BILL ANALYSIS Ó
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: sb 694
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: correa
VERSION: 4/22/13
Analysis by: Eric Thronson FISCAL: yes
Hearing date: April 30, 2013
SUBJECT:
Outdoor Advertising Act exemption for high-speed rail stations
DESCRIPTION:
This bill exempts from the Outdoor Advertising Act advertising
displays at current or future high-speed rail stations.
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.
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 created the California High-Speed Rail Authority
(HSRA) in 1996 to direct development and implementation of
inter-city high-speed rail service that is fully coordinated
with other public transportation services. In 2008, voters
approved Proposition 1A (Prop 1A) authorizing $9.95 billion in
general obligation bonds for the project. Prop 1A identified
the first phase of the project to be a corridor between the
Transbay Terminal in San Francisco and Anaheim and include Los
Angeles' Union Station. Prop 1A further identified a number of
future potential destinations after the first phase is
completed, such as Sacramento, Oakland, and San Diego.
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According to HSRA's most recent business plan, completion of the
first phase of the high-speed rail project will cost at least
$68 billion. This estimate does not include the build-out of
stations, with the expectation that local governments will plan
for and fund stations based on local preferences. To date, HSRA
has secured roughly $13.6 billion to develop and construct the
project, leaving a roughly $55 billion deficit HSRA still needs
to address from sources yet to be identified.
This bill exempts from the OAA advertising displays at current
or future high-speed rail stations. In order to qualify for the
exemption, this bill includes the following requirements:
The displays must be located on public property upon which is
located a multimodal transit station that currently includes,
but is not limited to, passenger rail.
The station must be publicly owned and operated and support
the goals of the region's sustainable communities strategy
(SCS).
The station must either serve as a current or future
high-speed rail station along the first phase of the system
between San Francisco and Anaheim, or be approved as a station
location by HSRA along any of the corridors in the subsequent
phases of the high-speed rail system.
The displays cannot advertise distilled spirits,
tobacco, firearms, or sexually explicit material.
The displays cannot cause a reduction in federal aid
highway funds.
The local government must adopt an ordinance regulating the
displays including, but not limited to, the number of signs
and total signage area, minimum separation between signs,
illumination restrictions, and hours of operation.
COMMENTS:
1.Purpose . According to the author, this bill provides an
opportunity to utilize a public-private partnership to
partially fund the construction, operation, and maintenance of
high-speed rail station areas. The author contends that
construction and operation of large transit stations,
particularly once the stations begin servicing high-speed
trains, will result in significant economic development and
job creation. The ongoing costs to operate such facilities,
however, can be considerable. Advertising revenue, as
authorized by this bill, will help local communities defray
these costs and reduce the need for taxpayer offsets. In this
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way, the author contends, this bill promotes the development
of high-speed rail and creates another tool to fund and
deliver this important state priority.
2.Committee policy on exemptions to the OAA . Over the years,
legislators have introduced numerous bills to exempt stretches
of road from the OAA's prohibition against having an
advertising display along a landscaped freeway. Several years
ago, the committee determined that continued approval of
exemptions for nonconforming and prohibited advertising
displays threatened to undermine and render meaningless the
provisions and intent of the OAA. Therefore, in order to
defend the integrity of the OAA, the committee has adopted a
policy since the 2007-08 legislative session that states the
committee will not consider any measure that would result in
the placement of an advertising display in violation of the
OAA.
In the current session, however, the committee has adopted a
slightly modified policy on exemptions to the OAA. In light
of recent legislative decisions, it has become clear that
simply denying a hearing of bills related to the OAA does not
allow the committee to consider measures that reflect shifts
in statewide policy positions, such as actively pursuing the
financing and development of a statewide high-speed rail
system. For this reason, the committee's policy for the
current session retains the prohibition against hearing any
measure exempting specific advertising displays from the OAA,
but includes the possibility of hearing bills reflecting
legislative changes to statewide policy. This is one such
bill.
3.Dedicate advertising revenue to the stations . The author
suggests that this bill is one tool to finance some of the
construction and operations of high-speed rail stations.
While this bill allows signage along landscaped freeways on
land shared by future high-speed rail stations, it does not
commit the revenues from those signs to the stations or the
project. If the state is providing an exemption for a
particular purpose, it is important that a state-level entity
is ensuring that the purpose is fulfilled. The committee may
wish to amend the bill to require HSRA to approve an
expenditure plan that ensures the revenues from these signs
will be dedicated to station construction and operation.
4.Distance from the station . This bill exempts signs from the
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OAA as long as they are placed on public land upon which a
high-speed rail station also is located. This description is
vague and could lead to abuse of this exemption. For example,
if this language is read to mean the public land hosting the
sign only has to be connected via other public lands to
another parcel of public land upon which the station sits, it
could expand the exemption to essentially any public land
adjacent to a freeway, because most roadways are publicly
owned and interconnected. The committee may wish to amend the
bill to restrict the distance from the station the sign can be
erected in order to avoid abuses of the exemption.
5.Require HSRA approval . This bill allows a station along the
first phase high-speed rail corridor, whether a current or
future station serving the system, to place advertising
displays along landscaped freeways. HSRA has not identified
the location of every station along this corridor, however.
This could lead to a potential station location along the
corridor to claim this exemption and erect signs in violation
of OAA but never serve as a high-speed rail station, therefore
providing no benefit to the state priority project. In order
to avoid the potential abuse of this exemption, the committee
may wish to amend the bill to require HSRA approval of the
station location before a station can erect signs.
6.Subsequent phases of the high-speed rail system . HSRA has
acknowledged that completing the first phase of the high-speed
rail system will take years. The latest business plan doesn't
foresee first phase completion until 2029. HSRA's business
plan does not even contemplate when the subsequent phases will
be built, proposing to finance system expansion with surplus
revenues from the base system. Without a clear timeline or
expectation of construction of subsequent phases, it seems
premature to grant exemptions to the OAA for potential
stations. If the system is constructed more quickly, this
language could be amended in the future to include stations in
subsequent phases. The current language could, however, lead
to exemptions for stations that may not be built for decades,
if ever. Given this, the committee may wish to amend the bill
to limit the exemption to stations only in the first phase of
the high-speed rail project.
POSITIONS: (Communicated to the committee before noon on
Wednesday, April 24,
2013.)
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SUPPORT: The City of Anaheim
OPPOSED: None received.