In some regions dedicated grant programmes have been established by higher level governments - State or province - to fund the construction of cycle highways. These schemes differ in the amount of co-funding required, which ranges from zero to 50%. Differences also exist with respect to the activities eligible for funding. Sometimes planning and preparatory work can also be funded, while other grant programmes only make funds available for actual construction.
Other sources public funding
Higher-level governments do not always establish a dedicate grant programme, but also commit resources from existing (annual) Transport budgets. In most regions cycle highways are financed under a co-funding principle where local authorities also commit financial resources to the initiative. Funding can also be secured from the national governments. Finally, in Belgium and Germany higher-level governments have assumed full responsibility for the construction of a number of routes, which means that they will fund all activities themselves.
Several alternative funding schemes exist with respect to grant programmes and other more regular forms of public finance. We will discuss these sources below. However, these alternative financial models are hardly used in the regions concerned.
Value capture mechanisms
Depending on country-specific legislation, value capture can be applied to ‘cream off’ private sector development gains to cover the costs of public infrastructure and public space, including cycling infrastructure. A step forward can be to require cycling-related services in private sector real estate developments. In the Netherlands and Germany, value capturing is, to a degree, built in into planning practices and regulations. In Belgium, such "value capturing" is examined in relation to transit lines (Regionet Leuven). However, it is likely that only the parts that feed into bicycle highways can be financed in this way as it is hard to prove the added value of the total route for a specific real estate development scheme. PPIS is another potential model, but such partnerships are not yet in place. The discussion about fiscal legislation concerning ownership or leasing infrastructure can be considered a structuring element in this respect. The total turnover of cycling in total costs (expenditures, incomes, taxes) is probably too small to have a PPS project working, since there needs to be a certain percentage of profit for the companies.
Increasingly used as a ‘new’ source of income for investments in sustainable urban development, often as part of a bottom-up organic development approach. Crowd funding is not considered as as a valuable source of income.
Private sector investments may be financed from contributions by insurance companies (or others) based on ‘cost reduction’ effects (with respect to health insurance costs, the reduction of environmental costs or mobility costs). Health insurance companies sometimes apply incentives for a healthier lifestyle. However, it proves difficult (at least in the Netherlands) to involve these actors in cycling schemes.
Public transport concession
Cycling-related services may become part of public transport concessions, offering ‘last mile solutions’ for public transport providers. Such integrated concessions do not exist yet, but are currently explored. These ‘last mile solutions’ will involve bicycle access programs, such as bicycle sharing, but it is not likely that they will also make available funding for new bike infrastructure.