A Bid for Improvement : Business Districts Pool Resources to Draw Patrons

After a year of controversy, the offices of Miracle on Broadway are closed, its files and equipment stored at City Hall and its team of green-shirted street sweepers disbanded.

Downtown merchants have killed off Los Angeles’ first business improvement district, tired of ponying up money to pay for trash collection, street sweeping and police bike patrols along a seven-block stretch of Broadway.

But the idea of businesses picking up where budget-strapped government leaves off is alive and flourishing elsewhere in Los Angeles.

The downtown Fashion District BID, a recent creation with a $2-million budget, plans a kickoff parade this month. The more modest, 4-month-old Westwood Village BID is trying to bring back the crowds of shoppers who once thronged the area’s sidewalks, by luring more upscale shops.

At least 20 other commercial neighborhoods in the city are exploring ways to organize themselves, dip into their own pockets and meet safety and maintenance needs the shrinking city budget can no longer cover.

“It’s the wave of the future,” said Donald Cosgrove, interim director of the Westwood BID. “With cities having less and less money, if business communities want to remain viable they have to find a way to do the things cities have done in the past.”

Recognition of the unmet needs along decaying Broadway prompted the City Council to create Miracle on Broadway in January 1995. The 1,000 merchants along Broadway from 2nd to 9th streets were assessed $420,999 annually to pay for the BID’s office costs, the salary of executive director Estella Lopez and various safety and cleanup programs.

But the assessments did not sit well with the merchants, a mix of Korean, Middle Eastern, Latino and Jewish small-business owners. About 25% of them opposed the BID from the beginning. Their numbers grew to 52.3% by December, enough to defeat the BID when the council met to consider its renewal. (Under state law, BIDs must be approved annually and must be dismantled when more than 50% of its merchants oppose it.)

The fatal flaw in the Broadway BID was to unfairly assess struggling small-business owners and leave out property owners, who paid nothing, said opponent Herman Cohen, a Broadway jeweler for 35 years. Director Lopez said the 1,000 merchants were hard to organize because of cultural and language differences.

Both those mistakes were avoided in the 56-square-block Fashion District, which organized its 320 property owners, who are more committed to a long-term plan for the area than the 10,000 businesses busy with day-to-day survival, said Marianne Giblin, the district’s executive director.

Besides increased cleanup and safety measures, the Fashion District BID includes promotional efforts, such as purple and gold banners, the parade next month and a proposed trolley that would include instructions on how best to shop the area, Giblin said.

Promotion is also a high priority for the Westside BID, which began working in October with a $685,000 operating budget. Although the Westside BID, like the Broadway district, assesses merchants, Cosgrove said only 1.4% of Westside merchants opposed the creation of the BID.

Enthusiasm for BIDs also runs high in Los Feliz, South-Central, Woodland Hills, San Pedro, along Wilshire Boulevard and in other areas where they are being formed.

Even business and property owners within the boundaries of the much-maligned Miracle on Broadway have been meeting since the demise, mulling the idea of reconfiguring themselves into a nonprofit corporation or some other entity that would encompass a larger area than Miracle on Broadway did, but with much the same goals.

With property owners and a more just assessment, the new configuration might work, said Cohen, adding, “The idea in general is good.”