SIDs: An Essential Source of Support and Investment for NJ's Downtowns

SIDs: An Essential Source of Support and Investment for NJ’s Downtowns

By Stuart Z. Koperweis
President, Economic Development Strategists

July 15, 2020

This is an absolutely devastating time for our community, our nation, and the world. We know that the impact is significant and that the road to recovery will not be a quick one. Small business owners need support and resources to navigate the “new normal”; and even still, many will not be able to keep their doors open. To ensure our downtowns weather the storm, it is critical that communities take a proactive role in recovery and revitalization efforts. 

Each day another conversation ensues over the role of Special Improvement Districts (SIDs). Their mission is to create economic growth and revitalization opportunities a community’s commercial district. They do so through marketing, events, placemaking, technical assistance, maintenance and cleaning, and fostering collaboration between the district’s key stakeholders – business owners, landlords, developers, and municipal officials. The means of providing services, the lifeblood of the organization, is their budget. The budget controls what services will be created, instituted, and carried to fruition. Without the budget, there can be no assessment. Without the assessment, there are no funds. Without funds, there can be no services. Not only were the SID services necessary prior to the crisis, they are more so now than ever.

SID services will need to change to respond quickly and effectively to achieve the “new” undertaking of economic revitalization. Since the shutdown, SIDs have been taking a proactive role in supporting their businesses, promoting the districts to consumers, and helping to maintain health and safety standards. Some examples of what SIDs are doing for their businesses and communities:

  • Promotion: SIDs stepped up promotion within their districts, ensuring information about open businesses was readily available. They also created innovative ways for customers to interact with businesses virtually, through activities such as shop local bingo, girls’ night in, etc.
  • Technical Support: SIDs became a critical information conduit, relaying information about financial resources available to them, and at times assisting businesses with pulling together application. SIDs have also been providing support to small businesses transitioning to online sales. Some even went so far as to create “virtual Main Street” stores.
  • Financial Assistance: Many SIDs established relief funds to support their small businesses, and/or partnered with the municipality or a foundation to do so. Some also supported their small businesses by purchasing gift cards and redistributing them to first responders, while others subsidized the purchase of gift cards by customers – both of which resulted in cash on hand for the businesses.
  • Cleaning & Maintenance: SIDs play a critical role in maintaining the appearance of the downtown district by cleaning sidewalks, removing graffiti, clearing trash, and maintaining greenery. In particular, since the COVID crisis began, SID crews have been out there regularly cleaning high touch areas.
  • Social Distancing: SIDs have been at the forefront of thought when it comes to enabling safe opportunities to shop. To this point, I recommend that we are change the dialogue to Physical Distant/Socially Together. SIDs have worked with their businesses to set up take-out pick-up zones, provided signage for both outdoor and indoor activities, and generally helped maintain order in these confusing times. As NJ moved into phase 2 of opening, SIDs initiated conversations with municipalities to pass resolutions to simplify zoning and permitting to ensure businesses can expand outdoors. SIDs are helping to determine the best places for street closures and/or parklets, and some are even subsidizing the creation of appealing outdoor seating areas.
  • Vacancy Mitigation: We know that the fall out of the shutdown will be the closure of many businesses – with some experts projecting upwards of a 30% vacancy rate. SIDs know their districts, the retail spaces, and the landlords – they are best positioned to create and implement a plan to fill these vacancies. SID efforts during the inevitable downturn will help mitigate the impact of the vacancies on the downtown and surrounding businesses, which will mean a quicker recovery than allowing things to run their course without guidance.

In order to maintain the vital role of the SID as a public/private partnership, there should be an affirmation supporting the State SID Statue, especially regarding budgets. To this point, municipalities should: 

  • Keep budgets intact;
  • Maintain procedures;
  • Forgive interest/penalties and liens placed for failure to pay assessments for 120 days as a moratorium;
  • Allow budgets to be amended without delay to respond to needs of community; and
  • Advocate for supplemental funding for SIDs as part of federal and state grant programs.

In the few months since the crisis began, SIDs have aggregated resources and information to help small business owners understand what is available to them and have been making meaningful connections with small business owners, and amplifying their messages via social media — sharing ways the community can support their businesses, ways they have pivoted to be there for the community and beyond. They have significant plans in place to keep the engine going and rally the community in these times of need, shifting efforts as restrictions are lifted and new habits are formed. They have dedicated boards and local teams aligned with their community who are committed to putting the businesses and their town first!

Now more than ever, it is important to recognize that SIDs stand with local governments, effectuating a critical partnership that supports and strengthens municipal services, especially during times of crisis and cutbacks in municipal personnel. It is a powerful relationship that depends on a commitment of dedicated funding; a commitment of public leadership and support by the municipality; and dedicated management and personnel to serve the stakeholder community.

It has been noted in the many conversations we have had with Improvement Districts around the state in response to the COVID-19 crisis, that governing bodies and administrations must ensure that local SIDs remain fully funded. This requires the timely passage of SID budgets, as well as, a commitment on the part of state and local governments to work together to ensure that the assessments. 

The time will come shortly when we know that we must be “Socially Together,” yet “Physically Distant.” SIDs have the mechanism to create the new paradigm.

Stuart Z. Koperweis, president of Economic Development Strategists, brings an especially valuable combination of both public and private sector experiences in community development and economic growth.  He has been instrumental in forging alliances and partnerships with numerous statewide organizations—assisting both municipal governments and private corporations while serving under U.S. Congressmen and Mayors. Stuart is a longstanding and dedicated Board member of Downtown New Jersey. For more information visit https://strategistsllc.com.