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Business Improvement Districts Dr. Carol Becker
Business Improvement Districts
Dr. Carol Becker
A Definition of BIDs
A public special taxing district that all businesses fund
A private non-profit implements or oversees the implementation of work plan (i.e. public-private partnership)
Typically does cleaning, marketing, security and other activities for a business area
Excludes: Purely public organizations Purely private organizations Neighborhood Improvement Districts Organizations funded primarily by TIF Chambers of Commerce Districts that only provide capital/debt service Special districts that provide other services like
water, sewer, fire, mailboxes California Tourism Business Improvement District
Names for BIDs
Municipal Improvement District (MID)Local Improvement DistrictEconomic Improvement DistrictsCommunity Improvement Districts
(CID) Special service Taxing District Special improvement district (SID) Local Improvement Taxing District Municipal Service Districts Special benefit assessment district Downtown Improvement District Special Business District Public Improvement District (PID) Economic Improvement Districts (EID) Property-based business improvement
district (PBID) General Improvement District
Enhanced municipal service districts Municipal Special Service Districts Municipal management district Community Improvement District
(CID) Self-Supported Municipal
Improvement District (SSMID) Principal Shopping District (PSD) Business Improvement Zone (BIZ)Special Service Area Maintenance Assessment DistrictCommunity Benefit District (CBD)Special Assessment Districts (SAD) Special Community Benefit District Residential Improvement District
(RID)Business Improvement Area (BIA)
How many BIDs are there?
Answer: 1,001
Business Improvement Districts in the United States
Terminated or Dormant BIDs Although it was not a primary focus of this
study, BIDs that were terminated or have gone dormant were noted.
50 located so far Some terminate and later are restarted From this very initial work, it appears that
there is a less than 5% failure rate in BIDs
Size of City
Population of city Number of BIDs0 - 25,000 20725,000 - 50,000 15050,000 - 75,000 8775,000 - 100,000 48100,000 - 500,000 217500,000 - 1,000,000 951 - 2,000,000 442 - 3,000,000 573,000,000 + 97Total 1002
Creation acceleratingBIDs by Year of Creation
0
10
20
30
40
50
60
1975- 1979 1980 - 1984 1985 - 1989 1990 - 1994 1995 - 1999 2000 - 2004 2005 - 2010
Created in response to economic stress
Year BID Created
0
5
10
15
20
1975 1980 1985 1990 1995 2000 2005 2010
Budgets
Budget Size
Smallest: $2,500 Largest: $18,000,000 Median: $355,000
Largest Revenue Sources
What is the source of your current organizational budget revenues Assessments: 95.9%Member dues: 36.1%Contracts: 41.2%Sponsorships: 48.5%Development fees: 21.6%City General Revenues: 38.1%Other: 56.2%
Other revenue sourcesEvents (most mentioned)Voluntary DonationsTFCA and Lifeline Grants Rental income & TIF fundingRevenue from operation of transportation system.Clean Communities Grant & Recycling Trust FundsOther levels of government and project partnershipsFarmers' Market ManagementFundraising events, promotions, miscContracted servicesUniversity partner
Basis for Assessment
What is the basis you calculate your BID assessments on in this district?Based on assessed value for real estate taxes 55.9%Based on sales tax 1.8%On a square foot basis 12.2%On a linear front footage basis 4.5%Other (please specify) 25.7%
Other ways of Assessing Combination of linear footage, building square footage, lot area,
use, location Gross receipts Rate per $100 total assessed value plus rate per SF parcel Business License Fees Square foot, linear front footage and lot size Flat fee - depends on type of business and location Base fee plus tax per employee Square footage plus the taxable rate and an additional flat rate is
added to each parcel. Combination of front footage and assessed value Commercial rate on property is basis for calculation of "business
levy" per $100.00 worth of assessment. Annual Business license Based on a combination of assessed value and linear front footage Combination of linear frontage which accounts for 65% of the
budget and 35% based on square footage Formula based on lot square footage and linear front footage
Other ways of Assessing (con’t)
SF of building, SF of land, and assessed value of building Square footage of "visitable" retail space with a set maximum. Based on percentage of business tax assessment receipts Combination of various property related characteristics including
parcel size, building size, amount of adjacent street frontage and a flat fee per parcel.
Based on business license fees. Generally 150% of license fee, with some flat rates, and a cap at $750
Sales tax and property tax Both AV & linear front footage Assessed value and square footage Front footage, assessed land and building values. Combination of assessed value, sq.ft., type of use, # stories, type
and number of parking spaces, Square footage of lot, taxable market value, square footage
above first floor City business tax
What do BIDs do?
MaintenanceProvide with our
staff
Provide through contract
Do not provid
eRubbish collection 38 69 95Litter and graffiti removal 61 90 52Sidewalk washing 38 75 87Snow shoveling 16 41 134Grass and tree cutting, flower 42 94 70Streetscapes/lighting/street furniture installation 36 96 78Directional signage 18 69 114
With our staff
Through contracts
Do not provid
eNon-uniformed ambassador 9 4 176Uniformed, unarmed ambassador 27 27 141Uniformed, armed ambassadors/security personnel 1 4 181Uniformed/unarmed private security personnel 7 19 162Uniformed/armed private security personnel 0 10 177Sworn police officers 2 33 158Electronic security/ security cameras 11 18 160Community policing program 23 17 153Program to share crime information 63 11 120Community court 2 3 182Supervision of persons serving a sentence from community court 18 6 165
Security
Marketing/HospitalityWith
our staffThrough contract
s
Do not provid
eStreet guides or ambassadors 53 28 117Tourism kiosks 37 13 141Maps and area information 132 27 37Marketing/advertising campaigns 142 31 28Festivals 121 20 58Farmer's markets 62 19 108Arts events 95 20 80Historic tours 49 8 132Holiday decorations 89 59 48
Business RecruitmentWhich of these Business Recruitment and Retention activities do you provide with funding from the BID:
With our staff
Through
contracts
Do not provid
eMarket research 79 44 75Performance reporting 82 15 98Financial incentives for new/expanding businesses 46 13 135Business recruiting 113 11 76Marketing 137 28 37
Public Space ManagementWhich of these Public Space services do you provide with funding from the BID:
With our staff
Through contract
sDo not provide
Sidewalk vending management 21 7 171Management of street performances and artists 52 16 133Code compliance 47 14 137Management of loitering 40 28 134Development of urban design/facade guidelines 66 24 109Enforcement of facade or design requirements 46 15 136
Accountability
Accountability and Freedom
Does your Governing Board have the right to: Yes No
We recommend, government
decidesSet its own level of assessment revenues? 109 28 80Set its own budget? 167 10 42Make personnel/hiring decisions? 195 7 12Make choices about the bundle of services? 192 5 19Make choices over the level of services provided? 192 3 21
Accountability and Freedom
Has government ever set a different level of funding than the one you originally requested?
ResponseGovernment doesn't levy funding for us 14.7%Yes 12.8%No 72.5%
Answer: Reauthorization
Does the contract that government has with the BID organization extend indefinitely or does it require periodic renewals?Indefinitely 31.7%Periodic renewal by government 68.3%
Does your organization's fee or assessment exist for a limited time, at which point government has to renew approval? Expires 64.1%Exists indefinitely 35.9%
Answer: Wide Accountability of board members
How are the members of your board elected or appointed? Appointed by city mayor 23.0%Appointed by city council 22.1%Appointed by another level of government 8.9%Selected by organization's existing governing board 37.6%Members are elected officials from city, state or other government 8.0%Elections held within the service district 40.4%Recommended by BID but approved by local government 13.1%Other (please specify) 16.9%
Answer: Special interest groups represented on governing boards
Are you required to have certain members of your board represent specific interests? (you must have one board member who is a renter or two board members who are business owners, etc.)Yes 65.1%No 34.9%
Special Interest Groups on Governing Boards
Some examples: individuals who pay at different levels of taxation; individuals who represent different sectors, including retail, commercial, small businesses, renters, tenants; individuals from different geographic areas; individuals by sectors, including non-profit, for-profit and government sectors; and a wide range of other alternatives.
Answer: BID Scale
Most BIDs are sub-municipal organizations, providing direct service to a relatively small group. Because of their size, there is little to go wrong, little incentive for shenanigans and many eyes watching.
Answer (sort of): Performance reporting
Does your organization: Yes NoReport performance information to a governmental organization 177 32Publish an annual budget 186 22Publish an annual financial report 168 38Conduct an annual independent financial audit 169 39Publish annual performance information 154 51Report budget or other financial information to a governmental organization
183 25
Publish or make publicly available the pay levels of employees 95 109
Answer: Performance Reporting
How does your organization measure its performance?Business Surveys 64.8%Visitor Surveys 25.5%Balanced Score Cards 6.1%Focus Groups 20.9%Data from the local government 38.3%Data from the state government 7.1%Data from the federal government 4.6%Data from private organizations 23.5%Other (please specify) 39.3%
Answer: Performance ReportingWhat information do you present in your performance reporting?Square feet leased or vacancy 38.7%New construction 38.1%Retail Sales 20.1%Number of visitors 23.7%Change in employment 16.0%Population 23.2%Number of businesses 61.9%Crime statistics 36.6%Number of pedestrians 15.5%Business perceptions 55.2%Visitor perceptions 39.7%Number of businesses 53.6%
Article coming out this summer
Public Performance & Management Review (PPMR): Special edition on Public-Private Partnerships: “Democratic Accountability and Business Improvement Districts”
