13. BIDs Bolster Main Street Programs

With Main Street programs across the country being drastically reduced by budget cuts, the time may be right for small downtowns to consider adding a business improvement district (BID) to their overall revitalization strategy. Some already are. According to Kennedy Smith, director of the National Main Street Center, as many as 20 percent of Main Street programs already have a BID. That number is likely 10 grow as downtown businesses recognize the importance of supporting a viral downtown.

“The financial woes currently facing Main Street programs are an exaggeration of their recurrent budget crises even in the best of times,” says Lawrence O. Houstoun, AICP and principal in The Atlantic Group, a downtown consultancy with offices in Cranbury, NJ, and Philadelphia, PA. ”Time spent soliciting contributions distracts staff from productive activities.” Seeking voluntary contributions can absorb a third of staff time, according to one former Main Street board chairman, With the passage of time, Houstoun adds, even this fund-raising depends increasingly on promises that can’t or won’t be filled.

Many Main Street programs are learning that the hard way. From California to Nebraska, (See Downtown Idea Exchange, March 1, 2003), state Main Street programs have been cut back or eliminated entirely, leaving local members increasingly on their own. Municipal and state governing bodies cannot commit funds from general taxation into future years, so Main. Street programs take their chances every year along with police, street repairs, fire, and other essential activities.

No state funds to lose

BIDs, on the other hand, are assured multi-year funding through a separate assessment structure. “BIDs have virtually no. state funds to lose,” Houstoun notes. More than. half of the estimated 1,000 business improvement districts in North America function in small commercial districts, and that number is likely to grow. Neither wholly public sector nor entirely private, BIDs are adaptable instruments that successfully resolve persistent and common economic problems, as well as provide a source of energy and funding for implementing commercial center plans. Similarly, there are hundreds of Main Street projects, almost all in communities of less than 50,000 in population.

Structural advantages

While BIDs may offer a funding advantage over Main Street programs, Main Street programs everywhere have a dependable structure. The four Main Street principles design, promotion, economic restructuring and organization – give participants a blueprint to follow, while BIDs plan, organize and operate based on local priorities that can differ widely. The overall objective- producing better commercial centers – is common to both, although BIDs define this more in terms of economic functioning and Main Streets with greater emphasis on appearance and design.

Main Street managers have abundant technical assistance. Small BIDs, however, tend to be professionally and sometimes geographically isolated, unable to take advantage of the technical assistance opportunities available to large BIDs with ample budgets for travel, Houstoun says. Nonprofit organizations such as Downtown New Jersey have served BIDs for a dozen years. A state university BID-support model exists in the Wisconsin Extension Service. The Pennsylvania Downtown. Center, principally formed for Main Street, also helps small BIDs. And Pennsylvania’s Main Street office ‘appears to be encouraging some Main Street leaders to consider adopting BIDs.

Hybrid entities on the rise

In consequence, Houstoun says, there is a growth in hybrid entities formed in small business districts, linking BIDs as core financing instruments with Main Street principles. “Inherently compatible, the only surprise is why there have been so few hybrids thus far,” he adds.

The Virginia State Main Street office is advising existing programs to explore formation of BIDs to garner a more reliable source of funding.

The Ambler, PA, Main Street program, faced with reduced funding, has been working long and hard to establish a BID to enable it to continue operating, although the current BID plan has been tabled. The program manager, Bernadette Dougherty, had been successful in securing grants to improve the appearance of the principal street. Yet, there were grumblings by side-street business operators whose .properties would be assessed, complaining that they had not earlier received the full benefits of the Main Street improvements. While there was a lot of rank and file support for the BID, including from the largest property owner, ultimately the BID steering committee determined that there isn’t enough support as yet.

In a letter from BID Steering Committee member Christopher Lawlor, the committee regretfully informed the borough of the lack of support behind the BID program. “We on the committee still believe in the idea and hope that eventually the Ambler business community will embrace it; how ever, it is clear that, due to strong resistance to’ the idea from those who have yet to receive a full copy of the plan, now is not the time for a Business Improvement District in Ambler,” Lawlor wrote. The program is currently in operation and seeking other methods of funding.

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