                                ATTORNEYGENERAL OF TEXAS
                                              GREG         ABBOTT




                                                    May 20,2004



The Honorable Florence Shapiro                               Opinion No. GA-01 92
Chair, Education Committee
Texas State Senate                                           Re: Validity of a local ordinance that allows a
Post Office Box 12068                                        nonconforming sign to be replaced with a new
Austin, Texas 78711                                          nonconforming sign (RQ-0129-GA)

Dear Senator Shapiro:

         You inquire about the validity of a local sign ordinance that allows a nonconforming outdoor
advertising sign to be replaced with a new nonconforming sign,’ expressing concern that such
ordinances violate state law and place federal timds for Texas highways injeopardy? See 23 U.S.C.
5 131(2000) (federal Highway Beautification Act of 1965);’TEX. TRANSP.CODEANN. $5 391.001-
.255 (Vernon 1999 & Supp. 2004) (chapter 391). You ask whether “Texas law prohibit[s] the
issuance of anew nonconforming sign permit to allow the replacement of an existing nonconforming
sign with a new nonconforming sign.” Request Letter, supra note 2, at 2. You also ask whether “the
right to the nonconforming use belong[s] to the landowner or the sign owner.” Id. Your questions
relate to signs located on sites owned by someone other than the sign owner. See id.

I.       Legal Background

         A.        Federal Law

              The local sign ordinance you inquire about must be understood in relation to the
Highway Beautification Act of 1965 (the “HBA”), see 23 U.S.C. 5 13 1 (2000),4 a provision of the
Federal-Aid Highway Act. See id. $5 101-164. Federal aid is paid to a state for the costs ofcertain


          ‘A “nonconforming    sign” is a sign that was lawfully erected but does not comply with the provisions of a law
or rule passed at a later date or that later fails to comply with a law 01 rule due to changed conditions.    See 43 TEX.
ADMIN. CODE § 21.142(16) (2004); 23 C.F.R. 5 750.707 (2003).

          ‘See Letter from Honorable Florence Shapiro, Chair, Education Committee, Texas State Senate, to Honorable
Greg Abbott, Texas Attorney General (Nov. 11, 2003) (on tile with Opinion Committee, also available at
http://www.oag.state.tx.us)  @ereinafter Request Letter].

         ‘Seenlso23 U.S.C. ~101(2000)(“Historica1   andStahltoryNotes”explainingthat”Pub.    L. 89-285,s 403,Oct.
22, 1965,79 Stat. 1033,” enacting section 136, and amending sections 131 and 319 of title 23, “may be cited as the
‘Highway Beautification Act of 1965.“’

         ‘Seeid.
The Honorable Florence Shapiro - Page 2            (GA-0192)




highway projects pursuant to an agreement between the United States Secretary of Transportation
and the grantee state to the effect that the highways will conform to federal requirements. See id.
$5 106, 109; see also id. 4 120(a)-(b) (federal share is ninety percent of costs of projects affecting
highways on Interstate System and eighty percent of costs ofprojects affecting other highways in the
National Highway System). The HBA provides that the construction and maintenance of

               outdoor advertising signs, displays, and devices in areas adjacent to
               the Interstate System and the primary system should be controlled in
               order to protect the public investment in such highways, to promote
               the safety and recreational value of public travel, and to preserve
               natural beauty.

Id. § 13 l(a); see also id. 5 131(t) (“primary system” includes highways in the National Highway
System). If states do not control outdoor advertising signs along interstate and primary highways
pursuant to section 131, they will suffer a ten percent reduction in federal highway funds. See id.
5 13l(b). The HBA applies to advertising signs within 660 feet of the highway right-of-way and to
signs located beyond 660 feet from the highway that are outside an urban area and intended to be
seen from the highway. See id. However, the construction and maintenance of billboards in
commercial or industrial zones within 660 feet of the right-of-way may be allowed under state law.
See id. § 131(d). “Just compensation shall be paid upon the removal of any outdoor advertising
sign, display, or device lawfully erected under State law and not permitted” under section 131(c).
Id. 5 131(g).

        The agreement implementing the HBA in a particular state may include a grandfather clause
under which criteria as to size, lighting, and spacing of signs in commercial or industrial areas
within 660 feet on each side of the highway right-of-way apply only to new signs. See 23 C.F.R.
5 750.707(c) (2003). The grandfather clause may only allow “an individual sign at its particular
location for the duration of its normal life subject to customary maintenance.” Id.

        B.      State Law

                Transportation Code chapter 391 was adopted to comply with the HBA. See TEx.
TRANSP.CODE ANN. 5 391.002 (Vernon 1999) (purpose clause). Chapter 391 defines “outdoor
advertising” as

               an outdoor sign, display, light, device, figure, painting, drawing,
               message, plaque, poster, billboard, or other thing designed, intended,
               or used to advertise or inform if any part of the advertising or
               information content is visible Tom the main-traveled way of the
               interstate or primary system.

Id. 5 391.001(10) (Vernon Supp. 2004). Chapter 391, like the HBA, prohibits outdooradvertising
(1) within 660 feet of a right-of-way, if the advertisement is visible from the interstate or primary
The Honorable Florence Shapiro - Page 3            (GA-0192)




highway system, or (2) if outside an urban area, more than 660 feet from the right-of-way, but visible
from the highway and erected for the purpose ofhaving its message seen from the highway. See id.
5 391.031(a) (Vernon 1999); see also 23 U.S.C. 5 103(b)-(c) (2000); 43 TEX. ADMIN. CODE
$5 21.143 (2004) (continuance ofnonconforming signs), 2 1.146 (limits on installing or maintaining
outdoor advertising sign along regulated highway). The Texas Transportation Commission (the
“Commission”) may purchase or acquire by eminent domain “outdoor advertising that is lawfully
in existence on a highway in the interstate or primary system.” TEX. TRANSP. CODE ANN.
8 391.033(a) (Vernon 1999). Signs within 660 feet of the right-of-way in commercial or industrial
areas, as well as other specific kinds of outdoor advertising, are exempted from the prohibition. See
id. @ 391.005, .031(b)(4). The Commission is authorized to regulate outdoor advertising in areas
with industrial or commercial land use. See id. 4 391.032.

        Chapter 391, subchapter C establishes license and permit requirements for permissible
outdoor advertising along interstate and primary highways (“regulated highways”). See id.
$5 391.061-,068 (Vernon 1999 & Supp. 2004); see also 43’TEx. ADMIN. CODE $5 21.141-,162
(2004) (chapter 21, subchapter I - “Regulation of Signs Along Interstate and Primary Highways”);
id. 5 21.142(23) (defining “regulated highway” as a highway on the interstate or primary system).
A person who wishes to install or maintain outdoor advertising within the 660-foot corridor
alongside a regulated highway must hold a license for each county in which the person installs and
maintains outdoor advertising and must also have a permit for each sign. See TEX. TRANSP.CODE
ANN. $9 391.061, ,067 (Vernon 1999). The Commission will issue a permit to a person whose
outdoor advertising“if erected would comply with. [chapter 3911 andrules adopted under Section
391.032(a),” that is, rules pertaining to outdoor advertising in areas of industrial or commercial land
use. Id. $5 391.032(a), .068(a)(2). Section 391.068(c) provides that “[a] permit issued to regulate
the erection and maintenance of outdoor advertising by a political subdivision of this state within
that subdivision’s jurisdiction shall be accepted in lieu of the permit required by this subchapter if
the erection and maintenance of outdoor advertising complies with this subchapter and rules adopted
under Section 391.032(a).” Id. $ 391.068(c).

        The federal and state highway beautification provisions apply to interstate and primary
highway systems and do not prevent cities from adopting different regulations and compensation
provisions for signs on city streets that are not part of those systems. See Sign Supplies ofTe.x., Inc.
v. McCann, 517 F. Supp. 778,78586 (SD. Tex. 1980); City ofHouston Y. Harris County Outdoor
Adver. Ass’n., 732 S.W.2d 42,48 (Tex. App.-Houston [14th Dist.] 1987, no writ); LubbockPoster
Co. v. City oflubbock, 569 S.W.2d 935,941-42 (Tex. App.-Amarillo 1978, writ refd n.r.e.), cert.
denied, 444 U.S. 833 (1979). However, Local Government Code chapter 216 governs regulation of
signs by cities, including home-rule cities. See TEX. Lot. GOV’T CODE ANN. $5 216.001-,903
(Vernon 1999 & Supp. 2004). A home-rule city “may license, regulate, control, or prohibit the
erection of signs or billboards by charter or ordinance,” but may not “regulate the relocation,
reconstruction, or removal of a sign in violation of Subchapter A,” Local Government Code chapter
216. Id. 3 216.901 (Vernon 1999); see also id. $ 216.902 (municipality may extend the provisions
of its outdoor sign ordinance within its area of extraterritorial jurisdiction).
The Honorable Florence Shapiro - Page 4             (GA-0192)




         The predecessor of Local Government Code chapter 216 was adopted not to implement the
HBA, but to establish guidelines for municipal regulationofoutdoor advertising and to provide more
adequate compensation to the billboard owners than city ordinances had formerly provided. See Act
of May 26, 1985, 69th Leg., R.S., ch. 221, art. 1, 1985 Tex. Gen. Laws 1085 (adopting House Bill
1330); HOUSESTUDY       GROUP,BILLANALYSIS,Tex. H.B. 1330,69th Leg., R.S. (1985) at 3. Chapter
216 establishes requirements for relocating, reconstructing, or removing any sign in a municipality
and requires the city to compensate the owner of a sign that a city requires to be relocated,
reconstructed,orremoved. S~~TEX.LOC.GOV’TCODEANN$4 216.001(a) (Vernon 1999)@rpose
of chapter), 216.003(b) (Vernon Supp. 2004) (compensation); see also id. 5 216.002(l) (Vernon
1999) (defining “sign” as “an outdoor structure, sign, display, light, device, figure, painting, drawing,
message, plaque, poster, billboard, or other thing that is designed, intended, or used to advertise or
inform”). “In lieu of paying compensation, a municipality may exempt from required relocating,
reconstruction, or removal those signs lawfully in place on the effective date of the requirement.”
Id. 8 216.003(d) (Vernon Supp. 2004). Thecompensationrequirementsofchapter              216 “donot apply
to a sign that was erected in violation of local ordinances, laws, or regulations applicable at the time
of its erection.” Id. ,§ 216.013(a) (Vernon 1999). Nor do they apply

                to a sign that, having been permitted to remain in place as a
                nonconforming use, is required to be removed by a municipality
                because the sign, or a substantial part of it, is blown down or
                otherwise destroyed or dismantled for any purpose other than
                maintenance operations or for changing the letters, symbols, or other
                matter on the sign.

Id. $216.013(b); see nlso id. 8 216.013(c) (a sign or substantial part of it is considered to have been
destroyed only if the cost of repairing the sign is more than sixty percent of the cost of erecting a new
sign of the same type at the same location).

II.     Ouestion 1

       You inquire about a conflict between a city sign ordinance and state regulations governing
outdoor advertising. Your question is as follows:

                Is a local ordinance which allows a permit to be issued to replace a
                nonconforming sign with a new nonconforming sign invalid under
                state regulations [promulgated under Transportation Code chapter
                3911. Put another way, does Texas law prohibit the issuance of a new
                nonconforming sign permit to allow the replacement of an existing
                nonconforming sign with a new nonconforming sign?

Request Letter, supra note 2, at 2. A municipal sign ordinance applies throughout the city and may
include the city’s extraterritorial jurisdiction as well, see TEX. LOC. GOV’TCODEANN. 5 216.902
The Honorable Florence Shapiro - Page 5             (GA-01 92)




(Vernon 1999), but a conflict between the ordinance and state regulations can arise only where a
regulated highway is routed through a city or its extratenitorial jurisdiction.

        A municipal sign ordinance, as we have noted, may “grandfather” existing signs that do not
comply with the ordinance instead of requiring their removal and compensating the sign owner.
See id. § 216.003(d) (Vernon Supp. 2004). Chapter 216 does not prohibit a home-rule city Tom
allowing a grandfathered billboard to be replaced. See id. 9 216.901 (Vernon 1999) (authority of
home-rule city to “license, regulate, control, or prohibit the erection of signs or billboards by charter
or ordinance”).

        Where a state grandfather clause adopted pursuant to federal regulation allows a
nonconforming sign to be located within 660 feet of an interstate or primary highway, the sign may
not be replaced by another nonconforming sign. See 23 C.F.R. 5 750.707(c) (2003) (grandfather
clause may allow only “an individual sign at its particular location for the duration of its normal life
subject to customary maintenance”). The Department of Transportation (“TxDOT”) will not issue
a new permit for a nonconforming sign. See 43 TEX. ADMIN. CODE 5 21.143(c)(2) (2004). Thus,
the HBA and chapter 391 prohibit the issuance of a new nonconforming sign permit in a location
within the 660-foot corridor along interstate and national highways defined by the HBA. But see
23 U.S.C. 5 131(d) (2000); TEX. TMNSP. CODEANN. 8 391.031(b)(4) (Vernon 1999) (exemption
for construction and maintenance ofbillboards in commercial or industrial zones within 660 feet of
the right-of-way).

         A city may be certified to exercise control of outdoor advertising signs pursuant to the HBA
and chapter 391 if TxDOT, after consulting with the Federal Highway Administration, determines
that the city’s sign ordinance is consistent with the HBA. See 43 TEX. ADMIN. CODE 3 21.151(c)
(2004) (certification process). A permit issued by a certified city will be accepted in lieu of a permit
issued by TxDOT. See id. 5 21.151(a); see also TEX. TRANSP.CODEANN. $ 391.068(c) (Vernon
1999) (acceptance of permit issued by political subdivision in lieu of state permit). A city ordinance
that is consistent with the HBA and chapter 391 will not authorize a new nonconforming sign in the
660-foot corridor next to regulated highways.

        If a local sign ordinance is inconsistent with the requirements of the HBA, for example, by
allowing the replacement of an existing nonconforming sign with a new nonconforming sign in the
same location, it will not govern signs in the corridor affected by the HBA. Even if the political
subdivision issues a permit for the new nonconforming sign within 660 feet of an interstate or
national highway, the sign would still be subject to the permit requirements stated in the
Commission’s rules, which prohibit the issuance of a new nonconforming sign permit in that
corridor. See 43 TEX. ADMIN. CODE $5 21.143, .150 (2004). The sign owner will not be able to
secure the state permit needed to maintain a new nonconforming sign within 660 feet of an interstate
or national highway and will not be able to maintain a sign that violates requirements of the HBA.
State law limits the application of a local sign ordinance so that federal highway funding is not
jeopardized. The federal and state highway beautification provisions do not prevent political
subdivisions from applying different regulations to signs on streets that are not part of the interstate
The Honorable Florence Shapiro - Page 6             (GA-01 92)




or primary highway systems. See Sign Supplies of Tex., 517 F. Supp. at 785-86; Harris County
Outdoor Adver., 732 S.W.2d at 48; LubbockPoster, 569 S.W.2d at 941-42. A local ordinance that
allows a permit to be issued to replace a nonconforming sign with a new nonconforming sign is not
invalid under state law, but state law supercedes such ordinances in areas subject to the HBA and
Transportation Code chapter 391. See TEX.TRANSP.CODEANN. $391.068 (Vernon 1999). Such
local ordinance provisions do not place federal funding for Texas highways in jeopardy.

III.   Ouestion 2

        You ask whether “the right to the nonconforming use belong[s] to the landowner or the sign
owner.” Request Letter, supra note 2, at 2. The sign owner’s and landowner’s interests in a
nonconforming sign depend on the laws and regulations applicable to the particular sign, and in some
cases, the contract between the sign owner and the landowner will also be relevant.

         We address this question in terms of the HBA, Transportation Code chapter 391, and
regulations adopted under these statutes. These provisions address the sign owner’s and landowner’s
interests and responsibilities with respect to a nonconforming sign in the corridor along a regulated
highway. S~~TEX.T~ANSP.CODEANN.$5 391.061-.090(Vemon 1999&Supp. 2004)(chapter391,
subchapter C - “License and Permit for Outdoor Advertising”); id. $5 391.065 (Vernon 1999)
(authority of Commission to adopt rules for licensing); 391.068 (permit requirements; Commission
by rule shall prescribe, among other things, form and content of permit application). A sign owner
must secure a license covering the county in which the sign is to be installed or maintained and a
permit to maintain the sign. See 43 TEX.ADMIN.CODE$5 21.149, ,150 (2004). No permit will be
approved unless the applicant has obtained written permission from the owner of the site on which
the sign is located. See id. 5 2 1.150(b)(2). Nonconforming signs may continue in a regulated area
subject to the requirements stated in TxDOT rules. See id. 4 21.143. “[Tlhe permit holder’s sign
. . may not be relocated even if the sign is sold, leased, or otherwise transferred, without affecting
its status,” unless the relocation results from a right-of-way acquisition to accommodate a regulated
highway project. Id. 9 21,143(2)(A); see id. 3 21.160 (relocation of certain signs along regulated
highways). The permit allows for reasonable repair and maintenance of a nonconforming sign. See
id. 5 21.143(b). A new permit is required for substantial changes as defined by rule, but TxDOT
will not issue a new permit for a nonconforming sign. See id. 6 2 1,143(c)(1)-(2). See also 23 C.F.R.
5 750.707(c) (2003) (grandfather clause may allow only “an individual sign at its particular location
for the duration of its normal life subject to customary maintenance”).

        TxDOT regulations make the owner of a sign along a regulated highway responsible for
securing the permit for a nonconforming sign and for maintaining the sign. See 43 Tnx. ADMIN.
CODE4 21.143 (2004). Thus, the sign owner effectively controls the nonconforming use, subject to
limits found in the statutes, regulations, and lease with the owner of the site where the sign is located.
See id. $5 21.143(b), 21.150 (2004); see also id. 5 21.150(b)(2) (no permit will be approved “unless
the applicant has obtained written permission from the owner” of the site on which the sign is
located).
The Honorable Florence Shapiro - Page 7            (GA-0192)




        City ordinances may differ as to the regulations and compensation provisions they apply to
signs on city streets that are not subject to the HBA or chapter 391. Although municipal regulations
must be consistent with Local Government Code chapter 216, they will not necessarily include
identical provisions for nonconforming signs. It is not possible to determine in the abstract that the
nonconforming use in a sign governed by a city ordinance “belongs” to either the sign owner or the
land owner. Thus, where a nonconforming sign is governed by a municipal ordinance, questions
about interests in the nonconforming use to that sign must be addressed in terms of the applicable
statues, regulations, ordinances, and contracts.
The Honorable Florence Shapiro - Page 8          (GA-01 92)




                                      SUMMARY

                      A local sign ordinance that allows a permit to be issued to
              replace a nonconforming sign with a new nonconforming sign is not
              invalidunder state law, but state law supercedes such local provisions
              in areas along highways that are subject to the federal Highway
              Beautification Act. Such provisions do not place federal funding for
              Texas highways in jeopardy. It is not possible to determine in the
              abstract that the nonconforming use belongs to either the sign owner
              or the land owner. Interests in the nonconforming use must be
              evaluated in terms of the applicable statues, regulations, ordinances,
              and contracts.




BARRY R. MCBEE
First Assistant Attorney General

DON R. WILLETT
Deputy Attorney General for Legal Counsel

NANCY S. FULLER
Chair, Opinion Committee

Susan L. Garrison
Assistant Attorney General, Opinion Committee
