Report: Think Twice Before Supporting Business Improvement Districts

Posted on: February 25th, 2016 at 5:17 am by

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Branding for Lower East Side Partnership

Yes, it’s time to think twice before supporting the local business improvement district. Max Rivlin-Nadler over at the New Republic pens a compelling piece about how these organized groups of local stakeholders – such as the Lower East Side Partnership (nee BID) – are actually toxic to the neighborhood they purportedly serve. In the end, lining the pockets of the property owners and making it difficult for small business to thrive.

In the case of the Lower East Side, it’s spelled increased local development and over-proliferation of nightlife (i.e. Hell Square).

Choice excerpts from the article…

Business Improvement Districts are a favored neoliberal practice that transforms mixed-income neighborhoods into the same chain stores one can find at any outlet mall across the country. And once a BID is in place, it’s incredibly difficult to dissolve: either a majority of property owners must turn against the BID, or there must be a direct decree from the City Council or Mayor. During the week The Gap opened in Jackson Heights—in one of the few blocks where a BID already exists there—it offered 70 percent discounts. Within a year, a low-end discount chain across the street had been replaced by a Banana Republic.

Regarding the BID’s metamorphosis into a harbinger of gentrification…

The first Business Improvement District was founded in Toronto as a local initiative; by 1974, they had made their way to the U.S. Today there are more than 1,000 BIDs in America—New York City alone has 67, the highest number of any city in the country. Originally intended to take over certain services that down-on-their-luck cities were no longer delivering, like trash collection and aggressive policing, BIDs have transformed in into a tool that displaces small businesses and heavily favors property owners. These days, BIDs are one of the most popular ways to advance urban renewal, a vision for cities that favors large businesses that immediately mark a neighborhood as meriting a Starbucks or Dunkin’ Donuts. They’re also wholly un-democratic. Because of BIDs, entire swaths of cities have effectively been placed under private control.

A BID’s creation is fairly straightforward. After petitioning a municipality to create a BID, the city government determines if a plurality of business owners are against the BID, a much lower hurdle than a majority of positive votes. Some business owners might never respond to the ballot, while others might support it, fed up with how the city is taking care of their neighborhood. Once the city passes legislation allowing the BID, the area affected exits democratic control, with major decisions—including street cleaning, homelessness outreach, and use of space—determined by the BID. BIDs can hire its own security to patrol an area, effectively control who is offered retail space, kick out street vendors, and influence legislation and expansion efforts. A Board of Directors, made up mostly of commercial landlords who sometimes don’t even live near the area where the BID is calling the shots, generally manages the districts.

Do you agree with Rivlin-Nadler? Has the formation of the Lower East Side Partnership (nee BID) in 1992 by Sion Misrahi benefited the neighborhood in the long run?

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DayLife on Orchard St, June 2012

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