Indian Cities Can Learn From New York City’s BIDs

February 14, 2018

Swati Ramanathan, Hindustan Times

At the first meeting of the Special Purpose Vehicle for Bengaluru’s Smart City Plan held last month, the mayor raised a pertinent query – ‘What is the purpose of the Area Based Development (ABD) boundary requirement in the Smart City scheme?’ Across the Smart City plans, the size and location parameters for ABD vary vastly, and seem quite random.

Contrast this with another boundary that is evolving for urban redevelopment - the Business Improvement District, or BID.

Bryant Park is a 10-acre quintessential city park located in the heart of New York City, right across from the New York Public Library. Like the more famous Central Park, it, too, is considered a Manhattan landmark. But this was not always the case. During the 1970s, ridden by incidents of crime, rape, and drug dealings, Bryant Park was notorious. It was popularly known as “Needle Park”.

In fact, several attempts to close down Bryant Park failed, until finally a revival of the park was undertaken, led by stakeholders outside government. With initial funding from the Rockefeller Brothers, the design and transformation of the park was nothing short of spectacular. Today, Bryant Park is the jewel in the neighbourhood, a pride of the community and local businesses, boasting vibrant economic activity and land values.

Bryant Park is now managed by a private not-for-profit company called the Bryant Park Corporation (BPC), financed entirely by private funds — largely from local merchants, property owners, and philanthropists. The project demonstrates the direct link between the revival of public space, community benefits, and economic interest. At the heart of this transformation is a new kind of public-private partnership called ‘Business Improvement Districts’ or BIDs.

A BID is a defined area where local business and property owners pay an additional tax or fee to fund projects within the BID boundary. BIDs identify highly localised goals and shared priorities of the BID area, without disturbing the larger municipal planning and delivery framework. While the city continues to provide regular services, the BID community may allocate their funds towards their own priorities — capital improvement priorities such as waterfronts, public spaces, parks, and public toilets, or towards improvement in civic services such as traffic management, more frequent garbage removal, parking systems, and public safety.

Currently there are over 1000 BIDs across America’s cities. New York itself has over 75 BIDs, including more than 30% of all retail business, and 50% of all office space in the city. Mayor Bloomberg had this to say about the impact of BIDs, “Business Improvement Districts represent public-private partnerships at their very best. Time and again, they have proven effective in revitalising neighbourhoods and improving business conditions in commercial districts – injecting vitality into the community.” The idea has gained significant traction in other countries like the UK, Canada and South Africa. And the list is growing.

The success of BIDs is because it is a hyper-local action, led primarily by small businesses and supported by the residents. The compact boundary of BIDs helps in finding consensus around local priorities, as well as the best means to achieve these priorities within a reliable timeframe. BIDs create a unique opportunity for leadership and collaboration across the polity – government, business, and citizens – born of enlightened self-interest. Most importantly, they tap into much needed money, skill and management capacities to address civic challenges.

Can BIDs work in India? India’s cities don’t have a hundred thousand problems; they have a hundred problems repeated a thousand times. However, each solution must be situation-specific needing local adaptation. What works in Mumbai will not work in Meerut (indeed, what works in Chandni Chowk is unlikely to work in Lajpat Nagar). Solutions will only be effective when they are locally defined, designed, and implemented. Cities today are the wastelands of unkept government promises. With most municipalities starved of funds and all bereft of qualified resources, it is clear that municipal authorities by themselves cannot solve our problems. Instead of just talking about issues at a 100,000 feet, BIDs offer credible on-the-ground action for at least some of our pressing challenges.

BIDs don’t work in every location. Clearly, there must be substantial economic presence of retail and commercial owners to engage in action. But such engagement can release government resources for other deserving areas. From an operational standpoint, the success of BIDs is dependent on well-defined institutional structures, representation and procedures, functioning with the utmost transparency. It is also dependent upon the buy-in from a majority of residents and local businesses in the defined area.

BID is neither an idea we can rush to embrace, nor the panacea for all the challenges that our cities face. But it provides cities a much-needed hyperlocal spatial focus and the ability to revitalise neighbourhoods. Hopefully, some smart states will pilot BIDs within the ABD plans of their smart cities.