BIDs get Bloomberg boost

Real Estate Weekly, May 22, 2002 by Parke Chapman

New York City's Business Improvement Districts are elated after Mayor Michael Bloomberg announced several new initiatives aimed at strengthening the BID system.

The move was, seen as a stark departure from former Mayor Rudolph Giuliani's efforts to freeze BID budgets. A BID is a public-private partnership that complements commercial districts and neighborhoods with supplemental services such as sidewalk sweeping, public, safety officers, street landscaping and restaurant and shopping consultation.

Bloomberg said that the city will support requests for assessment increases on behalf of city BIDs. Property owners within each BID district are assessed annually as a way to supplement needed city services.

There are 44 BIDs in New York City, 19 of which are already requesting increased assessments from property owners.

"Business Improvement Districts have played a fundamental role in the renaissance of New York City. By working to improve business conditions and quality of life, BIDs are a proven example of how public/private partnerships can promote economic development," said Bloomberg, who was joined at the announcement by Department of Business Services commissioner Robert Walsh.

Walsh was formerly head of the 14th Street BID, which has the distinction of being the first BID formed in New York City.

"I enthusiastically welcome the announcement of Bloomberg's support for BIDs. This reflects his recognition not only of the outstanding contribution of BIDs, but also the greater importance of BIDs in this period of fiscal austerity," said commercial owner Peter Malkin, who has probably done more to foster BID development in Manhattan than any other landlord. Malkin is the founding chairman of both the Grand Central Partnership and the 34th Street Partnership. Malkin is the founder and director of the Fashion Center BID.

Malkin also praised the city's desire to issue long term debt as a way to finance capital improvement projects such as lighting, signage and planters. According to Malkin, only two BID's--the 34th Street Partnership and the Grand Central Partnership--currently do this as a way to finance projects. Very soon, qualified BID's will be able to issue long-term debt financing for capital projects. Under Mayor Giuliani, this practice was halted.

Dan Biederman, president of the 34th Street Partnership and executive director of the Bryant Park Restoration Corporation, called the announcement "a 180 degree turnaround" from the former administration's stance on BIDs.

"Mayor Bloomberg has put together an outstanding team that knows how important business is to the city," said Biederman, one of the city's most active BID presidents.

Biederman was pleased to hear that BIDs will be given greater flexibility in their efforts to raise money, and though his 34th Street Partnership is well-funded now, he is glad that three years from now the BID can revisit long-term debt financing.

The president of the BID Managers Association, Carl Weisbrod, was similarly pleased with the announcement.

"We appreciate the city's recognition of our value and our contributions and we fully accept the mayor's invitation and challenge to continue to make our communities better places to live and do business," sad Weisbrod, who is also the president of the Downtown Alliance, a lower Manhattan BID.

One of the initiatives will speed up the process of forming a BID. Under Giuliani, this process typically took as long as two years before the group could even qualify for, the formal application process.

Many neighborhoods are now seeking to create BIDs. One of them--the 23rd Street Association in Manhattan, which oversees 18th street to 28th street, from the Hudson River to the East River--is in dire need of such help, since one stretch of this major cross-town corridor is a refuge for drug addicts and panhandlers. Unkempt plastic newspaper boxes block much of the sidewalk, and illegal canopies are prevalent.

"We do similar things to a BID. But we're really excited about becoming a BID, which will allow us to make a real difference," said Sharon Ullman, president of the 23rd Street Association, which will soon become the 23rd Street BID.

In its current form, the 23rd Street Association is more or less a networking organization, said Ullman. Once it becomes a BID, however, the group will have greater influence over the area, with the resources to make needed changes in security, sanitation and streetscape issues. All of which are needed here, said Ullman.

She has worked for the association since 1995. Since then, the response from property owners and merchants has been positive, though the notion of creating a BID struck many as too expensive.

Along streets such as 34th Street, the symbiotic nature BIDs is evident. By working with property owners and merchants on the finite details of the streetscape, this BID, in particular has made great strides in an area that once left much to be desired. As a result, property values, and retail sales have risen, while issues such as security and sanitation have been addressed also. Those who criticize BIDs tend to focus on the assessments levied by BIDs on property owners, even though the amount is rarely much. Given the amount that commercial owners pay in property taxes, the added burden of a 2% BID assessment isn't really that much money, especially when the benefits of having a BID are considered.