The State of California recognized in 1989 that older existing business districts within the state's communities were at an economic disadvantage to newer malls and "super store" shopping centers. As a result, the State passed Section 36500 of the California Street and Highways Code in order to prevent economic erosion, stop loss of jobs, and attract new businesses. This code provided authorization for local governments to levy assessments in order to fund particular improvements and activities that would revitalize these business districts.

The Corona del Mar Business Improvement (BID) was thus formed on September 1, 1996 by the City of Newport Beach. The BID is chartered under the auspices of the Corona del Mar Chamber of Commerce, and elects its own Board of Directors. It levies assessments every year against those businesses within the benefit area, maintains it's own bank account, and allocates those monies on projects and improvements which will benefit all the merchants, offices, and services within the business district. It receives matching annual funds from the City of Newport Beach in an equal amount to the revenue generated by the BID itself every August.