Frequently Asked Questions (FAQ)
Have BIDs been supported elsewhere in the UK?
The legislation came in September 2004 and there have already been over 93 successful ballots. These BIDs involve over 45,000 businesses and will bring in over £170m of new finance to develop their centres over the next 5 years.
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What might a BID deliver?
BIDs can deliver any projects or services that are agreed by the relevant businesses and are an addition to anything the Public Sector does. In most cases they focus on marketing and promotion activities, increasing safety and security for business and customers and better transport and access arrangements. The important thing is that BIDs are in the main addressing operational matters and those actual projects and services will be determined as a result of detailed consultation with all the business in the BID area.
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Why is a BID needed?
A BID is a mechanism which allows businesses to raise a sum of money to manage and deliver projects which they believe will improve the trading environment for them. It should ultimately increase trade and drive down costs for those businesses that are paying for the improvements.
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Who can develop a BID?
A BID can be proposed by any business ratepayer, property owner, local authority or partnership with an interest in the BID Area.
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How will the BID be managed?
BIDs are normally controlled and managed by local businesses that are paying the levy. The majority of BIDs are delivered through Companies Limited by Guarantee. The organisation delivering the BID will be responsible for the delivery of the BID projects and services and directly responsible to all its business membership through an elected board.
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Who pays for a BID?
Once projects and services have been agreed by businesses, these are costed up. The cost to each business is worked out on a pro rata basis. This is called the ‘BID Levy’. A formal vote then takes place on the agreed projects and services and if the majority vote YES then ALL within the BID area HAVE to pay. The BID Levy is normally paid by the occupiers of a property. In addition BIDs can draw in other voluntary funding, e.g., from property owners, public sector and Regional Development Agencies.
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How does an area become a BID?
Normally a ‘BID Working Group’ is set up which is responsible for putting together a detailed business plan setting out the projects it aims to deliver on behalf of the business in the area.
This is based upon a detailed consultation process with businesses. The business plan will include the projects, cost, delivery guarantees, performance indicators and the management structure. A confidential postal vote is then held of all the businesses that would pay the BID Levy. To become a BID a majority of those that vote must be in favour by number and rateable value. A successful BID then has a mandate for a maximum of 5 years after which it needs to re-ballot businesses with a new Business Plan.
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Does this mean the local authority will stop delivering services?
BID money can only carry out projects and services which are ADDITIONAL to those that public agencies have to provide. Prior to the BID Business Plan being produced the current services being delivered by all public agencies including the Local Authority and Police are benchmarked. The Local Authority has to continue to deliver that level of service for the period of the BID. The BID company can agree to provide additional resources to deliver a higher level of service over the benchmarked level if businesses want this.
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How is the BID monitored?
Like any good business plan specific key performance indicators (KPI’s) are set and performance is monitored against the KPI’s by the BID board. As business contributes the funding to achieve those specific KPI’s set out in the prospectus the BID Company will be required to monitor and inform its members how well the KPI’s on a regular basis.
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