November 7, 1995
THE COUNCIL OF
THE CITY OF NEW YORK
SPEAKER & FINANCE CHAIRMAN TO RELEASE RESULTS
City Council Speaker Peter F. Vallone and Finance Committee Chairman Herbert E. Berman, will release on Wednesday, November 8th, the results of the Finance Committee's six month investigation of the City's 33 Business Improvement Districts. In a report, titled n CITIES WITHIN CITIES: Business Improvement Districts and the Emergence of the Micropolis," the Finance Committee concludes that although BIDs have positively impacted many New York City neighborhoods, they nevertheless require additional oversight, and in some cases serious managerial restructuring.
OF SIX MONTH INVESTIGATION INTO THE
MANAGEMENT, OPERATIONS AND SERVICES OF NYC'S
BUSINESS IMPROVEMENT DISTRICTS!
The Committee has strong concerns that many of the property owners and managers, who are legally required to pay their BID assessment, are not properly informed about BID activities. Furthermore the report will demonstrate that the majority of property owners do not believe the BID assessment is a good investment. Given that BID assessments totaled more than $42 million last year (more than the combined budgets of the five Borough Presidents) and that the number of BIDs could easily double within the next few years, immediate action must take place to ensure that BID activity is in the best interest of the property owners.
The report will reveal the following:
The report, intended to provide the public with a comprehensive analysis of BID operations, is the most exhaustive oversight of BIDs to date. The report will detail problems inherent in the structure of the BIDs as well as highlight some management abuses. The Committee will also provide a series of important recommendations including legislative changes to the BID process, enhanced financial reporting, and more extensive BID oversight by both the BIDs and the Administration.
- Shockingly, the East Brooklyn BID requested property owners to increase their assessment by $40,000 to cover the mismanagement and faulty budgeting of BID personnel.
- Years before the allegations were made that the Grand Central Partnership Social Service Corporation workers operated as "goon squads", the GCSSC was the subject of two separate $5 million lawsuits involving allegations of assault against homeless individuals.
- The GCSSC, after being sued by a homeless individual claiming assault, paid this individual $27,500 to "settle" the lawsuit.
- The Fifth Avenue BID failed to acknowledge to Council staff, the existence of a $2 million lawsuit involving allegations of assault by BID personnel.
- The Jamaica Mall BID is suing its previous management team for mismanagement, fraud and the illegal diversion of funds.
- Two BIDs, Graham Avenue and 165th Street, made illegal loans to organizations which shared common board members.
- Any BID could guarantee its continued existence by issuing or incurring debt.
- 90% of property owners and property managers had no idea how much it cost to administer their BIDs.
- 55% of property owners and property managers could not state that they thought their assessment was a good investment.
- 57% of property owners and property managers did not know who was in charge of their BID.
TIME: 10:30 a.m.
DATE: Wednesday, November 8th, 1995
PLACE: City Hall