BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 31|
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THIRD READING
Bill No: SB 31
Author: Padilla (D), et al.
Amended: 4/1/13
Vote: 21
SENATE TRANSPORTATION & HOUSING COMMITTEE: 8-0, 4/9/13
AYES: DeSaulnier, Gaines, Beall, Cannella, Galgiani, Lara, Liu,
Wyland
NO VOTE RECORDED: Hueso, Pavley, Roth
SENATE APPROPRIATIONS COMMITTEE: 7-0, 4/22/13
AYES: De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg
SUBJECT : Outdoor Advertising Act: arena exemption
SOURCE : Author
DIGEST : This bill allows arenas to display advertising for
products, goods, or services sold on premises as well as part of
a sponsorship marketing plan if the arena is on public land and
has a capacity of 15,000 or more seats.
ANALYSIS : The Outdoor Advertising Act (OAA) regulates the
size, illumination, orientation, and location of advertising
displays adjacent to and within specified distances of
interstate or primary highways, and, with some exceptions,
specifically prohibits any advertising display from being placed
or maintained on property adjacent to a section of landscaped
highway.
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The OAA generally does not apply to "on premise" advertising
displays, which include those advertising the sale of the
property upon which it is placed or that advertise the business
conducted, services rendered, or goods produced or sold on the
property. Local government regulates on-premise displays,
except for certain safety requirements.
AB 2339 (Solorio, Chapter 493, Statutes of 2008), known as the
arena exemption, expanded the definition of an "on premise"
display to include those displays advertising products, goods,
or services sold on the premises of an arena that has a capacity
of at least 5,000 seats and is located on public land, provided
certain conditions were met. AB 2339 specifically prohibited
the advertising of products, goods, or services directed at an
adult population, including alcohol, tobacco, gambling, or
sexually explicit material.
This bill clarifies aspects of the OAA arena exemption in the
following ways:
1.Allows arenas to display advertising for products, goods, or
services sold on premises as well as part of a sponsorship
marketing plan if the arena is on public land and has a
capacity of 15,000 or more seats.
2.Defines the premise of the arena to potentially include a
district encompassing the arena but not extending more than
1,000 feet beyond the arena.
3.Requires the local government to adopt an ordinance
authorizing the advertising displays on the premise of the
arena with specific regulations including, but not limited to,
the number and size of allowable signs, illumination
restrictions, and hours of operation.
4.Requires the state Transportation Secretary to review and
certify, in consultation with the Department of
Transportation, that the proposed displays and sign ordinance
meet the minimum statutory requirements.
5.Restricts the arena from advertising products, goods, or
services related to distilled spirits, tobacco, firearms, or
sexually explicit material.
6.Allows a qualifying arena to place up to two displays at
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approaching highway off ramps and treat them as though they
are arena displays as long as the displays are authorized by a
local ordinance as of January 1, 2019.
7.Requires the owner of these displays either to provide or fund
the installation of one changeable message sign to accommodate
public service messages such as "Amber Alerts" and emergency
disaster communications.
Comments
Why are arenas exempted from the OAA? Major sports arenas are
often funded primarily with public dollars, but as the public
becomes more reluctant to apply tax dollars to such projects,
private investors are increasing their share of arena
development and construction costs. To address this shift,
arena promoters have looked for other means by which to finance
these costly projects. Proponents determined that advertising
revenue, particularly generated alongside busy interstates in
front of massive sports complexes, was a reasonable and
potentially lucrative alternative to public financing. In some
ways, policymakers have traded direct public funding for the
indirect public cost of allowing these signs to exist, including
all the potential downsides such as increased driver distraction
and blight.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Initial Department of Transportation (Caltrans) costs of
approximately $75,000 to conduct any up-front coordination
activities, revise existing regulations regarding outdoor
advertising, and inspect newly erected signs (State Highway
Account).
Ongoing Caltrans staff costs of approximately $35,000 annually
to consult with the Secretary of Transportation in reviewing
any proposed displays and ordinances, and to annually inspect
existing signs (State Highway Account).
Minor costs to the Secretary of Transportation to review
proposed displays and local ordinances.
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SUPPORT : (Verified 4/23/13)
AEG
Anaheim Ducks
Asian Business Association
Farmers Insurance Group
Greater Los Angeles African American Chamber of Commerce
Honda Center
HP Pavilion
Latino Business Chamber of Greater Los Angeles
Major League Soccer
National Association of Woman Business Owners
National Hockey League
State Building and Construction Trades Council
OPPOSITION : (Verified 4/23/13)
California State Outdoor Advertising Association
ARGUMENTS IN SUPPORT :
According to the author's office, this bill allows for local
control while establishing statewide guidelines for advertising
displays at professional sports facilities and arenas. The
author's office states that the cost of building, operating, and
maintaining professional sports facilities is rising, and while
public funding was traditionally a large portion of the
necessary financing, today funding comes from many different
sources such as naming rights, ticket sales, and concessions. A
growing revenue source funding professional sports arenas is
advertising, both inside and outside the arena. The author's
office argues that this bill is important to enable current and
future arenas to tap into this increasingly critical financing
source to backfill the decrease in public funding available for
such purposes.
ARGUMENTS IN OPPOSITION :
Opponents of the bill raise several issues. First, opponents
argue that this bill creates a conflict for local governments
because the billboards must be on public land, so the local
government may share in the advertising revenue, and at the same
time is required to regulate on-premise signs. Second,
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opponents share the concern that these signs could jeopardize
federal highway funds. Third, opponents are concerned that this
bill is unnecessarily broad, suggesting that dozens of new
billboards would be exempted by this bill. Finally, the
opponents believe this bill puts the Legislature and the
Governor in a position of picking winners and losers, because it
is unfairly exempting some sign owners from state laws and not
others.
JA:ej 4/23/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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