Proposed business improvement district gains traction

Proposed business improvement district gains traction

By Chris Teale (File photo)

More details emerged Tuesday morning on the planned business improvement district for Old Town and the redeveloping waterfront, which is planned for a vote by city council next spring.

In a presentation to the city’s waterfront commission, Alexandria Economic Development Partnership president and CEO Stephanie Landrum said commercial properties within the BID’s boundaries would pay an extra 10-cent tax per $100 of assessed value to fund it, while residential properties would be exempt.

The BID’s proposed bound- aries would encapsulate the King Street retail and commercial corridor between the King Street Metro station and the waterfront, the area captured in the city council-approved waterfront small area plan and Washington Street in the city limits.

North Old Town would be excluded from the BID in its current form, due to the ongoing revamp of its small area plan, although Landrum said it could be added once the district is up and running.

During her presentation, Landrum stressed that no residences will be taxed, only businesses.

“That is a 100 percent foundational aspect of this group,” she said. “… There was no de- bate about this, and there is no intention that residents pay.”

A BID has been under discussion for some time. The waterfront commission’s governance subcommittee studied various models for funding maintenance and programming on the waterfront, which staff said is not financially feasible for city control as it would cost more than managing city parks.

The subcommittee recommended the BID as its preferred option for further study in May, while the city’s MGM readiness task force similarly suggested it for further study as one way the MGM National Harbor resort across the Potomac River can be leveraged to help Alexandria.

In addition, several business and property owners approached city council about the idea and were awarded $25,000 for fiscal 2017 through the city budget’s add/delete process to study it. The Old Town BID Exploratory Committee was thus formed, and met over the summer.

Landrum said the exploratory committee decided on several priorities for the BID during their discussions: management of public spaces; business advocacy and information dissemination; finding solutions to transportation and parking issues; beautifying the area; marketing Old Town as a brand; and event programming.

“It does not mean that the city would give up responsibility or stop maintaining,” she said. “What it means is that our properties would get a higher level of service, and we have paid a fee to have that.”

In an interview after the meeting, Landrum said the Old Town Business and Professional Association, an all-volunteer organization that advocates for the area’s businesses, could have its mission folded into the BID’s work and be phased out, or it could continue to exist in some form.

“Right now, those groups are voluntary,” she said. “People pay dues, so it’s not very representative. For a BID, everyone will be paying in so then they are all forced into this larger mechanism that is more powerful, is more representative, has a stronger voice.”

David Remington, AEDP’s senior associate for commercial real estate, said the tax on businesses would raise approximately $2.2 million each year, while additional revenue can be raised through ticket sales from events, voluntary contributions and other fundraising.

Remington said approximately 35 percent of the BID’s annual budget would be spent on making the area cleaner
and safer, 37 percent would go to branding and marketing for Old Town, 21 percent would be spent on improving the streetscape and 7 percent would pay for administrative costs.

He said the BID must exist within the laws and policies established by city council, and would be held accountable by them. Remington said the BID would be a 501(c)(6) like chambers of commerce and managed by a board of directors
that includes both residents and business owners. Initially, it would be in existence for a five-year term and subject to council scrutiny.

“This is not something we’re setting up and letting the ship sail away,” he said.

Reaction among commissioners was broadly positive. Howard Bergman, a member of the commission who represents the Founders Park Community Association, said the passive nature of Founders Park must be preserved as it is laid out in the waterfront small area plan.

Steve Mutty, executive director of the Alexandria Seaport Foundation, a local nonprofit, said the BID must recognize residents’s needs and concerns and keep within city policies.

“We talked about this being a mixed-use community, and while residents are not paying into [the BID], they are a part of it,” he said.

Nathan Macek, vice chairman of the planning commission and a member of the waterfront commission, said the BID will help keep Old Town relevant in an increasingly competitive region.

“I think this is absolutely what we need to be doing to ensure the success of this business area,” he said.

A series of public meetings on the proposed BID will follow in January, and city council is tentatively slated to vote on creating the new district in March. Councilors will need to approve enabling legislation to create the BID’s tax district and set the tax rate. If established, the BID’s scope and duties would be codified through a memorandum of understanding with the city.