Overview Business Improvement Districts by Dr. Carol Becker

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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:
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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 District
Economic Improvement Districts
Community 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 District
Community 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
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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
0 - 25,000
25,000 - 50,000
50,000 - 75,000
75,000 - 100,000
100,000 - 500,000
500,000 - 1,000,000
1 - 2,000,000
2 - 3,000,000
3,000,000 +
Total
Number of BIDs
207
150
87
48
217
95
44
57
97
1002
Creation accelerating
BIDs by Year of Creation
60
50
40
30
20
10
0
1975- 1979 1980 - 1984 1985 - 1989 1990 - 1994 1995 - 1999 2000 - 2004 2005 - 2010
Created in response to economic
stress
Year BID Created
20
15
10
5
0
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
95.9%
Assessments:
36.1%
Member dues:
41.2%
Contracts:
48.5%
Sponsorships:
21.6%
Development fees:
38.1%
City General Revenues:
56.2%
Other:
Other revenue sources
Events (most mentioned)
Voluntary Donations
TFCA and Lifeline Grants
Rental income & TIF funding
Revenue from operation of transportation system.
Clean Communities Grant & Recycling Trust Funds
Other levels of government and project partnerships
Farmers' Market Management
Fundraising events, promotions, misc
Contracted services
University partner
Basis for Assessment
What is the basis you calculate your BID assessments on in
this district?
55.9%
Based on assessed value for real estate taxes
1.8%
Based on sales tax
12.2%
On a square foot basis
4.5%
On a linear front footage basis
25.7%
Other (please specify)
Other ways of Assessing
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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)
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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?
Maintenance
Rubbish collection
Litter and graffiti removal
Sidewalk washing
Snow shoveling
Grass and tree cutting, flower
Streetscapes/lighting/street
furniture installation
Directional signage
Provide
with our
staff
38
61
38
16
42
Provide
through
contract
69
90
75
41
94
36
96
78
18
69
114
Do not
provide
95
52
87
134
70
Security
Non-uniformed ambassador
Uniformed, unarmed ambassador
Uniformed, armed
ambassadors/security personnel
Uniformed/unarmed private security
personnel
Uniformed/armed private security
personnel
Sworn police officers
Electronic security/ security cameras
Community policing program
Program to share crime information
Community court
Supervision of persons serving a
sentence from community court
With our
staff
9
27
Through
contracts
4
27
Do not
provide
176
141
1
4
181
7
19
162
0
10
177
2
11
23
63
2
33
18
17
11
3
158
160
153
120
182
18
6
165
Marketing/Hospitality
Street guides or ambassadors
Tourism kiosks
Maps and area information
Marketing/advertising
campaigns
Festivals
Farmer's markets
Arts events
Historic tours
Holiday decorations
With our Through Do not
staff
contracts provide
53
28
117
37
13
141
132
27
37
142
31
28
121
62
95
49
89
20
19
20
8
59
58
108
80
132
48
Business Recruitment
Which of these Business Recruitment and Retention activities
do you provide with funding from the BID:
With our Through Do not
staff
contracts provide
79
44
75
Market research
82
15
98
Performance reporting
Financial incentives for
46
13
135
new/expanding businesses
113
11
76
Business recruiting
137
28
37
Marketing
Public Space Management
Which of these Public Space services do you provide with
funding from the BID:
With our Through Do not
staff
contracts provide
21
7
171
Sidewalk vending management
Management of street
52
16
133
performances and artists
47
14
137
Code compliance
40
28
134
Management of loitering
Development of urban
66
24
109
design/facade guidelines
Enforcement of facade or
46
15
136
design requirements
Accountability
Accountability and Freedom
Does your Governing Board have the
right to:
Set its own level of assessment
revenues?
Set its own budget?
Make personnel/hiring decisions?
Make choices about the bundle of
services?
Make choices over the level of
services provided?
Yes
No
We
recommend,
government
decides
109
28
80
167
195
10
7
42
12
192
5
19
192
3
21
Accountability and Freedom
Has government ever set a different level of funding
than the one you originally requested?
Response
14.7%
Government doesn't levy funding for us
12.8%
Yes
72.5%
No
Answer: Reauthorization
Does your organization's fee or assessment exist for
a limited time, at which point government has to
renew approval?
64.1%
Expires
35.9%
Exists indefinitely
Does the contract that government has with the BID
organization extend indefinitely or does it require
periodic renewals?
31.7%
Indefinitely
68.3%
Periodic renewal by government
Answer: Wide Accountability of
board members
How are the members of your board elected or appointed?
23.0%
Appointed by city mayor
22.1%
Appointed by city council
8.9%
Appointed by another level of government
Selected by organization's existing governing
37.6%
board
Members are elected officials from city, state or
8.0%
other government
40.4%
Elections held within the service district
Recommended by BID but approved by local
13.1%
government
16.9%
Other (please specify)
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
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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
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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:
Report performance information to a
governmental organization
Publish an annual budget
Publish an annual financial report
Conduct an annual independent financial
audit
Publish annual performance information
Report budget or other financial
information to a governmental
organization
Publish or make publicly available the pay
levels of employees
Yes
No
177
32
186
168
22
38
169
39
154
51
183
25
95
109
Answer: Performance Reporting
How does your organization measure its performance?
Business Surveys
Visitor Surveys
Balanced Score Cards
Focus Groups
Data from the local government
Data from the state government
Data from the federal government
Data from private organizations
Other (please specify)
64.8%
25.5%
6.1%
20.9%
38.3%
7.1%
4.6%
23.5%
39.3%
Answer: Performance Reporting
What information do you present in your
performance reporting?
38.7%
Square feet leased or vacancy
38.1%
New construction
20.1%
Retail Sales
23.7%
Number of visitors
16.0%
Change in employment
23.2%
Population
61.9%
Number of businesses
36.6%
Crime statistics
15.5%
Number of pedestrians
55.2%
Business perceptions
39.7%
Visitor perceptions
53.6%
Number of businesses
Article coming out this summer
Public Performance & Management
Review (PPMR): Special edition on
Public-Private Partnerships:
“Democratic Accountability and
Business Improvement Districts”
Contact
Carol Becker 612-275-4437
[email protected]
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