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EDITORIAL: Digital billboards could fill coffers

September 6, 2014

Several city-county councilors are willing to lift a ban on digital billboards in Marion County but are waiting on three major sign companies to privately settle differences over regulations that could determine market share, IBJ reporter Kathleen McLaughlin wrote in a front-page story Sept. 1.

Sooner or later, the sign companies will come to terms. Digital billboards are many times more lucrative than traditional ones because they rotate multiple advertising messages.

The pitch to elected officials is likely to include promises of public-service announcements to benefit law enforcement and tourism, and removal of old billboards in exchange for the conversion of others to digital.

We’d like to suggest another bargaining chip the city should put on the table: revenue.

The city’s elected officials—both Republicans and Democrats—agree that more tax dollars are needed for public services, primarily law enforcement. Mayor Greg Ballard has pushed to raise the public safety income tax and remove a local homestead exemption. He’s also pushing for a commuter tax on those who work downtown—and use city services—but live in the suburbs.

If the major sign companies—Clear Channel, Lamar Advertising and CBS Outdoor—want digital billboards badly enough, and their lobbying investments suggest they do, they should be willing to pony up for the privilege.

In Indiana and most other states, billboards are taxed as business personal property. A review of Marion County tax records found local billboards assessed at valuations ranging from $2,000 to $60,000 apiece. Obviously, digital billboards are worth more and would need to be assessed at a higher valuation.

But city officials also should consider upfront and ongoing fees for each digital billboard conversion. Under a proposal from Democratic City-County Councilor Mary Moriarty Adams, the city would permit 20 total conversions in the first year. A $50,000 fee on each would raise $1 million. That would pay quite a few cops.

Another reason to harvest revenue from digital billboards: Many of the consumers of their advertising messages are the commuters who live outside Marion County and don’t pay local income taxes.

Years of industry lobbying helped wear down political opposition to digital billboards in Marion County, but that’s no guarantee the companies will overcome community opponents who are likely to show up in force if there’s a public hearing.

Easing the public’s tax burden won’t hurt the sign companies’ case.•

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Send comments on this editorial to ibjedit@ibj.com.

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