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Sign Code Case Study Sign Code Case Study Location: Tennessee
Background Regarding Sign Owner and Application Procedure. During the late summer of 2001, the business owner became part of a “turn-around signs” franchise, locating his business in a retail center in a small Tennessee town. Under the town’s sign code, the only signage available for the business was a wall sign. Because of severe restrictions on the total sign area (and after receiving permission from the parent franchise), the owner chose to submit his application to the Design and Environmental Review Commission (DERC) for a sign that simply said, “Signs,” rather than challenging the town’s size restrictions. In keeping with the permitted area parameters, sign type, and design criteria, the proposed sign, composed of five raceway-mounted, internally illuminated 21-inch white acrylic letters, was 11.6 square feet in total size (20.964” x 79.728” or 1.75’ x 6.64’) – a very small sign! At the application hearing before the DERC, the applicant was questioned about his choice of wording “Signs,” instead of the name of the company. When the applicant explained that a sign containing the full name of the company would be too small to be seen from the adjacent roadway, a DERC member referred the applicant to the city code, which stated in its introduction: “The overall objective of the sign standard to ensure that signage does not detract from [the town’s] environment [and] emphasis shall be on using signage for identification purposes, not for product or service advertising.” The applicant was then referred to the design review criteria followed by the DERC, which directs: “No wording other than the name of the business and street address shall be permitted…” After discussion of the code references, in summary the following exchange occurred:
The applicant accepted the denial, and attempted to continue in business with temporary signage and alternate advertising (Yellow Pages, other print mediums), not wanting to spend extra dollars for a “conforming sign” that would not be detected or read in time to attract potential customers. A year after the business was denied its proposed signage, the owner of the parent franchise attended a lecture on the value of signs to a business and the legal protections available to business owners when faced with oppressive sign codes that overly burdened their ability to communicate to the street. After the lecture, the franchise owner contacted the speaker, a well-known signage expert, and asked him to review and comment on the aborted attempt of the franchisee to obtain a sign that said “Signs.” At the review, it was immediately apparent that the code contained constitutional infirmities with respect to limiting commercial expression to company identification ONLY. Simply, a municipal sign code may not forbid “product or service advertising,” unless the municipality can prove to the satisfaction of a court that the restriction is necessary to advance a substantial state interest that cannot be advanced any other way. Thus, when a sign conforms to a code with respect to dimensions, type, placement, and illumination, it may not be denied based on content, when what it says is a truthful representation about a lawful product. After reviewing the code, the business owner was advised to resubmit the original application, and to proceed to the hearing. In the meantime, the signage expert and his staff prepared a sign code analysis and discussion of relevant law for use by the applicant in aid of the presentation and argument. (See case law addendum.) Upon receipt of the analysis and case law summary, the franchise owner in pre-hearing discussions met first with the Mayor and then with members of the Code Enforcement Department (DEC) and the DERC. In discussion with the Mayor, the franchise owner emphasized the need for a larger sign of one word to permit the street visibility necessary to keep the business “in business”. The Mayor was receptive to this argument, and promised his support of the application on those grounds. The DEC confirmed that the sign complied with all regulatory requirements except those concerning the sign’s content, and referred that issue to the DERC. In discussions with the DERC, a member disclosed a fear on her part that if the code was “relaxed” to permit product or service advertising, the town might have to endure a sign like one in a neighboring town that said “Nude Dancing.” In response, the franchise owner carefully pointed out that it was unlikely a similar situation would arise in their small town, and regardless one could not unconstitutionally impair a business’s right to communicate a product or service in lieu of a company name based upon vague conjectures and overly-broad standards. In any event, the applicant pointed out, a sign that simply and tastefully said “Signs” could not possibly compromise the community’s desire to preserve an attractive, family-friendly commercial environment, and was therefore in keeping with the general (although constitutionally suspect) purposes of the code. The Outcome: On November 14, 2002, the application for the sign—a sign essentially identical to the one previously denied a year earlier—was approved by the DERC. The Lesson: It is never too late to assert your constitutional rights. Although not addressed in this case, the size restrictions imposed by the community are highly suspect and might be challenged as censorship. This business has the Constitutional right to not only display the word “SIGNS,” but also to display their business name and other reasonable messages at a size readable by the public and in any presentation style selected by the business owner. SIGN CODE ADDENDUM Excerpts from the code analysis undertaken in this case study The seminal case in most commercial speech constitutional issues is Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, 425 U.S. 748 (1976), where the Court held that commercial speech is entitled to protection under the First and Fourteenth Amendments. Once this protection was granted, subsequent court decisions have intensified scrutiny of regulations that negatively impact commercial speech via signage, with the result that commercial speech in all forms is nearly on par with noncommercial speech insofar as the constitutional protection it enjoys. The constitutionality test for signage regulation was first set out in Central Hudson Gas & Electric Corp v. Public Service, 447 U.S. 557 (1980), and expanded in Bd. of Trustees v. Fox, 492 U.S. 469 (1989) and City of Cincinnati v. Discovery Network, 507 U.S. 410 (1993). Today the test can be stated as follows: Time, place or manner
restriction of truthful commercial speech concerning a lawful activity
is permissible only if (1) the government interest is substantial, (2)
the regulation directly advances the government’s interest, and
(3) the regulation is narrowly tailored and no more extensive than necessary
to serve that interest, leaving open ample and feasible alternative methods
of communication. The Fourteenth Amendment
also applies to sign regulations, particularly those that arise from unequal
treatment of similarly situated sign owners based solely on who they are
or the message they are conveying. Due process issues arise if the code
does not provide narrow, objective, and definite standards, or provide
for timely application decision and appeals. Prior restraint questions
also arise when a permitting scheme grants too much discretion to the
permitting authority, or fails to provide for quick decisions on an application
and speedy appeal procedures. A business’s ability to communicate
its presence and its chances for effective marketplace entry and competition
are almost entirely dependent upon its signage. Therefore, it is essential
for new or emerging businesses to be able to obtain timely decisions on
sign applications. A brief review of relevant cases essentially discloses
that to pass constitutional muster a sign regulatory scheme must not place
unbridled discretion in the hands of the government, and must not fail
to place reasonable time limits on the permitting decision and follow-up
appeal processes. The constitutional problems in the subject code begin in the introductory section, “SIGNAGE.” Based on recent U.S. Supreme Court decisions, “purpose” or “objective” statements must contain more than merely a reference to ill-defined standards that offer no more guidance or control to the permitting authority than making sure “signage does not detract from the environment.” This is especially true in this case, when the code throughout grants broad discretionary power to the permitting authority, the Design and Environmental Review Commission. While the “intention” statement is constitutionally problematic, a greater issue is presented by the second sentence, which states that in protecting the city’s “environment,” emphasis shall be on using signage for identification purposes, not for product or service advertising. Such a purpose is unconstitutional on its face, for it advocates signage control based upon the content of the sign. A code may not constitutionally mandate what a sign may or may not say, provided, of course, that the message displayed is speaking truthfully about a lawful product or activity. It follows that subparagraph “h” under “Design Criteria” is also unconstitutionally content-based wherein it purports to restrict signage to the name of the business and street address only. By applying the above constitutional imperatives to the case, it is clear that the initial denial of the application to place a sign that said “Signs,” indicating the product available on site, instead of a sign displaying the company name (an “identification sign”), was in violation of the First Amendment. Simply, a city may not regulate lawful commercial speech about a lawful product. Thus, if one wishes to communicate what it is one sells, rather than the name of the company, one is entitled under the First Amendment to do so, unless the city can prove to the satisfaction of a court that it is necessary to restrict a sign to “identification only” in order to serve a substantial government interest that cannot be served any other way. For another way to look at the issue, assume that the business owner wishes to place a permanent noncommercial sign conveying a message such as “VOTE.” The city would not be able to prevent this message under any regulatory theory. One can then argue that the word “SIGNS” is no different than the word “VOTE” in terms of “environmental quality,” and since the proposed sign comported with all sign dimension, type, and design requirements, there should no longer be any question that the sign, as proposed, is deserving of approval. Chapter 15, Design and Environmental Review Commission, continues some of the vague language and directives, particularly in the creation and purpose section where objectives based on promoting health, safety, comfort, general welfare, appearance, environment, character, etc., are not sufficiently defined to avoid exercise of “unfettered discretion” or subjectivity in the hands of the Commission. Furthermore, the makeup of the commission does not require a member from each listed profession or field, but instead says members may be architects, engineers, landscapers, urban planners OR retail businesspersons. Thus the Commission can be weighted toward architects or urban planners, with no representative from the business community or sign industry whatsoever. To function properly—and objectively—the Commission must include a broad, representative spectrum of professionals and interests, particularly since a great deal of power is vested in this Commission. Finally, the 45-day period that may lapse between submission of an application and Commission approval is too long, especially for someone starting a business. A prior restraint issue is always present whenever a decision is delayed much beyond 10-14 days. At the very least, this time period should be reduced to 30 days, with any subsequent appeal also to be scheduled for hearing within 30 days of the date of denial. There may be other problems with discriminatory or content-based treatment of signs that are not immediately discoverable from the code itself. The city should be cautioned that if there are any signs on any public buildings that do not adhere to the code or are “exempt,” such favored treatment is in violation of the First and Fourteenth Amendments. In the same vein, signs that display “public service” messages, such as time and/or temperature, must also follow the code, or be found in Constitutional violation. Footnotes: (See, Lorillard Tobacco Co v. Reilly, 533 U.S. 525 (2001),
wherein the Court noted that the state’s interest in protecting
children from tobacco advertising might be considered compelling, but
even so, the statute restricting tobacco advertisements failed the “narrowly
tailored/reasonable fit” requirement set out in Central Hudson and
its progeny, and therefore, the restriction was unconstitutional.) |
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