Home Events + News A Breakdown of What’s Happening With Hoboken’s Special Improvement District

A Breakdown of What’s Happening With Hoboken’s Special Improvement District

by Steph
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The term “Special Improvement District” has become almost as common a buzzword as “electric scooter program” here in Hoboken. While you may have heard or seen the term lately, it’s totally okay if you’re not one hundred percent on what exactly is going down with the Mile Square’s Special Improvement District {also known as a SID}. Hoboken Girl is breaking it down for you — what it means, how much the budget will be, and exactly what that budget will go toward. Keep reading for a full breakdown of what’s happening with Hoboken’s Special Improvement District.

What is the Special Improvement District?

special improvement district

The Special Improvement District {SID} is a defined area within Hoboken in which businesses pay an extra assessment. This assessment goes toward funding projects within the improvement district’s area. That’s the vague definition of Special Improvement Districts; Hoboken’s calls for a new District Management Corporation, which will be managed by Hoboken Business Alliance Inc, according to Patch.

In Hoboken, the members of the SID committee include 15 commercial properties and business owners. These include the owners and landlords of Amanda’s and Elysian, Hoboken Business Center, Little City Books, La Isla and Sparrow Wine and Liquor, Roig Art and Swift Interiors. Representatives from local developers like SJ Properties, Pegasus Properties, and Bijoux Properties are also members of the committee.

See More: A List of Hoboken + Jersey City Charities to Donate to Year-Round 

How Much is the Budget for the Special Improvement District?

budget sid

After the ordinance adopting the Special Improvement District was passed by Hoboken City Council and signed into law by Mayor Ravi S. Bhalla in July 2019, the Special Improvement District made headlines again recently when its budget was announced.

According to Patch, the Hoboken Business Alliance will have a $1.3 million operating budget. These funds will be collected via an additional assessment from eligible businesses that fall within the district. 

You may be wondering: What does this mean for this businesses of Hoboken? Well, it does mean an additional assessment for those that fall into the Special Improvement District vicinity. However, not all businesses will be assessed the same. Businesses will be given appropriate assessments based on their locations throughout the Mile Square. For example, businesses in the thick of it all on say, Washington Street, will likely have a higher assessment to pay.

According to the Special Improvement District Feasibility Study conducted in June 2019, the areas with higher assessments will include businesses on Washington Street, 1st Street, 14th Street, and near the South Waterfront and Terminal, North Waterfront, North Gateway, South Gateway, and Hybrid/Remaining properties.

What is the Purpose of an SID?

hoboken washington street

According to the State of New Jersey Department of Community Affairs, cities or municipalities could chose to enact an SID if the government or members of the community felt that local businesses were not attracting as many shoppers as they could or should.

The NJDCD website states, “A community may be experiencing a growing awareness that commerce in does not function as well as it could; that it does not draw the number or variety of shoppers that it should; and that the quality of the shopping, dining, and other commercial experience there is not as appealing as it could be for residents, visitors, and others.”

According to the NJDCD, the goal of a Special Improvement District — or Business Improvement District, which in this case is interchangeable — is to “improve the economic, physical, social, and civic value of the commercial district in question.” The website continues, “It enables a collective, organized response to problems as well as opportunities, leveraging the district’s assets to mitigate its issues.”

Essentially, the idea is to issue the assessment to businesses in order to pump more life, engagement, and ultimately, money back into local businesses.

Read More: How to Stick to a Budget Without Going Crazy {A Money Expert’s Tips}

Are There Other SIDs in the State of New Jersey?

Yes, there are other Business Improvement Districts in New Jersey. Enactment of the law that allows BIDs in New Jersey came about in 1984. Since then, New Jersey has seen upwards of 90 such districts. Nearby cities and municipalities with BIDs include Cranford, Westfield, Montclair, and Englewood. Jersey City has several as well — including our friends at HDSID!

And that’s just New Jersey. Throughout the world, there are an estimated 67 Improvement Districts throughout 67 municipalities and 19 countries.

How Did the SID Come to Be?

As mentioned above, the Special Improvement District was officially passed when the Hoboken City Council adopted an ordinance that included SID over the summer. Prior to that, SID had been coming up in discussions for a while. Then, Mayor Bhalla signed the ordinance into law in July 2019.

Next came the arduous task of deciding on the SID operating budget. On December 4th, the Council adopted the $1.3 million operating budget for the Hoboken Business Alliance {HBA} in an 8 to 1 vote. The HBA is the nonprofit responsible for collecting the assessments from business within SID

Where Do the SID Assessment Funds Go?

new SID zoning

{Photo courtesy of City of Hoboken}

Okay, now back to the financials of it all. The idea behind Business Improvement Districts is to collect a tax from businesses operating within the area, then using those funds to pump back into the surrounding neighborhood.

The assessment funds would go toward city-wide programs that prioritize efforts like maintenance, beautification, street-scaping, marketing, small business promotion, tourism, and arts and events, according to Patch. Any initiatives that promote small biz growth will also be fair game.

That entity would oversee city-wide programs under the SID focusing on maintenance, beautification, street-scaping, marketing, small business promotion, tourism, arts and events, and other initiatives designed to stimulate business within Hoboken.

Which Businesses Have to Pay SID Assessments?

The SID requires an assessment that targets businesses, not individuals. However, assessments will be done on all commercial, industrial, and retail properties that feature five or more rental units or apartments.

To get more technical, if a commercial or mixed-use property is legally classified as 4A, 4B, or 4C under New Jersey’s Property Tax System Qualifications Code, then it is eligible for the SID assessment.

Now, how much money is it? Well, we already established that businesses in different areas of Hoboken will be assessed differently. However, the general idea is that the assessment rate will be a percentage of total property taxes paid for each block; as mentioned, the rate would also take into consideration the business’s location within the Mile Square.

To learn more about Hoboken’s Special Improvement District, log onto HobokenNJ.gov. To access the Special Improvement District Feasibility Study in full, click here.

Got a news tip? Let us know — email us at hello@hobokengirl.com! We appreciate it.

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