DC Business Improvement District Tax

DC Business Improvement District (BID) tax revenues provide services and programs within a specific commercial area. The District has eight BIDs -- Adams Morgan Partnership, Capitol Hill Business Improvement District, Capitol Riverfront Business Improvement District, Downtown DC Business Improvement District, Georgetown Business Improvement District, Golden Triangle Business Improvement District, Mount Vernon Triangle Community Improvement District, and NoMA Business Improvement District. 

BID expenditures supplement city services to support cleanliness, safety, economic development, and other business issues. This can include maintaining commercial corridors with litter and graffiti removal, as well as landscaping. Some BIDs also opt to increase security with ambassadors who walk the area. Promoting the local businesses is another popular BID function. BIDs may also decide to make capital improvements with decorative lighting or outdoor benches.

The DC Business Improvement District tax is paid by commercial property owners within a particular BID. This tax is in addition to real property taxes imposed by the city. Both taxes are due twice each year in October and April. If residents also opt to be taxed, the BID can be called a Community Improvement District (CID).

The members of each BID generally meet annually to adjust their tax rate. Those rates are then approved by the City Council and the mayor’s office.

Most DC Business Improvement Districts tax hotels at $90-95 per room each year. Yet, the Downtown DC BID only taxes $82 per room. But those rates are expected to rise to $87 per room in 2014 and $90 per room in 2015. The increases will help fund 100 new initiatives over five years. Some of those improvements include planning for a new K Street streetcar line, a parking management plan, video monitoring, license plate readers, extending Arts on Foot, planning for a new homeless shelter, and a bike plan.

Business Improvement District tax revenue helps to pay for these initiatives, but it’s not the only source of funding. The DC government and federal government also chip in, especially for transportation and security. In the Downtown BID, only two-thirds of the budget comes from the Business Improvement District tax.