It is difficult to say precisely when the business improvement district (BID) was born. BIDs emerged out of legal structures and concepts that date back many decades, but the specific BID form is a relatively recent development. By some accounts, the first BID in the United States was the Downtown Development District of New Orleans, which was established in 1975. Few BIDs were created before 1980, and in most places the surge in BID formation did not really get going until around 1990 – the year that Philadelphia's Center City District was first established. Although new BIDs were created on a regular basis around the country throughout the 1990s and 2000s, it is fair to say that 2010 marks the completion of two decades of what I will call the BID movement – that is, the development and spread of, and the academic and public debate about, this new structure of urban governance. The BID combines public and private, as well as city and neighborhood features, in novel and interesting ways, and it provides a useful means of maintaining and supporting the urban environment. Yet, as many critics have pointed out, the BID also raises troubling issues of urban service inequality, accountability, and the focus of urban governance. It is hard to imagine a better way to analyze the coming of age of the business improvement district than through the extraordinary collection of studies of Philadelphia's BIDs in this issue of the Drexel Law Review.
These studies nicely demonstrate the success of the BID as an institutional innovation. From a tentative beginning, with one district two decades ago, Philadelphia now has fourteen BIDs in a wide variety of neighborhoods. Many of the BIDs have been renewed one or more times.In Philadelphia, as in much of the country, the BID is now a well-established and widespread phenomenon.
Yet these studies also indicate that the scope of BID activities has changed little in two decades and continues to be limited largely to the basics of "clean and safe," street maintenance and some streetscape improvements, district branding, and the marketing of district businesses. In other words, even as the number of BIDs has increased significantly, what they do remains relatively constrained. Although some observers in the early years of the development of BIDs expressed the fear that BIDs were the harbinger of a broader privatization and balkanization of urban governments, these studies suggest that those fears were significantly overblown. BIDs are interesting, but with the exception of the Center City BID, they play a relatively small role in urban governance.
These studies also examine the complex relationship between BIDs and other institutions, including businesses, local government, and most importantly, community-based nonprofit organizations like community development corporations (CDCs) and neighborhood associations. They demonstrate that the BID needs to be seen as part of a broader ecology of urban governance structures. Not only do BIDs play a more limited role than might have been predicted a decade ago, but when seen in the context of other community- based organizations, they seem a little less distinctive as well.
Finally, these studies have important implications for consideration of the future of decentralization within large urban centers. They underscore the benefits of having community-based organizations for the articulation of neighborhood concerns, the delivery of basic services, and the protection of the urban environment. But, they also show that further decentralization will require much greater attention to inter-neighborhood resource inequalities and governance and accountability issues.
In this Article, I will first examine both the diverse use of the BID form in Philadelphia and the similarity and limited nature of the services most Philadelphia BIDs provide. I will then turn to what these studies tell us about the relationship between BIDs and the surrounding urban institutional environment. I will conclude with some reflections on the implications of the Philadelphia BID experience for the decentralization of governance within big cities.
The Business Improvement District Comes of Age,
Drexel L. Rev.
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