BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 684|
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THIRD READING
Bill No: SB 684
Author: Hill (D)
Amended: 4/1/13
Vote: 27 - Urgency
SENATE TRANSPORTATION & HOUSING COMMITTEE : 10-0, 4/30/13
AYES: DeSaulnier, Gaines, Beall, Cannella, Galgiani, Hueso,
Lara, Liu, Roth, Wyland
NO VOTE RECORDED: Pavley
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Outdoor Advertising Act: former redevelopment
agency project areas
SOURCE : California Sign Association
League of California Cities
DIGEST : This bill amends the redevelopment agency exemption
to the Outdoor Advertising Act (OAA) to reflect the elimination
of redevelopment agencies.
ANALYSIS :
Redevelopment Agencies . Historically, the Community
Redevelopment Law allowed a local government to establish a
redevelopment area and capture all of the increase in property
taxes generated within the area over a period of decades. These
tax revenues were intended to address the blighted nature of a
project area, and if used effectively, therefore, should have
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eventually ended the blight and become unnecessary. Because of
this, over time these project areas were given expiration dates,
generally up to 40 years following their inception, until which
they were able to collect tax revenues and pay off debt.
In 2011, the Legislature enacted AB 26X1 (Blumenfield, Chapter
5, Statutes of 2011-12 , First Extraordinary Session). The bill
eliminated redevelopment agencies and established procedures for
winding down the agencies, paying off enforceable obligations,
and disposing of agency assets. In addition, the bill
established successor agencies, typically the city that
established the agency, to take control of all redevelopment
agency assets, properties, and other items of value. Successor
agencies are to dispose of an agency's assets as directed by an
oversight board, made up of representatives of local taxing
entities, with the proceeds transferred to the county
auditor-controller for distribution to taxing agencies within
each county.
OAA . The 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.
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.
Existing law includes a number of exceptions to the OAA and
assigns the Department of Transportation (Caltrans) the
responsibility of reviewing and permitting signs which qualify
for these exceptions. Under the OAA, displays advertising those
businesses and activities within the boundaries of an individual
redevelopment agency project area are considered on-premise
displays for an initial period of 10 years or until the project
area expires, whichever occurs first. Caltrans may for good
cause extend the permits for these signs beyond the initial 10
years, but not beyond the life of the redevelopment project.
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This bill:
1. Amends the redevelopment agency exemption to the OAA to
reflect the elimination of redevelopment agencies.
2. Allows an existing advertising display to be considered
on-premise if the display:
Advertises those businesses and activities developed
within the former redevelopment agency project area
boundaries, as those boundaries existed on December 29,
2011;
Is located within the boundary limits of the project;
Was constructed, under construction, or approved for
construction by the designated agency of the project on or
before January 1, 2012; and
Does not cause the reduction in federal aid highway
funds.
3. Allows existing displays to be considered on-premise displays
until January 1, 2023, or the expiration of the redevelopment
project area, whichever comes first. Caltrans can extend
this exemption for good cause beyond 2023, not to exceed the
expiration of the project area, upon application of the
successor agency.
4. Places the responsibility on the designated successor agency
for ensuring these advertising displays are advertising
qualifying businesses, are otherwise being operated lawfully,
and remain in the public's best interest.
Background
Generally speaking, local governments established redevelopment
agency project areas in blighted areas that required some
additional investment to address the blight. In theory, the
investment should eventually turn the neighborhood around and at
some point no longer be necessary. As mentioned earlier, this
theory led the Legislature to assign expiration dates to all
redevelopment areas, expecting them either to achieve success
and no longer be needed or acknowledge the problems are not
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resolvable through increased investment alone.
According to proponents, legislation created the redevelopment
exemption to the OAA to allow businesses in these less-desirable
places to advertise for two reasons. First, travelers on the
landscaped freeway who may have been reluctant to frequent the
businesses in the area because of the perceived blight would
consider doing so as redevelopment investment helped address the
blight issues. Second, this new advertising opportunity could
be an additional tool to help a struggling business in the
project area become more successful. In either case, the theory
behind the expiration of the redevelopment areas seems to hold
true with the expiration of the OAA exemption. At some point,
either the blighted area has improved to the point that the
businesses no longer need the unique competitive advantage
provided by the sign or the problems are too large for the signs
to resolve.
Permits in a "post-redevelopment" world . As mentioned earlier,
Caltrans enforces the OAA, which includes activities such as
maintaining a list of landscaped freeways, issuing permits for
signs allowed by statute to exist, and fining owners of
non-compliant signs. Caltrans has issued 95 permits for
advertising displays along landscaped freeways in redevelopment
project areas throughout the state. Many of these signs are
currently or will soon be in existence longer than 10 years and
therefore have permits which need to be extended. With the
elimination of redevelopment agencies, however, Caltrans has
been unsure how to proceed and has not extended any permits.
Neither has Caltrans issued any fines to sign owners with
expired permits. Instead, Caltrans has indicated that it is
waiting for further direction from the Legislature regarding the
state's position on these sign permits.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 5/13/13)
California Sign Association (co-source)
League of California Cities (co-source)
American Outdoor Advertising, Inc.
Avant Outdoor Advertising
California New Car Dealers Association
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California Professional Association of Specialty Contractors
California State Association of Counties
Cities of Huntington Beach and Yorba Linda
City of Buena Park, Office of the Mayor
City of Inglewood, Office of the Mayor
G.B. Enterprises
Lloyd A. Wise Companies
Marina Media Vision
Superior Electrical Advertising
OPPOSITION : (Verified 5/13/13)
California State Outdoor Advertising Association
ARGUMENTS IN SUPPORT : According to the author's office, this
bill addresses an issue inadvertently created when the
Legislature eliminated redevelopment agencies. Existing law
allows Caltrans to permit advertising displays as on-premises
displays within redevelopment project areas for a period of 10
years and includes the possibility of extending those permits.
Now that the Legislature eliminated redevelopment agencies,
there is no mechanism to extend the permits for these signs.
This bill amends current law to allow these signs to continue to
function as on-premise displays and remain so as long as was
expected before the elimination of redevelopment.
The League of California Cities states "Prior to the elimination
of redevelopment agencies, advertising displays were exempted
from the Outdoor Advertising Act and considered to be on the
premise anywhere within the limits of the redevelopment area.
The ability of the signs to receive an extension was contingent
upon approval of the redevelopment agency and CalTrans. One of
the unintended consequences of the elimination of redevelopment
is that approval for the extension of these signs is impossible
since there is no redevelopment agency to consent. This bill
simply seeks to clarify that the existing redevelopment signs
can continue with agreement of the designated agency and
CalTrans."
ARGUMENTS IN OPPOSITION : California State Outdoor Advertising
Association (CSOAA) states this bill allows sign operators
within former redevelopment agency (RDA) projects to evade
regulation under the OAA and compete unfairly against CSOAA
member companies. CSOAA states this bill could prove disastrous
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for the State of California. CSOAA believes this bill promotes
the improper use of offsite advertising displays in RDA projects
as purported "on-premises" signs. In so doing, this bill
violates regulations adopted pursuant to the federal Highway
Beautification Act, 23 United States Code Section 131. Such
violations could result in the loss of 10% of California's
federal highway funding.
JA:k 5/14/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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