NEWALLEN ALLIANCE

What is an Economic Improvement District (EID)?

An Economic Improvement District (EID), also known as a Business Improvement District (BID), established in Indiana Code (IC) 36-7-22, is a public-private partnership in which local property and business owners elect to make a collective contribution, by way of a special assessment, to the maintenance, development, and promotion of their property. The Fort Wayne Downtown Improvement District is an example.

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Why establish an EID/BID?

An EID/BID is an important tool for use in revitalizing commercial corridors in downtowns and neighborhoods. It provides a unique and straightforward economic and community development tool for municipalities, developers, and property owners because it allows targeted control, financing, and development of projects without creating an additional financing burden on county and municipal taxing units. An EID/BID also allows tax units to leverage the cost of public improvements and services that would otherwise be limited by the circuit breaker credit. It also can help to provide supplemental services, such as cleaning streets, providing security, making capital improvements, and marketing the area, to those already provided by the municipality.

 

What types of projects may be funded by the EID/BID?

EID/BID projects may include:
 

1. Planning or managing development or improvement activities.
    

2. Designing, landscaping, beautifying, constructing, or maintaining public areas, public improvements, or public ways (including designing, constructing, or maintaining lighting, infrastructure, utility facilities, improvements, and equipment, water facilities, improvements, and equipment, sewage facilities, improvements, and equipment, streets, or sidewalks for a public area or public way).
    

3. Promoting commercial activity or public events.
    

4. Supporting business recruitment and development
    

5. Providing security for public areas
    

6. Acquiring, constructing, or maintaining parking facilities
    

7. Constructing, rehabilitating, or repairing residential property, including improvements related to the habitability of the residential property

 

How is an EID/BID established?

The steps toward establishing an EID/BID include the following:
 

1. The property owners in the proposed district petition the taxing unit's legislative body for its approval. The petition must be signed by:

   • A majority of the owners of real property within the proposed district; AND

   • The owners of real property constituting more than 50% of the assessed valuation in the proposed district. Also, the petition must include the following information: The boundaries of the proposed district The name and address of each parcel and owner of land within the proposed district, and a description of the existing land use and zoning classification of each parcel A detailed description of the economic improvement projects to be carried out within the proposed district, the estimated costs of these projects, and the benefits to accrue to the property owners within the district A plan for the application of assessment revenue to the cost of the economic improvement projects within the district

   • A proposed formula for determining the percentage of the total benefit to be received by each parcel of real property within the district

   • The number of years in which assessments will be levied

   • A proposed list of members for the board (see #4 below)
      

2. The legislative body conducts a public hearing on establishing the proposed EID/BID
    

3. The legislative body adopts an ordinance establishing the EID/BID
    

4. Establishment of an economic improvement board appointed by the legislative body. The board must be comprised of

   • At least 3 members, AND

   • A majority of the board members must own real property within the established EID/BID

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How does an EID/BID work?

Using the formula approved by the legislative body, the board determines the amount of the special assessment for each parcel. The assessments are then collected into an economic improvement fund established for financing the purposes specified in the ordinance that established the EID/BID.

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1. Anderson Partners LLC, "Economic Improvement Districts (EIDS),"  (accessed February 8, 2016).

2. Ibid.

3. IACED, "Economic Improvement Districts Legislation Passes House of Representatives Committee" (accessed February 8, 2016)

4. IC 36-7-22-3" 'Economic improvement project' defined"

5. IC 36-7-22-7, "Ordinance; establishing district"

6. IC 36-7-22-4, "Petition; filing; contents" 

7. IC 36-7-22-6, "Hearing; notice; questions heard" 

8. IC 36-7-22-7 9

9. IC 36-7-22-11, "Ordinance; economic improvement board" 

10. IC 36-7-22-12, "Assessments; percentage of benefit; notice; hearing; decision; lien; certification; economic improvement districts" 

11. IC 36-7-22-16, "Economic improvement fund"