from UW Extension's "Lets Talk Business" newsletter series, March 2001

This article helps us understand BIDs by looking at what they are, how they are created and function, their history and distribution in the state.

In 1984, the state of Wisconsin passed enabling legislation that gave municipalities (i.e., cities, towns, and villages) the power to create one of more special assessments districts within their jurisdiction. As defined by the legislation, these "business improvement districts (BIDs)" represents a geographic grouping of commercial properties where the owners have agreed to assess themselves in a manner that generates funds that can be used for virtually anything as long as the expenditures are related in some way to the management, the development, the maintenance or promotion of the district.

Wisconsin BIDs-Typical Assessment Strategies

There are three basic ways in which Wisconsin communities assess BID properties. By far the most popular way for assessments to be levied is using a dollar amount based on each $1,000 of assessed value. Another way in which properties are commonly assessed is based on a property's lineal or square footage. This type of assessment is popular when the intent of the BID is to pay for physical or capital improvements such as street-scape projects. In addition, most communities place a minimum as well as maximum on the amount of assessment owed. Lastly, communities might use a combination of the two methods noted. Some BIDs also vary the assessments according to the parcel's location or the type of business it supports.

Wisconsin BIDs - How They Are Administrated

By expanding BID Boards, communities insure representation from a broader cross-section of the community and can engage other groups that share an interest in the promotion, marketing, maintenance and development of the district.

BID Supported Programs and Activities

BIDs are designed to support a wide spectrum of programs and activities as long as they are some way related to the management, development, maintenance or promotion of the district. Survey results shows that BIDs support a wide range of programs and activities. Almost 90 percent of the reporting BIDs support promotional efforts of some kind including special events or other types of retail promotions. Three-fourths of the reporting BIDs support specialized advertising campaigns and 66 percent underwrite the development of new district marketing materials as well as job training programs. More than half (60%) of the reporting BIDs finance streetscape development an/or maintenance programs or contribute to some type of physical improvement program such as façade loan pools.

BID Impacts on Property Values

Attempting to measure the impacts of BIDs on Wisconsin communities proves to be a difficult challenge. Not only is it difficult to determine what measures you might use in trying to evaluate impacts but comparisons across districts is also problematic. Keep in mind that BIDs are often created for different reasons and support a wide range of activities.

It is generally agreed that examining changes in property values can be a reasonable indicator of BID impact. In these cases, the property value figures were compared over a several year period and then compared with a figure known as the local "mean". In other words, "like" commercial properties located outside of the district area. Four of the five districts studied experienced significant increases in property values, two to three times the increases in the Milwaukee mean. Thus, there is some suggestion that the formation and operation of a BID can influence property values in a positive way over time.

Looking Forward

BIDs have had a significant impact on the face of many traditional commercial centers. BIDs have created new alliances and introduced new funding opportunities to support the process of downtown redevelopment. BIDs have brought about Main Street programs, introduced numerous comprehensive streetscape redevelopment programs, demonstrated experience in working with historic structures through the development of façade loan programs, supported the development of urban design standards and have encouraged infill and adaptive reuse. Given the established record of BID development in the state, there is no reason to believe that the next decade of experience will be any different.

Charles S. Law, is Director and Community Planning and Design Specialist, Local Government Center of the University of Wisconsin Extension.

For more information:

Wisconsin Business Improvement Districts

New York State Main Street Alliance

National Main Street Center