Thanks to Susan Hopkins & Laura Fox of Bergmann Associates for
contributing the following article.
What is a BID?
Improvement District (BID) is a public/private partnership in which property
and business owners elect to make a collective contribution to the maintenance,
development and promotion of their commercial district. Unlike a Merchants’
Association where contribution is voluntary, BIDs provide a steady and reliable
source of funding because legislation requires that property owners pay
assessments once the BID is approved. The
BID movement began as a property owner response to limited public resources and
deteriorating commercial districts. BIDs give property owners in commercial
districts control over how funds are spent to improve their shared public
space. BIDs are similar to common area maintenance fees in suburban shopping
centers, where fees paid by tenants are used to provide services that enhance
the appearance of common areas, security, and marketing. Unlike a mall,
however, a BID contains multiple property owners iwho collectively agree to pay
an assessment for these services.
cleaner, safer and more attractive business district
steady and reliable funding source for supplemental services and programs
ability to respond quickly to changing needs of the business community
potential to increase property values, improve sales and decrease commercial
district that is better able to compete with nearby retail and business centers
What can a BID do?
designed to be able to deliver a range of supplemental services in coordination
with municipal services. The services and improvements made to the district are
voted on by the property owners and can include, but are not limited to:
events and promotional materials
How is a BID formed?
A BID is a
non-profit organization initiated and formed by the property owners in the
district and approved by the
municipality. A vote by the majority of property owners, as defined below, is
required to form a BID:
least 51% of the owners of real property within the area of the proposed BID
must vote in favor of forming the BID.
least 51% of the assessed value of all taxable real property within the
boundaries of the proposed BID district
How is a BID funded?
and services are funded by an assessment, which is based on the assessed value
of the property and paid by property owners within the district. In New York
State, the total annual assessment levied in a BID cannot exceed 20% of the
total annual property tax paid in the area (roughly 2% of the total assessed
valuation of the district). During the BID formation process, the amount paid
by each property owner is determined by a formula that each BID creates based
on factors such as property size , frontage, value and others (or a combination).
allow property owners to pass the BID assessment onto their tenants. Typically,
different properties pay different assessments: occupied commercial or
industrial properties are all assessed and pay the commercial rate;
not-for-profit owned and occupied properties as well as government occupied
properties do not pay assessments; residential and vacant properties generally
pay reduced assessments.
BIDs have proven
to be popular and successful solutions for improving urban commercial
districts. While New York City has nearly 70 BIDs currently in operation, BIDs
have also been implemented in smaller New York State communities including, but
not limited to, the Village of Webster, downtown Elmira and downtown Troy.
One such BID
that can serve as a model of success is the Elmira Downtown BID whose staff and Board of Directors work closely with
the business community, economic development partners, service organizations,
city staff, city schools and the arts community to improve the business climate
and experience of being downtown. The BID’s goal is to provide the downtown
business area with the resources to develop a strong marketing campaign,
increase public awareness of downtown Elmira and beautification projects in
partnership with the city of Elmira. Since 1990 the Elmira BID has sponsored
and managed special events including concerts, festivals and farmers markets in
addition to its responsibilities as a central point of communication between
city government officials and downtown constituents.