Special improvement district (SID)
A defined business area, usually a downtown, where the town charges a special assessment on commercial properties or businesses. The money goes to a nonprofit management group that runs district programs, and the town approves its budget yearly.
New Jersey example
Say your town creates an improvement district along its Main Street business area. Commercial property owners there pay a yearly special assessment, and the money goes to a district management corporation that handles things like marketing, events and upkeep. A home outside the district doesn't pay it.
Official source
Frequently Asked Questions - Improvement District (ID) Programs, NJ Department of Community Affairs
This is a plain-English summary. Rules and dollar amounts change, so check the official source or a professional before you file or sign anything.