When Robert Walsh—a veteran of the city’s first business improvement district, in Union Square—was tapped by Mayor Bloomberg to run the Department of Small Business Services, his marching orders were clear. "My first conversation with the mayor in January 2002 was ‘Grow the program, energize it, and get out of the way as much as you can and let these organizations develop,’ " Walsh says.

Increasing the number of BIDs, as these groups are called, has been one of the centerpieces of the city’s small-business strategy. And under the city’s current leadership, the number of BIDs has grown from 44 to 64, with 18 of the 20 new groups outside Manhattan.

City Limits Magazine


November 2010:
Mom and Popeyes

News Topics
The Economy
Housing and Development
Government
BIDs are coalitions of property owners in a common district who assess themselves a fee to provide services. The services tend to be custodial, providing janitors and wastebaskets; they may also include security, holiday decoration and lighting, trees and planters, and marketing and promotions. They may solicit new businesses to fill vacant spaces or negotiate with the city over issues that arise.

The Bloomberg administration has championed the BID as an ideal way to help property owners help themselves. Although many business owners and advocates say the BID fulfills an important function, some also believe the city relies too much on BIDs to provide services it should be offering itself. Critics also say the groups can disenfranchise merchants, since landlords wield most of the power and stand to gain the most from the district’s success.

"I think BIDs can be helpful, but they don’t have all the answers," says Jonathan Bowles, director of the Center for an Urban Future. "I think it’s a mixed bag, and quite often their main goal is really to improve property values. There are all these pressures on small business in New York today, and I think the Department of Small Business Services could probably be doing more to help small business deal with some of these threats."

Some BIDs have been profoundly unsuccessful, as in Washington Heights, where city officials said earlier this year they could find little evidence that the BID was functioning, and the executive director was removed by the board. For small BIDs with small budgets, the cost of overhead can keep the groups from carrying out their goals. And although business owners who rent their space tend to profit from the improvement of an area, the accompanying rise in property values can end up hurting them if it causes rents to rise out of their reach.

"All these BIDs, they basically represent the real es- tate interests in the neighborhood, not the merchant," says Richard Lipsky, a lobbyist who has represented several small-business groups. "Today you can’t count on the BID to be an ally, because they’ve been totally co-opted by the city."

Some of the larger BIDs in Manhattan, such as those in Union Square and at Grand Central, have multimilliondollar budgets. The BID of 86th Street in Brooklyn, which began 10 years ago, has never increased its original budget of $210,000.

BIDs in New York date back to the 1980s, when the city’s budget problems coupled with worsening issues like crime, graffiti and homelessness. Landlords could pool their resources to fix problems that might be keeping customers away that the city could not afford to address. "A lot of it is power of persuasion—getting the property owners to buy in to a vision of where you’re taking the neighborhood and getting them to believe in it," says Walsh, who led the Union Square Partnership from 1989 to 1997. "It’s getting people together and saying, ‘What do we need?’ And we went out and got that."