A business improvement district
) is a defined area within which businesses pay an additional tax or fee in order to fund improvements within the district's boundaries. Grant funds acquired by the city for special programs and/or incentives such as tax abatements can be made available to assist businesses or to recruit new business. BIDs may go by other names, such as business improvement area
), business revitalization zone
), community improvement district
), special services area
), or special improvement district
). BIDs provide services, such as cleaning streets, providing security, making capital improvements, construction of pedestrian and streetscape enhancements, and marketing the area. The services provided by BIDs are supplemental to those already provided by the municipality.
The first BID was the Bloor West Village
Bloor West Village is a shopping district in Toronto, Ontario, Canada. Located along Bloor Street, it encompasses all businesses along Bloor Street between Jane Street and Ellis Park Road, consisting of more than 400 shops, restaurants and services. The mix of stores include specialty clothing...
Business Improvement Area, which was established in Toronto
Toronto is the provincial capital of Ontario and the largest city in Canada. It is located in Southern Ontario on the northwestern shore of Lake Ontario. A relatively modern city, Toronto's history dates back to the late-18th century, when its land was first purchased by the British monarchy from...
in 1970. The first BID in the United States was the Downtown Development District in New Orleans
In New Orleans, Louisiana, USA, "downtown" has historically referred to neighborhoods along the Mississippi River down-river from Canal Street, including the French Quarter, Treme, Faubourg Marigny, Bywater, the 9th Ward, and other neighborhoods...
in 1974, and there are now 1,200 across the country. BIDs have been established around the world, including in New Zealand, South Africa, Jamaica, Serbia, Albania, Germany, South Africa, and the United Kingdom.
Legislation is necessary to permit local governments to create BIDs. The process for creating a BID varies from one jurisdiction to another, but generally three steps are involved. First, some number of businesses in the area petition the local government to create the BID. Second, the local government determines that a majority of businesses want the BID. Third, the local government enacts legislation creating the BID. Prior to this occurring, state legislatures need to grant local units the authority to create BIDS. In Texas and Missouri, state legislation is required to create a BID..
In the United States, all property owners in the area pay the required tax or fee, even if they opposed the creation of the BID. Residences, non-profits, and governmental entities are usually exempt from making any contributions. This helps avoid the "free rider" problem that hampers voluntary organizations like Chambers of Commerce.
In companies where accounts are split between corporate and government representatives, one would split a BID as it should be considered a quasi-government account.
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. "In the UK, for a BID to go ahead the ballot must be won on two counts: straight majority and majority of rateable value. This ensures that the interests of large and small businesses are protected."
The operating budgets of BIDs range from a few thousand dollars to tens of millions of dollars.
A BID may be operated by a nonprofit organization
Nonprofit organization is neither a legal nor technical definition but generally refers to an organization that uses surplus revenues to achieve its goals, rather than distributing them as profit or dividends...
or by a quasi-governmental
A government-owned corporation, state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, or parastatal is a legal entity created by a government to undertake commercial activities on behalf of an owner government...
entity. The governance of a BID is the responsibility of a board composed of some combination of property owners, businesses, and government officials. The management of a BID is the job of a paid administrator, usually occupying the position of an executive director of a management company.
There are nearly 1,000 BIDs in the United States. New York City has 66 BIDs, the most of any city. BIDs exist in almost every one of the top 50 largest cities in the United States, including Los Angeles, Chicago, Houston, Philadelphia, Atlanta, San Francisco, Seattle, and Washington, DC. Minneapolis and Boston have been the last of the top 20 largest regions to adopt a business improvement district. The State of Wisconsin has adopted the most for smaller towns, with about 90 in the state, 25 of those being in Milwaukee and the rest throughout the state.
has more than a dozen Community Improvement Districts (CIDs), most of which are in the Metro Atlanta area. These are business communities whose property owners voluntarily tax themselves additional property taxes in order to expedite needed infrastructure, transportation, amenities or other improvements within a geographic district’s boundaries.
The two CIDs in Cobb County
are mainly related to transportation issues, working to relieve traffic and congestion and improve air quality through promoting infrastructure improvements. They also provide additional services and facilities for parks and recreation areas, land use planning, development and improvements consistent with Cobb County's coordinated and comprehensive planning.
Georgia’s first CID, the Cumberland Community Improvement District (CCID)
, was created in 1988 and covers five and one-half square miles at the intersection of I-285 and I-75 in Cobb County in the Cumberland/Galleria area.
The Town Center Area CID (TCACID)
, also in Cobb County, was created in 1998 and covers about six square miles at the junction of Interstates 75 and 575. The area includes Town Center at Cobb Mall and its office parks, Kennesaw State University (KSU) and McCollum Airport.
In Canada, Toronto has 71 BIAs within its city limit. Montreal
Montreal is a city in Canada. It is the largest city in the province of Quebec, the second-largest city in Canada and the seventh largest in North America...
- where BIAs are called Sociétés de développement communautaire (SDC) - has 14. The City of Winnipeg has 15 "Business Improvement Zones," the first of which were formed in 1987, with the amendment of The City of Winnipeg Act
The City of Winnipeg Act was enacted on July 21, 1971 in Winnipeg, Manitoba, Canada. The act incorporated the municipalities of Charleswood, Fort Garry, North Kildonan, Old Kildonan, Tuxedo, East Kildonan, West Kildonan, St. Vital, Transcona, St. Boniface, St. James-Assiniboia, Winnipeg and the...
. In the province of Alberta
Alberta is a province of Canada. It had an estimated population of 3.7 million in 2010 making it the most populous of Canada's three prairie provinces...
, they are termed "business revitalization zones". There are nine zones in the city of Calgary and 10 in Edmonton. Regina, Saskatchewan has two Business Improvement Districts: Regina Downtown (BID) and The Warehouse District. It is estimated that there are over 400 BIDS in Canada but no count has been made.
In England and Wales
England and Wales is a jurisdiction within the United Kingdom. It consists of England and Wales, two of the four countries of the United Kingdom...
, BIDs were introduced through legislation (the Local Government Act 2003
The Local Government Act 2003 is an Act of the Parliament of the United Kingdom. It made various changes to the administration of local government in the United Kingdom...
) and subsequent regulations in 2004. The Circle Initiative, a five-year scheme funded by the London Development Agency
The London Development Agency is the Regional Development Agency for Greater London, England. It is a functional body of the Greater London Authority...
, 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. As of October 2007 there were 36 proposed or operational BIDs across Greater London. To date the most successful BID in the UK is the Broad Street Business Improvement District when measured against the enabling ballot and subsequent re ballot. Broad Street BID is responsible for transforming the top entertainment district of the English Midlands in Birmingham from a low base to an internationally recognizable area of excellence. The membership of Broad Street gave close to 100% support during both ballots.
The legislation in Scotland (The Planning etc. (Scotland) Act 2006) is different to the England and Wales legislation in that it allows property owners as well as occupiers to be included in a BID. There are also differences in the timescales, reballot and requirements of the BID Proposer. The legislation, and subsequent regulations were passed by the Scottish Parliamnet in 2006 and 2007 respectively. In March 2006, the Scottish Government announced funding for six pilot BIDs in Scotland, Bathgate (town centre), Clackmannanshire (business parks), Edinburgh (city centre), Falkirk (town centre), Glasgow (city centre)and Inverness (city centre). There are currently ten operational BIDs in Scotland with a further eighteen in development and considerable interest from across the country and from various towns, rural settlements, tourism and visitor organisations and single business sector BIDs. In recognition of the contribution that BIDs can make to local partnerships, the management and resolving of local issues and concerns locally, as well as their contribution to the Scottish Governments National Outcomes and Local Single Outcome Agreements the Scottish Government is currently awarding a grant of up to £20K to local business associations or groups, working in partnership with their local authority to develop and implement a Business Improvement District. Business Improvement Districts Scotland leads the Scottish Governments BID programme and provides central support to operational and developing BIDs and promotes and encourages the development of BIDs across Scotland.
Six of the sixteen German Bundeslander (Federal States) introduced the requisite legal framework to create BIDs: Hamburg, Bremen, Hessen, North Rhine-Westphalia, Saarland and Schleswig-Holstein. BID projects in implementation exist only in a few German cities, yet - e.g. in Flensburg, Hamburg and Giessen.
Whilst BIDs have been heralded for improving the trading environment, BIDs have also received noteworthy criticism.
In Coventry, a BID was created outside of the City Centre that promoted a BID levy strike.
The New West End Company BID in London's West End has used its collective strength to remove what they see as undesirables from Oxford Street and Regents Street. A man who walked about holding a banner stating "Don't be a sinner, be a winner" was banned from Oxford Circus with an Anti-social Behaviour Order (ASBO). The New West End Company now wish to remove (legal) street traders and small businesses and instead increase the number of larger multiple stores.
Others have claimed that BIDs are by their very nature undemocratic and concentrate power in a geographic area into the hands of the few. Small businesses who fall below the BID levy threshold, although not liable to pay the BID levy, are often priced out of an area because BIDs tend to increase rental values. Larger businesses are more able to absorb these rent increases, particularly the multiple stores.
BIDs have also become a powerful lobby
Lobbying is the act of attempting to influence decisions made by officials in the government, most often legislators or members of regulatory agencies. Lobbying is done by various people or groups, from private-sector individuals or corporations, fellow legislators or government officials, or...
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 it is necessary to improve business. The Rideau Street BIA in Ottawa
Ottawa is the capital of Canada, the second largest city in the Province of Ontario, and the fourth largest city in the country. The city is located on the south bank of the Ottawa River in the eastern portion of Southern Ontario...
has lobbied the city for years to give the entire street a face-lift because of its "run down" look.
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