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Good for business or bad for scenery? Salt Lake City renews battle with billboard industry

Published: Friday, April 13 2012 5:57 p.m. MDT

An electronic billboard on 600 South in Salt Lake City in Nov. 2011. Now that legislation to regulate conversion of electronic billboards has failed, Salt Lake City is gearing up for another fight with the outdoor advertising industry.

Jeffrey D. Allred, Deseret News

Editorial: A pig in the parlor: SB136 is misguided effort

SALT LAKE CITY — An orange background frames a man and woman, both smiling and dressed in dark business attire, the woman with her arms folded.

Reagan Outdoor Advertising is hiring account executives.

Moments later, a blue and green screen features the image of a father giving his daughter a piggy-back ride. "Select security," the SelectHealth ad advises.

The screen is now red, informing motorists on 600 South that Wasatch Transfer is the place to go for their moving and storage needs.

From the northeast corner of 600 South and 300 West, Salt Lake City Mayor Ralph Becker watches the electronic billboard across the street cycle through images — eight seconds at a time.

It's troubling to Becker that, in some cases, billboards are the first sights for visitors as they arrive in Utah's capital city. In particular, electronic billboards — those with digital advertisements — do not present the image the second-term mayor wants for Salt Lake City.

"We live in, I think, the most beautiful setting of any city in the nation," he said. "You see that in all our (tourism) advertising. … We don't advertise to come here and look at our billboards. We advertise to come here and experience our city, to experience this beautiful landscape we have."

The battle over electronic billboards is playing out across the country, with some states, counties and cities banning their use and others allowing them only if other billboards are torn down.

In Utah, the battleground is Salt Lake City, where decades of intense lobbying, financial contributions to lawmakers and a push by pro-business interests are pitted against city leaders and concerned residents trying to prevent Utah from resembling Florida, Michigan, Missouri or Wisconsin — where the outdoor advertising industry runs rampant to the tune of 15,000 to 20,000 billboards per state.

The emergence of electronic billboards in Salt Lake caught city officials off guard. Six of them were installed — including two on 600 South — before city leaders and planners knew what to do with them.

"We were all of a sudden starting to see (electronic billboards) spring up in our community, and we realized we had no standards for them," Becker said. "We knew we needed to put a hold on what was going on while we evaluated what would be a good policy for Salt Lake City."

Today, 19 requests for digital billboard conversions from Reagan Outdoor Advertising, Utah's largest billboard company, are being held up while city officials work to come up with an ordinance to regulate where or how they can operate in Salt Lake City.

If Becker had his way, no electronic billboards would be allowed. And the 145 traditional billboards in the city would be coming down, too, wherever possible.

"I think it is pretty commonly held here … that billboards in the numbers (Salt Lake City has) and where they're located are a blight on the city and its natural landscape," he said. "That's the view I hold. I don't hide it."

The prevailing opinion at the City-County Building is billboards don't belong in residential areas; on boulevards such as 700 East and Foothill Drive; or main entries to the city, including 400 South, 500 South and 600 South.

There's little city leaders can do about billboards already in place in those areas, aside from a handful where permitting is being disputed. But they can keep billboards there from being converted to digital signs, and for now, that's what they intend to do.

In January, following more than a year of study and debate, the City Council put in place a temporary measure that prevents billboards from being converted to electronic signs anywhere in the city other than freeways and major highways.

And even then, outdoor advertising companies have to take down a billboard somewhere else to convert an existing sign to digital — a two-for-one deal the outdoor advertising industry calls unfair and some city leaders say is too lenient.

Neither side is satisfied with the ordinance, but a decision had to be made, city leaders said, before the state Legislature stepped in.

"We knew they have a tendency to get involved in these issues," the mayor said.

Becker has had a front-row seat for government battles against billboards for nearly two decades. Unlike the majority of those previous conflicts, the outdoor advertising industry didn't triumph at the state Capitol during the most recent legislative session.

"Until this year, they've basically gotten anything they've wanted," Becker said.

In the coming months, the spotlight at the City-County Building is expected to shift back to electronic billboards as officials work to strike a balance between the mayor's ban-all-billboards way of thinking and the outdoor advertising industry's right to grow its business.

And no matter what is decided, both sides expect the Utah Legislature to have something to say about it.

Good for business

Salt Lake City leaders' opposition to billboards makes no sense to Jeffrey S. Young, senior vice president of Young Electric Sign Co.

Billboards, he says, are good for business.

"We just don't understand why cities would want to place any restrictions on them at all," Young said outside his office on Foothill Drive.

Armed with survey results that say most Utahns have no problems with billboards, Young confidently states his position that it's just a "small group of planners" and "environmental groups" who want to "regulate, limit and restrict" the outdoor advertising industry.

"It still remains a mystery to us as to why this small group of individuals who, from our perspective, don't represent the interests of the whole community would be putting restrictions in place at this time," he said.

The study Young cites was conducted nearly a decade ago by Kenneth Foster, an adjunct associate professor of communications at the University of Utah. It compiles the mailed responses of 1,165 people who live along the Wasatch Front, the study states, to "determine public perceptions of media and advertising issues in the community."

"The conclusion was that (billboards were) just not that big of a blip on (the public's) radar," Foster said.

According to the study, 89 percent of respondents would not "advise government officials to ban or limit billboards." But questions in the survey — such as, "What is more of an issue in your community: unsightly vacant lots or billboards?" — seem to steer respondents toward a more favorable opinion of billboards.

"If I would have said an unsightly billboard versus an unsightly vacant lot, the results would have come out differently, of course," he said. "But would that be a fair question?"

Foster says city planners essentially chose the terminology by comparing billboards to "unsightly vacant lots and buildings."

"If I bent it slightly toward the billboard industry, it's because (billboards) were being compared to these places — that they were as bad as unsightly lots and ugly buildings," he said.

Foster said the outdoor advertising industry didn't commission the study, though he did disclose that he has worked for more than 20 years as a consultant for Reagan.

Even if the billboard industry isn't supported by 89 percent of Utahns, it certainly has plenty of supporters. Public hearings at Salt Lake City Council and Planning Commission meetings over the past 18 months routinely attracted far more speakers in favor of the industry than those opposed.

Paul Murphy, spokesman for Utah Attorney General Mark Shurtleff, has touted the merits of electronic billboards in broadcasting AMBER alerts, saying they have helped in locating abducted children.

A representative from the Great Salt Lake Council of the Boy Scouts of America credited electronic billboards for its accomplishments in collecting food for the needy.

And several small-business owners told city officials about their successes, attributing them to billboard advertising.

Todd Cella, owner of a startup basement finishing company Finished For 14, said he opted to advertise using only a digital billboard because of its relatively low cost compared with other media — TV, radio and newspaper ads. The results, he said, were far better than he'd imagined.

"I know the importance of advertising in this format," Cella told the City Council last year.

Studies also have shown that more people look at electronic billboards than the traditional large roadside signs, Young said.

"We can't look past what a great economic advantage this gives to businesses to advertise though this efficient mechanism," he said. "Electronic billboards really do work."

For now, YESCO officials have decided they won't attempt any electronic billboard conversions in Salt Lake City. Taking down a billboard in order to convert another to digital doesn't make financial sense for the company, Young said.

"As far as our company is concerned, we can't afford to shut half of our business down to deploy electronics in Salt Lake City," he said.

Other cities along the Wasatch Front have "much more flexible requirements on where you can and can't put electronics up," Young said, and YESCO will focus its business in those cities.

"It's a much bigger state than just Salt Lake City," he said.

Legislation stalls

At the Utah Legislature, Rep. Mel Brown, R-Coalville, shakes hands with Young and Dewey Reagan, president and general manager of Reagan Outdoor Advertising, prior to the start of a House Transportation Committee meeting in February.

"I think over my legislative tenure, this is probably the third time I've had the privilege of dealing with outdoor advertising," Brown told the committee.

Brown then introduced HB87, the outdoor advertising industry's answer to restrictions on electronic billboards imposed by Salt Lake City.

The proposed legislation, along with an identical bill introduced in the Senate the same day by Majority Whip Wayne Niederhauser, R-Sandy, aimed to prevent Utah municipalities from enacting or enforcing restrictions on billboard owners.

The bills also sought to prohibit any requirements that billboards be forfeited in order to upgrade to electronic signs.

"We're talking about, in my view, the responsibility we have as legislators to protect a viable private enterprise that makes a contribution to the economy and the job market," Brown told his fellow legislators.

The committee voted unanimously to advance the bill to the House floor, where it later passed by a lopsided 55-16 vote. But the bill stalled in the Senate on the final day of the session, in part because Niederhauser wasn't sure there were enough votes for it to pass.

"I could have probably got a vote on it, but there was not a lot of support for a bill that didn't have more buy-in on both sides," he said. "I just decided we were going to have to do it another year."

The lack of action by the Legislature came as a disappointment to billboard companies and a surprise to Becker and other Salt Lake City leaders.

"We firmly believe that, if given an opportunity, the Senate would have passed this bill," Young said. "Unfortunately, we ran out of time, and we didn't get to a vote."

Despite the setback, he said, "we firmly believe these changes need to occur."

Becker said he was pleased by the Legislature's failure to take action on electronic billboards. He credits the Utah League of Cities and Towns for helping Salt Lake City present a united front with other municipalities along the Wasatch Front.

The Utah County Council of Governments, made up of mayors and commissioners throughout the county, took a position against the billboard industry's proposal, and city leaders from Davis and Weber counties also spoke out against the bills.

"What was being proposed by the outdoor advertising folks was going to be very harmful for our communities," Becker said. "Ultimately, I think that's the reason legislation didn't get passed."

Influence on the hill

The Legislature's lack of action allows Salt Lake City to tackle the issue on its home turf rather than the state Capitol, where the outdoor advertising industry has a decided advantage.

Billboard companies, particularly Reagan, have long been one of the most influential groups on the hill, using generous campaign contributions and a slew of lobbyists to advance their agendas.

In the past 10 years, Reagan has donated more than $800,000 to local political campaigns, mainly to state legislators.

According to campaign finance disclosures through 2011, only seven of the 104 current members of the Utah Legislature have not accepted contributions from Reagan since 2009. Three of those seven were appointed to office in 2012.

That leaves four legislators — Reps. Roger Barrus, R-Centerville; Becky Edwards, R-North Salt Lake; Marie Poulson, D-Cottonwood Heights; and Kraig Powell, R-Heber City — who haven't accepted money from Reagan.

Powell doesn't accept campaign donations from any corporation, lobbyist or special interest group, he said, because "the tradeoff is so much on the negative side."

"Whether the inference or the assumptions are true or not, I think the appearance that campaign contributions create is negative enough that I decided, when I first ran for the Legislature, that I didn't want to be associated with that," Powell said.

Barrus said he chooses not to accept any money from the billboard industry because of a previous experience he had with a local company that was "very, very difficult to work with."

"That's a group that I'm not comfortable accepting funds from," he said, declining to offer any specifics about the situation that led to that decision.

Barrus said he received a check from Reagan shortly after being elected in 2000.

"I sent it back to them, thanking them for it, but asking them to take me off their list," he said. "And they have honored that."

Becker, who served in the state House for a little more than a decade before being elected mayor in 2007, also has never taken money from Reagan or other outdoor advertising companies.

Sen. Niederhauser, an ally of the outdoor advertising industry, has accepted more than $4,800 from Reagan since being elected in 2006. Rep. Brown, who did not respond to interview requests for this story, has received nearly $3,500 from Reagan since '06.

Niederhauser acknowledges that billboard companies have influence on the hill, but lawmakers ultimately answer to the public, he said, and that's what drives their decisions.

"It's been my experience, regardless of campaign donations, that the Legislature usually … isn't going to ram something down somebody's throat when there's a lot of controversy over it," Niederhauser said.

"While (campaign donations and lobbyists) might help a little, what I've seen as a legislator is that the legislative process works 90 percent of the time in getting the parties together and working out compromise legislation," he said.

A nationwide dispute

The outdoor advertising industry's influence on lawmakers isn't limited to Utah.

Billboard companies are powerful players in state legislatures across the nation, said Max Ashburn, spokesman for Scenic America, a nonprofit organization based in Washington, D.C., dedicated to "preserving and enhancing the visual character of America's communities and countrysides."

"In the states where there are a lot of billboards, which is about two-thirds of them, the billboard industry is entrenched in state houses, and they have been for years," Ashburn said. "That's where they prefer to do their regulating because they have a lot of lobbyists and long-term friends in the state houses."

When such battles are fought at city hall, billboard companies tend to lose, he said, "because most people don't like billboards."

"That's why they like to make regulations in the back halls of state houses where they have their friends who they've donated money and billboard space to," Ashburn said.

Local ordinances regulating electronic billboards — and state lawmakers' attempts to overrule them — are topics of debate all over the country, he said.

Four states — Alaska, Hawaii, Maine and Vermont — have longstanding bans on any kind of billboard, and Montana began prohibiting all electronic billboards in 2009.

Large cities that have banned electronic billboards in recent years include Houston, Kansas City, Mo., San Francisco and St. Louis. In Los Angeles, no new digital billboards are allowed, and there's an effort under way to force removal of the 101 standing there because the legality of their construction is in dispute.

In the past two years, three states where lawmakers passed legislation to override local regulations on electronic billboards were overturned by governors' vetoes. None of the states — Arizona, Missouri and South Dakota — had enough votes to override the governors' rulings.

'Not all business is good'

Mayor Becker's somewhat adversarial history with the outdoor advertising industry dates back more than 20 years, when he served on the Salt Lake City Planning Commission.

Becker was chairman of the commission in 1993, the year it advanced a plan to cap the number of billboards at their current levels and remove them from historic and residential districts.

Becker spoke at City Council meetings on behalf of the Planning Commission's action. Though he hadn't taken the lead on the proposed ordinance, Becker was a vocal advocate of the plan.

"It was fought vigorously, particularly by Reagan," he said.

William Reagan, then-president of Reagan Outdoor Advertising, touted the findings of a Dan Jones & Associates poll commissioned by the company that indicated 86 percent of city residents at that time didn't consider billboards a problem.

The City Council ended up siding with the Planning Commission and approved the ordinance by a 5-2 vote.

"It infuriated the Reagan folks," the mayor recalled. "I think they thought they were going to be successful in overturning the Planning Commission at City Council, and they weren't."

After the meeting, Becker said, things got ugly.

"I'll never forget it," he said during a recent interview in his office at the Salt Lake City-County Building. "That is the only time in my career as a public figure that I have been accosted — literally accosted — by anyone when I came out of a City Council meeting."

Reagan representatives, Becker said, "were poking their fingers in my chest."

"They were screaming at me," he said. "I just walked away from it and left. It was not a pleasant experience. That kind of stuff does not leave a very good taste in my mouth."

Keith Christensen, then a member of the Salt Lake City Council, surprised his colleagues with his support for capping the number of billboards in the city. Christensen was then and continues to be an advocate for local business.

But a vote for billboards isn't necessary a vote for business, he said.

"My personal opinion is that business is good, but not all business is good," Christensen said during a recent interview. "I am not a fan of billboards."

Christensen said his opinion of the outdoor advertising industry took a negative turn following his dealings with a local billboard company that refused to remove one of its signs from his property more than 20 years ago.

"We had terminated the leases on the property," he recalled, "but the billboard company that owned those signs refused to take them down. That leaves the property owner in a difficult spot."

Folk stories circulating at the City-County Building include descriptions of Christensen ultimately wielding a chainsaw and removing the billboard himself.

Today, he chuckles at the tale, but doesn't offer any indications about its truthfulness.

"It's a lot easier for property owners to sign leases and get a little bit of revenue for a property that may not be fully utilized at a given time," Christensen said. "It's a lot more difficult to get those billboards removed when property owners want to do something different with that property."

Unfair advantage?

The volume of state code pertaining to the outdoor advertising industry is daunting and continues to grow nearly every near.

Opponents say the laws give billboard companies an unfair advantage over any other industry in the state.

Outdoor advertising officials counter that the only reason state lawmakers have to get involved is because municipalities and environmental groups have placed a bull's-eye on their backs. Salt Lake City's restrictions on electronic billboards, they say, are the latest example of that.

"We're not trying to promulgate and build a bunch of new billboards," said Young, YESCO's senior vice president. "That's never been what it's been about. We haven't added new structures in Salt Lake City for decades. We're just trying to keep what we have, to be allowed to improve our business."

Becker points to several sections of state law that he says provides special treatment to the outdoor advertising industry.

The "most egregious" example of that, he said, deals with the way billboards are treated for purposes of valuation.

Under state law, billboards are considered personal property, not real property, meaning they aren't subject to property taxes, even though they're attached to property.

"(Billboard companies) don't pay taxes like every other property owner in the state," Becker said. "They're exempt."

The mayor's biggest beef with that law, he said, is that it doesn't apply to the billboard when a property owner — or the government — wants to remove it. In that case, the billboard is treated as real property, which increases its price tag.

On top of that, outdoor advertisers include the value of each sign as part of its network of billboards, driving up the cost to remove a billboard even further.

"They make it almost impossible for a local government … to remove a billboard," Becker said.

The Liberty Wells Community Council knows that all too well.

For years, community members attempted to negotiate the sale of property on the corner of 1300 South and 300 East, where one of Reagan's billboards is located.

Thirty years ago, Salt Lake Police Sgt. Ron Heaps was shot and killed at the site in the line of duty. Retired Lt. Art Healey, Heaps' former partner, led an effort for several years to raise funds in hopes of purchasing the property and building a memorial there.

Reagan refused to sell.

"I, personally, would like to see something worked out," company president Dewey Reagan told the Deseret News in 2010. "I know that memorial is important to that community. But it's got to work for all parties."

The community is now focused on a new piece of property at 256 E. Herbert Ave., where it plans to construct Ron Heaps Memorial Park. Thanks to a $240,000 grant from Salt Lake City to purchase the property, the park will be shared with Lincoln Elementary School and will include vegetable and flower gardens.

"It's a classic example of what happens when you try to work with these companies," Becker said. "It's not just the effect of the billboard. It's also the way they practice their business that tends to be pretty offensive."

Work in progress

Salt Lake City's ordinance regulating electronic billboards remains a work in progress.

It's unlikely city planners will advance a proposal the outdoor advertising industry will be happy with; the goal is to find an approach they can live with.

Becker says part of that process will include putting aside past prejudices and bringing billboard companies back to the table for discussion, along with members of the community and leaders from other cities along the Wasatch Front.

From Young's perspective, such a compromise would need to eliminate the requirement that sign companies remove a billboard in order to convert another to digital.

"We would strongly be in favor of (the ordinance) being relaxed and unrestricted to open the opportunity for other businesses to advertise this way," he said.

Standing outside the YESCO offices, Young motions to the north, where a Key Bank on Foothill Drive recently added a drive-through to its branch.

"What if the city were to say, 'To put in a drive-through, all you have to do is close another branch of yours?'

"It's preposterous to think why a city would place such a requirement on any industry," Young said.

Salt Lake City isn't the first to suggest a conversion ratio for electronic billboards. Cities including Long Beach, Calif., and Tampa, Fla., have enacted 10-to-1 conversion ratios to reduce the number of billboards. Other cities with such policies include Cleveland (7-to-1), Orlando, Fla., (4-to-1) and Dallas (3-to-1).

Becker says it makes sense to reduce the number of billboards for every digital sign because "one electronic billboard can really be the equivalent of six or 10 billboards with the frequency of how they change their messages."

And the mayor isn't ready to concede on that point, at least not yet.

"We're going to try to come up with a standard that we think will work for our communities and work for the outdoor advertising industry," Becker said. "We hope that both reason and sensibility prevail."

E-mail: jpage@desnews.com

Editorial: A pig in the parlor: SB136 is misguided effort

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