Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Friday, May 25, 2012

Economic impact of business improvement districts (in San Diego and Canada)

Typically, there are four types of organizations that may be involved in local commercial district revitalization: community development corporations, although cdcs usually focus more on producing housing; merchants associations; Main Street organizations, which link merchants, residents, and other stakeholders; and business improvement districts, which usually are in larger cities, are funded by assessments on commercial property, and spend a goodly portion of their efforts on clean and safe activities, along with property-development-oriented economic development activities.

People usually get confused about what type of organization does what.  The most important things that these organizations do are: (1) marketing the commercial district as a distinct entity; (2) business recruitment and development; (3) streetscape improvement and transportation coordination; (4) clean and safe activities; with funding provided in a wide variety of ways.  Typically, the smaller city and towns don't provide the means to do tax assessments and the bigger cities do.

BIDs usually have the most stable funding source, but tend to be oriented most toward the interests of property owners, because property owners provide the funding support for the organization, and they provide the fewest opportunities for citizens who are not "interested parties" (either property or business owners) to get involved in the activities of the organization.  Lack of citizen involvement can be a particular concern especially because commercial districts are becoming mixed use districts with a goodly amount of residential housing, and BIDs act on business issues in those districts, and residents have limited input into those decisions.

Main Street organizations tend to be more focused on the interests of retail and service businesses, and unlike the BIDs, they work to capture the involvement of local residents, to expand the ability and capacity of the organization to accomplish work.

I've always felt the best possible structure would be to have the regular funding system typically "enjoyed" by BIDs, with the committee structure and community involvement components of the Main Street Approach.

San Diego comes closest to this ideal. 

It has 17 business improvement districts, funded with property assessments, but many are organized like Main Street programs, such as the Little Italy, North Park, and Adams Avenue districts.

Because the programs are up for renewal of their funding stream, a report, The Economic Impact of Business Improvement Districts (BIDs) in San Diego, was commissioned to determine their impact.  The report found that there is a $5 return for each $1 provided through the property tax assessment.  (Also see this article from the San Diego Union-Tribune, "Study: It pays to have a Business District.")

I haven't worked through the report yet, so I doubt that it has made this distinction between how San Diego BIDs operate versus more typical business improvement districts.

Speaking of economic impact of investment in the coordination and capacity building of traditional commercial districts, the Canadian Urban Research Institute released the report, The value of investing in Canadian DOWNTOWNS,which finds that downtown revitalization is dependent on successful partnership and organizational development.

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