Public investment in downtowns: Financing models for local business districts

In cities across North America, local business districts are struggling for survival in the face of mounting competition from shopping centers and strip malls, big boxes and hypermarkets, internet sales, and other changes wrought by the global economy.  The retailers and service establishments that were once the heart of the local community are dwindling in number.   Community economic development strategies focus on approaches to not just preserving but enhancing these local business districts and restoring their community importance.

Three distinct public financing models to address these issues have evolved in different jurisdictions in Canada and the United States – Business Improvement Associations across Canada, with significant concentrations in Ontario and British Columbia; Main Street programs in Quebec; and Downtown Development Authorities in Michigan.  Each of these organizations shares the broad objective of revitalizing a small town city center or neighborhood shopping district; there are, however, important differences with respect to membership, legal status and, most importantly, financing.

Online, mail and phone surveys were used to refine organizational profiles, identify best practices and explore how the different financial and organizational models responded to contextual changes wrought by the global economy.  For the most part, there was little evidence that any of these models was focused on adapting to changing economic circumstances or undertaking strategic planning.  Main Street and Business Improvement Associations in particular seemed preoccupied with organizational survival and fund raising.  DDAs, at least those that had attained a measure of financial security, were slightly more likely to consider redefining their mission and vision.