A business improvement district in Boston-finally

With city services cut and unlikely to rebound to pre-recession levels any time soon, Bostonians are stepping into the breach.

Businesses in the Downtown Crossing area are banding together and voluntarily agreeing to pay more property taxes next year to fund their own cleanup and security operations. Other parts of the city, including the Rose Fitzgerald Kennedy Greenway, the North Station area, and the Back Bay, are watching closely and considering following suit. Corporate donations are also being sought for the upkeep of the Boston Common and the Public Garden.

Rosemarie Sansone, the president of the Downtown Crossing Partnership, which spearheaded the effort to form a business improvement district, says it’s taken way too long for Bostonians to wake up to the city’s new funding reality. “With 60 percent of the land in this city tax exempt, we shouldn’t have been the last major city in the country to form a business improvement district,” she says. “We should have been one of the first.”

Many big and small cities across the country have business improvement districts. New York City, for example, has more than 60. Massachusetts has business improvement districts in Hyannis, Springfield, Westfield, North­ampton, and Taunton.

Downtown Crossing flirted with the concept many times over the years, but those attempts usually foundered because of opposition from one group or another. Sponsors also tried unsuccessfully to change state law to make participation mandatory if a majority of businesses voted to form a district. Approval was finally won this year from area businesses, but firms were allowed to opt out of the district if they wanted.

Just over 80 percent of the businesses in the district agreed voluntarily to pay more on their property taxes to fund the privately run district, and officials hope more companies in the area will eventually sign on. Partici­pants include Bank of America, Millennium Partners, Fidelity Investments, and State Street Bank, but a number of big names in the district opted out, including Equity Office Properties, which owns five buildings in the district, the Omni Parker House Hotel, and NStar. There is likely to be some friction between the participants and nonparticipants, because nonparticipants stand to benefit from the district even though they aren’t supporting it.

The participating companies are paying an extra $1.10 per $1,000 of assessed value on properties valued up to $70 million; any assessed value above $70 million would be taxed at a rate of 50 cents per $1,000 of value. Only businesses are being assessed. Owner-occupied residential properties were not invited to become members of the district although they are being invited to provide input. “Residents can play a role, but I don’t think they should be assessed,” says Sansone.

The downtown district, which officially launches in April, will be big. Think of it as a triangle with Govern­ment Center at one corner, South Station at another corner, and the intersection of Boylston and Tremont Streets at the third. Sansone estimates the district’s annual operating budget will be $3.1 million, which will be used to fund cleaning crews, market the area, and hire ambassadors who will roam about serving as a cross between Wal-Mart greeters and private cops. Those involved say they hope a laser-like focus on cleanliness will demonstrate that someone is taking care of the area and prompt the public to take better care of it, too.

The business improvement district is unlikely to tackle the biggest eyesore in the area—the hole in the ground left when the developers of One Franklin tore down most of the old Filene’s and then ran out of financing to finish their project. Sansone says it’s the first question everyone asks her.

“People are excited about the BID but they’re also concerned about the hole in the ground. We can’t ignore it,” she says.

Meet the Author

Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

Nancy Brennan, president of the Rose Fitzgerald Ken­nedy Greenway Conservancy, said her organization is exploring the creation of a business improvement district to increase funding for the park. If feasible, she says she would like to see it up and running by 2012.

Brennan called the idea of a business improvement district one of the original concepts to fund the Greenway. State officials eventually went in a different direction, but, with state funds scarce, Brennan says the Greenway is revisiting the original idea. The biggest property owner along the Greenway, developer Don Chiofaro, has pledged to lead the effort for a Greenway business improvement district.

“This seems to be a really good time to dust it off and see if it would create a more stable funding platform for the Greenway,” she says.