How Do I... Improve My Neighborhood

When I was about 7 years old, fresh off my first viewing of "The Wizard of Oz," my mom announced that she had an errand to run in Crystal City, Va. I pleaded to go, sure that a town with such a name would house a huge, icy castle like its sister city, Emerald.

I was stupefied when she told me for the 10th time that yes, we had arrived. This was Crystal City. But where was the sparkle, the pizzazz? It was a maze of ugly concrete towers.

Decades later, the region is trying to buck its original design as a government enclave with services geared toward government workers. Like many neighborhoods across the nation, it's enlisting the help of a Business Improvement District to spur small business growth and make the community more livable.

The neighborhood in Virginia's Arlington County had suffered a loss when thousands of military personnel were relocated about the same time the Patent and Trademark Office decided to move to a new campus down the road in Alexandria. Business leaders there realized something had to be done before the region began to erode.

Meet the new "man behind the curtain." She's Angie Fox, president and CEO of the Crystal City BID.

The 250-acre BID (pdf) was established in spring 2006 as a public-private partnership between commercial businesses located within the business improvement district and Arlington County. The district includes restaurants, retailers, small businesses, commercial property owners, tenants and residential apartment buildings.

Small businesses may benefit from being a part of a BID, like the one in Crystal City, because they can piggyback on the marketing and events muscle that comes from a BID's larger budget. BIDs also can upgrade a neighborhood's common areas through landscaping services, additional trash cans, a public safety presence or banners, for example. However, a BID's budget is mostly derived from higher property taxes, so small firms must see how that cost is passed on to them.

What is a BID?

A Business Improvement District is a designated area where a majority of businesses or property owners agree to pay additional assessments in exchange for services not provided by their city such as sidewalk sweeping, public safety officers, landscaping, and restaurant and shopping guides. Even if a business doesn't want to be included, it's in if 51 percent of its neighbors vote to join.

If you're moving into a new neighborhood, BIDS can also help you obtain research on a community's demographics and services. To find a BID, contact the county's economic development office. If there is one, contact the group and find out what additional services they provide. Ask business members of the groups what they think about the organization and if they believe they're getting results out of their investments.

Businesses set up BIDs with the help of their county. Rules differ by state. In Crystal City, property owners have agreed to pay an additional 4 1/2 cents per $100 of their property's assessed value. The county collects the money and sends a check to the Crystal City BID twice annually. The owner of a building likely will pass the additional BID fees on to a tenant, such as a small business. Crystal City is one of the less expensive BIDs in the D.C. area; most of the BIDs in the Washington region add 12 cents per $100.

"When BIDs are formed, there's generally a feeling in the community that there's a need," said Fox. "Looking at downtown D.C., maybe 12 years ago some people thought it was unsafe and unclean and it needed a higher level of service that the city was able to keep up with."

The Downtown D.C. Bid was one of the first and largest BIDs in the Washington area. It stretches 138 blocks from near the Capitol to the White House. It has served as a model for Crystal City and many other BIDs in the metro area. It's also celebrating its 10th anniversary with a party this month. It's hard to walk up Connecticut Avenue toward Dupont Circle without feeling like you've crashed a Pittsburgh Steelers party. The Golden Triangle BID has hired black-and-gold clad information guides who are stationed throughout the neighborhood to help tourists and other newcomers.

"Today, D.C.'s downtown is remarkably transformed, and it shows what a vision within the business community can do," Fox said.

It's Not Easy Starting a BID

"It's not easy forming a BID," Fox said. She suggests business areas that don't have a lot of square footage might want to start with a small business association instead. For example, before it was part of the BID, businesses along 23rd Street in Crystal City, which houses a row of independent restaurants, would each pay into a fund for landscaping.

"They didn't have the kind of tax base that our BID can generate - when you bring 10 million square feet of office space and you tax it, you're bringing in some money versus 10 businesses paying $100 a year into a fund," said Fox. Her BID's budget this year is $2.2 million. The 23rd Street group has benefited from BID's backing, even with simple but effective actions like additional trashcans that have kept the area cleaner.

The Crystal City BID's jewel in the crown is the recent acquisition of Arena Stage, which temporarily moved there while its D.C. headquarters undergoes a three-year renovation.

"When you think about creating a healthy area, you've got to have the right mix of residential and commercial," said Fox. The area "had great restaurants, but not a lot of color to it, and nothing to do at night."

Fox said any business owner looking to move into a BID should contact its marketing manager to ensure that his or her business is involved in neighborhood events hosted by the BID.

For example, the Crystal City BID jumped at the chance to host the month-long Artomatic, after the event's coordinators were not able to secure space in D.C. The art spectacle showcased thousands of artists who displayed their wares to the public in the offices of a former PTO building.

The event drew thousands of visitors, who viewed the art late into the evening and dined and shopped at the neighborhood establishments.

Fox also suggests that small firms make sure they have a voice on BID committees. That can help in a variety of ways -- even if it's something as simple as making sure that your business news is put into the BID newsletter.

"If a BID is hosting a wine and cheese festival, for example, think about how your business can be a part of it, what ever kind of good or service you provide," Fox suggests. "All ships rise that way."

She did offer a note of caution, however, for areas the look into starting BIDs: "Make sure your public entity - whether it's a city, county or something else - doesn't cut back on providing services because they think the BID will do it."

Small Business Readers: Do you live or work in a Business Improvement District? Has it helped improve your neighborhood?

By Sharon McLoone |  November 6, 2007; 12:30 PM ET How Do I...
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Comments

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Thank Goodness we were able to avoid a new BID Tax in Alexandria! We didn't need an additional tax and layer of bureaucracy merely to turn King Street into another shopping mall.

Instead of standardized potted plants that a few commercial real estate developers wanted to impose, businesses & individuals have voluntarily enhanced the beauty of King Street and the surrounding areas, keeping Old Town the unique destination spot it is.

With substantially lower commercial real estate taxes than Fairfax & Arlington County, Alexandria is the place to do business. The best is yet to come!

Posted by: Bud Miller | November 28, 2007 8:34 AM

BID taxes are often used in areas (such as downtown DC) where regular tax collections are often siphoned off into other parts of the jurisdiction. That isn't the case for Old Town in Alexandria. It's the heart of the city, and receives plenty of attention from both government and private sources. As a consumer who would have faced higher prices at Old Town shops had the Alexandria BID tax passed, I'm glad the poorly-designed BID plan was put to rest.

Posted by: Kristina | November 28, 2007 9:40 AM

One of the primary driving forces behind Alexandria's success is the fact that the county has the lowest commercial property taxes when compared to Arlington and Fairfax. Allowing entrepreneurs to hold on to more of their hard earned cash has provided many benefits to the county. This is likely to continue as long as Alexandria maintains its pro-business climate. Unnecessary taxes, such as a BID tax, work contrary to these efforts.

Posted by: Drew | November 28, 2007 11:22 AM

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