BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 694
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          SENATE THIRD READING
          SB 694 (Correa)
          As Amended  September 3, 2013
          Majority vote

           SENATE VOTE  :   34-3
           
           GOVERNMENTAL ORGANIZATION 10-1  APPROPRIATIONS      16-1        
           
           ----------------------------------------------------------------- 
          |Ayes:|Hall, Campos, Chesbro,    |Ayes:|Gatto, Harkey, Bigelow,   |
          |     |Cooley, Gray, Hagman,     |     |Bocanegra, Bradford, Ian  |
          |     |Jones-Sawyer, Levine, V.  |     |Calderon, Campos, Eggman, |
          |     |Manuel Pérez, Salas       |     |Gomez, Hall, Holden,      |
          |     |                          |     |Linder, Pan, Quirk,       |
          |     |                          |     |Wagner, Weber             |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Jones                     |Nays:|Donnelly                  |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :   Exempts from the Outdoor Advertising Act (OAA)  
          advertising displays at current or future high-speed rail  
          stations.  Specifically,  this bill  :   

          1)Exempts from the OAA  advertising displays at current or  
            future high-speed rail stations only if the following  
            requirements are met:

             a)   It is publicly owned and operated and is located on  
               public land.

             b)   It is identified as a critical component in the region's  
               sustainable communities strategy, as described.

             c)   One of the modes of transportation served at the  
               multimodal transit facility is a passenger rail.

          2)Specifies that in order to advertise any products, goods, or  
            services, all of the following shall apply:

             a)   The advertising display shall be on the same side of the  
               highway and within 1,000 feet of an entrance to a  
               multimodal transit facility.









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             b)   The advertising display shall not advertise products,  
               goods, or services related to, tobacco, firearms, or  
               sexually explicit material.

             c)   Beyond the cost of erection, revenues from the  
               advertising display shall be used to support the  
               construction, operations, and maintenance of the multimodal  
               transit facility.

             d)   The advertising display shall not cause a reduction in  
               federal aid highway funds.

          3)Clarifies that if the Federal Highway Administration, or any  
            other applicable federal agency to the state provide notice  
            that the operation of that display will result in the  
            reduction of federal aid highway funds, then the authorization  
            of that display shall cease and the display owner shall remove  
            all advertising copy from the display within 60 days after the  
            state notifies the display owner of the receipt of the federal  
            notice.
          4)Specifies that the failure to remove the advertising copy, as  
            specified, shall result in a civil fine, imposed by the  
            California Department of Transportation (Caltrans), of $10,000  
            per day until the advertising copy is removed.

          5)Specifies that Caltrans shall not assume any liability in  
            connection with cessation of operation or removal of  
            advertising display or advertising copy.

          6)Specifies that that the city, county, or city and county  
            adopting the ordinance shall have the primary responsibility  
            for ensuring that the displays remain in conformance with the  
            provisions of this measure.

          7)Specifies that if the city, county, or city and county fails  
            to ensure that the displays remain in conformance with all  
            provisions of the ordinance and this measure after 30 days of  
            receipt of a written notice from the Caltrans (department),  
            the city, county, or city and county shall hold the department  
             harmless and indemnify the department for all costs incurred  
            by the department to ensure compliance with the ordinance and  
            this measure or to defend actions challenging the adoption of  
            the ordinance allowing displays.

          8)Specifies that any advertising display shall be lawful only if  








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            authorized by a local ordinance, adopted by the city or county  
            that regulates advertising displays by either identifying the  
            specific displays or by establishing regulations that include,  
            at a minimum, all of the following:

             a)   The number of signs and total signage area allowed.

             b)   The maximum individual signage area.

             c)   Minimum sign separation.

             d)   Illumination restrictions and regulations, including  
               signage refresh rate, scrolling, and brightness.

             e)   Illuminated sign hours of operation.

          9)Specifies that authorization of an advertising display shall  
            be subject to the owner of the display submitting, to the High  
            Speed Rail Authority (HSRA), a copy of the ordinance  
            authorizing the display that has been adopted by the  
            applicable city or county.

          10)Requires the HSRA to review and certify that the proposed  
            display and the ordinance meet the minimum requirements,  
            including that the multimodal transit facility is or will be a  
            current or future station for the high-speed train system.

          11)Specifies that nothing in this bill limits a city, county, or  
            city and county from adopting an ordinance prohibiting or  
            further restricting the size, number, or types of advertising  
            displays authorized by this bill. 

           FISCAL EFFECT  :   According to the Assembly Appropriations  
          Committee, the workload associated with reviewing and certifying  
          proposed advertising displays should be minor and absorbable  
          within existing HSRA resources.
           COMMENTS  :   

           Purpose of the bill  :  According to the author, SB 694 provides  
          an exemption to the OAA for high-speed rail stations when  
          certain requirements are met.

          The author further states that significant economic development  
          and job creation result from the building and operation of large  
          transit stations that can accommodate the high speed rail train.  








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           However, the ongoing costs to operate the facilities can be  
          considerably high.  Estimates contained in High Speed Rail  
          Authority's (HSRA's) most recent business plan, indicated that  
          the project will cost at least $68 billion.  This estimate does  
          not include the build-out and ongoing operational and  
          maintenance costs associated with high speed rail stations,  
          which the HSRA assumes will be funded by local agencies.

          By authorizing on-site advertising, SB 694 promotes the creation  
          of public private partnerships, which help local agencies defray  
          operational and maintenance costs of high speed rail transit  
          stations.

           The Anaheim Regional Transportation Intermodal Center (ARTIC):    
          Set to open in in late 2014, ARTIC is a planned 67,000 square  
          feet terminal that will combine a transportation gateway and  
          mixed-use activity center on a 16-acre site owned by the City of  
          Anaheim.  Upon opening, ARTIC will serve as a major  
          transportation hub for Orange County and the region where  
          freeways, major arterials, bus routes and Orange County's rail  
          system will converge.  ARTIC will increase mobility options for  
          residents, business, commuters and local and international  
          visitors to Anaheim, Orange County and the entire Southern  
          California region. ARTIC will also accommodate planned  
          high-speed rail, linking the state's major population centers,  
          including Sacramento, the San Francisco Bay Area, the Central  
          Valley, Los Angeles, Inland Empire, Orange County, and San  
          Diego.

          According to their website, the vision of ARTIC is to be a  
          transportation facility where people will seamlessly move  
          between transit services to reach Southern California activity  
          centers and business districts. Transit oriented development in  
          the immediate area will integrate with ARTIC to form a vibrant  
          Southern California community.  Together, it will represent  
          Orange County's continuing transformation from rural farmland  
          and suburban community to a thriving metropolis. 

          The project is estimated to cost approximately $188 million and  
          is estimated to create about 5,000 jobs.

           ARTIC funding sources  :  According to the City of Anaheim, the  
          city is seeking to implement an on-site sponsorship program to  
          support operation and maintenance of the ARTIC facility.  While  
          the bulk of the capital funding come from local Measure M1 and  








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          M2 funds, the project also uses some state and federal sources  
          for the capital investment.  Funding for operation and  
          maintenance is expected to be funded through a sponsored  
          advertising program. 

          The primary purpose of the proposed sponsorship program is to  
          generate revenues for day-to-day operations and long term  
          maintenance of capital assets at ARTIC, including facilities  
          management. According to the City of Anaheim, sponsorship  
          revenues are projected to generate approximately $6,070,000 over  
          the first three years.  This revenue source will be used to pay  
          92% of operation and maintenance expenses during that time  
          period. 

           Arguments in support  :  The City of Anaheim writes in support of  
          the bill stating that SB 694 is an important measure that  
          authorizes local agencies which will build and operate future  
          high speed rail stations to establish an advertising display  
          program.  The bill provides significant local control so the  
          jurisdiction in which the displays will be located can determine  
          the number, spacing, illumination, and hours of operation.

          Supporters further argue that significant economic development  
          and job creation results from the building and operating of  
          large transit stations that can accommodate the high speed rail  
          train.  However, the ongoing costs to operate the facilities can  
          be considerable.  On-site advertising, as authorized by this  
          bill, will help local communities to defray the operational and  
          maintenance costs of these transit stations and reduce the need  
          for taxpayer offsets.


           Analysis Prepared by  :    Felipe Lopez / G. O. / (916) 319-2531 


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