Business improvement district

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A business improvement district (BID) is a public-private partnership in which businesses in a defined area elect to pay an additional tax in order to fund improvements to the district's public realm and trading environment. In some areas, a BID is referred to as a business improvement area (BIA), a business revitalization zone (BRZ), or a community improvement district (CID), A BID is, in some ways, similar to a residential community association, but an appropriate analogy would be that of a suburban shopping mall, from which the idea for BIDs is, itself, modelled. Malls are generally single properties managed by one entity that rents out retail spaces to various tenants. Tenants pay a common maintenance fee to pay for services that enhance the appearance of the mall's common areas and provide cooperative advertising for the mall and its various stores. BIDs operate in much the same way.

BIDs are often grassroots organizations driven by community support. They do, however, require legislative authorization by the government in which it resides, in order to be established.

BIDs typically provide services such as street and sidewalk maintenance, public safety officers, park and open space maintenance, marketing, capital improvements, and various development projects. The services provided by BIDs are a supplement to the services already provided by the municipality.

In many countries such as the US, BIDs are funded through special assessments collected from the property owners in the defined boundaries of the district. Like a property tax, the assessment is levied on the property owners who can, if the property lease allows, pass it on to their tenants. In the city of New York, the operating budgets of BIDs range from $53,000 to over $11 million. Typically, an individual property owner will pay an assessment of approximately 6% of his/her annual real estate tax charge.

A BID is often overseen by a board of directors.

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[edit] History

BIDs first emerged in Toronto, Ontario, Canada in the late 1960s and have subsequently emerged across Canada and the USA and into New Zealand, South Africa, Jamaica, Serbia, Albania, England and Wales, Germany and Ireland with BIDs legislation also being passed in Scotland in April 2007.

[edit] By Country

[edit] United States

There are 57 BIDs within New York City.[1] Toronto has 60 BIAs within its city limit. In the province of Alberta, they are termed "business revitalization zones". There are nine zones in the city of Calgary and 10 in Edmonton.

The first special improvement district in New Jersey was formed in Cranford, New Jersey. Several CIDs have been formed in Georgia, all in metro Atlanta. There are also 3 BIDs within the city of Albany, New York.[citation needed] Central BID [1] Downtown BID and the Lark Street BID.

[edit] United Kingdom

[edit] England and Wales

In England and Wales, BIDs were introduced through legislation (the Local Government Act 2003) and subsequent regulations in 2004. The Circle Initiative, a five-year scheme funded by the London Development Agency, set up the first pilot BIDs, five in London, all of which had successful ballots by March 2006. Association of Town Centre Management-coordinated pilot 'talking shops' in 22 locations in England and Wales corresponded with the development of BIDs' regulations.

The first BID to be created under this process was Kingston upon Thames. By November 2007, 57 BIDs had emerged in urban centres and industrial estates in England and Wales.

Unlike the US, BIDs in England and Wales are funded by a levy on the occupiers rather than the owners of the properties within the area. If voted in by local businesses, the BID levy is an extension to existing non-domestic business-rates.

Keswick in the English lake District Cumbria became the first rural business improvement district (BID) in the country, as a result of the ballot of the business community in September 2005.[2]

Private sector business people came forward and a company limited by guarantee was incorporated (April 2006) to deliver the business plan on which the vote was held. Keswick Business Improvement District Limited has been established with a 15 place Board of Directors, which represent a cross section of the business community within the town.

Every business rate payer of £2,900 or more, within the boundary of Keswick are members of the BID and are required by legislation to pay a 1% levy based on their business rateable value. The levy is collected by the local authority as the collection agency on behalf of the BID Company. The BID Company and the Directors are responsible for the effective delivery of the projects within the Keswick BID Business Plan.

As of October 2007 there were 36 proposed or operational BIDs across Greater London. They provide services above and beyond those already supplied by borough councils and business associations. Examples of this include the Environmental Forum organised by the London Bridge BID Company, an initiative aimed at helping London Bridge businesses become more environmentally friendly while cutting costs.

[edit] Scotland

In March 2006, the Scottish Executive announced funding for six pilot Business Improvement Districts in Scotland (BIDS) and, between 2006 – 2008, it is providing around £1 million to support the development of pilot BIDS in Scotland.

The pilot BIDS are:

  • Bathgate Town Centre
  • Clackmannanshire Business Parks
  • Edinburgh City Centre
  • Falkirk Town Centre
  • Glasgow City Centre
  • Inverness City Centre

The websites for the pilot BIDS are located on the main website.[2]

The pieces of legislation which implement BIDs in Scotland are:

  • The Planning etc. (Scotland) Act 2006 (Part 9);
  • The Business Improvement Districts (Scotland) Regulations 2007;
  • The Business Improvement Districts (Ballot Arrangements) (Scotland) Regulations - 2007, and
  • The Planning etc. (Scotland) Act 2006 (Business Improvement Districts Levy) Order 2007.

BIDs legislation came into force in Scotland in April 2007. The BIDS Scotland website holds these pieces of legislation.[3]

Beyond the actual provision of the legislation, the Explanatory Notes in the 2006 Act (Part 9) and those attached to the Regulations and Order, are useful in explaining the legislation further.

[edit] Germany

Some German Bundeslander introduced the legal framework to create BIDs over the last copuple of years: Hamburg, Bremen, Hessen, Saarland and Schleswig-Holstein. Northrine-Westfalia will introduce a BID-legislation in 2008.

The Free and Hanseatic City of Hamburg was first to transfer the BID-idea and the specific elements of this model to residential areas. This new instrument is called "Housing or Neighbourhood Improvement Districts" (HID/NID). The law is in place since December 2007. Detailed information regarding the situation in Germany (legislation, projects and discussion) can be found on the scientific website.www.urban-improvement-districts.de A research paper in English on the experiences with BID in Hamburg and the new model of Neighbourhood Improvement Districts is available under EURA conference 2007.

[edit] Criticism

BIDs have received noteworthy criticism. For example, in Plymouth it has been claimed that vast amounts of taxpayers' money has been channelled into the promotion of the BID companies' directors business interests whilst their competitors has been left unsupported. Moreover, despite being forced to pay a BID levy, membership to the Plymouth City Centre Company requires the approval of its directors, who have been known to refuse membership due to an applicant having a business that might compete with their own. Critics argue that the BIDs provide services which should be provided by the government such as policing services. Critics also argue that there are services which should be paid for by the individual business owner such as sweeping/cleaning.[3] Other critics believe that BIDs are too large and wield too much power and are taking away power from neighbourhood community organizations. In some neighbourhoods there are now umbrella groups made up of commercial landowners, property management firms, and condominium dwellers which aim to stop the BIDs.

BIDs have also become a powerful lobby group, lobbying government for improvements such as new sidewalks, trees, park benches and other restorations. BIDs can also lobby different levels of government for a complete facelift on their area if they feel its necessary to improve business.[4] The Rideau Street BIA in Ottawa has lobbied the city for years to give the entire street a face-lift because of its "run down" look.

There is also very little public access to the accounts of the BID companies in the UK despite the fact that the vast majority of their income is derived from public taxes. In Plymouth, England, for example, the bid company known as the Plymouth City Centre Company does not publish its full accounts and questions are now being asked as to where and how millions of BID funds have been spent.[citation needed]

In addition, there has been some recent concern in social science literatures that critique aspects of the BID model.[citation needed] It is argued that the devolution of limited political authority to the private boards of these districts effectively privatizes the public spaces of the city.[citation needed] This privatization is potentially problematic given the important role that is played by public space in a democracy as a site of free speech, association and protest.[citation needed] There is concern that overt control of BIDs by business and property owners results in the privileging of the interests of those people over the democratic interests of society at large.[citation needed] There has also been substantial attention to the manner in which BIDs have often attempted to rid the spaces they control of the homeless (who by definition must be in public space since they do not own any private spaces), ethnic minorities, and political activists who might frighten off potential shoppers.[citation needed]

[edit] References

  1. ^ NYC BIDS http://www.nyc.gov/html/sbs/html/neighborhood/bid.shtml
  2. ^ http://www.keswick.org/bids.asp
  3. ^ Seattle Weekly http://www.seattleweekly.com/news/9919/features-bush.php
  4. ^ Ottawa Business Journal http://www.ottawabusinessjournal.com/293685399357911.php

Blackwell M. 2005. A critical appraisal of the UK Government's proposals for Business Improvement Districts in England. Journal of Property Management, 23 (3).

Clough, N. and R. Vanderbeck. 2006. Managing Politics and Consumption in Business Improvement Districts: The Geographies of Political Activism on Burlington, Vermont's Church Street Marketplace. Urban Studies, 43 (12), 2261-2284.

Cook, I. R. 2008. Mobilising Urban Policies: The Policy Transfer of US Business Improvement Districts to England and Wales. Urban Studies, 45 (4), 773-795

Hoyt, L. and G. Devika. 2007. The Business Improvement District Model: A Balanced Review of Contemporary Debates, Geography Compass, 1 (4).

Mitchell, J. 2008. Business Improvement Districts and the Shape of American Cities. Albany: SUNY Press.

Schaller, S. and G. Modan. 2005. Contesting Public Space and Citizenship: Implications for Neighborhood Business Improvement Districts. Journal of Planning Education and Research, 24 (4), 394-407.

Stokes, R. 2006. Business Improvement Districts and Inner City Revitalization: The Case of Philadelphia's Frankford Special Services District. International Journal of Public Administration, 29 (1 - 3), 173 - 186.

Ward, K. 2007. Business Improvement Districts: Policy Origins, Mobile Policies and Urban Liveability. Geography Compass, 1 (3).

[edit] External links

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