BIDs face budget holes from unpaid taxes


The Georgetown business district has a $3.1 million budget, of which the debt accounts for 6 percent. Above, Georgetown Park. (Jeffrey MacMillan/Capital Business)

District property owners owe more than half a million dollars in overdue taxes to Business Improvement Districts, the nonprofit groups that provide enhanced cleaning and marketing services to eight areas of the District.

Delinquent property owners owed $520,761 to the city’s eight BIDs as of June. The debts amount to 10 to 20 percent of some organizations’ budgets, according to city documents provided through a public documents request.

BIDs are formed when property owners in an area create a special tax district requiring payments based on the value of each owner’s holdings, whether offices, apartment buildings or retail. The BIDs provide services including cleaning crews that patrol the neighborhoods in brightly colored shirts, and marketing campaigns to help sell their areas.

The BID with the largest debt owed is in Georgetown. The Georgetown business district has a $3.1 million budget, of which the debt accounts for 6 percent.

On Capitol Hill, city records say 60 property owners owed a total of $165,204, about 13 percent of that organization’s budget.

And in Mount Vernon Triangle, there are 342 delinquent taxpayers in large part because of an aspect of the organization’s structure that requires individual condominium owners to pay the tax.

All but 14 of the delinquent tax payers to the Mount Vernon Triangle Community Improvement District appear to be individual condo owners, and many of the bills are for less than $100. The $113,401 of debt amounts to 18 percent of the group’s $617,000 budget.

Bill McLeod, executive director of the organization, said the group sends tax bills to more than 1,000 condo owners. “At first we had a lot of condo owners who weren’t aware of it and weren’t paying,” McLeod said.

Since then, McLeod has been trying to educate condo owners about the BID and the reason for the tax. “I think the tide has changed,” he said, but the organization still budgets for 8 percent or more of condo owners not to pay.

Richard H. Bradley, executive director of the Downtown Improvement District, said the missing payments are sometimes because new property owners are unfamiliar with the BID setup. Downtown property owners owe $111,267, only 1 percent of the organization’s $10.6 million budget. “We haven’t noticed any trend one way or another the last seven or eight years,” Bradley said.

Jonathan O'Connell has covered land use and development in the Washington area for more than five years.
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