Guide Business Improvement Districts: Research, Theories, and Controversies

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The creation of BIDs gives the big businesses, which already dominate local politics through Chambers of Commerce and political donations, yet another mechanism for changing city policies to reflect their interests. Homeless people are the first to feel the brunt of these privatization and gentrification initiatives but low-income tenants soon discover that they too are being pushed out.

While incumbent homeowners may be the beneficiaries of a brief boom in the value of their homes, new families trying to move from apartments into houses are likely to be driven out to the periphery, further degrading the diversity of our communities. The first significant governance by a BID in the U. BIDs are granted the power to assess commercial property owners within a district with what amounts to a real estate tax, collected on their behalf by the local government.

Voting power in a BID is based on the amount of tax paid, not the number of businesses in a district. In some cases, BIDs, which are privately managed entities, also take on the land-use planning and capital investments typical of government. While most BIDs file some sort of report to their city council once a year, research into the actual practice shows city councils largely uncritical of plans created by the business-led boards of BIDs and rarely, if ever, overrule them.


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BIDs are quickly spreading from state to state and laying the groundwork for ever more direct corporate governance at the municipal level. In California, which leads the country in BIDs with almost in downtown and suburban areas statewide,2 a BID can be created with the support of 51 percent of the business taxpayers in a district. They act, in effect, as a political action group. In fact, almost all elected officials were put forth by the Chamber of Commerce. Business and government were almost hand-in-glove, way more than it is now.

Business people, because of suburbia, began to move out of the urban areas So they lost their political power in town. In San Francisco, Oakland and Berkeley, the BIDs that control and patrol the downtown city centers have aggressive anti-homeless policies enforced in a joint effort with the local police departments.

Business Improvement Districts: Research, Theories, and Controversies

Grossman is frank in his evaluation of why BIDs aim to move homeless people out of the districts. So they are concerned about customers.

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You are either a customer or a contagion. They are just trying to save their own ass or their business.

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He sees BIDs as a way of reconnecting business and government. Chambers of Commerce are flaccid, but BIDs are exerting more and more political power. They are a public-private partnership.

The Berkeley DBA has been doing a good job of organizing for what they see as their collective interest. Street protests and interventions by local faith leaders and other civil rights advocates have managed to prevent the immediate adoption of the new anti-poor laws, but BIDs across the state are maintaining constant pressure to deprive homeless people of their human and civil rights.

CCEA is just one of many business lobbying groups that is helping itself to local taxing authority in LA, which now boasts nine BIDs in just the downtown area—three of which overlap or abut the Skid Row area.