California pulls the plug on flawed e-bike project once run by investigated San Diego nonprofit – San Diego Union-Tribune

California clean-air officials have ended the statewide electric-bike program that was badly botched by a San Diego nonprofit and left thousands of applicants frustrated and angry.

In a statement, the California Air Resources Board blamed “budget constraints” for closing out what was called the California E-Bike Incentive Project, which got more than $30 million to support subsidies of up to $2,000 for thousands of eligible riders.

Most of the e-bike funds were diverted to another state climate-change program that is designed to help lower-income Californians replace their high-polluting cars with plug-in hybrid and electric vehicles.

“Due to state budget constraints, CARB is moving $18 million of funding previously earmarked for the California E-Bike Incentive Project to the regional Clean Cars 4 All programs to ensure funding is available,” spokesperson Bradley Branan said by email.

The state air board did not respond to follow=up questions about the flawed administration of the e-bike program or two investigations into Pedal Ahead, the San Diego nonprofit selected to manage the effort whose website is now suspended.

Moving the $18 million to the clean-cars promotion all but ends the ambitious state e-bike program that was modeled after a pilot project first promoted by the San Diego Association of Governments, or SANDAG.

The regional planning agency in 2022 put Pedal Ahead in charge of a local e-bike program that sought to reduce greenhouse gases by encouraging people to rely on electric bikes instead of cars for short, routine trips.

Even before the SANDAG project was in full swing, Pedal Ahead was chosen to manage the California effort. Later in 2022, it was awarded $10 million to promote electric bikes across the state.

But the rollout of the broader statewide program hit multiple snags, both at the air resources board and with Pedal Ahead.

The initial online signups were delayed by more than two years and finally took place last December. When it opened, the website shut tens of thousands of people out of the system and closed within minutes.

The follow-up enrollment in April was even worse, with officials ending the session due to what they called a security threat. The air resources board publicly apologized for the snafu and pledged to do better.

“We had over 150,000 people trying to get into the program, and we only have 1,000 vouchers,” spokesperson Lisa Macumber told reporters during a briefing last year. “It’s challenging. It’s like getting tickets to a Taylor Swift concert.”

The following week, the state successfully awarded 1,000 more vouchers worth up to $2,000 each — although that effort was managed by a new vendor.

The San Diego Union-Tribune first reported in June 2024 that the SANDAG e-bike initiative was troubled. Agency officials had begun investigating Pedal Ahead early last year for failing to comply with terms of the grant it had been awarded two years earlier.

At the same time, the Union-Tribune reported, CARB was conducting its own review into Pedal Ahead’s management, and criminal investigators at the California Department of Justice were scrutinizing the San Diego nonprofit.

Meanwhile, the state Attorney General’s Office listed Pedal Ahead as delinquent for failing to comply with regulations governing nonprofit organizations.

The Pedal Ahead founder, Edward Clancy, also opened a for-profit venture called Pedal Ahead Plus to promote e-bikes, and was investigated for allegations of mixing his for-profit and nonprofit business interests.

Clancy has not responded to questions from the Union-Tribune in more than a year. He did not respond again Friday.

But last year, after SANDAG resumed control of the program, he acknowledged some mistakes.

“We delivered up to a certain point — the product, the bikes, tracking mechanisms, etc.,” he said in June 2024. “There was a point where they said ‘OK, we’re going to manage the contract from this point.”

State officials, who have never commented on the criminal or civil investigations into Pedal Ahead, removed the nonprofit as manager of the state e-bike program earlier this year.

Clancy is a former political consultant who once wore a wire for the FBI as part of an investigation into foreign money being donated to San Diego-area politicians. He was not charged with any wrongdoing.

But in his leadership of Pedal Ahead, publicly filed tax returns and Clancy’s own comments raised questions about how the organization accounted for the millions of dollars it received from government contracts.

The nonprofit’s revenue and expenses reported on federal tax returns did not always match publicly announced contracts. Clancy told the Union-Tribune that $1 million Pedal Ahead collected was in a bank despite not being included in declared revenue.

“Funding is in a money market account, per contract requirement to yield interest that goes back into the program,” he said in a 2024 email. “To date, there is additional approximate $34,000 earned.”

General accepted accounting principles do not allow nonprofits to withhold revenue or spending from their public tax filings.