BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 1199|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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THIRD READING
Bill No: SB 1199
Author: Hall (D), et al.
Amended: 4/26/16
Vote: 21
SENATE TRANS. & HOUSING COMMITTEE: 8-1, 4/19/16
AYES: Beall, Cannella, Galgiani, Leyva, McGuire, Mendoza,
Roth, Wieckowski
NOES: Allen
NO VOTE RECORDED: Bates, Gaines
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
SUBJECT: Advertising displays: City of Inglewood
SOURCE: Author
DIGEST: This bill authorizes two existing advertising displays
in the City of Inglewood to be considered on-premise displays
until January 1, 2023.
ANALYSIS:
Existing law:
1)Establishes the Outdoor Advertising Act (OAA), which regulates
the placement of advertising displays adjacent to and within
specified distances of highways that are part of the national
system of interstate and defense highways and federal-aid
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highways.
2)Prohibits any advertising display from being placed or
maintained on property adjacent to a section of a freeway that
has been landscaped if the advertising display is designed to
be viewed primarily by persons traveling on the main-traveled
way of the landscaped freeway. The OAA, however, only applies
to signs that are located within 660 feet of the right-of-way
of federal-aid interstate and primary highways.
3)Provides for limited exemptions and specified exceptions to
the prohibition on advertising along system and landscaped
freeways, including exemptions for signs advertising the
property's sale or lease, signs designating the premises or
its owner, and signs advertising goods or services
manufactured or produced on the property itself.
4)Provides 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.
5)Allows an existing advertising display to be considered
on-premise if the display:
a) Advertises those businesses and activities developed
within the former Redevelopment Agency (RDA) project area
boundaries, as those boundaries existed on December 29,
2011;
b) Is located within the boundary limits of the project;
c) Was constructed before January 1, 2012; and
d) Does not cause the reduction in federal aid highway
funds.
6)Authorizes, on and after January 1, 2022, the applicable city,
county, or city and county to request, for good cause, from
the Department of Transportation (Caltrans) an extension
beyond January 1, 2023, not to exceed the expiration of the
redevelopment project area.
This bill:
1) Expands existing exemptions for billboards contained within
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former RDAs to include advertising displays located within the
boundary limits of the City of Inglewood at two locations on
Interstate 405 that were constructed on or before January 1,
2012, so long as the advertising displays do not cause the
reduction of federal aid highway funds.
2) Makes findings and declarations to the need for the special
statute for the City of Inglewood.
Comments
1)California's exemption for RDA displays in a post-RDA world.
In 2013, the Legislature passed and the Governor signed SB 684
(Hill, Chapter 544, Statutes of 2013), which sought to address
the question about billboards that advertise businesses in RDA
project areas in the era of successor agencies. That bill
permitted existing advertising displays that advertised
businesses and activities within the boundary limits of an RDA
project to remain and be considered "on-premise displays"
(e.g., not subject to the OAA) until January 1, 2023. The
city or county could then apply to Caltrans for an extension,
showing "good cause" beginning on January 1, 2022.
Local governments established RDA project areas in blighted
areas that require additional investment to address the
blight. Until RDAs were dissolved, existing law allowed RDAs
to permit advertising signs for 10 years, after which they
were regulated by Caltrans and the OAA, unless the RDA and
Caltrans agreed to an extension for good cause. Legislation
created the RDA exemption to the OAA to allow businesses in
these less-desirable places to advertise.
The dissolution of RDAs raised questions about how existing
signs would be treated by Caltrans because there is no longer
an RDA to negotiate the extension with Caltrans. SB 684
permitted these existing displays to remain in place for a
designated period of time and modeled the OAA exception for
RDA signs. The thought was that 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.
2)Impacts on the subjects of a recent legal decision. This bill
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impacts the subjects of a recent decision by an administrative
law court concerning violations of the OAA. On November 20,
2015, an administrative law judge (ALJ) found that cause
existed for Caltrans to issue Notices of Violation, requiring
correction of violations and payment of statutory penalties,
pursuant to the OAA and related Caltrans regulations,
concerning two "large-scale super graphic wall signs"
displayed by Sky Posters in Inglewood, California. One
display, measuring 25,000 square feet, depicted displays for
movies such as X-Men and Ant Man, while the other, measuring
30,000 square feet, displayed an image of the Nissan Rogue.
Both are affixed to the side of a 12-story building adjacent
to a section of Interstate 405. By comparison, the OAA
restricts permitted advertising to displays of 1,200 square
feet in area with a maximum height of 25 feet and a maximum
length of 60 feet.
In or about August 2010, Sky Posters applied for and obtained
approval from Caltrans for placing RDA displays on the
building. In April 2014, however, Caltrans issued two
violation notices based on the conclusion that the subject
displays were not redevelopment displays advertising
businesses in the City's redevelopment zone and Sky Posters
had only received approval for the placement of RDA displays.
Additionally, these wall signs were found along a landscaped
highway.
After the Notice of Violation was issued, Sky Posters filed a
Notice of Defense, which requested an administrative hearing.
As noted above, the administrative law judge found Sky Posters
to be in violation of the OAA, and pursuant to the OAA,
ordered Sky Posters to pay $10,300 in penalties and $1,405,641
as disgorgement of the gross revenue that resulted from the
displays. The ALJ opinion states that the OAA does not
provide for injunctive relief. For this reason, if Caltrans
wants to require Sky Posters to remove the wall signs,
Caltrans will have to seek such relief from a Superior Court
of the State of California.
If this bill were passed, Sky Posters would likely be
permitted to continue displaying the two wall posters at
issue.
3)Federal highway funds imperiled. Current law permits existing
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signs within an RDA project area that advertise for businesses
within the RDA to remain in place until 2023. This bill
expands that exemption and permit two signs in the City of
Inglewood to qualify as on-premise displays and remain until
January 1, 2023.
This exception would conflict with regulations that are
adopted pursuant to the federal Highway Beautification Act,
and could place California at risk to lose up to 10% of its
federal funds. Presently, California receives $3.5 billion
from the federal government, and stands to lose up to $350
million. This bill states that if an advertising display will
result in the loss of federal aid highway funds, the display
owner or operator shall remove the display and be subject to a
civil fine of $10,000 per day.
Related/Prior Legislation
SB 684 (Hill, Chapter 544, Statutes of 2013) permitted existing
advertising displays that advertised businesses and activities
within the boundary limits of an RDA project to remain and be
considered on-premise displays until January 1, 2023. The city
or county could then apply to Caltrans for an extension, showing
"good cause" beginning on January 1, 2022.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
SUPPORT: (Verified5/9/16)
None received
OPPOSITION: (Verified5/9/16)
California State Outdoor Advertising Association
ARGUMENTS IN SUPPORT: According to the author, "[a]dvertising
displays located in former redevelopment agency zones provide a
number of benefits to local businesses and local governments.
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Not only do these displays encourage economic investment in the
area, they also provide general fund revenue for the local
government successor agency. SB 1199 will allow the City of
Inglewood to utilize advertising displays located in the former
redevelopment zone to advertise business located within the
City's boundaries. Because redevelopment agencies and their
boundaries no longer exist and successor agencies are tasked
with managing their assets and property, this bill ensures that
the City of Inglewood is able to fully utilize their outdoor
advertising displays to promote business located within the
City."
ARGUMENTS IN OPPOSITION: Writing in opposition, the
California State Outdoor Advertising Association (CSOAA) states
that this bill seeks to legalize two outdoor advertising
displays that were recently found to violate state law.
According to CSOAA, the sign owner has filed a motion for
reconsideration with the Office of Administrative Hearings, and
for this reason, believes this bill is premature until there is
legal resolution. Additionally, this bill creates an unleveled
playing field for those outdoor companies that have maintained
lawfully permitted displays. CSOAA argues that there is no
reason to put $350 million of federal funds at risk to
facilitate two illegal advertising displays.
Prepared by:Alison Dinmore / T. & H. / (916) 651-4121
5/11/16 15:38:21
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