A bid ballot is the formal voting process undertaken by businesses within a proposed area to determine whether to establish a Business Improvement District (BID).
Understanding the Context: Business Improvement Districts (BIDs)
To understand a bid ballot, it's essential to first know what a Business Improvement District (BID) is. As defined, a Business Improvement District (BID) is a defined area in which a levy is charged on all business rate payers in addition to the business rates bill. This levy is used to develop projects which will benefit businesses in the local area.
BIDs are typically established to fund projects aimed at improving the local trading environment, such as enhanced security, cleaner streets, marketing initiatives, or accessibility improvements. Because the BID levy is a mandatory charge on all eligible businesses within the designated area, a ballot is required by law to ensure there is sufficient support for its creation and the financial commitment involved.
The Bid Ballot Process Explained
The bid ballot is the democratic mechanism that allows businesses to decide if they want to pay the additional BID levy and become part of the BID. Here's a breakdown:
- Initiation: A proposal for a BID is developed, often by a group of local businesses, property owners, or the local authority. This proposal outlines the planned projects, the budget, the duration of the BID, and the proposed levy rate.
- Eligibility: Businesses liable for business rates within the defined proposed BID area are typically eligible to vote. Each eligible business usually gets one vote.
- The Vote: Eligible businesses receive ballot papers and vote on whether to approve the BID proposal. The ballot is conducted independently, often by the local authority or an electoral services provider.
- Threshold: For the BID proposal to pass the ballot, it must usually satisfy two conditions:
- A majority (e.g., over 50%) of those businesses who vote must vote in favour.
- These "yes" votes must represent a majority (e.g., over 50%) of the aggregate rateable value of the properties of those who voted.
- Outcome:
- If the ballot passes both tests, the BID is legally established for the proposed term (often 5 years), and the levy becomes mandatory for all eligible businesses within the area.
- If the ballot fails either test, the BID is not established.
Why is a Bid Ballot Important?
The bid ballot is crucial because it ensures that the creation of a BID, and the imposition of a mandatory financial levy, is supported by the majority of the businesses who will be funding and benefiting from it. It provides legitimacy and democratic mandate for the BID's operations.
| Aspect | Description |
|---|---|
| Purpose | To gain formal approval for establishing a Business Improvement District (BID). |
| Participants | Eligible businesses within the proposed BID area (business rate payers). |
| Decision | Whether to agree to pay a mandatory levy for local area improvements. |
| Outcome | BID established if vote passes set threshold (majority votes & rateable value). |
Practical Considerations
- Engagement: Successful BID ballots often involve extensive consultation and engagement with businesses beforehand to ensure the proposal meets their needs and that they understand the benefits and obligations.
- Information: Clear information about the BID plan, budget, and how the levy will be spent is vital for businesses to make an informed decision.
- Renewal: After the initial term expires, a BID typically needs to go through a re-ballot process to continue operating.
In essence, a bid ballot is the vote that gives businesses the power to decide collectively whether to invest in the improvement of their local trading environment through a BID.
