Real estate developer Andrew Gallina believes he knows downtown Rochester well. His passion for reinvigorating the center city is palpable.
Gallina fondly recalls acquiring the One East Avenue building in 2012, the first of many purchases downtown.
“Why did I invest in downtown at first? Because I saw opportunity and I saw a real need in our community. It was clear no one else was going to step up,” says Gallina, president of Gallina Development Corp. “I could have done a lot better taking my money to Raleigh or Charlotte or somewhere else, but I decided to stay here because I feel strongly about our community. This is where my family is; we feel this is our hometown and we need some help.
“My mantra when we talk about this is that I think we, as a community, can do much better, we should do much better,” he adds emphatically. “Downtown is not meeting our expectations from a community, employment, growth, vibrancy (standpoint), all the items we talk about.”
Like Gallina, several downtown small-business owners believe the city center needs to do better. The stretch of East Main from Pitkin to Scio streets is home to a number of storefronts, including Jamaican restaurants Everything Iz Good and Peppa Pot, Caribbean groceries, Izzy’s Convenience Mart, and Mass Appeal Barber shop. Shop owners, some of whom have been at their location for 15 years, are struggling with rising rents and cost of merchandise. (The Beacon spoke with these owners, who preferred to stay anonymous.)
Gallina and others believe there is a way to catalyze efforts to revitalize downtown: forming a business improvement district, a geographically bounded space where property owners would pay a special assessment based on their buildings’ valuation for services to the area.
Rochester’s BID plan is supported by stakeholders across the public and private sectors, including government officials, property owners, and businesses in the downtown core. However, the plan faces organized pushback, mainly from Rochester’s artistic and activist communities, through a group called the BID Education Committee. And some within the BID boundaries are unaware of the process.
The BID backers
The effort to create a BID in downtown Rochester began with the 2018 ROC the Riverway Phase I Vision Plan. The plan recommended a BID as a way to ensure a consistent level of services in the downtown area. (A BID already exists in the High Falls neighborhood, north of center city, and an attempt to create one downtown failed in 2014.)
Last week, the Partnership for Downtown Rochester released its draft for a potential center city BID, which included details on an assessment formula, a governance model, a budget, and proposed boundary lines.
“With a BID in place, we can help advance toward the community-informed vision for downtown Rochester, helping it solidify its position as the region’s historic and innovative center of bustling community activity where active streetlife will make all feel welcome and safe,” said Galin Brooks while unveiling the plan. She leads PDR and the Rochester Downtown Development Corp., the organizations spearheading the effort.
A nonprofit created in 1977, RDDC is focused on driving economic vitality in downtown Rochester. PDR is collaborative initiative launched in 2021 by Empire State Development, the city of Rochester, RDDC, and ROC2025, a regional alliance of economic development organizations.
“The conversation of a BID in Rochester is overdue,” said Mayor Malik Evans, a PDR board member, at the release of the BID draft plan. “For many cities around the country, this is table stakes. When I’ve talked to mayors of Cleveland, Baltimore, and other major cities, they say, ‘You don’t have a BID yet?’ and I say, ‘No, but we’re trying to get there.’”
In addition to Evans, the roughly 40 members of PDR’s board and BID Formation Committee include Monroe County Executive Adam Bello; Rochester City Council President Miguel Meléndez; leaders or representatives of downtown property developers and managers; the Greater Rochester Chamber of Commerce; cultural institutions like the Strong Museum, the Eastman School of Music and the Hochstein School of Music; Visit Rochester; the RIT Center for Urban Entrepreneurship; and the Urban League of Rochester.
Attracting more visitors
With a focus on building tourism, creating active, welcoming street traffic, and events designed to attract people downtown, the BID draft plan appears to be concerned mostly with visitors to the center city.
In Gallina’s view, the widespread dearth of retail space and negative perceptions of the area have driven away potential dollars that exist in the region and beyond. According to MarketBeat, the office vacancy rate in downtown Rochester stood at 28.6 percent in the second quarter.
Gallina believes marketing efforts can attract investment from other developers who have avoided Rochester and harness the potential of the area. Twenty-five percent of the BID budget is set aside for “Marketing, Events & Activation.”
“We used to bring people downtown, have dinner downtown, show off the river, do some things downtown. We don’t do that anymore because it’s not on the list,” Gallina says. “How did downtown fall off the list?”
The draft plan also calls for street ambassadors. These individuals would promote the area’s amenities and activities, serving as guides, conversation starters, or active listeners. Other cities such as Pittsburgh, Kansas City, and Portland, Maine, have BID-run ambassador programs.
The draft plan includes a “Downtown Ambassadors’ Code of Conduct,” which includes in its “do’s” section such activities as: “Offer directions, maps, and information” and “Encourage visitors to explore and support local businesses.”
The code of conduct also includes language stating the ambassadors’ role is not one of security, a criticism leveled at the program by the BID Education Committee, a group that has emerged as the most organized opposition to the BID formation efforts. The inclusion of a code of conduct has not swayed their opinion on the matter, however.
Gallina envisions these ambassadors coming to the aid of people suffering from mental health issues or homelessness. The federal Department of Housing and Urban Development estimates 748 people were unhoused in 2022 in Monroe County. Most of them are estimated to live close to or in the city of Rochester.
This outreach by ambassadors would be in a “connector” role, linking individuals with designated providers rather than administering services themselves. Similarly, $110,000 or 7 percent of the proposed 2024 BID budget would go to a category named “Social Services,” which includes mental health, addiction and housing.
Recently, Evans proposed including the RDDC ambassador program as part of the city’s Neighborhood Collaborative Program, using money from the Opioid Compensation Fund. It was voted down by City Council in November.
Even if the focus is primarily on visitors to downtown, Gallina says improvements will help conditions for residents too. Increased foot traffic and retail spending, companies such as Constellation Brands moving headquarters and jobs downtown, and further investment will lift all boats.
“A strong, vibrant downtown is the core of the regional economy. Without a strong downtown, our regional economy will falter,” Gallina says.
Rory Van Grol, owner of Ugly Duck Coffee on Charlotte Street, is uncertain of that future, however, and thinks a BID ultimately could hurt small-business owners. He is not actively involved with BID supporters or its opponents.
“It’s silly to think that these added taxes property owners will incur won’t pass those along to those occupying space. This will only lead to more vacant storefronts and less diversity of businesses,” he says.
Shop owners at East Main Street locations, after learning about BIDs in other cities, have similar concerns about spikes in rent. Additionally, they worry that people who BIDs attract to events are not interested in what their stores have to offer, meaning they will not share in the benefits if foot traffic does increase.
Critics also claim gentrification and anti-homelessness activity have occurred in cities that have established BIDs including Washington D.C. and Los Angeles, which has a BID in its Chinatown district.
“It’s shocking to see these powerful developers imposing taxes on all properties to control a new $2 million budget, and ignoring impoverished neighborhoods just blocks away,” a statement from Rochester’s BID Education Committee reads. “Any new taxes should be spent to address critical needs in the Crescent, an area with some of the most concentrated poverty in New York State.”
These cases are exceptions, rather than the rule, say Gallina, PDR, RDDC and government supporters.
“Rochester is one of the only cities in its size in the United States without a downtown BID and we are the only city in Upstate New York without one,” Evans says. “I think our residents deserve to have the exact same success they have in Buffalo, in Syracuse, Canandaigua and Batavia.”
“We are so far from gentrification along Main street. For one thing, there’s no one living on Main Street,” says Gallina. “There are virtually no retail establishments from the Liberty Pole all the way west to the river then to State Street.”
Victoria Van Voorhis, CEO of Second Avenue Learning, an interactive media company that designs education material, is a business owner who sees potential in downtown and the proposed BID. (Van Voorhis also serves on the Board of Directors of RDDC.)
“I voted with my feet. When I had an opportunity to relocate my company, I committed to downtown,” she says. “I believe in the power and potential of downtown and know that we can do and be so much more than we are today. The downtown business improvement district is one tool that can help get us there.”
A BID would give small businesses more access and opportunities, Van Voorhis believes, which would then spur additional activity and energy in the city’s core.
The BID draft boundaries cover most of the downtown core, which is essentially the area within the former Inner Loop. Major sites such as the Strong Museum, Blue Cross Arena, Parcel 5, the police and train station, the Hochstein School of Music, and the Joseph A. Floreano Rochester Riverside Convention Center all fall within this area.
St. Joseph’s Park and Grove Street residences in the north as well as the area west of Washington Street fall outside the proposed boundaries.
Over the last decade, some signs of downtown revitalization have emerged. According to U.S. Census data, from 2012 to 2021, the estimated percentage of downtown households living in poverty fell from 57 percent to 29 percent. In addition, the number of housing units grew by over 40 percent.
“Rochester, for many years, is a place where not many people have lived downtown,” says Evans, estimating only 1,000 or so residents when he first started working at ESL.
According to PDR, which cites data from CoStar group and RDDC, today more than 10,000 live in downtown Rochester.
However, census data from 2021 estimates the total population at about half that figure, including the Monroe County Sheriff’s Office Jail. Any growth that is occurring in the area appears to be coming from a white population that increased by over 50 percent from 2011 to 2021.
According to an analysis of tax parcel data available from the city of Rochester, there are slightly more than 420 properties within the draft boundaries that would need to pay a BID assessment. (Religious buildings and residences with fewer than four units would be excluded from this assessment.)
Most buildings in the district would fall into the “Commercial” category. The majority are office buildings, parking lots and garages, mixed-use detached and attached row buildings or apartments. Vacant land makes up 11 percent of the properties within the boundary lines.
There are 4,895 residential units within the BID-assessment properties. Large apartment complexes at Andrews Terrace, the Savannah, 111 on East, VIDA Apartments and Midtown Manor all have over 200 units and account for about 31 percent of all units. Hotels, which are also included in the count, account for 12 percent of total units.
The area also includes many functioning government buildings, including the Monroe County Hall of Justice, which houses multiple courts, the Rochester Police Department headquarters, and the Monroe County jail.
Assessment and budget
For property owners in the proposed BID zone, the city would levy an annual special assessment–the greater the property assessment, the greater the levy ($0.25/100 x total assessed property value).
For example, Blue Cross Arena would pay $42,000 toward the BID on its $16 million property valuation whereas the Little Theatre would contribute $1,100 on its $454,000 valuation.
Government and universities would pay an amount calculated at the same rate but by interagency agreement rather than assessment.
According to a Beacon analysis, using the draft plan formula with the current valuation for eligible properties, the total amount raised would be roughly $2.1 million. That levy for properties could be as low as $1 (a vacant lot owned by the University of Rochester) or as high as $89,000 (the East End parking garage).
Of that estimated $2.1 million, the city would be the largest individual payee, contributing $350,000 (16 percent) for its 63 properties downtown. Properties owned by the city, county, state and federal government would contribute $505,000, or 23 percent, of the total BID assessment.
Developers Buckingham Properties and Gallina Development are the next largest contributors with $222,000 (10 percent) and $153,000 (7 percent), across their 20 and eight properties, respectively.
In fact, the top 15 property owners, in terms of valuation, would contribute $920,000 (42 percent) of the total funding toward the BID under this plan. An additional $620,000 (28 percent) would come from the other 346 property owners.
Rochester Gas and Electric also would pay a significant portion of the BID assessment–more than $114,000 (5 percent) across its 10 properties.
“At the end of the day, who’s going to do it? That’s the whole point. The city just does not have the capacity, nor the staffing, nor the money to do it independently,” Gallina says. “And RDDC is just supported by membership, which is a fraction of what these contributions (to the BID) will be.”
Governance of the BID would be shared by a board of directors, who would monitor the yearly budget, work plan and performance, and four committees focused on reporting progress of the BID vision: Small Business & Livability; Finance; Hospitality & Maintenance; and Marketing, Events & Activation.
PDR’s draft includes board positions for at least two non-owner tenants, two residents, one local artist, one nonprofit leader, one retailer/small-business owner, one hospitality leader and one residential landlord. It also includes three members appointed by the mayor’s office, the city’s chief financial officer, and the Rochester City Council, respectively.
By state mandate, a majority of BID board members must represent property owners. This would suggest the total number of board members would be at least 25 to include 13 seats for property owners. However, Brooks says the board makeup will be defined based on input received.
Board members would serve staggered three-year terms and meet at least four times a year. An annual meeting open to the public would have an election for new board members, with each rate-paying property parcel receiving one vote.
That would seem to give property owners who own more parcels more votes in board elections, although Brooks says this too will be vetted through the process ahead and defined by input.
The four committees also would meet quarterly and be open to community members whose votes would carry equal weight to board members.
“It’s about support, never control,” Brooks says of the proposed governance structure.
City Council would be the final approval authority required to advance the annual program of services and budget for the downtown BID.
Many supporters among key downtown stakeholders, including small businesses, government officials, cultural institutions, and social services organizations, believe that the greater marketing and reinvestment efforts could unlock the potential and transform the area for the better.
A number of smaller stakeholders, however, are still uncertain about a BID’s effectiveness. Others are actively opposed to the plan, making claims of an undemocratic process or of gentrification and displacement.
The BID Education Committee–supported by Rochesterians who live, work or own property downtown and organizations like Metro Justice, 540 W Main, the Free Art Collective, and the Rochester Mutual Aid Network–say the BID was foisted on the community by property owners to circumvent local government. They believe the plan will further marginalize vulnerable groups in the city center. The organization has an online petition that currently numbers around 1,000 signatures.
“The RDDC’s push for a Business Improvement District that they would control is a direct affront to our community. Using taxpayer funds to support the ambitions of a few at the expense of many is not just unjust, it’s undemocratic,” reads a statement released by the group shortly after the draft plan was released. “We unequivocally oppose any policy that prioritizes private interests over public welfare and community development.”
“From what I know of and understand of the BID, I’m unsure of how this will positively impact or make the BID district better for those in it other than the folks advocating for it,” says Van Grol.
Awareness of the BID proposal is not uniform. While Gallina has been very involved with the process, co-chairing the BID Formation Committee, some shop owners on East Main Street say they were unaware of the proposed BID.
But that lack of knowledge does not surprise them. A common refrain: “We’re the last to be told about anything.”
Van Grol calls the BID process “murky” and a “mystery” with more questions than answers.
“Is the city of Rochester government just trying to pass the responsibilities of creating a safe and inventing downtown to someone else so they don’t have to be directly responsible anymore? Will there be a diverse group of stakeholders making decisions or just the folks with money and property?” he asks.
PDR notes that it undertook a public engagement tour over the past year, carrying out 35 community events with a total of more than 1,000 participants.
The next step for the proposed BID is further public engagement on the draft plan.
“I emphasize ‘draft.’ This gives individuals the opportunity to give input and have an impact to make this plan even better,” Evans stressed last week. “So, I am encouraging our residents and employers to be part of this important process.”
PDR welcomes community feedback at its online survey and pop-up events for a public review period lasting until Dec. 31. A community open house will take place at the Central Library on Dec. 13. Winning over BID opponents could be difficult, though.
“With the amount of questions I have, and no direct or clear answers, I don’t support the BID in what I have come to understand it to be. Unfortunately, it has to regain my trust due to how very unclear of who it’s really for and how the initiative came to be,” Van Grol says. “I do not own property within the BID district so I can only assume that ultimately those directly impacted by those financial impacts will pass them along to folks like myself.”
“As we have seen from the beginning, participating in any of the RDDC’s ‘community feedback’ sessions and surveys is being counted towards validating their project. They are not a neutral party, they are manufacturing consent. They stand to materially benefit from the results,” states a BID Education Committee statement on the survey and public engagement sessions. “Introducing a feedback session now is an attempt to legitimize backroom decisions rather than a genuine effort at public inclusion.”
If the timeline follows the draft plan, collected petitions for the BID will be delivered to City Council this winter. Council will hold one or more public hearings in the spring with final approval expected in summer and establishment of the BID next fall.
“If we don’t make downtown an attractive alternative in the retail and commercial office market, we will see people leave downtown. That will have devastating effects,” Gallina says. “If we don’t make this change, if we don’t be aggressive and assertive in trying to reverse this trend and strengthen downtown, we’re going to be really hard pressed to dig out of that hole (where) we are now.”
Jacob Schermerhorn is a Rochester Beacon contributing writer and data journalist. The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. Submissions to the Letters page should be sent to [email protected].