BILL ANALYSIS                                                                                                                                                                                                    Ķ



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          Date of Hearing:  April 27, 2015


                   ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION


                                  Adam Gray, Chair


          AB 1373  
          (Santiago) - As Introduced February 27, 2015


          SUBJECT:  Outdoor advertising:  City of Los Angeles


          SUMMARY:  Provides an exemption from regulations of the Outdoor  
          Advertising Act (OAA or Act) for signs allowed by a City of Los  
          Angeles ordinance in relation to the number and location of  
          billboards in an area bounded by West 8th Street on the  
          northeast, South Figueroa Street on the southeast, Interstate 10  
          on the southwest, and State Route 110 on the northwest if  
          certain conditions are satisfied.  Specifically, this bill:  


          1)  Exempts from specific provisions of the OAA, any advertising  
          display located in the geographic area in the City of Los  
          Angeles bounded by W. 8th Street on the northeast, S. Figueroa  
          Street on the southeast, Interstate 10 on the southwest, and  
          State Route 110 on the northwest, if all of the following  
          conditions are met:

               a)  The advertising display is authorized by, or in  
               accordance with, an ordinance, including, but not limited  
               to, a specific plan or sign district, adopted by the City  
               of Los Angeles that regulates advertising displays by  
               identifying the specific displays or establishing  
               regulations that include, at a minimum, all of the  
               following:








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                  i.        Number of signs and total signage area  
                    allowed.

                  ii.       Maximum individual signage area.

                  iii.      Minimum sign separation.

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

                  v.        Illuminated sign hours of operation.

          2)  Specifies that the owner of the advertising display has  
          submitted to the California Department of Transportation  
          (Caltrans) a copy of the ordinance adopted by the City of Los  
          Angeles authorizing the advertising display and identification  
          of the provisions of the ordinance required, as defined and the  
          department has certified that the ordinance meets designed  
          minimum requirements.

          3)  Provides the advertising display will not advertise  
          products, goods, or services related to tobacco, firearms, or  
          sexually explicit material.

          4)  Provides this bill would not limit the City of Los Angeles  
          from adopting ordinances prohibiting or further restricting the  
          size, number, or type of advertising displays permitted by this  
          legislation.

          5)  Provides that if the advertising display is a message  
          center, the owner of the display shall do one of the following:

               (a) Makes the message center display available on a  
               space-available basis for use by Caltrans or the Department  
               of the California Highway Patrol for public service  
               messages, including Emergency Alert System (Amber Alert)  
               messages, as defined, and messages containing, among other  








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               things, reports of commute times, drunk driving awareness  
               messages, reports of accidents of a serious nature, and  
               emergency disaster communications.

               (b) Makes a message center display not subject to the  
               provision that is under the control of the owner of the  
               advertising display available on a space-available basis  
               for public service messages in a location acceptable to  
               Caltrans and the Department of the California Highway  
               Patrol.

               (c) Provides funding to Caltrans for the installation of a  
               message center display to accommodate those public service  
               messages, which may include funding as part of mitigation  
               in connection with the approval of development of the  
               property on which the message center display is located by  
               the City of Los Angeles.

          6)  Provides that if an advertising display is subject to a  
          notice from the United States Department of Transportation,  
          Federal Highway Administration, or other applicable federal  
          agency to the state that the operation of that display will  
          result in the reduction of federal funds, as provided,  
          authorization of the display would cease 60 days after the state  
          notifies the display owner of the receipt of the federal notice,  
          and would require the display owner to remove all advertising  
          copy within that time or be subject to specified civil fines.

          7)  Makes the City of Los Angeles primarily responsible for  
          ensuring that a display remains in compliance with the ordinance  
          and the bill's requirements, and would require the city to  
          indemnify and hold Caltrans harmless if the city fails to do so.

          8)  Makes findings and declarations as to the need for a special  
          statute relating to the City of Los Angeles.



          EXISTING LAW:  








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          1)  Establishes 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 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 Act, 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)  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.










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          5)  Allows a single advertising structure exemption for each of  
          several cities, including an exemption for advertising on  
          "street furniture" in San Francisco, several billboards situated  
          on the grounds of the Oakland-Alameda County Coliseum complex,  
          and structures within the Mid-City Recovery Redevelopment  
          Project Area within Los Angeles.





          6)  Requires the Department of Transportation (Caltrans) to  
          assess penalties for a violation of the OAA, as specified.  If  
          an advertising display is placed or maintained in a location  
          that does not conform to the provisions of this chapter or local  
          ordinances, and is not removed within thirty days of written  
          notice from the department or the city or the county with land  
          use jurisdiction over the property upon which the advertising  
          display is located, a penalty of ten thousand dollars ($10,000)  
          plus one hundred dollars ($100) for each day the advertising  
          display is placed or maintained after the department sends  
          written notice shall be assessed.





          FISCAL EFFECT:  Unknown


          COMMENTS:  


           Purpose of the bill  :  According to the author, this bill  
          proposes to allow for the use of revenue-generating advertising  
          displays within a small area of Downtown Los Angeles with the  








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          City of Los Angeles consent.


          The author's office states, according to a recent report, the  
          City of Los Angeles has lost $5 billion in economic development  
          over the last four years alone due to a lack of hotel rooms and  
          an outdated Los Angeles Convention Center.  Studies have shown  
          that an additional two to three thousand-hotel rooms together  
          with hotel facilities such as meeting and banquet rooms are  
          needed to fully support the Convention Center.  





          According to the information provided by the author, the Los  
          Angeles' Metropolis Project (Project) is a 6.3-acre, $1 billion  
          development adjacent to LA Live that has taken nearly three  
          decades to come to fruition.  The development, which broke  
          ground in the summer of 2014, will be composed of four towers:  
          1) an 18-story boutique hotel - Hotel Indigo - set to open in  
          October 2016; 2) a 38-story residential tower; 3) a 40-story  
          residential tower; and 4) a 52-story residential tower.





          The Project is expected to bring $156.7 million in tax revenue  
          into the City over the next 25 years, 20,000 construction jobs  
          over the next four or five years, and 500 permanent jobs upon  
          completion.  The project will also add 350 hotel rooms (with  
          meeting and event facilities), substantial restaurant and retail  
          space, as well as 1,560 residential units to the Convention  
          Center area.  In addition, AEG recently announced a 755-room  
          expansion of its Marriott Hotel located at LA Live between the  
          Convention Center and the Metropolis Project.










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          The author states, this measure will spur the construction of  
          needed hotels in support of the City's Convention Center, the  
          Sports & Entertainment District, and the Project's link to the  
          City's financial district.  It also empowers the City of Los  
          Angeles to control its urban streetscape and interface with the  
          state highways bisecting its urban core.  With the completion of  
          the Project, the expansion and revitalization of the Convention  
          Center, and the addition of hotel rooms in the Sports and  
          Entertainment District, over the next several years, the area  
          covered by this bill will become a central tourist, convention,  
          sports, and entertainment destination for people from all over  
          the world. 


          The author points out, this bill only affects signage within the  
          few blocks east of Interstate 110, north of Interstate 10, south  
          of 8th Street, and west of Figueroa Street in the City of Los  
          Angeles. These blocks are very different from other  
          freeway-facing areas in California in that they are highly  
          urbanized and contain a dense proliferation of convention,  
          entertainment, sports, and hotel uses.  This measure retains  
          local control by allowing the City of Los Angeles to determine  
          the amounts and types of safe signage to be placed at its  
          gateway.  It also allows the City of Los Angeles to require  
          public benefits that enhance traffic safety and aesthetics in  
          the streets within and surrounding the area. 





          The author points out that this bill additionally requires any  
          corresponding ordinance within the City of Los Angeles to  
          include protections to prevent signage from becoming overly  
          distracting, misleading, or disruptive.  This corresponds with  
          similar limitations set forth in the OAA.   For large  
          developments - especially those that fall within the sports and  
          entertainment industries - the ability to generate revenue via  
          the use of near-freeway signage for off-site sponsors  








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          dramatically decreases the overhead costs of construction  
          projects to taxpayers.





          The author concludes that this bill is an important step towards  
          ensuring that current and future developments within the  
          revitalized Downtown Los Angeles area will be able to tap into  
          this increasingly critical financing source to backfill the  
          decrease in public funding available for such purposes.


           Background:





          Outdoor Advertising Act  :  The Act regulates the placement of  
          advertising displays (i.e., billboards) and signs along  
          interstate or primary highways, landscaped freeways and similar  
          specified highways.  The OAA must also generally conform to  
          various federal laws, including the Highway Beautification Act  
          of 1965 (23 USC Section 131 et seq.).  





          The OAA sets standards for the structures, including their size,  
          identification and location, and requires compliance with  
          application procedures and conditions administered by the  
          Department of Transportation (Caltrans).  The Act 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  








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          freeway.





          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.





          While state and federal law generally regulates billboards and  
          similar advertising displays, local governments may also impose  
          restrictions equal to or greater than any restriction imposed by  
          state law, but local governments may not allow a display that is  
          in violation of state law.  Local governments are also entitled  
          to a portion of fees and fines under the state law, and they may  
          also require advertisers to obtain licenses and permits, in  
          addition to any licenses required by state law.  





          The OAA provides for general exemptions and specified exceptions  
          to the prohibition on advertising along 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.  In addition, since 1995, a number of bills  
          have created exemptions for specific cities, including an  
          exemption for advertising on "street furniture" in San  
          Francisco, five signs situated on the property of the  








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          Oakland-Alameda County Coliseum complex, one sign each in the  
          cities of Costa Mesa and Richmond, and four signs within the  
          Mid-City Recovery Redevelopment Project Area within Los Angeles.





           Federal Highway Beautification Act of 1965  :  The Highway  
          Beautification Act (HBA) was created to protect the public  
          investment, promote the safety and recreational value of public  
          travel, and to preserve the natural beauty of highways in the  
          nation.





          HBA specifies that states have the responsibility to enforce  
          provisions regarding the placement and maintenance of outdoor  
          advertising signs, displays and devices along the Interstate and  
          National Highway System.  The state of California enforces the  
          provisions of federal law through a compact that was developed  
          between the state and the federal government in 1967.  Federal  
          law also includes a penalty for states that violate HBA by  
          reducing all federal highway transportation funds by a  
          designated percentage.


           


          Policy issue  :  This bill might authorize the placement of an  
          advertising sign that is non-conforming to both the specifics  
          and intent of the OAA.  It might extend further the precedent  
          for legislative approval of exemptions to OAA.   Exemptions for  
          nonconforming and prohibited billboards and lighted signs along  
          interstate or primary highways and landscaped freeways might  
          undermine and render meaningless the provisions and intent of  








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          the OAA.





           Prior legislation  : SB 31 (Padilla), Chapter 542, Statutes of  
          2013.  Recasts an arena advertising exception to exempt from the  
          OAA specified advertising displays authorized before January 1,  
          2019, by local ordinance, at a venue with a capacity of 15,000  
          seats or more that is capable of providing a permanent venue for  
          professional sports.  In essence, the bill allows for local  
          control while establishing statewide guidelines for advertising  
          displays at professional sports facilities and arenas.





          SB 684 (Hill), Chapter 544, Statutes of 2013.  Amended the  
          redevelopment agency (RDA) exemption to OAA to reflect the  
          elimination of redevelopment agencies.  (Held in Senate  
          Transportation)


          SB 694 (Correa), Chapter 545, Statutes of 2013.  Exempted, from  
          the OAA, advertising displays at a publicly owned multimodel  
          transit facility (MTF) that is to serve as a station for the  
          high-speed train system, as specified, and requires revenues  
          from the advertising display to be used to support the  
          construction, operation, and maintenance of the MTF.


          AB 2566 (Hill), 2011-12 Legislative Session.  Would have  
          provided an exemption from the regulations of the OAA for an  
          advertising display located on State Route 1, in the County of  
          San Mateo, if certain conditions are satisfied.










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          SB 402 (Vargas), 2011-12 Legislative Session.  Would have  
          provided an exemption from the regulations of the OAA for an  
          advertising display located within 1,800 feet of the  
          intersection of State Highway Routes 8 and 111 in the County of  
          Imperial if certain conditions are satisfied.  (Senate Rules  
          Committee)





          AB 2756 (Blumenfield), Chapter 615, Statutes of 2010.  Defines  
          "mobile billboard advertising display" and allows a local  
          authority to regulate these displays.





          AB 2339 (Solorio), Chapter 493, Statutes of 2008.  Expanded the  
          definition of an "on premise" display to include those displays  
          advertising products, goods, or services sold on the premises of  
          an arena of at least 5,000 seats and is located on public land,  
          provided certain conditions were met.  


          AB 1117 (Benoit) of 2007, would have deemed an advertising  
          display erected by a city or county to advertise businesses  
          operating within a redevelopment agency project area, or within  
          a business improvement district whose boundaries partly or  
          wholly overlap those of the redevelopment agency project area,  
          to be on the premises at any location within 1,000 feet of the    
               legal boundaries of the redevelopment agency's project area  
          if the display meets certain conditions. (Died - Never heard in  
          Senate Local Government Committee)   









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          AB 563 (Ridley-Thomas) of 2007, would have deleted the  
          "rebuttable presumption" in current law that deems those  
          advertising displays that were unlawfully erected as lawful if  
          the sign owner had not received notice that the display was  
          unlawful within five years of the display being erected.  This  
          bill also would have deleted the requirement that entities  
          requiring the removal of unlawfully erected signs pay sign  
          owners just compensation to do so.  (Died in Senate Rules  
          Committee)





          AB 1499 (Benoit) of 2006, would have created an exemption to the  
          Act, to permit the City of Riverside to erect an outdoor  
          advertising display along Highway 91 to promote economic  
          activity for the Riverside Plaza.  (Vetoed by Governor)





          AB 801 (Jones) of 2006, would have created an exemption from the  
          OAA for one sign in the County of Sacramento.  (Vetoed by  
          Governor)





          AB 2441 (Klehs) of 2006, would have authorized an advertising  
          display in the redevelopment zone of the City of San Leandro  
          subject to specified conditions.  (Vetoed by Governor)









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          AB 1518 (J. Horton) of 2006, would have exempted, from the  
          prohibition against placing advertising displays adjacent to  
          landscaped freeways, any billboard located on property owned by  
          the Lennox School District, subject to certain conditions. (Died  
          pending concurrence in the Assembly)





          AB 762 (Nuņez), Chapter 725, Statutes of 2003.  Created an  
          exemption to the OAA by allowing the National Latino Arts  
          Council to place an advertisement on the roof of a  
          not-for-profit educational academy.





          SB 190 (Perata), Chapter 54, Statutes of 2001.  Exempted from  
          the OAA the prohibition against placing advertising displays  
          adjacent to landscaped freeways, up to five advertising  
          structures or signs (billboards) used to support the  
          Oakland-Alameda County Coliseum Complex.





          REGISTERED SUPPORT / OPPOSITION:




          Support








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          Greenland USA




          Opposition


          None on file




          Analysis Prepared by:Eric Johnson / G.O. / (916) 319-2531