BID Reporting Responsibilities










We were asked a question by Matt Severn from Market Place Books to answer a few questions on governance. Matt wanted to know:

  1. a) If Market Place Books was a member and
  2. b) If he could see a copy of the ‘constitution’ of Kendal BID Ltd

We are always happy to respond to any sensible questions and concerns of our levy payers and we like to publish them as we know others have similar questions, it serves as an information tool for everyone and we are grateful for our members taking the time to ask questions.

  1. All BID levy payers are entitled to be members and all BID levy payers were sent an application form for membership when we re balloted. We got a few back but this is about business opportunity to vote at the next AGM. So please find the link here to the application form and send it back.

Matt wrote “Whilst you are a company, you are a company accountable to the businesses of the town.

We suggest is a partial misunderstanding, because once the BID is established the role of business owners from the BID Zone is to either confirm or deny the continuation of BID in a 5 yearly re-ballot cycle. Subject to their confirmation of continuity. the BID Zone business owners then also elect the Directors from business member volunteers. Once those processes are completed in terms of accountability regulation takes over from BID Zone businesses.

Kendal BID Limited is then managed by the Directors and in terms of accountability, it is to the Business Improvement District (England) Regulation 2004 that they are accountable. Rules in respect of the limited company are set down by Companies House and HMRC in respect of Corporation Tax and VAT.

The above does not mean the Directors do not take the views of BID Members seriously, quite the opposite. Neither does it say business owners, or indeed any other person or group cannot make requests of BID, Directors regularly receive requests. When requests are made, they are considered seriously by the Directors on their individual merit. In terms of monitory grants considered by the Directors, there is a scoring system to establish a regular standard of evaluation.

When directors are unsure of processes or procedures, they consult the solicitor who is a director, or British BIDS.

If of interest,  we can offer the following more detailed explanation

Prior to any BID being formed a provisional board sets out the proposed BID Zone and arranges an election for business owners from that proposed BID Zone to obtain their views on if a BID should be established. The election must be carried out under Electoral Commission rules. The Electoral Commission is the independent body which oversees elections and regulates political finance in the UK. It works to promote public confidence in the democratic process and ensure its integrity. The Business owners in reality become the shareholders.

Subject to the business owners voting in favour of the BID, in the case of Kendal BID volunteer business owners from BID Zone offered themselves for election to be directors and it was the other business owners who voted on who they wanted to be appointed as the Directors. After the elections, an application was submitted to Companies House to form a limited company with the elected Directors being checked by Companies House for their suitability to be Directors.

BIDs run on a set five-year term basis.  At the end of each 5-year term the business owners from within the BID zone must again be balloted using Election Commission rules, to obtain their approval for the BID to continue. Director election is the same as originally. The BID only continues if a majority of business owners vote for continuation. In the case of Kendal BID, the initial vote was in 2014 and the first reballot in 2019. The next reballot will be prior to the end of the present five-year term in 2024. The system of selecting directors is repeated.

To that extent it is the business owners in the BID Zone that determine if BID continues every five years, and if so, it is they who select the Directors to run the company.

Once elected by business owners from the BID Zone, the Directors are then accountable to both BID Regulations and Companies House rules.

It is at this point that we address regulation and accountability during the BID 5-year term.

Kendal Business Improvement District Limited is accountable under The Business Improvement District (England) Regulation 2004, also rules as set down by Companies House and HMRC.

That BID Regulation 2004 says there must be a Board of Directors, and sets down The Role of the Board of Directors as

    • Recruit, supervise, retain, evaluate, and compensate the manager.
    • Provide direction for the organization.
    • Establish a policy-based governance system.
    • Govern the organization and the relationship with the CEO.
    • Fiduciary duty to protect the organization’s assets and shareholder investment.

Drawing your attention to Provide direction for the organization & Establish a policy-based governance system and I deal with that now.

Officially, the Directors key purpose is set out in the Act, telling Directors-

To ensure the company’s prosperity by collectively directing the company’s affairs,

There is an addition that states –

whilst meeting the appropriate interests of its shareholders and relevant stakeholders“.

In the case of Kendal BID, the Directors understand the term ‘Shareholder’ to also mean ‘Business Owners’, but it should be noted it is the duty of the Directors to ‘Provide direction for the organisation’.

Also, to “meet the appropriate interests of its shareholders and relevant stakeholders”, the Directors are expected to establish lines of communication with shareholders/members, to obtain the appropriate and relevant stakeholder views and opinions.

To that end the Directors have established a communications network that includes –

    1. Agreed with BID Zone business owners a five-year business plan.
    2. Created an email address
    3. Establishes a Facebook address
    4. Appointed a BID manager, employed for two days per week.
    5. Created an information website.
    6. Publish audited account to the website.
    7. Published all minutes of Board & Director meetings to the website.
    8. Published member questions and BIDs replies to the website.
    9. Publish member agreed objectives on the website.
    10. Hold Annual General Meetings
    11. Holder member consultation meetings.
    12. Produce regular Newsletters and arrange hand delivery to members to ensure receipt.
    13. Publish consultation articles in local newspapers.
    14. Appoint dedicated Directors to different sectors of the business community.
    15. More recently establish a shared office facility to assist member contact.
    16. By prior agreement, members are welcome to attend Board meetings.
    17. BID is represented on Kendal Futures Board, to both update and be updated on Kendal projects.
    18. *Kendal BID invites local councils to appoint representatives to attend the Board meetings.
    19. BID also welcomes organisation such as festivals & Environment Agency to attend meetings by invitation.
    20. Kendal BID also regularly networks with other BIDs to share ideas with a view to improving value for members levy payments.
    21. Kendal BID consults with British BID’s for guidance and advice, in particular when its actions are questioned.

There are two types of BID meetings, Directors meetings and Board meetings. The difference being Directors meetings do not include representatives from councils.

*There must always be a majority of elected Directors present at Board meetings for a vote to take place.

The relevance of British BIDs is that Kendal BID became members of this specialist body to ensure that Kendal BID complies with the Act and adopts good management practices.

The Role of British BIDs

British BIDS is the highly respected and long-established organisation focused entirely on Business Improvement Districts (BIDs). This membership organisation focuses on the delivery of advice, training, products, and services. All of British BIDS services are provided by its team of leading BID experts who have first-hand knowledge and experience of BID development, management, and renewal, including involvement with policy formation across the country.

Its also worth noting that the UK Government also consult with British BID and has guidance notes written by them.

In summary

It is NOT the businesses in the town to which Kendal BID Limited is accountable, it is

    • The shareholder/member elected Directors.
    • To the Business Improvement District Regulation 2004.
    • Companies House.
    • HMRC for VAT and Corporation Tax matters.
    • Kendal BID uses the professional advice of British BIDs on matters of good governance, in particular when Directors actions are questioned by members.

On every occasion to date when Kendal BID has consulted British BIDS in respect of good governance advice they have confirmed Kendal BID Limited and its directors have met all their statutory obligations, and are reporting to members at a level above the nationally accepted guidelines.

It should also be noted the Directors individually have not declared any potential conflicts of interest, including political. Directors take their responsibilities very seriously and so they should, they are accountable under the BID Regulation (England) 2004 and to Companies House because they are directors of the Limited Company.

There are no financial incentives in directorship of Kendal BID Limited because the Directors do not receive salaries or expense payment for their services, neither do they receive consultancy fees or honorariums.

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