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Item 7 Piccadilly Circus BID(14 June 2004)

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Item 7 Piccadilly Circus BID(14 June 2004) City of Westminster Item No. Decision-maker Date Title of Report CABINET 14 June Proposed Business Improvement 2004 District for Piccadilly Circus and Leicester Square CLASSIFICATION Report of Director of Planning & FOR GENERAL RELEASE City Development; Director of Legal and Administrative Services; Director of Environment & Leisure; Director of Community Protection Wards Involved St James and West End Policy Context The Civic Renewal targets for 2004/5 include helping the existing three pilot BIDs become formally established during the year and to improve Leicester Square and the Gardens. Financial Summary The costs for holding the ballot as part of the BID process can be met from existing budgets. Should the BID ballot be successful, then the BID levy supplement for the properties that the City Council occupies will total £3,100 for 2004/5 and about £13,000 for each of the following two years. This cost could be met from the budget agreed to cover expenditure on BIDs during this period. Report Author Mike Fairmaner Planning and City Development Department 1. Summary The City Council has been working with three pilot BIDs - Piccadilly Circus Partnership, New West End Company and Paddington BID - to improve their areas of the city through their funding of additional services and the promotion of their areas. All of these three pilot BIDs are intending to become formally established by holding a ballot of their businesses during 2004/5. Piccadilly Circus Partnership (PCP) is the most advanced and is now seeking the City Council’s endorsement Page 1 of 11 before it begins its campaign to get the necessary support from its businesses before the ballot in the autumn. The City Council has been working with PCP to deliver a better environment to the area between Piccadilly Circus and Leicester Square. PCP has been providing a number of additional services, generally through its contractors, and these arrangements have generated improvements to the area This report sets out the process that PCP will have to follow according to the draft regulations to become a formal BID. Currently PCP will be required to formally notify the City Council of its intentions to become a BID only when it is ready for the City Council to hold the ballot. The only stage at which the City Council has to take a formal decision on a proposed BID is after the ballot if it wants to use its power of veto unless particular information requirements under draft Regulation 3 are not met. However, this may change when the Government publishes the final version of the BID Regulations. Therefore it is proposed that a Committee of the Cabinet comprising the Cabinet Members for Economic Development and Transport, Street Environment and Community Protection and Licensing be formed to decide on whether the City Council wishes to veto the proposed BID or to make other decisions in respect of a BID as may be required by the Regulations. Finally, the City Council will be liable for the BID levy as it occupies 2 properties in the BID area liable for the BID levy and therefore will have two votes in the ballot. This will mean that should the ballot be successful, then the City Council will have to pay the BID levy totalling £3,100 for 2004/5 and about £13,000 for each of the following two years. This cost could be met from the BIDs budget. It is proposed that the Cabinet Member for Economic Development and Transport be authorised to vote in the ballot on behalf of the City Council. This report is listed in the forward list of key decisions. 2. Recommendations 2.1 That Cabinet welcomes and endorses the proposals by PCP to become a formally established BID. 2.2 That it be noted that a Committee of the Cabinet comprising the Cabinet Members for Economic Development and Transport, Street Environment and Community Protection and Licensing be formed to decide on whether the City Council wishes to veto the proposed BID or to make other decisions in respect of a BID as may be required by the Regulations. 2.3 That it be noted that the Cabinet Member for Economic Development and Transport will decide how the City Council will vote in the BID ballot. Page 2 of 11 3. Background 3.1 BIDs are a North American concept where businesses vote to pay a supplement to their business rates to fund improvements to their local area. Cabinet last considered BIDs in December 2002 when it agreed that the City Council should work positively with other agencies to establish BIDs within the City. Legislation allowing for the formal establishment of BIDs into England has since been included as part of the Local Government Act 2003. Cabinet Members received an update on BIDs in an Information Report in January 2004. Since then, the Government has consulted on draft Regulations setting out the process to become a formal BID and details of their operation. These regulations are due to be published in their final form in July. The City Council’s response to the draft regulations is attached in appendix 1. 3.2 In anticipation of the introduction of BIDs into the UK, the government has promoted a number pilot BIDs to help it in formulating the legislation. There are three such pilot BIDs in Westminster. Two of these are the Piccadilly Circus Partnership and the Paddington BID, established under the government’s Single Regeneration Budget programme in 2001 with 50% private sector match funding, as part of the CIRCLE initiative which largely ends this year. The third is the New West End Company which is mainly private sector funded. The two CIRCLE pilot BIDs both have Ward Members on their Boards – Councillor Hyams is on the PCP board and Councillor Batty on the Paddington BID board. All three of these pilot BIDs have funded the provision of services in their areas over and above that provided by the City Council and together these partnerships (between the pilot BIDs and the City Council) have contributed to improvements in the local area. They are all intending to become formal BIDs following a ballot during 2004/5. 3.3 The Piccadilly Circus Partnership, who’s BID operation is called the Heart of London Business Alliance, is the most advanced of these three BIDS and aims to hold a ballot of its businesses in November and to formally start on 1 January 2005. This report sets out the process which PCP/ Heart of London Business Alliance has to go through to become a formal BID and seeks the City Council’s formal endorsement of its BID Proposal that sets out how the BID intends to spend the money that will be raised by the BID levy. Local authority approval of the BID Proposal is not a statutory requirement but PCP consider that City Council endorsement of its proposals will add weight to its campaign amongst its businesses to get support for the BID proposals. 3.4 The proposed BID is for 2¼ years – starting on 1 January 2005 until 31 March 2007. PCP has chosen this relatively short period to avoid businesses having to give a full five year commitment immediately and gives PCP the opportunity to refine the BID activities. To continue after Page 3 of 11 March 2007, a new BID proposal and ballot will be necessary and this would be likely to be for the full five years allowed for by the legislation. 3.5 The New West End Company and the Paddington BID both aim to have a ballot in February to formally start on 1 April 2005. It is likely that they will also be seeking similar City Council support for their proposals in the forthcoming months. 3.6 The legislative background to BIDs, the BID process and the requirements on the local authority are set out in Section 4. Section 5 sets out in detail PCP’s BID proposals and comments on the suitability of their proposed activities. 4. The Legislative Background and BID process Legislative Background 4.1 Following the Local Government Act 2003, the Government published draft Regulations for BIDs in March this year that set out the details of how BIDs are to operate. It is hoped that these will be finalised in July before the Government’s summer recess. If they are delayed until the autumn, then this may delay PCP’s progress towards becoming a BID. 4.2 The City Council’s main concern on the draft Regulations was the lack of a requirement for a proposed BID to formally consult with the local authority prior to a request for a ballot being received. The City Council’s response is contained in appendix 1. The only stage at which a local authority can intervene (save in respect of certain information provision requirements) is to use its power of veto after the ballot has taken place. As such, the City Council is not statutorily required to have a formal view on the proposed BID unless it wishes to use its power of veto. However, PCP considers that having consulted the City Council and gained its endorsement for its BID proposals at this stage will encourage businesses to vote for the BID. The BID process 4.3 The formal process for establishing a BID is not yet clear because the Regulations are still in draft form. However, in order to start on 1 January 2005, PCP has to anticipate and begin the process now. The first formal stage as set out in the draft Regulations is that PCP has to notify the Secretary of State that they want to form a BID and they then formally notify the City Council and ask them to carry out the ballot.
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