By LESLIE COLLINS
Northeast News
August 22, 2012 

Kansas City’s proposal to implement a tax on billboards has outdoor advertisers ready to sue.

“When somebody comes up and says, ‘We’re going to tax you and nobody else,’ that’s obviously picking on one industry, and it’s prejudice in its worst form,” said George Massood, a real estate broker who leases signs to CBS Outdoor, Inc. and Lamar Advertising Co.

During their Aug. 15 meeting, Planning, Zoning & Economic Development committee members discussed implementing a 2 percent tax on the gross revenue of billboards located within the city. City Council members are debating whether or not to place the tax proposal on the November ballot and are expected to make a decision this week.

An estimated 400 billboards of varying sizes exist within Kansas City, and City Manager Troy Schulte said the proposed tax could generate $112,000 in annual revenue. If voters approve the tax, the revenue would be used to fund a full-time employee at $60,000 per year to keep a database on Kansas City’s billboards, inspect billboards and oversee enforcement on billboard codes. The remaining funds would be used to tear down dilapidated and illegal billboards.

Frances Semler, who lives north of the river, said she supports the tax.

“I think they’re (billboards) probably more obnoxious than they are effective,” she said.

Kansas City resident Tarrence Nash agreed.

“I think it’s a very modest opportunity to improve the beauty of the city and alleviate blight, and I believe these are blight boards,” Nash said.
Billboard advertising also blocks the view of Kansas City’s attractive downtown amenities, he added.

Other proponents for the billboard tax agreed the revenue could further beautify Kansas City and that outdoor advertising companies could afford the additional tax.

Jim Bowers of Lamar Advertising called the tax a “war on billboards” and pointed out the myriad of negative comments regarding the look of billboards.

“It’s an all-out assault to eliminate billboard advertising in Kansas City,” Bowers said. “We’re very active in the community and we’re being bullied. It’s really frustrating. You try to do the right thing, be a good business, and a select few people want to target you.”

Bowers pointed out that the company built a new office in Kansas City in 2004 and that the office grew from 12 employees to 23. Last year the payroll totaled $1.4 million and $178,000 was paid in payroll taxes, along with $14,000 in earnings tax. Last year, the Kansas City office donated $950,000 in free advertising space to entities like the Susan G. Komen foundation, City Union Mission, Harvesters, Crime Stoppers and others.

“The tax is both punitive, and it’s targeted,” Bowers said.

David Hyatt, a CBS Outdoor Inc. real estate manager, also highlighted the taxes billboard companies already pay that contribute to the local economy. The City of Kansas City even purchases billboard advertising from CBS, he said. City entities have included EnergyWorks KC, the health department, among others.

Implementing the tax would threaten the company’s right to freedom of speech, and customers would shoulder the cost of a new tax, Hyatt said.

Both outdoor advertising companies said they would sue if the tax passes.

When it comes to singling out an industry, committee member Ed Ford said, “We do it all the time. We have a tax on just restaurants, on hotels, on rental cars.”

In addition, a number of Kansas City billboards aren’t complying with city ordinances, he said.

Cities throughout the U.S. have already implemented similar taxes on billboards, said committee member Scott Wagner.

One committee member, however, said she’s been opposed to the tax since the beginning.

Instead of implementing a tax, the city should set aside money in the General Fund to finance a full-time employee to monitor billboards, said committee member Cindy Circo.

“This amount of money (from the tax) will not take care of the problem,” Circo said. “It simply gives us the feel good feeling that we’ve done something to address the issues.”

Billboard Tax

Proponents

• Generates an estimated $112,000 in annual revenue
• Billboard companies can easily afford tax
• Enables city to add full-time employee to monitor billboards
• Creates additional funding to remove dilapidated and illegal billboards
• Removing billboards beautifies Kansas City

Opponents

•Unfairly targets and singles out outdoor advertising industry

•Cost of tax will be passed on to customers

•Billboard companies already pay several substantial taxes, like property tax, earnings tax, billboard structure tax, etc.

•Equates to another sales tax

•Will negatively impact the industry