Business Improvement Districts

Business Improvement Districts (BIDs) A strategy for mobilizing private funding in order to improve the environment of city centres. By 1997 over 1,000 Business Improvement Districts (BIDs) or Zones had been created in the USA and Canada (31 in New York alone).

In the wake of the urban riots in America during the 1960s, major business companies rallied behind the National Urban Coalition, and began to support neighbourhood improvement initiatives by investing in development schemes in cities where they had plants or offices. The Ford Motor Company, for example, was heavily involved in renovating downtown Detroit. However, by 1980 it became clear that this voluntary effort was too erratic, sometimes unfair in its consequences, and insufficient to halt inner-city decay and the decline of confidence in city centres. BIDs are an attempt to reverse these trends. Property owners in a run-down area are balloted in the attempt to secure their agreement for the levy of a mandatory tax (typically an additional 5 per cent) for the improvement of the urban environment (refurbishment of public amenities, installation of security cameras, and so forth). The tax is collected by the local authority, but handed over to a board run by the private sector, which spends the money on urban renewal projects. The idea was pioneered in the development of the Nicollette Mall in Minneapolis in 1970.

Most BIDs are limited to a five-year time-span, which means that positive achievements often have to be demonstrated quickly, especially in relation to those problems which are of greatest concern to the business community. Typically, BIDs are concerned with the development of ‘clean, safe and friendly streets’ (many devote up to 80 per cent of expenditure on this item), and so concentrate on filling vacant lots, improving traffic management, and enhancing the physical environment. Some do tackle social issues, such as begging and homelessness, and many go on to promote particular areas by organizing festivals and other cultural events. Although results to date in the USA have been impressive, this form of city-centre partnership between the public and private sectors has proved hard to export, and even the Canadian initiatives suffered problems when government support was withdrawn. In Britain, a number of possible variants on the BIDs strategy are being researched and discussed in policy circles, all based on the same basic idea: of a partnership between private sector interests, a local authority, and (possibly) other public sector agencies; focused on the commercial enhancement of the city centre; and dependent on significant and sustained private sector contributions (although a range of funding options, only one of which is the tax levy, are being explored).

BIDs vary widely in their programmes and resources, but some of the largest (Grand Central, New York, at $9.3 million; Philadelphia, $6.4 million; Baltimore, $1.7 million; Buffalo and Seattle, $1.4 million each) confirm that substantial sums of money are involved in developing this model of urban renewal. Enthusiasts argue that BIDs should be judged by their results, and claim that these typically will include a cleaner, friendlier, and safer urban space, a reduction in crime, and reinvigoration of the economic life of hitherto depressed areas. Sceptics point to higher property values and argue that BIDs may result in a form of gentrification which merely dispossesses and displaces the inner-city poor. See also CONCENTRIC ZONE THEORY; URBAN SOCIOLOGY.