A Business Improvement Area is a geographic area in a municipality. A BIA board of management is an organization set up to provide certain business promotion and improvement functions within that area.
A BIA allows local business people and property owners to join together and with the support of the municipality, to organize, finance and carry out physical improvement and promote economic development in their district. The local municipality is the body that is responsible for approving the budget of the BIA.
There are now more than 230 BIA’s in place across the province. They vary in size from lessthan 60 businesses and property owners to more than 2,000.
The purpose of this document is to provide an information resource on Business Improvement Areas (BIA’s) for local property owners, business people and municipal officials. Business Improvement Areas offer a self-help approach to revitalizing business districts. Involvement with a BIA generally entails a substantial commitment of time and financial resources. However, past experience suggests that a committed membership generally leads to a successful BIA.
What is a BIA?
A BIA is a geographic area in a municipality. Each BIA has a board of management which is an organization set up to provide business promotion and improvement functions. A BIA allows local business people and property owners to join together and with the support of the municipality, organize, finance and carry out physical improvement and promote economic development in their district. The local municipality is the body responsible for approving the budget of the BIA.
In 1970, the province passed enabling legislation in response to a request by the business community in the Bloor and Jane Street area in the City of Toronto for special authority to establish the Bloor West Village BIA. Provisions for creating and operating a BIA are now contained in Sections 204 to 215 of the Municipal Act, 2001. In addition to Bloor West Village, there are now more than 230 BIAs in place across the province. They vary in size from less than 60 businesses and property owners to more than 2,000.
The BIA concept has also spread beyond the boundaries of Ontario. The concept has been adopted by more than 1,500 communities across the United States, in most provinces in Canada and has now taken hold in Europe. 1.3
What is the purpose of a BIA?
The main purposes of a BIA are to revitalize and maintain a dynamic local neighbourhood and to promote the area as a business or shopping destination. While a major goal of revitalization and retention is to encourage both local residents and others to spend their shopping dollars within the local commercial district, all businesses and residents in the area may benefit as well. Revitalization and maintenance create a cleaner, safer and more congenial atmosphere that benefits all local businesses. It also benefits professional service firms, whose clientele can enjoy the local atmosphere as part of their trip to the doctor, dentist, lawyer or accountant. The same is true for entertainment and dining establishments which benefit from the increase in local traffic and the improved atmosphere that results from the presence of a BIA.
Further activity is needed beyond just beautification and promotion, although both are important elements of any comprehensive improvement effort. A concerted effort is also required on the part of the BIA leadership to develop a network of relationships and partnerships among local community groups (schools, churches, citizen groups etc.) and institutions (Chamber of Commerce, committees of council etc.). The key to the success of any BIA lies in establishing and maintaining this network. It is only through the combined effort of all local community groups that a BIA can truly be successful.
Revitalization and maintenance often includes defining an identity for the local community. This identity is then used as a means to further promote the local community as an interesting and unique business area. In some cases, leaders of the BIA (the board of management) become a line of communication between the community and the local municipal council. The BIA forum can be used as a vehicle for conveying community concerns to council and, for prompting council to pursue policies and activities that will promote and strengthen the community and its unique identity.
What does a BIA do?
The BIA has a two fold mandate:
- to oversee the improvement, beautification and maintenance of municipally owned land, buildings and structures in the area beyond that provided by the municipality generally, and
- to promote the area as a business and shopping district.
In carrying out these responsibilities, BIAs have become involved in numerous activities, which often include:
- Marketing: Understanding who area customers are, and creating effective promotions to retain and expand the customer base.
- Business Recruitment: Working with property owners to help ensure that available space is occupied, and that an optimum business and service mix is achieved and maintained.
- Streetscape Improvement and Other Amenities: Providing for more customer-friendly lighting, signage, street furniture, planters, banners and sidewalk treatment.
- Seasonal Decorations: Creating a unique and pleasant environment for customers and staff of all businesses, retail and non-retail, through the use of decorations that are appropriate to the season and holiday.
- Special Events: Organizing and partnering in special events that highlight unique attributes of the area and increase customer visits.
Who benefits from having a BIA?
A BIA can benefit more than just local retail businesses. All businesses in the area, whether professional, dining, entertainment, finance, or retail, may benefit from the improved local atmosphere and ambience that a successful BIA helps to create.
It is the responsibility of each business to build upon the activities of the BIA and ensure that the customer receives best value in an efficient and courteous manner. An expanded
customer base depends on the successful partnership between the activities of the association and individual businesses.
BIA-initiated improvements and activities may lead to an increase in property values. Improvements help to create and sustain a more vibrant and viable economic environment within the local area. This attracts both commercial and service sector businesses to the area that, in turn, may lead to an increased demand for retail and office space, and a subsequent increase in property values.
Non-retailers also benefit:
BIA improvements and activities help to create a more vibrant local community and a more prosperous local economic environment. A more vibrant community attracts more visitors and retains more local customers for all types of services – including dining, entertainment and professional services. In addition, a more vibrant community creates a more inviting atmosphere that clients and customers will enjoy visiting.
A BIA is a secure source of funding:
A secure source of funding is a significant benefit to having a BIA. Once the board of the BIA has prepared a budget, discussed it with its membership and has it approved by the municipality, the municipality collects money as a special levy on all industrial and commercial properties in the area. Funds are then transferred to the BIA organization to carry out its work.
- increasing community interest and pride in the business area
- ensuring on going co-operation among the members of the business community
- improving lines of communications between the business community and municipal council and staff
- advocating membership interests and concerns through effective communication with both the municipality and other levels of government
- increasing cost savings to the membership through improved integration of capital funding and promotional activities
Approving the Budget and Determining the Levy
The annual budget for the Oshawa BIA is $143,100.00. The board prepares annual budget estimates that must be submitted to municipal council for approval. Generally the board presents the budget to members at the annual general membership meeting for approval. The board is required to discuss the proposed budget with its membership and should solicit input from the membership. To allow for a thorough discussion, the board should provide a copy of the proposal budget to the membership along with the notice of the budget meeting. Once the budget has been discussed by the membership, it is then submitted to municipal council.
Once the budget is approved by municipal council, the council adds a special levy to the property tax paid by every owner of property designated as industrial or commercial within the boundaries of the BIA. For each property, the amount of the levy will be related to its realty assessment. Ordinarily, if the property assessment represents .005% of the total realty assessment within the BIA boundaries, it will also pay .005% of the total BIA levy. The exact amount of the BIA levy is determined by dividing the property’s realty assessment by the total realty assessment in the BIA and multiplying by the total BIA annual budget.
For example, if:
a property’s realty assessment is $100,000, and the total realty assessment in the BIA boundaries is $10,000,000 and the annual BIA budget is $40,000, then the property’s BIA levy is equal to
$100,000___ x $ 40,000 = $400
The municipal council can set minimum and maximum contributions that properties within the BIA can be assessed. In addition, the council can set a special charge for properties that derive greater benefits from the BIA. Municipalities seldom use such special benefit provisions. However, a maximum levy can be a useful tool in situations where one property in the BIA represents a significant proportion of the total applicable realty assessment in the BIA. In such situations, in the absence of maximum levies, the BIA levy may prove a heavy burden on the large property in relation to others in the BIA.
If you would like a complete copy of the BIA Handbook visit www.mah.gov.on.ca
The Downtown Oshawa BIA has been a not-for-profit organization since 1974.