Despite its many sophistications, New York City has earned a reputation as one of the most intimidating, crueliest, and dirtiest cities in the world.
Nevertheless, Industry Week, a travel and tourism industry magazine, recently published an account of one visitor’s experience in the Big Apple:
“Something bizarre has happened to New York in the last five years,” the author wrote. “On a recent visit, not one street person asked this writer for money, nor was there any graffiti to be found, even in the subway, or one menacing moment of any kind. I thought I’d died and gone to Toronto. I considered littering, just so I could see a little trash in the gutter.”
The story went on to credit Manhattan’s network of 34 so-called Business Improvement Districts (BIDs), created in 1992 by merchants and other property owners to revitalize their neighborhoods.
The BIDs have accomplished a lot. In the historically seedy and junked-out Times Square area, cleaning crews were hired to sweep the streets and sidewalks. Some 40 security people were brought in to patrol the area, which, for years, has been plagued by pickpockets, prostitutes, and drug dealers. The Times Square BID has also identified, and put pressure on, landowners responsible for renting their properties to the numerous striptease joints and sex shops for which the area is so well known.
Since the BIDs have been established in Manhattan, resultsnot just in Times Square but across the cityhave been phenomenal. The crime rate has dropped 40 percent (although, to be certain, a more aggressive police department deserves some credit for that). The streets are said to be 90 percent cleaner (though it’s hard to say how one establishes a percentage-based cleanliness improvement scale for city streets).
In Times Square in particular, new businesses are opening up, old theaters are being restored, and playgoers seem to be feeling safer. But it is not just in flashy Times Square that BIDs have made noticeable strides. There are signs of improvement in less visible areas such as the Garment District and in the city’s residentially dense neighborhoods too.
Nashville is no New York, and Riverfront Park is a far cry from Riverside Drive, but if Times Square, considered for nearly a half-century to be an albatross-like urban nightmare, can improve, Nashville ought to take a look at how the changes came about.
Nashville has long been prey to the same types of problems faced by larger cities. And at the present moment, crime, graffiti, and garbage are key concerns for merchants and property owners in downtown Nashville. Because of rapid development, the influx of large numbers of tourists and entertainment-seekers, and the increase in automobile traffic, the area has grown at a pace that has Metro departments struggling to keep up.
As a result, business and civic leaders here have been scratching their heads and considering solutions. In recent months, they have taken note of the accomplishments of BIDs in New York and in more than 1,000 other cities and towns in the country, including Memphis and Knoxville. Nashville may be on the verge of creating its own BID system. But it takes cash to set up BIDs, and it’s business and property owners who’ll be expected to shell out. In other cities where BIDs have been established, the business and property owners are assessed a special tax that underwrites special services that benefit themselves, as well as the whole city’s tourism and business.
“Downtown property and business owners have expressed a need for a higher level of service, beyond what is being provided now for cleanliness and safety,” says Bill Blaufuss, managing partner of KPMG Peat Marwick. Blaufuss serves on the board of the Nashville Downtown Partnership, an organization created in 1994 by the Nashville Area Chamber of Commerce to improve the quality of life in the business district. He also heads the task force charged with exploring the possibility of a BID for Nashville.
So far, Blaufuss says, the idea of a BID has been received quite positively, “but of course, everybody wants to know what they’re going to get and how much it’s going to cost.”
Blaufuss and supporters of the proposal can already point to one example of how a BID could help downtown:
Thursday nights during every spring and summer, the “Dancin’ in the District” concert series brings thousands of youthful, beer-guzzling partyers, downtown business workers, and tourists to Riverfront Park, where they frolic, dance, and drink from late afternoon until late in the evening.
The revelers bring more business for downtown shops and restaurants, and they add a feeling of vitality to a district that, only a few years ago, was little traveled in the evenings. But in their wake, these partyers leave trash and other debris, straining the already over-extended resources of Metro’s departments of parks and public works. A BID, however, might provide the resources for clean-up and security on “Dancin’ in the District” evenings.
But there’s more, Blaufuss says: “Beyond cleanliness and safety, other cities have used BIDs for retention of businesses and marketing.”
The Downtown Partnership is conducting a preliminary study for a BID, with funding provided by a $25,000 grant from the Metro Development and Housing Agency (MDHA). Before the end of the month, the Partnership will send surveys to business and property owners, who will be asked to give their reactions to the BIDconcept. Already, however, Downtown Partnership officials say they are cautiously optimistic about the future of the idea.
Kym Gerlock, executive director of the Partnership, estimates that a downtown BID would cost between $500,000 and $700,000 a year. A budget of that amount would require a 5-or 6- percent increase in property taxes for businesses and property owners within the proposed BID. The BID that is now being proposed would encompass the area between the arena and the Metro Courthouse, and between First and Eighth Avenues. “We want the boundaries to be large enough to spread the cost, and we want to have the cost low enough to have the agreement from the property owners,” says Gerlock.
At present, commercial properties downtown are assessed at 40 percent of their appraised value. Property owners pay $4.50 for every $100 of assessed property. For example, the current assessment for a commercial property appraised at $100,000 is $40,000, and the owner must pay property taxes of $1,800. A 5- percent increase to finance the BID would bring the owner’s tax payment to $1,890 per yearan increase of only $90.
State law gives Metro broad flexibility in calculating property assessments. But state law also protects property owners: The aggregate levy can’t be more than 15 percent of the assessed value for any property.
The Downtown Partnership board must vote to sell the BID idea. That decision will probably come before the end of the year. Before proceeding with a BID, the Partnership must also secure the signatures of a majority of the District’s property owners.
After it passes those hurdles, the proposal will have to receive the blessing of the Metro Council. “Our timeline is to present a complete program as if we were going to sell it to property owners by the end of the year,” Gerlock says. “We would have to get it to Council by late spring in order to have something in place for 1998.”
Do it ourselves
Downtown advocates here and in other cities have compared the costs of BIDs to the maintenance fees residents pay in condominium and other housing associations. A BID is often described as a kind of “self-help process” for businesses operating in the area.
The idea for a downtown BID has considerable support from key players in town. MDHA is openly behind it. A panel of the International Downtown Association (IDA), a collection of downtown activists from around the world, visited Nashville in April and recommended that Nashville create a BID.
In a memo to Gerlock, the IDA noted that, since Houston has introduced BIDs, litter there has been reduced by 84 percent and crime has gone down 50 percent. In Denver, after the creation of BIDs four years ago, the downtown work force has grown by 15 percent, and some $500 million of new development has taken place. Philadelphia has seen retail occupancy increase from 84 percent to 87 percent over five years, and hotel occupancy rates have increased by 8 percent.
While some might argue that it will be difficult to get the players involved to pony up the necessary cash, others point to cities like Knoxville. There, officials established a downtown BID and had little problem getting support from the people who were going to be served. “We had a little opposition, but not much,” says Ann Marie Tugwell, executive director of Knoxville Central Business Improvement District (CBID), which was set up in 1994. “In the first year of service, we probably had more skepticism than at any other time. In the past year, a lot of that has gone away.”
To finance its BID, the city of Knoxville collects a special tax assessmentwhich amounts to 32 cents above the regular tax rate. It then turns the money over to the CBID, which is a not-for-profit corporation.
In Knoxville, the available monies do not all go to outside service providers, such as security companies or clean-up crews. Merchants and property owners in the district itself are free to apply to the CBID for small grants to complete rehabilitation projects or for other needs.
“We pay for restorations of buildings,” Tugwell says. “We’ll help pay for exteriors of the buildings based on the total investment the property owner is putting in. We’ve also used the money for security, police bicycles, and additional street lights where we felt there was a need.”
The outlook for the creation of a Nashville BID has at least passive support from Mayor Phil Bredesen and from Julius Sloss, who represents downtown in Metro Council. However, it’s still uncertain whether the idea of a BID will fly with the people who will be paying for its added services. There are more than Downtown Partnership members in the downtown business district. Those businesspeople and property owners would be likely to go along with the plan. On the other hand, there are property owners who are not members of the Downtown Partnership. It is their reactions that will be most anxiously awaited when the BID surveys go out this month.
Historically, Nashville has seen enormous resistance to property tax increases of any kind. But a BID is a different animal. The increased funds do not go to “big government,” per se, but to an outside agency. Disbursement of the funds is tightly controlled, and the resultspositive or negativeare plainly evident.
But the political prospects for creating such an arrangement are still not entirely clear. Downtown merchants wear many hats. Some are hopelessly skeptical. In the end, some will have to be convinced that what is good for the whole will also be good for the individual parts.
The Downtown Partnership hopes they get the message: You get what you pay for.
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