BIDs subject of Bar Assn. meeting.

Concerns about Business Improvement Districts have led to a report by the City Council detailing abuses, as well as a meeting on these so-called "BIDs" at the Association of the Bar of the City of New York late last year.

The latter program brought together Times Square BID President Gretchen Dykstra; Washington Heights District Management Association District Manager Carlos Estrada; City Council Finance Chair Herb Berman, whose committee authored the report; and others to discuss issues pertaining to BIDs.

In 1995, the New York City BIDs had budgets that amounted to $42 million, said moderator Judah Gribetz, totalling more than the budgets of the five borough presidents.

The law under which the BIDs operate mandates that the City Council conduct oversight of these districts, organized by each area's property owners. In the past, there had been no comprehensive look at the BIDs, and that motivated the Finance Committee to prepare an in-depth report that was released late last year.

Berman said he was surprised that over 400 copies of the report have been requested and sent to interested parties across the country. Through the years, helped by the Main Street Alliance, similar programs have developed around the United States - but without the big ticket budgets of New York - as local business owners organize to beautify their shopping districts.

The local BIDs have had an impact on many neighborhoods through increased cleanliness, security and capital improvements. Many, however, are required to deal with social service problems and provide additional solutions.

While the BID budgets, and therefore the existence of the BID's themselves, needs to be formally approved by the City Council each year, Berman and other critics are very concerned that a BID can incur debt just to perpetrate its own existence.

Additionally, the Council researchers found, some BIDs have been plagued with management problems, financial turmoil and disagreeing boards. Often, the Boards don't communicate with the district's property owners, who pay additional property taxes to fund the BIDs. Some boards don't pass out annual reports or let the owners know what their funds are paying for, according to the report. Some spend too much money on administration; others have one employee who just can't do it all.

"Most people don't have the foggiest notion of the services provided by the BID," said Berman.

Nevertheless, there have been substantial increases in property values in areas where BIDs have been successful, such as in the Grand Central and Times square areas.

Yet in some BIDs, property owners feel they are not represented on the BID boards and are paying additional assessments without realizing any benefits. The quasi-governmental BID board is often criticized by some owners and politicians.

Dykstra said it was very important to keep the property owners informed by getting them together and working with them collectively. Times Square has 47 people on its board, that includes 13 tenants, three residential property representatives, as well as commercial owners and governmental representatives, such as staff members from the Borough President's office.

Explaining why BIDs can work with government to obtain services, Dykstra said "The squeaky wheel is the one that gets oiled and a BID is a squeaky wheel."

While the larger BIDs like the Alliance For Downtown Manhattan, Times Square and the 34th Street Partnership have multimillion dollar budgets, Estrada noted that he works with merely $260,000. This promotes "creativity" for his staff of one, he laughed, adding "There is life above 125th Street. We are doing a lot of hard work over there. It's a vital community, it's alive, and we invite you to come visit."

While that BID does not have a security force of its own, Estrada said it does have the 34th Precinct, which is "very responsive."

In Washington Heights, an increase in the number of people shopping in the district stores has led to a request by adjoining owners on 14 other blocks to join the BID. That phenomenon has occurred in other BIDs, and both Grand Central and the Fifth Avenue BID have formally encompassed more adjoining blocks at the request of those property owners.

While BID owners in Washington Heights are receiving about $75 per square foot for store space, ten blocks away the owners are getting merely $45 a foot.

Richard Schwartz, senior advisor to Mayor Rudolph Giuliani, represented the Mayor on the Bar Association panel. He pointed to BIDs as a form of privatization of government. He agreed there are changes that have to be made in BID operations, but said "There is a tremendous amount of good and it is with reluctance that we should look at further regulation."

Berman noted there is a direct correlation between the recent decreases in city services and the budgets of the various BIDs. The service decreases, especially in Sanitation pick-ups to areas like Fifth Avenue, Times Square and Grand Central Partnership, has been troubling to the BIDs, as they have had to come up with tens of thousands of dollars to maintain an acceptable level of services. Luckily, Washington Heights was not affected.

"I don't think services have been reduced that much," responded Schwartz to this complaint.

While Berman's committee will continue to keep a sharp eye on the BIDs, he does believe they are doing tremendous good and do not need additional government regulation, as long as they have disclosure.

"We are loathe to intrude government upon the operation of BIDs," he told REW. "One of the benefits they have is not being curtailed by government and that's part of the reason they are successful. However, they have to be accountable."