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BUSINESS IMPROVEMENT DISTRICTS WORKING GROUP PAPER 04/08
DISCUSSION PAPER - BID PATHFINDER PROJECTS

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1. Background and Purpose of Discussion Paper

This paper outlines a potential approach to demonstrating the value of Business Improvement Districts (BIDS) in order to provide evidence to convince local stakeholders both private and public of the benefits of the BID approach to jointly managing shared place resources (town centres, high streets and business parks).

Case studies of BIDs in other countries are familiar to many working in town centre management, regeneration and place development. However, to date, in the UK only voluntary approaches have been implemented. The essential difference between a voluntary approach and the BID approach is that all ratepayers in a defined BID area would pay a levy as opposed to voluntary contributions (following the local referendum). It is felt that rational self interest on the part of business rate payers means that no single business would vote to pay a levy if they were not convinced that the implementation of the business plan of the BID would bring them tangible benefits.

The approach outlined below seeks to identify a way in which through evaluated "Demonstration Projects" evidence of individual business benefit can be produced. Providing evidence through demonstration projects is key to gaining adoption of the BID approach in Scotland.

2. Summary of Demonstration Project Approach

Rationale

• There is a need to provide evidence that the projects and programmes funded out of BID levy payments will provide benefits to the individual levy payer;
• BIDs have been used in a variety of contexts elsewhere and the Demonstration programme should seek to provide evidence of the benefits across these "categories of places"

Approach

• Each demonstration project should develop a short term "business defined programme of actions." This would be a short term equivalent of the full business plans that a BID would require to develop and put to the vote.
• The costing of this programme should be equivalent to a defined additional business rate contribution (e.g. within the parameters of the levels defined in the English Guidance) and that funding should be supplied by the public sector as a "BID Equivalent contribution"
• Baseline information of place and individual business performance should be identified and changes attributable to the demonstration projects actions monitored to produce evidence of the individual and collective return that the "BID Equivalent Resources" produces.

3. "Categories" of Place for Demonstration Project

The terms used to describe categories of places can be refined and the examples are merely used to supplement the descriptions and are not intended to suggest potential demonstration projects.

Four place categories are suggested:

• City Centre or City Centre "Quarter" - e.g. - George Street (Edinburgh), Trongate (Glasgow), Grassmarket (Edinburgh), Union Street (Aberdeen)
• Town Centre Renewal - e.g. Motherwell, Kirkcaldy, Musselburgh, Stranraer
• Prospering Town Centre - e.g. Dunfermline, Ayr, Perth
• Business Park/Science Campus - e.g. Hillington, Strathclyde Business Park.

4. Selection Process Requirements

The process of selecting demonstration projects needs to ensure that each of the place categories is covered. As the approach depends on additional central resources for the "BID Equivalent" it may be necessary to limit the programme to one demonstration project in each category.

Places could be selected by invitation based on known strength of voluntary arrangements (e.g. existing public/private sector mechanisms for place/town centre management). This would have the advantage of shortening the period required to produce the short term business defined programme of actions. Alternatively expressions of interest from places within the categories could be called for by the Scottish Executive.

5. Management of Demonstration Programme Process

Three stages in managing the Demonstration Programme Process are envisaged

• Start Up - to include the selection of appropriate Demonstration Projects, agreement of BID equivalent funding for the defined Demonstration Project Area, identification of baselines both on an area and business basis.
• Demonstration Project Implementation Period - the running period of the demonstration projects, central management of monitoring information and collection of evidence of benefits.
• Evidence Collation and Presentation - a short period at the end of the demonstration project period to collate the impacts at area and individual business level and a programme of dissemination of the results of the Demonstration Projects to key stakeholders locally in Scotland.

It is felt that some central resource will be needed to ensure a co-ordinated approach to establishing, supporting and collating evidence in addition to the provision of BID equivalent funding to the local demonstration projects.

6. Timescales

Different forms of local business plan may be developed in the demonstration projects and these may require different periods of implementation to produce evidence of benefits. It is important that this is not over constrained as the demonstration projects will need to reflect a business defined set of actions.

It is felt that the minimum duration of a demonstration project should be no less than 6 months (perhaps for a marketing and events intervention) and the maximum not greater than 12 months (where clean and safe interventions might be the focus of the actions). If the projects that were selected had different lengths of implementation period a staged dissemination of information on the benefits of each would need to be planned. This should not be seen as a constraint to different lengths of project.

If there is support for the development of the Demonstration Programme approach potential timescales to move towards implementation could be:

• October 04 - December 04 - develop the programme approach and guidance, seek out potential demonstration project partners.
• January 04- March 05 - Agree BID equivalent funding and local project planning process, identify baselines for chosen areas and monitoring approaches.
• April 05 - March 06 - Demonstration Programme Period
• April 06 - Presentation and Dissemination of Evidence from the Programme

7. Summary of Key Discussion Points

The issues discussed above suggest a number of key points for discussion by the working group if progress is to be made on development a "Scottish BID Demonstration Programme"

The key issues are highlighted below:

• Is a Demonstration Programme approach fit for the purpose of convincing businesses in local contexts in Scotland that BIDs can produce tangible individual business benefits?
• At a Programme (Scottish) level who should organise the management of the programme and what stakeholders need to be involved at this level?
• How open or "directed" should the Demonstration Project selection be. Is it a question of invitation or competition?
• Are the place categories sufficiently distinct? Are there others?
• What are the possible sources of "BID equivalent" resources?
• If there is a view that there is merit in further developing the Demonstration Project approach who should be tasked with taking forward the necessary next steps?

8. Conclusion

This paper sets out for discussion an approach to demonstrating the benefits of the BID approach to the shared management of places which have multiple users, owners and stakeholders. It is prepared from a perspective which is positive about the potential benefits to individual business and areas in general of implementing BID approaches in willing local areas across Scotland.

However it recognises that these benefits are not proved in the Scottish context and argues that for wider adoption of BID approaches there is a need to provide evidence for both public and private sector stakeholders that the BID model can add value beyond current partnership approaches.

Evidence of the benefits of BID type approaches can be provided (or not depending on the success of the demonstration projects) through the Demonstration Programme approach outlined above. This evidence can build upon existing case studies such as those from the 1990s detailed in PAN 59 Improving Town Centres (1999) ( http://www.scotland.gov.uk/about/Planning/pan_59_imprvingtownc.aspx ).

28/09/04