Business Improvement Districts – Not Just for Big City Downtowns

Business-Improvement-DistrictsBy Dave Feehan
President, Civitas Consultants LLC

Since 1990, Business Improvement Districts or BIDs, as they are commonly known, have become the most effective and accepted method for funding downtown and business district organizations.

For many decades, merchant associations and voluntary downtown councils played the role of business district manager and advocate; but the decline in downtown retail, the shift to national chain stores, and the acquisition of local headquarter firms by national and international conglomerates made these downtown management models difficult to sustain.

In 1990, the Center City District (CCD) in Philadelphia was created, based to some degree on BIDs in Toronto and New Orleans. Paul Levy, CCD’s first and only director, focused on the “clean and safe” mission that has become the mantra for more than 1500 BIDs throughout the US, and hundreds more in Canada, Europe, Africa and elsewhere.

Today, BIDs have spread from the big cities like New York, Philadelphia, Los Angeles and Toronto to medium-sized cities, smaller cities, and neighborhood commercial districts. There are 75 BIDs in New York City alone, and only a few have multimillion-dollar budgets.

It is not unusual to see a BID in a town that once would have been a prime candidate for the National Main Street program. Fourth Economy and Civitas Consultants have helped establish a hopefully soon-to-be approved BID in Lebanon PA.

BIDs are popular for a number of reasons.

  • They are generally initiated by or supported by local property owners.
  • Property owners determine programs and services.
  • City governments must agree not to reduce services if a BID is created
  • BIDs have sunset provisions. If they are not working, they are not renewed.
  • BIDs produce measurable results, including higher property values, higher rents, decreased crime rates, increased occupancy rates, and improved perceptions of downtowns and business districts.
  • BIDs are generally agile, flexible, and non-bureaucratic. Decisions can be made more expeditiously and opportunities can be seized when they become available.
  • BID funding is much more dependable than voluntary contributions or dues.
  • BID funding means staff spend less time trying to fundraise to support the organization and more time delivering services.
  • BIDs can contract with municipal governments to do everything from snow removal to parking management; and can often do so more efficiently and at a cost savings.

BIDs have become more specialized in recent years. While downtown BIDs still dominate, there are tourist BIDs, arts and entertainment district BIDs, university district BIDs, residential BIDs and industrial BIDs.

In summary. BIDs have transformed the way downtowns and business districts are managed and improved, not only in the US but also in many countries around the world.