing houses appears to be minimal, and may in fact be positive, particularly in neighborhoods showing signs of decline.

Smaller Lots

Midwestern cities, in particular, have a bias toward generously sized lots for residential development.  That is fine for affluent buyers, but for the production of moderately priced housing a large or even mid-sized lot is a waste of money.  Front yards and side yards, for example, have very little functional value aside from providing an aesthetically pleasing setting for the house itself and providing a minimal amount of acoustic and visual privacy.  Consequently, they should be reduced in size by a third or more.  Even rear yards are becoming less useful as household sizes decline and our social activities trend away from backyard barbecues.  

A Cottage Court Development

A lot size of 3,000 to 5,000 square feet per unit is possible with some careful planning, but cities tend to default to much larger minimums suitable for generic, bigger-is-better designs.  Another approach is to allow cluster housing or cottage courts in which small lots for each unit are offset with a shared common area for play structures or get-togethers.  The bottom line is that smaller lots can save tens of thousands of dollars in the final cost of each housing unit, and cities will reap a secondary benefit of greater tax-revenue-per-acre in the bargain.

Smaller House Designs

America is the land of “bigger is better” and that attitude is certainly celebrated throughout much of our society and social media.  Homes that receive the most notoriety seem to feature enormous kitchens, closets and bathrooms, not to mention the more traditional living spaces and rec rooms.  This trend, in my opinion, is not driven by family size (which is shrinking) or a desire to entertain lavishly, but by a need to mark our affluence and house all of the “stuff” that we have acquired – most of which we rarely use.  This is a generalization, of course, because some people with large houses do have large families or entertain frequently.  But it wouldn’t surprise me if at least half of the homes with 2- or 3-car garages can’t actually fit more than one car due to all of the accumulated stuff that has overflowed from the house into the garage.  The result, again, is that builders default to larger and larger designs and home buyers seem compelled to buy larger homes even if they end up with rooms that are rarely used.

Fortunately, there is somewhat of a counter trend forming that places more emphasis on a simple lifestyle and quality of design rather than on raw size.  At the extreme this shows up in trendy articles on “tiny houses” in which people live in just 200 or 300 square feet.  There is a more practical middle ground, however, in which a modestly sized home can keep prices to moderate levels while giving the occupants enough space to live a normal life.  The trend was started over 25 years ago by architect Sarah Susanka who wrote a book titled "The Not So Big House: A Blueprint for the Way We Really Live." [2]  Her primary point is that better design can lead to spaces which are more comfortable and more engaging given our lifestyles rather than simply defaulting to larger spaces.  The key is to design spaces that do double duty, are flexible enough to adapt to changing needs, and appear larger than they really are.

A modestly sized house is crucial for keeping costs reasonable, and good design is crucial for making a modestly sized house marketable.  A skilled designer can make small look cool.  The problem is that “good design” has often been reserved for only very expensive, custom designed homes.  What needs to happen is for good design to be applied to homes that are mass produced.  I’m not talking about an architectural masterpiece, but simply a home that is functional, adaptable and attractive.

Pattern Zoning

A relatively recent innovation known as Pattern Zoning can boost the production of moderately priced housing and incorporate several of the suggestions that I have outlined above.  This approach starts with pre-approved residential plans designed by an architect and reviewed by the community for compatibility with local needs and character.  These pre-approved plans are paired with a streamlined approval process for the issuance of a building permit that typically avoids any type of review by the Planning Commission, City Council or zoning variance board.

The advantages of Pattern Zoning include:

  • High-quality designs where the cost is covered by the city and eventually spread over many units;

  • Pre-approved review by the community so that the neighbors know exactly what to expect which reduces NIMBYism and other forms of community resistance; 

  • A streamlined approval process which can save builders months of time and thousands of dollars of soft costs; and 

  • A simplified, step-by-step approach which can attract non-traditional, small scale builders that can ramp up housing production, particularly in inner-city, infill locations that more traditional builders might skip.

The key, of course, is developing a variety of pre-approved plans that the community views positively, that builders think will sell, and that fit the sizes and types of building lots available in the neighborhoods where the zoning will be applied.  The net result can be an increase in the production of modestly priced, “missing middle” types of housing in close-in locations that most communities desperately need.

Streamlined Financing

Many modestly priced residences are rented, but there are advantages for the community if our society can figure out a way to expand the range of households that can become home owners.  Home ownership is an important path toward wealth building for middle income families and it tends to build a higher level of commitment to the community in general and local neighborhoods in particular.  Unfortunately, the process of purchasing a home is complicated and expensive – two characteristics which are often the death knell for aspirations of home ownership.

Purchasing a home is different than purchasing almost anything else.  It is a highly standardized process for buying a highly variable product, and it is the most expensive thing that most families will ever buy.  Purchasing a home almost always involves obtaining a mortgage that covers the vast majority of the cost, and the financial institutions that issue mortgages typically sell those mortgages so that they can be securitized and resold to investors.  This process frequently involves either Fannie Mae (the Federal National Mortgage Association or FNMA) or Freddie Mac (the Federal Home Loan Mortgage Corporation or FHLMC) which have strict rules on what types of mortgages they will purchase.  These rules are the tail that wags the proverbial mortgage dog and nearly every institution that issues mortgages follows those rules as closely as possible.

Since the buyer of the home and the home itself can vary widely from case to case, many of the rules are designed to make sure that the purchase is done legally, that the buyer is likely to be able to repay the mortgage, and that the home is likely to last for the duration of the mortgage.  Compliance with each rule has to be documented by the mortgage issuer in order for the mortgage to be deemed “compliant” with Fannie Mae/Freddie Mac rules.  Each step in the process involves either some company certifying that the rule has been met (and charging a fee for doing so), or it involves the buyer or seller paying money to cover some part of the transaction cost.  Taken as a group, these are known as “closing costs” and frequently end up being 3 to 6 percent of the value of the mortgage – or typically thousands of dollars.

While there is a logical reason behind each step and each fee, the process feels bloated and antiquated to first time buyers.  It is ripe for what tech people call “disintermediation” which is just a fancy word that means getting rid of the middle man.  Virtually all of the records that need to be documented as part of the process are now computerized which means – at least in theory – that record checks should take seconds instead of hours or days.  The devil is in the details, of course, and many records may not be easily accessible due to privacy restrictions, but streamlining of the process seems inevitable.  As evidence, look at the growing number of companies such as Rocket Mortgage or Quicken Loans that have moved the entire process to the internet.  Even Fannie Mae and Freddie Mac (under pressure from the Biden administration) are realizing the need for change.  Fannie recently announced that it would expand the use of an attorney-opinion letter which is a simpler and cheaper alternative to a full blown title search. [3]

The bottom line is that making housing affordable must include simplifying the process of buying and selling so that it is both faster and less expensive.  If the IRS can devise a way for millions of taxpayers (those with the most straightforward returns) to calculate, file and pay their taxes online, then surely the mortgage industry can figure out how to simplify the process of buying and financing a home.

A New Form of Ownership

Some discussions of housing make it sound like owning a home in the traditional sense is a universally good thing that every household should aspire to.  That is flat out wrong.  Many households are better off renting, and the percentage that are better off renting is probably larger than most people would think.  Successfully owning a home requires both financial and locational stability, as well as a commitment to the community.  If your job is insecure or you are thinking about moving to another city in a year or two, then buying a house is likely to be a financial drain rather than a financial windfall.  And if you have no commitment to your neighborhood, then owning a home is likely to be frustrating and annoying.

The transaction costs of buying or selling a home are high enough that even in a market where housing is appreciating in value, owning a home is unlikely to contribute to an increase in total wealth unless it is kept for at least 3 to 5 years.  It takes roughly that long for the gradual increase in equity to cover the closing costs associated with selling (and potentially buying a new home elsewhere).  On top of that, selling in less than two years may trigger a capital gains tax issue.

First time home buyers, particularly those that are stretching financially to do so, are likely to be surprised by the unexpected costs and expectations that come along with home ownership.  A renter can call the landlord when the water heater breaks or the roof leaks, but a homeowner has to deal with those unexpected expenses themselves.  According to a recent survey, only 44 percent of American households say that they could pay for a $1,000 unexpected expense using their savings. [4]  This means that most of the remainder would have to take on debt (credit card, personal loan, or borrowing from family and friends).  Adding more debt, of course, can quickly spiral out of control if the household budget is shaky to begin with.

Not only does a homeowner have to deal with emergencies, but the neighbors are going to expect the grass to be mowed, the landscaping trimmed and the house to be kept painted – all of which cost money beyond the monthly mortgage payment.  Shirking your responsibility to the community is likely to result in angry neighbors and a visit from the local code enforcement officer.  All of this can turn the experience of home ownership from a dream into a nightmare.

What I think is needed is a third category for describing a household’s relationship to their home.  We already have “renter” and “owner”.  What I would like to see more of is what I’m going to refer to as “co-owning”.  This third category requires the participation of a housing-focused organization – most likely a not-for-profit, community- or faith-based organization that is willing to partner with individual households.  There are already examples of this type of partnership around the country, but it needs to become far more widespread for it to have a significant impact on the housing affordability crisis.

The role of the co-owning organization is akin to the role of a traditional landlord, but with the profit motive of the landlord replaced by a mission to provide affordable housing, build wealth, and smooth the transition from renter, to co-owner, to traditional owner.  Ideally, the co-owning organization would acquire multiple housing units in close proximity and maintain an active partnership with the residents in order to facilitate a sense of community.  At the extreme, this is known as “co-housing” or “intentional communities” where people often share daily activities such as gardening, child care, or social get-togethers. [5]  From the perspective of affordable housing, the key advantages of a co-owning organization would be:

  • Reducing the financial impact of closing costs and down payments so that moderate income households could “own” housing without a huge up-front cost;

  • Building relationships with local lending institutions so that financing arrangements for first-time buyers would be less intimidating;

  • Developing a list of trusted repairmen, contractors, insurance providers, and similar local services that homeowners are likely to need; 

  • Assembling a shared pool of tools, ladders, and lawn care equipment so that each owner doesn’t need to buy their own;  

  • Providing short-term financial assistance to smooth over unexpected expenses at interest rates far below what a credit card or payday loan business would require; and

  • Facilitating the eventual sale of the residence if the household needs to move or wants to upgrade to a traditional ownership role.

In exchange, the organization needs to have a revenue stream to not only cover its costs but to also provide an incentive to expand its services.  This revenue stream might be a monthly fee like dues for a homes association, or a differential in the interest rate between what the organization borrows at and what it charges the individual household buyers, or an agreement to split any appreciation in property values.  Whatever the arrangement, the idea is that the co-owners split the financial benefits of owning a home while providing an opportunity for a moderate income household to not only have safe and sanitary living quarters but to also build equity and learn the ins and outs of home ownership.  

There are a dozen different ways this could be set up and there are a wide variety of functioning examples across the country.  The key to success is to make this a financial and social win-win for both the sponsoring organization and the occupants of the housing.  It should not be charity and it should not be government subsidized if it is to become common enough to really have an impact on the volume of housing being put on the market.


Solving the housing affordability crisis is both simple and complicated at the same time.  The simple part is that the fundamental solution is to build more housing, particularly at the moderately priced end of the housing spectrum.  Depending upon who you ask, the country is short somewhere between 3 million and 7 million housing units. [6]  The complicated part is that implementing the “simple” solution is going to require many different participants taking independent actions that will only be effective if other participants take complimentary or supportive actions at the same time.  Unfortunately, there is no coordinating entity that can force all of the necessary steps to take place.  There is no single agency or company that can solve the problem on their own.  There is no single invention that will save the day.  There is no single template that will work for every community.  And yet the problem is so crucial to the success of cities that it must be addressed despite the difficulties.

Although cities rarely get involved in actually building housing, they play a critical role in “setting the table” so that other entities can produce the housing that is needed.  In particular, cities need to build consensus among civic leaders that a problem exists that threatens the well being of the community and that change to the status quo is necessary to solve the problem.  Then, cities need to examine their zoning regulations to make sure that they promote the creation of diverse housing options with as streamlined an approval process as possible and examine their building codes to make sure that energy efficiency and life-safety requirements are not so stringent as to undermine the ability to produce moderately priced units.

Finally, cities need to motivate as many community participants as possible to take steps to solve the problem.  This includes financial institutions, nonprofit community organizations, state and federal agencies, utility companies, and builders that range from national corporations to mom-and-pop start-ups.  All of these players need to see that improving housing affordability is in their long-term best interest.


1. Nathaniel Meyersohn; “The invisible laws that led to America’s housing crisis”; CNN; August 2023;

2. Sarah Susanka; “The Not So Big House: A Blueprint for the Way We Really Live”; Taunton, 2008;

3. Andrew Ackerman; “Plan Aims to Cut Home-Buying Costs”; The Wall Street Journal; January 17, 2024.

5. Jeffrey Kluger; “Why Americans of All Ages are Coming Together in ‘Intentional Communities’ “; Time;

6. Josh Zumbrun; “How Severe is the Housing Shortage?  It Depends on How You Define ‘Shortage’ “; The Wall Street Journal; April 2023;