Making your BID

As former Lincolnshire Police chief constable Richard Childs told the audience at the National Security Inspectorate’s (NSI) recent conference on ‘Delivering Customer Confidence’ (‘Policing for industry: the future’, Opinion, SMT, August 2004, pp11-12), the quest for security system funding has become an increasingly difficult issue for security professionals across the UK.

“Lessening political enthusiasm for putting resources into fighting industrial and commercial crime”, as Childs suggested, has been evident alongside trends including reduced Home Office funding of CCTV initiatives at the local and national level.

By way of example, the ‘CCTV Challenge’ scheme – which contributed millions of pounds towards the cost of surveillance projects around the country in the mid-to-late 1990s – has now ceased.

Childs also used the Warwick University platform provided by the NSI to underline several other related market moves, including the significant increase in the number of crimes that can be committed and the opportunities to commit them, increasing dissatisfaction with police response to many of these threats and the development of alternative policing strategies (including the ‘wider police family’).

Indeed, the widening gap between ever-present crime threats and traditional law enforcement methods has given rise to what Childs described as “the increasing development of alternative policing in the form of new types of people, as well as technology including CCTV and intruder alarms.”

The partnering approach

Viewed in this context, a welcome source for financially sustaining a variety of protective schemes has emerged as part of current local Government legislation.

The concept of Business Improvement Districts (BIDs) is a partnership funding arrangement set up by the Local Government Act. In essence, BIDs are an alliance between Local Authorities and businesses, designed to provide additional services or improvements to a specified area such as a town centre, an industrial estate or a business park.

BIDs could be used to fund the introduction of a wide variety of positive projects, ranging from making an area much safer by way of additional security measures through to improving its appearance, upgrading services like local transport, enhancing the visual appearance of an area or providing locally-based training and employment schemes.

However, it’s in the sensitive area of security that end users’ ears have noticeably pricked up, with the realisation that the effective protection of (potentially) vulnerable premises and assets might be realised. Not just as a by-product of isolated measures being introduced by one company, but rather ‘in the round’. The installation of CCTV and perimeter fencing, more frequent policing, better lighting and rapid response when it comes to removing litter and graffiti are examples of what can be achieved by business communities when using this new funding stream.

BID schemes – which have been used in the United States for several decades (see panel ‘BIDs: the local management solution’) – allow proposals for additional services to be voted on in a ballot by business ratepayers. Approval for any proposal put forward will have to meet two key tests: first, to obtain a simple majority of those voting and, second, to achieve a majority by rateable value. This aptly-named ‘dual key’ mechanism is designed to offer some safeguards against large firms forcing through a proposal against the wishes of smaller companies in the locality, or vice versa.

Business plans in place

Having identified a requirement for a capital project or services that will have a positive impact on the trading environment, the local business community defines the geographic location of the BID and develops a business plan to deliver the project and/or services.

The plan identifies how much money will be raised, how it will be spent, how the project will be managed and the delivery and monitoring procedures. The Local Authority is then responsible for organising a vote on the proposed plans.

A Government consultation exercise (see panel ‘Business Improvement Districts: background to the legislation’) sought comments and views on a draft BIDs guidance document issued by the Office of the Deputy Prime Minister. The draft included the need for BID proposals to meet a number of other provisos, such as providing evidence that consultation has taken place with business ratepayers and that 20% of those ratepayers feel the proposal should go to a ballot (though this percentage was challenged as being too high by at least one of the parties consulted, and has subsequently been amended).

The draft also states that the objectives, costs and investment targets would all need to be established, and that Local Authorities would have a veto on any inappropriate proposals. Funding for successful schemes would be met either wholly or in part by a compulsory levy on top of business rates for the maximum five-year term of the BID scheme. The Local Authority will collect the extra levy on behalf of the BID body and ring-fence it for BID purposes. Voluntary contributions to supplement a BID can be made by any billing authority, County or Parish Council, or property owners and other organisations.

To address other issues of versatility and affordability, local discretion extends to setting the amount of the BID levy (which may be different amounts for different types of ratepayer in the local area). The class of non-domestic rate-payers who’ll be contributing to the BID levy is also being left to local discretion.

The ATCM pilot project

Evidence from the US indicates a gestation period of around two years before the right conditions are created for a BID location to secure the necessary mandate.

Accordingly, the UK Government has supported a BIDs pilot project set up last year that’s being run by the Association of Town Centre Management (ATCM). Nearly 100 towns and cities applied to be part of the initiative, and 22 schemes have been selected from a shortlist of 53. Of differing sizes and types, these locations are being guided through the process of setting up BIDs, gaining the practical knowledge and establishing the mechanisms needed to help the schemes become a success.

BIDs could be used to fund the introduction of a wide variety of positive projects, ranging from making an area much safer by way of additional security measures through to improving its appearance

For instance, the New West End Company (NWEC) – formed in July 2000 as a voluntary BID in the Capital – is focused on Bond Street, Oxford Street and Regent Street, all of which lie (of course) within the largest shopping ‘district’ in the UK and one of the most significant retail floorspace concentrations in Europe. Examples of the NWEC’s partnership projects are its uniformed and branded Clean Team and the Red Caps Wardens, who were involved in ‘policing’ July’s Formula 1 parade along Regent Street that was attended by no less than 500,000 members of the general public.

Other areas involved in the pilot project include Blackpool, Hull, Lincoln, Swansea, Newquay, Plymouth and Maidstone.

Are BIDs really beneficial?

How wide-ranging are the benefits of BIDs in the real world, though? According to the ATCM, the local communities, businesses, Local Authorities and landlords can all experience gains. For the community, these schemes are said to produce economic well-being and growth, attracting inward investment and encouraging corporate social responsibility, as well as an enhanced feeling of safety.

For their part, Local Authorities may profit from the harnessing of private sector management and its organisational drive and skills. Not to mention the role of BIDs in providing new, sustainable investment that doesn’t detract from other resources.

Landlords stand to pick up rewards such as increased rental values on properties, with a rise in trade affecting turnover-based rentals. For businesses, the ‘upside’ includes reduced costs from crime reduction and joint activities such as promotions and marketing. Businesses are offered a local voice and the system is entirely fair: those that invest will benefit. There’s definitely no freeloading going on.

The latter point was expanded upon at a recent conference by Dave Hylands, chief information systems officer at Wrexham Borough Council. Speaking at the Manchester Royal Infirmary event – entitled ‘Complete Security Solutions’, and organised by Optimum Risk Management – Hylands welcomed the introduction of BIDs to fund future CCTV projects as “ a way of sustaining investment and maintenance issues well into the future”.

Hylands suggested that BIDs would be much fairer, a point he explained by describing the problems encountered by voluntary schemes in which some businesses don’t contribute financially, yet still receive the benefits of CCTV cameras having been installed.

Wrexham Borough Council’s interest in BIDs followed on from a 2002 Home Office-driven targeted policing initiative which involved North Wales Police and encompassed funding for a ten-camera scheme on Wrexham Industrial Estate. Businesses on the Estate contribute to the maintenance and monitoring costs of the cameras on a voluntary basis, a situation which Hylands described as being “unequal and unfair”.

Hylands added: “Many businesses are benefiting from extra security coverage, but in some cases at no extra cost to themselves.”

Nonetheless, Hylands stressed that the system’s installation has proven to be successful in reducing crime and fire-related losses. The surveillance cameras have been used, for instance, to alert operators in the Council’s Control Room to three major fires breaking out at night. There has also been a reduction in traffic flow – vehicles were previously being driven around the Estate on an ad hoc basis (often by opportunist thieves).

Such successes haven’t passed by unnoticed. At the neighbouring Rhosddu Industrial Estate, businesses have seen the true value of CCTV and are waiting for the BIDs legislation to be finalised this autumn such that they might implement similar crime prevention measures. Problems on the Rhosddu Estate include those joy riders and commercial theft (issues which are already being tackled by way of improved fencing and lighting, etc).

That said, additional investment is needed to cover the capital and revenue funding of a complementary surveillance system. Hylands explained that the Estate has a vocal Business Forum involving the developer and the Council’s economic development department, who work side-by-side on pinpointing security needs to give themselves a head start for their BID application.

A realistic funding solution?

Though any BID scheme is limited to a maximum duration of five years, Hylands doesn’t necessarily see this as a sticking point.

“At that time another ballot will be needed,” he added, “and if there was to be a negative vote then quite clearly the Local Authority would need to decide what to do. Hopefully, during the course of the preceding five years the system would have proven the benefits to be had from the initial investment.”

Hylands concluded: “The whole process offers potential security schemes a means to becoming a reality. It also makes the funding equation easier to deal with, because businesses can judge for themselves what’s involved from a practical point of view, as well as the likely benefits and costs accrued. If the majority agree with a proposal, they all pay equally towards the end result.”

Security by democracy. That can’t be bad.