Establishing and funding a BID is an investment that will yield returns in the form of increased property values, improved tenancy, and revenue to businesses through increased business activity and visitor traffic.
Continue reading to learn more about how a BID operates.
Fee structure
Property owners pay for the BID services annually based on a fee formula of .002 of their assessed property value. Property owners with property values of $3.5 million or more will pay .00125 of assessed property value. The following property types are included in the fee structure:
Commercial/business properties
Apartment buildings and multi-families with 4 or more units
Mixed-use properties
Public properties and non-profits, negotiated
Property types exempt from the fee structure include single-family, two-family, and three-family residences, and residential condominium properties over 4 units. The BID will consider short-term fee waivers or reductions for property owners experiencing extreme financial hardship (bankruptcy, 70% vacancy, or other extenuating circumstances).
*Note that the original fee structure included two-family and three-family residences. It is in the process of being revised to exclude these property types.
Budget
A BID creates a way for property owners to pool their resources to sustainably fund and coordinate supplemental programs and services to provide added value, generate more business activity, and enhance the district for everyone.
The BID’s funding will include property owner fees and other sources such as grants, sponsorships, negotiated cash and in-kind services, and revenue-generating activities.
Property owners within the BID determine the budget and which supplemental programs and services it will provide. Thus, involvement in the BID will give property owners within the district a seat at the table and a say in how the funds are allocated. The chart below reflects a proposal for how the BID’s budget will be allocated.
Operations and management
Once established, a BID is controlled and financed by the property owners in its district. A Board of Directors representing the property owners is established to oversee the execution and management of the BID Business Plan. The Board makes personnel, program, and budget decisions within the scope of the plan approved by the BID numbers. The BID will also hire professional staff to implement the BID plan, though BIDs run lean to maximize and leverage resources.