CITY OF GLENDALE CALIFORNIA REPORT TO CITY COUNCIL

Transcription

1 CITY OF GLENDALE CALIFORNIA REPORT TO CITY COUNCIL June 5, 2012 AGENDA ITEM Report: Digital Billboard Signs 1. Council direction to proceed with an option for Digital Billboard Signs and Revenue Sharing COUNCIL ACTION Public Hearing [ Ordinance [ Consent Calendar [ ] Action Item [ X ] Report Only [ ] ADMINISTRATIVE ACTION Signature Submitted ~ :::;:~e:aghani, Director of Community Development... ~~ - Annette Vartanian, Administrative Analyst LRJ.;C~ ) ~~bt~ 0 ;~~oa, City Manager fvh~hp:.yf---~ ;_..:..;_~=-.::::.,_...~ RECOMMENDATION Staff requests Council direction on digital billboard signs and revenue sharing. SUMMARY Since the 1970s, the City has taken an active approach to eliminate sign clutter and blight by removing billboard signs in an effort to preserve quality neighborhoods. In January, the Council requested that staff bring back options for a digital freeway sign to help the auto dealers in their 8 c

2 Page2 marketing efforts. Soon after, ~ Metro and CBS outdoor each approached the City to install digital billboard signs with revenue sharing options. Because the Council requested a new policy direction related to digital signs for the Brand Boulevard of Cars, staff has included the Metro and CBS Outdoor proposals for Council consideration under one overall policy discussion. The new policy discussion is presented as a tool to generate revenues for the City's Economic Development and other General Fund supported activities. This funding can be used to provide community programs and services, promote the City's businesses and other activities. Four options are presented for Council consideration consisting of Metro only signs, a combination of Metro and City signs, and CBS Outdoor signs only. These options all provide for revenue sharing, plus some oversight of aesthetic quality of the sign design. FISCAL IMPACT There is no fiscal impact associated with this report; however, there is a potential for revenue through revenue sharing given the four options: Option 1: approximately $200,000- $250,000 per year Option 2: approximately $900,000.Per year Option 3: approximately $1,700,000 per year Option 4: Approximately $200,000 per year BACKGROUND POLICY HISTORY Since the 1970s, the City has taken an active approach to eliminate sign clutter and blight by removing billboard signs in an effort to preserve quality neighborhoods. In the 1990s, the City Council set up a program to buy-out billboards overtime and successfully removed approximately 80 signs. The City has been consistent in this policy to maintain a high aesthetic quality in the city and has not allowed the installation of new billboard signs. On two occasions, the City entered into agreements with billboard companies to allow extensions of the life of certain billboards in exchange for permanent removal of many others. AUTO DEALER FREEWAY SIGN In the 1990s, the City ordered a study from Citygate Associates in an effort to retain the Brand Boulevard of Cars (BBC) auto dealerships, promote auto sales, and help increase the City's sales tax revenue. The report recommended the City prioritize the implementation of a marketing program including a freeway. readerboard sign with directional signage, and joint advertising programs. As part of the recommendation, the BBC proposed a freeway sign that it would sponsor, fund, and maintain. The sign was proposed on City owned property along San Fernando Road and Fairmont Ave (along the 134 and 5 freeways). The BBC would pay for the cost of sign (approximately $450,000) and ongoing maintenance. The sign required 3 variances to allow for a partially animated, non-accessory ground sign over 35 feet above grade. The sign was exempt from environmental review. The request was reviewed and ultimately denied by the Zoning Administrator. The decision was appealed to the Council with design changes and reduction in sign size, but it was also denied by the Council. The Council recognized the mixed support for the sign from the community and stated there was no existing zoning or ordinance to allow or accommodate a "reader board" sign. There was mixed support from the community with businesses, Glendale Chamber and some residents in favor of sign, while residents were

3 Page 3 opposed to the sign. The Glenc;lale Homeowners' Coordinating Council supported the City's. position of assisting the BBC, recognized its financial contribution to the City's General Fund, and supported efforts of improving an advertising campaign by the placement of an advertising sign at an appropriate location. Ultimately, the BBC chose not to proceed with the freeway sign, as they did not want to cause strife and division within the residential community. NEW POLICY DIRECTION In January 2012, as part of the South Brand Rezoning effort, the Council requested that staff bring back options for a digital freeway sign to help the auto dealers in their marketing efforts. Soon thereafter, LA Metro approached the City to replace static billboard signs with digital billboards. These signs are in the Metro right-of-way and do not require City oversight or approval; however, Metro has brought this the City's attention as a courtesy and with a proposal to share revenue. Metro has contracted with Allvision, an asset management and consulting agency, to install outdoor advertising signs along the Metro right-of-way. In addition, CBS outdoor has also approached the City to install two digital billboard signs on City-owned property, also with a revenue sharing option. Because the Council requested a new policy direction related to digital signs for the Brand Boulevard of Cars, staff has included the Metro and CBS Outdoor proposals for Council consideration under one overall policy discussion. The new policy discussion is presented as a tool to generate revenues for the City's Economic Development program and other General Fund supported activities. This funding can be used to provide community programs and services, as well as promote the City's businesses and other activities. In addition to revenue potential, a freeway sign would provide a source for advertising opportunities for local businesses, including the Brand Boulevard of Cars. Consistent with the older policy on billboard signs, maintaining a positive visual aesthetic is important. Should a new policy be considered, it would be under the highest quality aesthetic criteria for signs and in a location that would not infringe on neighboring communities. Any option pursued should be analyzed and prepared in a manner that would not set a precedent to open new proposals from outside entities in the future. DIGITAL SIGN OPTIONS Option 1: Metro Signs Only (2 signs, 4 faces) Proposal: New 2 double face 14 x 48 electronic signs (a total of 4) Removal of 2 single-face signs on Sonora Ave and Los Feliz Blvd Location: 1) Metro right-of-way, north of 134 Fwy (Metro owned property); AND 2) Metro right-of-way, south of 134 Fwy (Metro owned property) City Zoning: Content Restrictions: Illumination: Estimated Net Revenue to City: City regulations would not apply to Metro signs, as signs are on Metro rightof-way Metro has very strict content restrictions, since they are also a public agency. Their content restrictions will not allow tobacco, marijuana dispensaries, adult entertainment, or political messaging.. 3 candlelights from a distance of 250 feet Brightness would not exceed 800 nits from Sunset to Sunrise. At all other times, brightness would not exceed 7500 nits. Both the 800 nits and 7500 nit maximum are industry standard. Approximately $200,000 to $250,000 per year from combined Metro-owned signs, based on 25% of net revenue sharing with Metro. * estimate from Allvision

4 Page 4 Contribution: Response to New Policy: The City would receive space to promote public service, public events, and community messaging based on availability. The City would also have the ability to utilize the signs for emergency messaging, such as Fire, Police, Amber, and Homeland Security alerts. This option would generate approximately $200,000 - $250,000 per year for the City's General Fund. The signs, however, are on Metro right-of-way and would not be subject to review by the City. As such, the City may not be able to enforce a high aesthetic quality and/or reduce the visual impact to the community. However, the City could negotiate with Metro to install the signs in locations that would not be visually detrimental to the nearby community. Option 2: Proposal: Location: City Zoning: Content Restrictions: Combination of 1 Metro and 1 City Sign (2 signs, 4 faces) METRO New 1 double face 14 x 48 electronic sign Removal of 2 signs on Sonora Ave and Los Feliz Blvd CITY Maintain 1 existing digital sign ( Clearvision) *subject to negotiation 1) Metro right-of-way, north of 134 Maintain 1 existing digital sign Fwy (Metro owned property); OR ( Clearvision) 2) Metro right-of-way, south of 134 Fwy (Metro owned property) City regulations would not apply to Metro signs, as signs are on Metro right-of-way Metro has very strict content restrictions. since they are also a public agency. Their content restrictions will not allow tobacco, marijuana dispensaries, adult entertainment. or political messaging. Not applicable; sign is existing The City could place content restrictions to not allow tobacco, marijuana dispensaries, adult entertainment, or political messaging.

5 Page5 Illumination: Estimated Net Revenue to City: Contribution: Response to New Policy:.3 candlelights from a distance of Existing sign would comply with 250 feet industry standards. Brightness would not exceed 800 nits from Sunset to Sunrise. At all other times, brightness would not exceed 7500 nits. Both the 800 nits and 7500 nit maximum are industry standard. Approximately $100,000 to $125,000 Approximately $800,000 per year per year from Metro~owned sign, from 1 City-owned sign, based on no based on 25% of net revenue net-revenue sharing with Metro. sharing with Metro. * estimate from Allvision * estimate from Allvision The City would receive space to promote public service, public events, and community messaging based on availability. The City would also have the ability to utilize the signs for emergency messaging, such as Fire, Police, Amber, and Homeland Security alerts. This option would generate approximately $100,000- $125,000 per year for the City's General Fund. The signs, however, are on Metro right-of-way and would not be subject to design review by the City. As such, the City may not be able to enforce a high aesthetic quality and/or reduce the visual impact to the community. However, the City could negotiate with Metro to install the signs in locations that would not be visually detrimental to the nearby community. The City could reserve space to promote public service, public events, and community messaging based on availability. In addition, the City could have the ability to utilize the signs for emergency messaging, such as Fire, Police, Amber, and Homeland Security alerts. The City could generate approximately $800,000 from the City-owned sign for the General Fund. This sign is existing and would not create a new visual impact for the neighboring community.

6 Page 6 Option 3: Combination of.1 Metro and 2 City Signs (3 signs, 6 faces) METRO CITY Proposal: New 1 double face 14 x 48 electronic Maintain 1 existing digital sign sign (Ciearvision) Removal of 2 signs on Sonora Ave *subject to negotiation and Los Feliz Blvd New 1 double face 14 x 48 electronic sign Location: 1) Metro right-of-way, north of 134 Maintain 1 existing digital sign Fwy (Metro owned property); OR (Ciearvision); AND 2) Metro right-of-way, south of 134 1) 5 Fwy, west line, north of 134 Fwy Fwy (Metro owned property) (City owned property); OR 2) 134 Fwy, north line, east of 5 Fwy (City owned property) City Zoning: City regulations would not apply to City zoning would not apply to Metro signs, as signs are on Metro existing sign. right-of-way City zoning would apply to new City sign and would be subject to Planning Hearing Officer and/or City Council review and approval. A variance, code amendments, and/or development agreements would be required. Content Metro has very strict content The City could place content Restrictions: restrictions, since they are also a restrictions to not allow tobacco, public agency. Their content marijuana dispensaries, adult restrictions will not allow tobacco, entertainment, or political messaging. marijuana dispensaries, adult entertainment, or political messaging. Illumination:.3 candlelights from a distance of One existing and one new sign would 250 feet comply with industry standards. Brightness would not exceed 800 nits from Sunset to Sunrise. At all other times, brightness would not exceed 7500 nits. Both the 800 nits and 7500 nit maximum are industry standard. Estimated Net Approximately $100,000 to $125,000 Approximately $1,600,000 per year Revenue to City: per year from Metro-owned sign, from 2 City-owned sign, based on no based on 25% of Aet revenue net-revenue sharing with Metro. sharing with Metro. * estimate from Allvision * estimate from Allvision Contribution: The City would receive space to The City could reserve space to promote public service, public promote public service, public events, and community messaging events, and community messaging based on availability. The City would based on availability. The City could also have the ability to utilize the have the ability to utilize the signs for signs for emergency messaging, emergency messaging, such as Fire, such as Fire, Police, Amber, and Police, Amber, and Homeland Homeland Security alerts. Security alerts.

7 .I Digital Billboard Sign and Revenue Sharing Page 7 Response to New Policy: This option would generate The City could generate approximately $100,000-$125,000 approximately $1,600,000 from the 2 per year for the City's General Fund. City-owned signs for the General The signs, however, are on Metro Fund. The existing sign would not right-of-way and would not be create a new visual impact for the subject to design review by the City. neighboring community. The new As such, the City may not be able to sign could be designed and located enforce a high aesthetic quality in a way to minimize impact to the and/or reduce the visual impact to neighboring community. In addition, the community. However, the City the sign would be designed to be could negotiate with Metro to install consistent with the City's policy on the signs in locations that would not high-quality design. be visually detrimental to the nearby community. Option 4: Proposal: Location: City Zoning: Content Restrictions: CBS Outdoor Signs Only (2 signs, 4 faces) New 2 double face 14 x 48 electronic signs Remove some existing static billboard signs 1) 5 Fwy, west line, north of 134 Fwy (City owned property); AND 2) 134 Fwy, north line, east of 5 Fwy (City owned property) City zoning would apply to the signs and would be subject to Planning Hearing Officer a!")d/or City Council review and approval. A variance, code amendments, and/or development agreements would be required. CBS Outdoor will restrict the use of this location for Tobacco, Gentleman's Clubs, and Marijuana Dispensaries. Illumination: Estimated Net Revenue to City: Standard of point three (0.3) foot candles over ambient light. 1) $8,333 per month per location for 10 years 2) $200,000 total annual vs 25%, whichever is greater 3) $2,000,000) over 10 Years * estimate from CBS Outdoor

8 Page 8 Contribution: Response to New Policy: Response to New Policy: CBS Outdoor will provide on a space available basis to the City of Glendale for public service and civic causes. This option would generate approximately $200,000 per year for the City's General Fund, per the estimate This option would generate approximately $200,000 per year for the City's General Fund. CBA Outdoor has requested to place the signs on City-owned property, which would give the City design review authority. This would allow the City to negotiate the locations of the signs, and enforce a high quality desiqn. CONSIDERATION OF OPTIONS There are several considerations associated with each of these options in regards to the City's responsibility and opportunities for revenue sharing: Option 1: the City would not be responsible for management or maintenance of the signs; however, the City would receive 25% of net revenues from ad sales. Options 2 and 3: the City would be responsible to contract with a management company to oversee ad sales, maintenance, and other aspects of sponsoring a City-owned sign. The City would receive 25% of net revenues from the Metro-owned sign, plus 100% of net revenues on the City-owned sign. Although Metro has contracted with Allvision for the management of its signs, the City would have the opportunity to hire another management company through a Request for Proposals (RFP). Both options are subject to terms of an Owner Participation Agreement with The Walt Disney Company and require some negotiation for approval by the parties. Option 4: This option would not provide the City with the flexibility of contracting with a consultant to manage the signs. CBS Outdoor owns and manages all of its signs; as such, the City would be restricted to using CBS for the management of the signs. The City would receive approximately $200,000 per year, based on CBS' estimates.

9 Page 9 OWNERSHIP & MANAGEMENT Because of the complex nature of owning and managing these types of signs, it is recommended that the City have some ownership over the signs and contract out the management of the signs. This would allow a professional consultant to negotiate on the City's behalf to get the best advertising rates as well as oversee the maintenance of the signs. An ownership/management model like option 4 requires the City to take an active role in many of the responsibilities. In addition, it does not give the City the flexibility to negotiate higher advertising rates. CAMPAIGN FINANCE DISCLOSURE Not applicable. EXHIBITS

10 MOTION Moved by Council Member, seconded by Council Member,, that staff is hereby directed to proceed with options for digital billboard signs and revenue sharing as further outlined in the June 5, 2012 staff report from the Director of Community Development and subject to any Council Member comments thereon. Vote as follows: Ayes: Noes: Absent: Abstain: J.IFILESIDOCFILESIMTNIDIGITAL SIGNS AND REVENUE SHARING OPTION MTN DOC 8 c 1