Institutionalization of Business Improvement Districts: A Longitudinal Study of the State Laws in the United States

By Morçöl, Göktug; Gautsch, Douglas | Public Administration Quarterly, Summer 2013 | Go to article overview

Institutionalization of Business Improvement Districts: A Longitudinal Study of the State Laws in the United States


Morçöl, Göktug, Gautsch, Douglas, Public Administration Quarterly


ABSTRACT

The institutionalization of business improvement districts (BIDs) is investigated with analyses of the state enabling laws in the United States. The results indicate that no distinct institutional BID form has emerged yet, but there is a process of institutionalization. This process can be observed in the names used for BIDs in the laws, their governing models and the methods of determining their board membership. The name "improvement district" has been used with an increasing frequency in the laws. Of the three BID governing models-subunits of local governments, autonomous public authorities, and nonprofit corporations-the last has been adopted more frequently in recent decades. The governing bodies of BIDs may be appointed or elected, but the elected board model was adopted more frequently in recent decades.

Keywords: business improvement districts; special districts; institutionalization

Acknowledgement

We gratefully acknowledge Dr. Carol Becker's contribution to this study by sharing with us the detailed results of the BID survey she and her colleagues had conducted in 2010.

Business improvement districts (BIDs) have been established in all states of the United States, most provinces of Canada, a few countries in Europe (United Kingdom, Ireland, Germany, and the Netherlands), and South Africa and a considerable size of BID literature has been built in recent decades. BID researchers investigated their implications for democratic participation and accountability (Barr, 1997; Briffault, 1999; Hochleutner, 2008; Justice & Skelcher, 2009), BID-local government relations (Morçöl & Zimmermann, 2008; Wolf, 2008), and their successes and failures in helping solve urban problems (Hoyt, 2005; Ellen, Schwartz & Voicu, 2007; Cook & MacDonald, 2011).

After two decades of research, there still is a need to formulate a common conceptualization of BIDs, however. An important problem is whether BIDs should be conceptualized as a distinct form of local government or a mixture of different institutional forms. There are two sets of conceptual issues within this problem. First, is there a single and coherent BID institutional form? Justice and Skelcher (2009) argue that it is possible to identify an ideal typical BID institutional form, despite the considerable functional and institutional diversity among the BIDs in the different states of the United States and other countries (p. 740). Second, are BIDs distinguishable from other forms of special districts? This is an important question, because BIDs are often defined in terms of their similarities with and differences from special districts (e.g., Kennedy, 1996; Briffault, 1999). To answer these questions, we analyzed the definitions and descriptions of BIDs in the enabling laws of the 50 states of the United States, Washington DC, and Puerto Rico.

This comprehensive study of the state laws is needed because the conceptualizations of BIDs in the current literature are based on limited empirical investigations and legal analyses. Mitchell's (1999) nationwide survey in the United States in the later 1990s identified BIDs in 42 states and Washington, DC. Becker and her colleagues' survey in 2010 identified BIDs in 48 states-the only exceptions being North Dakota and Wyoming-and Washington DC (Becker, 2010; Becker, Grossman, & Dos Santos, 2011). However, the empirical and legal studies typically focus on few selected cases and/or few state laws. This narrow focus in the studies does not constitute a sufficient basis for a comprehensive conceptualization of BIDs.

The empirical BID studies have focused primarily on six states and Washington, DC: California (Brooks, 2006, 2007; Cook & MacDonald, 2011; Lloyd, McCarthy, McGreal & Berry, 2003; MacDonald, Stokes & Bluthenthal, 2010; Meek & Hubler, 2008; Stokes, 2008), Pennsylvania (Hoyt, 2005; Stokes, 2006; Morçöl & Patrick, 2008; Dilworth, 2010)1, New York (Ellen, Schwartz & Voicu, 2007; Gross, 2008; Meltzer, 2011), Maryland (Baer, 2008; Baer & Feiock, 2005; Baer & Marando, 2001), New Jersey (Justice & Goldsmith, 2008; Ruffin, 2010), Georgia (Ewoh & Zimmermann, 2010; Morçöl & Zimmermann, 2008), and Washington, DC (Mallet, 1993; Schaller & Modan, 2005; Wolf, 2006).

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