Goldman loans $41m to NY cycle project Goldman Sachs has quietly loaned $41m to help finance the start of New York City's much anticipated, and long-delayed, bike sharing programme. While Citigroup is paying $41m over five years to sponsor the project and has thousands of rental bicycles branded with its name, Goldman's role in the programme has until now remained behind the scenes. The bank's $41m loan is being used as the seed financing needed to get the project off the ground. New York's bike sharing programme plans eventually to offer 10,000 rental bicycles at hundreds of docking stations in Manhattan, Brooklyn and Queens, which would make it one of the largest schemes of its type. Initially scheduled to launch in the summer, "Citibike" was pushed back to March because of glitches in the rental software provided by Alta Bicycle Share, the plan's third-party operator. New York's Transportation Department has said the programme would be pushed back to May because of damage sustained during superstorm Sandy. Mayor Bloomberg has said that the bike share project would not be subsidised by the city, unlike some other bike rental programmes already in place. In London, where Barclays-branded bikes have become a common sight on the capital's streets, the scheme is funded by up to £50m from its British bank sponsor and public money. The loan from Goldman, made through the bank's Urban Investment Group, will be "repaid by operating revenue from the programme, which will include sponsorship payments from Citi," the company said in an internal presentation. Goldman's UIG, which aims to profit at the same time as doing good, has already poured money into projects ranging from single-family housing in hurricane-ravaged New Orleans to solar panel installations on the roofs of not-for-profit organisations in New Jersey. Since converting to a bank holding company during the depths of the financial crisis, Goldman has been obliged by the Community Reinvestment Act to invest in its local community. The bank says it has ratcheted up the amount of capital committed to the UIG from some $1.5bn about a year ago to more than $2bn now. The bank expects to earn a modest return on the bike share involvement, in keeping with rates typically paid on community development loans. "We had an opportunity to help structure a private capital solution to advance the city's agenda to launch a programme like this without using public dollars," said Alicia Glenn, head of Goldman's UIG. In August, the group teamed up with New York City and Mayor Bloomberg to create the first so-called "social impact bond" in the US. Goldman loaned $9.6m for a programme designed to reduce the number of young men who reoffend and end up back in prison at Rikers Island, New York's main jail complex. The bank's ultimate return on the loan is linked to the success of the programme. While the Mayor's office has been busy dealing with the devastating effects of superstorm Sandy, the transport chaos wrought by the storm has highlighted the need for different types of transportation in the city, according to some. With additional reporting by Robert Wright in New York.