Billboard Regulation Survives at the US Supreme Court

Written By Martin Crim, Esq.

I think that I shall never see
a billboard lovely as a tree.
Perhaps, unless the billboards fall,
 I’ll never see a tree at all.
—Ogden Nash

In the 2015 case of Reed v. Town of Gilbert, the U.S. Supreme Court announced a new rule that restricted local government regulation of signs. That case broadly defined “content-based” regulation in a way that caused alarm in local government circles because it threatened to render unconstitutional many zoning ordinances that addressed signs. One of the fears that it generated was that we might no longer be able to have one set of rules for signs that advertise products and services sold on-site and another set for signs that advertise products and services that are sold elsewhere (a/k/a on-premises v. off-premises signs).

Most billboards are off-premises signs, and the billboard industry aggressively protects its interests in those signs. The Reed opinion gave them an opportunity to increase the number and value of their stock of billboards if they could turn on-premises signs into off-premises signs by getting courts to strike down local ordinances that discriminated against off-premises signs. Federal and state beautification laws dating back to the 1960’s and 1970’s have curbed the ability to put up new billboards, so most billboards you see are “grandfathered” under zoning law – allowed to remain as long as they do not expand in size or upgrade their technology.

Since 2015, billboard companies have filed several challenges around the nation against ordinances that used the on-premises/off-premises distinction, arguing from Reed that an ordinance was unconstitutional if you have to read the sign to apply the ordinance – even if you need just a cursory examination. This became known as the “pillar of salt” theory, after the Biblical story that Lot’s wife got turned into a pillar of salt as punishment for looking back despite being commanded not to look.

Although Justice Alito’s concurring opinion in Reed said that on-premises/off-premises distinctions were still permitted, the failure of the majority opinion to agree with him cast doubt on whether a majority of the Supreme Court would agree. The lack of clarity in the Reed majority opinion left room for the “pillar of salt” theory to persuade some judges. Meanwhile, tens of thousands of local governments had sign ordinances that distinguished between on-premises and off-premises signs.

On April 21, 2022, the Supreme Court finally answered the on-premises/off-premises question, in a case (Austin v. Reagan National Advertising of Austin) brought by two advertising companies who wanted to digitize some grandfathered billboards. Austin’s sign code prohibited that, so the advertising companies sued. The case made its way up the Federal appellate court system to the top, where Justice Sotomayor delivered the opinion of the Court, rejecting the “pillar of salt” rule as “too extreme an interpretation.”

Instead, the Supreme Court has now allowed sign regulations to distinguish between on-premises and off-premises signs as long as the regulations meet so-called “intermediate scrutiny” (i.e., requiring more justification than the “rational basis” test but not as much as the “strict scrutiny” test). For that reason, the Supreme Court remanded the Austin case for the lower courts to determine whether the Austin sign code had an “impermissible purpose or justification” and whether it was “narrowly tailored to serve a significant governmental interest.”

When I worked on the model sign ordinance for the Local Government Attorneys of Virginia in 2016, we retained the on-premises/off-premises distinction, generally prohibiting all new off-premises signs. (Grandfathered signs have to be allowed as a matter of property law.) We held our breath at the time, and now we can breathe a sigh of relief.

If you have a question about whether a given sign ordinance is still constitutional – either in the abstract or in relation to an existing or proposed sign – I’d be pleased to consult with you and, if appropriate, to represent you in relation to that question.

Martin Crim is a shareholder at Vanderpool, Frostick & Nishanian, and has been practicing law for over thirty years, primarily for cities, towns, and other local governments. If you have additional questions or concerns contact Martin Crim at mcrim@vfnlaw.com or call us at 703-369-4738.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer.