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NYC Small Business Services


BID Creation
- 1: Contact SBS
- 2: Determine Feasibility
- 3: Form Steering

- 4: Hold Initial
Committee Meeting

- 5: Develop Database
- 6: Conduct Needs
Assessment Survey

- 7: Draft District Plan
- 8: Send Informational

- 9: Hold First Public

- 10: Hold Subsequent
Public Meetings

- 11: Document Results
- 12: Legislative Approval
Starting BID Operations
BID Management Resources
Avenue NYC Contracts
Return to SBS Web site

Doing Business with SBS
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Step 2: Determine Whether or Not to Form a BID


1. Complete Diagnostic Check to See if a BID is Right for Your Neighborhood 
2. Write Statement of Need 

1. Complete Diagnostic Check to See if a BID is Right for Your Neighborhood

The feasibility of implementing a BID depends on several factors:

Property Usage

The majority of funding for most BIDs comes from a special assessment levied upon the commercial property in a district. Therefore, it is important that the area you are considering for a BID contain an adequate base of commercial property to generate the special assessment. Keep the following guidelines in mind:

  • Residential properties should be kept to a minimum because they generally contribute a lower assessment.
  • There should be few government and other tax-exempt property owners, since they are generally exempt from any BID assessment.
  • There should be little undeveloped property.

Stable Commercial Occupancy Rates

The ability to generate adequate assessment revenue is dependent upon the current economic activity in the district. Therefore, BIDs are best situated in areas that are economically stable, and do not exhibit vacancy rates in excess of 20%.

Strong Local Support

The process of organizing and administering a BID requires public review, approval and oversight. It is important that local elected officials and community board members understand and support the concept of BIDs. Generally, local elected officials are supportive of BIDs because they recognize that BIDs deliver a higher level of service that directly benefits their constituents. You may wish to meet with your elected officials early in the process, especially if they have been newly elected, and discuss how BIDs have improved other neighborhoods throughout New York City.

Future Development

Funding for certain capital improvements may not include maintenance for the improvement. In some cases, capital allocations are made on the condition that the resulting improvement will be maintained over time with funds from another source. A BID can be an excellent mechanism to provide maintenance services for these improvements.

Complete this checklist to see if a BID might work for your neighborhood. If most of the conditions listed are met, then your neighborhood is likely to be a good candidate.
  • Local elected officials and community board members are supportive of BID policy
  • Property owners have a proven track record of working together and investing in their neighborhood
  • Existing local development organizations will be involved in the formation effort
  • There is significantly more commercial property than residential property
  • There are few public and non-profit property users
  • There is little vacant land
  • There is a low vacancy rate (less than 20%)
  • There are current or pending capital improvements or public amenities that need to be maintained

What if my neighborhood lacks many of these characteristics and conditions?

Even if your neighborhood does not currently exhibit many of the characteristics important to a BID, the area may be ready for a BID in the future. In the interim, work should be done on building partnerships, encouraging investment and laying foundations for a healthier commercial district. Forming a merchants association is a good first step towards a healthier commercial district. SBS can provide guidance on merchant organizing and district management.

What if my neighborhood is economically depressed?

Property owners who have vacant buildings or land may be hesitant to support a new BID since they cannot pass the BID assessment along to a tenant, but instead, must absorb the cost directly. This increases their carrying cost on an already unproductive property. Chronically high vacancy rates indicate that stakeholders within a district should focus on strategic investments and business development which will stimulate further private investment before they consider forming a BID. Once there is increased activity, there will also be a greater demand for the supplemental services that a BID is best suited to provide.

2. Write Statement of Need

Summarize the case for a new BID in a brief Statement of Need. Consider the following questions in developing the Statement:

  • What kind of commercial district is being considered? How would you describe the major user groups (shoppers, residents, day time office workers, tourists) and the businesses that are there?
  • What are the quality of life concerns that the BID could address immediately? For example, what is the need for better maintenance of streets, sidewalks, street furniture and public places throughout the district?
  • What are the long term development goals for the district?
  • How could a BID support these goals?

The Statement of Need should be submitted to SBS, as well as to those individuals whose participation you would like to have throughout the BID planning and outreach process.