Existing legislation in California and other states permits the creation of Business Improvement Districts (BIDs) to raise funds to improve the district. BIDs are a form of benefit district. Revenue raised must be expended to benefit property owners in the district. The intent is to raise additional revenue, so BIDs take pains to assure that the local jurisdiction will maintain baseline services and not merely allow BID funding to replace existing city funding.

If more than 50% of property owners in an area vote to create a BID a geographically defined BID comes into existence.^[58]  In California BIDS last only five years and then must be renewed or go out of existence.

Most BIDs are organized for parts of a single street like Telegraph Avenue in Berkeley and Lakeshore Avenue in Oakland. Some encompass a small shopping district like the ten blocks around Union Square in San Francisco.

The International Downtown Association (IDA) has published a series of how-to- do-it manuals on BIDs.^[59]  They undertook a year-long "Partnerships in Transition from Homelessness" research program under contract with the U.S. Department of Health and Human Services (HHS) "to determine best local practices to bring social service providers and downtown management organizations together to find lasting solutions to homelessness among the mentally ill."^[60] They presented findings of this study at the IDA Spring Workshop in Charlotte, North Carolina in May, 1999. The IDA offers limited technical assistance to their members based on this study.

Hormann Associates, a private consulting firm based in Sherman Oaks, California, provides consulting services to help establish and run BIDs.^[61]

Once a BID is formed, commercial property owners in the area are subject to an annual assessment. The amount of revenue raised varies with the size of the BID and the assessment rate. The Union Square BID assesses property owners $60 per linear foot of property a year ($5 a month) and anticipates raising $967,081 in 1999, the district’s first year of operation. The Times Square BID-the largest in the world-assesses commercial property owners approximately 3/10 of one percent of the assessed value of the property each year. This yields over $6 million a year. They report having an additional million dollars in grants and sponsorships annually.

A BID is governed by a board of directors. In the case of Union Square 11 members representing different commercial segments (hotel, retail, office, etc.) sit on the board. The board is elected by property owners  within the district; not area residents. It does not include public representatives or representatives of the homeless.

BIDs have two core concerns: keeping their area clean and public safety. Cleaning may include litter pick up, graffiti removal, street and sidewalk sweeping, gum removal, steam cleaning, and pressure washing. For example, the Union Square BID pays a supervisor and cleaning crew to do routine cleaning seven days a week. Public safety may involve hiring additional police officers or private security guards or training BID workers to look for and report criminal activity. The Union Square BID pays an off-duty regular uniformed S.F. police officer (a so-called 10B officer) to patrol the BID area from 3:00 to 9:00 PM every day. BIDs are also concerned with the area’s image and public relations. Some create and distribute maps, tourist information, and press releases. The Union Square BID has "ambassadors" to greet tourists and dispense information. The Times Square BID in New York City sponsors public art and festivals in the area.

BIDs are designed to promote the interests of business in the district and BID funds are spent to promote business. No Bay Area BID presently contributes any funding to support homeless services. It is unrealistic to expect BIDs, as they presently exist, to devote more than a small portion of BID revenue to directly support homeless services. BIDs might make a larger contribution in other indirect and non-monetary ways by (a) getting area property owners to adopt progressive policies regarding how homeless people in the area are treated, (b) organizing individual charitable contributions by area merchants, and by (c) hiring homeless people to help clean the area.

Addressing homeless issues is peripheral to BIDs. Their approach may be ambivalent at best. Many BID property owners would like homeless people to leave their areas. The San Jose BID downtown distributes "Say No To Panhandlers" cards to merchants within the district to give to shoppers. The cards encourage shoppers not to support panhandling, but instead to direct panhandlers to housing and social services agencies listed on the card. The San Jose Downtown BID opposed siting a homeless housing project near the BID, though they say they are in favor of affordable ownership housing and supported housing. Within the limits of the law BIDs may discourage behavior by homeless people they see as detrimental to the image of the area.

Some BIDs in other states-notably the Times Square BID in New York City and the South Street Special Service District in Philadelphia—have hired homeless people, organized contributions by area businesses to the homeless, and helped fund homeless social services activities. In the Bay Area the Telegraph Avenue BID has worked with Building Opportunities for Self Sufficiency (BOSS) to hire homeless people to help keep Telegraph Avenue clean. The Japantown BID in San Jose hires one homeless person.

The Times Square BID asserts that it helped raise over $2.5 million over three years from federal and State agencies for a pilot program by the Times Square Consortium for the Homeless to address the needs of service-resistant homeless. It works with homeless organizations in the area.^[62] The Times Square BID maintains a program called "Times Square Delivers" to collect donations of goods and contributions for local social service agencies. The Times Square BID may have raised some additional funding for homeless programs in the area, but the amount is small relative to the economy of the area.

There currently appear to be just seven BIDs in the Bay Area: 3 in San Jose, 2 in Berkeley, and one each in San Francisco and Oakland. San Bruno is considering a BID. Nationally, the International Downtown Association in Washington, D.C. estimates that there are more than 1100 BIDS and the number is growing.

A regional policy looking towards BIDs as a revenue source might pursue several strategies:

1. Promote progressive collaboration between existing  BIDs and homeless organizations, e.g. hiring of homeless people or organizing business philanthropy. BARI might provide regional-level advice for homeless organizations in the region about how best to work with BIDs;
2. Encourage formation of additional BIDs as collaboratives between business and homeless groups;
3. Reform State law to require BIDs to be more supportive of homeless;
4. Promote new legislation to (1) permit "big BIDs" which would assess businesses over large geographic areas, perhaps including the entire region, (2) "many BIDs," or (3) new hybrid districts modeled on BIDs, but which make homeless programs a priority.

Looking to BIDs as a source of funding is less complex than other fund-raising strategies that involve approval from multiple jurisdictions. Currently there are just a few BIDs in the Bay Area. Revenue is controlled by a small number of BID boards.

The total amount of BID funding which might realistically go to homeless projects is currently very small. The total  amount of revenue currently raised by all BIDs in the Bay Area is less than $2 million a year. All the BID funding from the Elmwood Theater BID is dedicated to repaying a loan from the City of Berkeley through the year 2013. The director of the Lakeshore BID in Oakland reported that there was only one homeless person who came into the BID area. The director of the Willow Glen BID in San Jose reported that there were never any homeless people in that BID. Total BID funding is a tiny amount compared to mainstream social service funding, potential tobacco settlement funds, existing and potential RETT funding, or tax increment set aside funds. BID funding is likely to grow as more BIDs are formed, and the amount of BID funding that goes to benefit homeless might increase from a base of $0 to a very small amount of funding from The Union Square and Telegraph Avenue BIDs where homelessness is an issue if homeless advocates are successful in getting existing BIDs to devote funding to homeless activities. But given the small initial base there is no possibility that BIDs will become a major funding source for long-term regional homeless activities. More promising is changing the culture of BIDs to be more sensitive to homeless people and perhaps, to get them to help raise grant funds or mobilize members to donate goods and services as New York’s Times Square BID does. Because BIDs employ unskilled people for street cleaning and litter removal they may offer employment for homeless people. But the total number of potential jobs is very small relative to the number of potential jobs for people with multiple barriers to employment available in the private sector or from local government.

BID funding is a stable revenue stream. BIDs establish a first year budget and revenue may only be adjusted modestly for inflation each year for five years. There is some uncertainty about continuation of funding after the maximum five-year life permitted for BIDs under California law, but it is probable that most BIDs will continue to be renewed every five years.
 

Sources: Union Square Business Improvement District (San Francisco), Union Square Business Improvement District Plan (San Francisco: Union Square BID, October, 1998).  Downtown Association BID (San Jose), Statement of Revenue and Expense Year ended June 30, 1998 (San Jose: San Jose Downtown Association, undated). Japantown BID (San Jose) interview Richard LeGates with Connie Shaw. Willow Glen BID (San Jose) interview Richard LeGates with Dimitri Rizos. Telegraph Avenue BID, Phone interview Amy Beinart w/Dana Ellsworth , President Telegraph Property and Management Association. Elmwood Theater BID information supplied by David Fogarty, City of Berkeley.

There are limitations and disadvantages to working with BIDs. BIDs are run by and intended to serve the interests of area businesses. Homeless people and their advocates are not included on their governing boards. BIDs’ core concerns are with cleanliness and public safety, not with helping the homeless. Some exhibit a mixture of hostility and ambivalence towards the homeless. BIDs currently cover a very small part of the area in which commercial activities are located.

Given how peripheral homeless issues are to the BID agenda and that there is relatively recent BID legislation, State-level advocacy to require BIDs to be more attentive to homeless concerns is not likely to succeed. Nor is new legislation to create some form of "big BID", assure that there will be many more BIDs, or create a new kind of BID-like district that would focus on homelessness likely to succeed.

Recommendation

Homeless organizations should not pursue BIDs as a long-term revenue source. There are too few of them, with too little money, too few potential jobs for homeless people, and too little inclination to work on homeless issues to make this a good priority for scarce funds. There are no realistic prospects that homeless organizations could significantly reform BIDs to make them do enough more for homeless people to justify the effort or create new hybrid BID/homeless entities. BARI’s Regional Employment Collaborative (REC) and/or city-level homeless organizations in San Jose, San Francisco, Oakland, and Berkeley might work with BID boards to increase BID hiring of the homeless if they consider this a priority relative to other employment and training opportunities.