Last week's announcement by Downtown Durham Inc. that they would seek the approval of local governmental leaders to create a Business Improvement District (BID) in the downtown area is the culmination of several years' worth of discussion about whether the special tax district could be the right solution to improve the frequency and quality of services in an increasingly visible downtown core.
The idea of a BID -- found in more than 90% of larger cities nationally, and more than fifty NC cities including Raleigh and Greensboro (with Chapel Hill in the wings) -- is to levy a surcharge on taxable properties and to have the extra funds raised dedicated to additional services, from waste cleanup to sidewalk ambassadors, that serve as a common good for all of downtown.
In Durham's case, the proposed BID would bring in just short of $400,000 per year, and would be met by a requested increase of $250,000 in funding from the City over the combined $202,000 in economic development dollars that City/County officials provide annually. That extra quarter-million dollars would be in exchange for Downtown Durham Inc. absorbing, funding and overseeing a number of services that are currently provided by the local government.
In that way, the BID also would be an interesting model in a city where politics are participatory, and often a contact sport: the assumption by a private organization, under time-limited contract, of some public functions.
In an interview last week, DDI director Bill Kalkhof, his staff, and downtown resident and BID booster Alice Sharpe emphasized that the need for a special tax district is real, and the best way to grow services and improve their quality.
"Local governments simply are lacking for resources, and they are doing the best they can," Kalkhof said. "We look out on the street and say, what's being provided now simply's not good enough, and we have heard that for years from people."
BID funding would be used to bring in a third-party contractor, SGI, that operates business improvement district services in a number of districts nationwide. Their street teams comprised of staff walking the downtown on foot would serve as ambassadors for visitors, handing out maps and giving directions to facilities, restaurants and the like.
They'd also provide a "clean and safe" service model, with the presence of these workers downtown would replace a number of existing City activities in downtown, including:
- Litter removal from sidewalks, curbs, and storefronts, and mechanical vacuuming of litter;
- Emptying trash receptacles inside the loop
- Weed removal and maintenance of landscaped beds
- Initial response to Durham One-Call reported issues
- Removing graffiti, old handbills and the like
SGI staff would also perform new services, from removing gum spots and snow/ice from sidewalks to straightening and wiping clean fixtures like benches and newspaper boxes. They'd also serve as extra eyes and ears for public safety, radioing in problems if they see them.
The so-called downtown "ambassadors" would use internet-enabled cell phones to receive new work orders of problems and projects from SGI managers, and would use digital wands to "check in" at points on their routes, improving accountability, said DDI's Melissa Muir.
Staff would have feet on the street in different districts downtown from 7am through 3:30pm, with another crew picking up coverage until 10pm in the busiest city center and W. Main St. corridor.
Additionally, BID money would be used to improve the number and quality of public events downtown, with DDI proposing to take over programming of spaces like the CCB Plaza. Kalkhof drew comparisons to Asheville's thriving downtown public scene, adding that the WNC city gains energy by having events going on simultaneously in different locations -- something that could happen at areas like the city center, American Tobacco and Brightleaf Square.
Kalkhof said DDI today receives a significant number of calls from downtown stakeholders and the public about appearance problems, but has no direct mechanism to implement solutions to the problem.
In a BID model, DDI staff, their board, and advisory committees would essentially provide management oversight of SGI's work and, in Kalkhof's opinion, could be more successful at improving results with a targeted focus just on downtown.
Kalkhof used the example of municipal crews who provide every-morning cleanup services in the downtown area. Currently staff spend about 3,000 hours a year providing such services in downtown; in the BID model, that work would increase to 13,000 hours a year of work.
In many ways, the idea of a BID emerges in communities because cities' downtowns are competing with single-owner areas like shopping malls or office parks where private property owners have more control over ensuring the provision of such services.
To DDI and supporters of a BID, the district would create that level of services with downtown paying more in order to get an augmented level of service.
Downtown residents and property owners who support the bid "are saying we're going to tax ourselves, use this money to improve the economic development, the safe and clean aspects," Alice Sharpe said. "People in a lot of other neighborhoods will get the benefit of what's happening with this BID, but they're not having to pay a dime for it. We're not asking them to, they just need to come on downtown and enjoy themselves."
The BID would cover an area from Main St. near Buchanan Blvd. to Golden Belt, and from roughly the freeway north through the Central Park district and emerging commercial area. Residential properties on the periphery of downtown were excised in every way possible while keeping a contiguous district, Kalkhof said.
Property owners inside the BID area would pay an additional seven cents a year on each $100 of valuation of real and personal property.
Unlike the rest of their taxes, which flow from the County's tax office to city and county coffers, the dollars from this seven cent levy would be spent by DDI, under the guidance of new committees and a pared-down board of directors.
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But how would a BID be governed?
DDI would have discretion over the outlays of funds, though Kalkhof stressed that the spending would be governed in part by a contract to be signed with the City spelling out what services would be provided by the district -- and providing a sunset period at which time those services would revert and the tax district ended, barring an extension.
The initial proposed BID district length would be three years, Kalkhof told BCR. Sharpe noted this was the third time that a BID has been broached by DDI's board.
A smaller DDI board would oversee DDI staff activities and the funds expended on services, with the help of two advisory boards. One board would be comprised of at least two property owners or residents from each of the seven areas SGI's workers would serve; the second would consist of today's DDI ex-officio board members from local governments, the police, the Durham Chamber and other groups. DDI's board itself would be newly comprised of real and personal property owners, residents, and representatives from the County and City.
While DDI is proposing a revised governance model to accompany a new financial model that sees it receiving dedicated funding from a local-area tax, the BID as proposed would still create a district in the Bull City where some public services are operated under the aegis of a non-elected board, albeit one with a specific contract for services with the city.
But Sharpe -- who along with downtown leaders like Scott Harmon and American Tobacco's Michael Goodmon is one of the ambassadors helping to promote the idea of a BID -- argued that DDI isn't an organization separate or independent of downtown interests, but one which had worked to understand the concerns of residents and property owners. And, she argued, the presence of a local tax district to specifically meet needs that aren't filled by the public sector is a sign of that responsiveness.
"This is another example of Durham grittiness. We're taxing ourselves," Sharpe said. "It is through Downtown Durham Inc., but that is the vehicle... that is the arm that [downtown residents and property owners] utilize."
And she rejected the idea that residents or property owners might feel like they lacked an outlet for concerns over service efficacy that the City Council might today provide.
Downtowners, Sharpe said, "will continue to be vocal, even after SGI starts. And we want that feedback," adding that the advisory boards are one key mechanism for those.
DDI government affairs coordinator Melissa Norton added that the first "temperature readings" of the idea last week with downtown property and business owners were generally positive as people had a chance to ask questions.
"One of the things that appeals to everybody is that the money has to be spent downtown," DDI's Muir added. "Currently when you are voicing to City Council that you want increased services downtown, you're competing with all of Durham for a limited amount of dollars."
"I hear a lot from people now that there are problems and issues, just day to day things that are frustrating" she added. "Now we're going to be empowered with the resources to be able to address it in our office, or through one phone call to SGI."
"It may actually create a point where people actually being more vocal, because they see that when they complain, things get done," Muir said.