Incentivizing the Establishment of New Business Improvement Districts (“BIDs”)

Editor’s Note:  I am pleased to present guest writer Max Musicant.  Mr. Musicant hails from Minneapolis and is currently serving as Project Manager for the Greater Jamaica Development Corporation in Queens.  The commentary that follows reveals some of Musicant’s perspective on Greater Jamaica’s successful use of BIDs for local development.  Contact Max at mmusicant (at) 

Business and property owners love business improvement districts – once they are in place and the benefits manifest themselves.  Still, with the benefits of business improvement districts being touted by municipalities across the country as well as in publications like The Economist, very little is being said about the often difficult task of establishing them in the first place. Despite numerous studies citing their benefit (including this recent one by the NYU’s Furman Center), it can be a difficult task initially to convince a property owner or merchant that they will see increased profits as a result of their higher property tax assessments. The positive impact of cleaner streets, more pedestrian amenities, and better marketing for the district can be more difficult to quantify than an increase in property taxes.


So how do you convince skeptical merchants and property owners that the trade off between a new assessment and increased business related services is a good one? The establishment of three BIDs over the past 35 years in Jamaica, Queens, New York City illustrate that linking the establishment of a BID to a targeted public investment can be a highly effective tool to bring merchants and property owners on board.

165th Street BID
From 1900 to 1960 Downtown Jamaica was the historic shopping center of Southern and Eastern Queens, with 165th Street as a one block stretch bustling with destination shopping anchored by the first non-Manhattan Macy’s department store. Starting in the 1960s revenues began to decline due to the opening of large suburban shopping malls with free parking on Long Island, as well as the perceived declining state of New York City as a whole. The merchants wanted to fight back and regain their premier position by creating a pedestrian mall along 165th Street based on the highly successful Nicollet Mall in Minneapolis. Before constructing the pedestrian mall, City officials required the property owners and their tenants to form a special assessment district. The substantial public infrastructure investment created a large enough incentive for the merchants and property owners to establish the special assessment district. The new special assessment district also insured that the retailers would be able extract the maximum benefit from the new pedestrian mall through dedicated and on-going funds for its maintenance.

Jamaica Center BID
By the 1970s, Jamaica’s other commercial corridor, Jamaica Avenue, was a shell of its past self; all three of its major department stores had left, along with a bank headquarters, two newspapers, countless legal offices, and many quality shops. A major reason for the decline of Jamaica Avenue was that it had an old and run down elevated train running over the length of the roughly twenty-block shopping district. The elevated train tracks created a dark and dirty atmosphere that gave the impression that the area was unsafe. As the effort began to lobby City and State officials to replace the elevated with a new subway, the promise of an improved shopping experience along with the need for a unified voice and organizational capacity created the strong incentive to establish a BID. The eventual organization of a BID along Jamaica Avenue was crucial in the lobbying effort that successfully got the elevated replaced by a subway line in 1980. With the elevated train gone Jamaica Avenue was able to come back, and today it is thriving.

Sutphin Boulevard BID
In the mid-1990s the Port Authority of New York/New Jersey was searching the region for a location to build a terminal for its new AirTrain light rail link to JFK Airport.  The terminal would serve thousands of domestic and international travelers each day and give whatever neighborhood it was located in a customer boost as well as positioning it well as a potential “Airport Village”. The local development corporation, Greater Jamaica Development Corporation, lobbied hard to have the terminal built in Downtown Jamaica arguing that it was only a few miles from the airport, was served by four subway lines, 49 bus lines, eleven of twelve Long Island Railroad (LIRR) lines, and was only twenty minutes from Midtown Manhattan via LIRR commuter rail. Despite the locational advantages of Downtown Jamaica, the establishment of a BID was deemed essential; so as to ensure the area’s continued maintenance and upkeep. By using the possible construction of a direct mass-transit link to JFK Airport as a motivator, skeptical merchants and property owners were convinced of the merits of establishing a BID. The AirTrain was completed in Jamaica in 2004 and today the Sutphin Boulevard corridor is poised and prepared to become JFK Airport’s first “Airport Village”, in part because of the Sutphin BID.

As these three examples exhibit, substantial focused public investment can be a highly effective tool to establish a BID. Local stakeholders and public officials can encourage BIDs by making them a required precursor to an investment, or local merchants and property owners can organize a BID to lobby the powers that be for public action that would significantly improve their business interests.  The important lesson is that the ability to link the establishment or enlargement BIDs to other previously unrelated issues is a highly effective strategy to bridge organizational hurdles.