Reagan Nat'l Adver. of Austin v. City of Austin

Opinion

 [*699]  Jennifer Walker Elrod, Circuit Judge:

Reagan National Advertising of Austin and Lamar Advantage Outdoor Company both filed applications to digitize existing billboards. The City of Austin denied the applications because its Sign Code does not allow the digitization of off-premises signs. Reagan and Lamar sued, arguing that the Sign Code's distinction between on-premises and off-premises signs violates the First Amendment. The Sign Code's on-premises/off-premises distinction is content [**2]  based and therefore subject to strict scrutiny. Because the Sign Code cannot withstand this high bar, we REVERSE and REMAND.

Plaintiffs-Appellants Reagan and Lamar are in the business of outdoor advertising. Reagan and Lamar own and operate "off-premise[s]" signs, including billboards that display both commercial and noncommercial messages.

In April and June 2017, Reagan submitted permit applications to digitize its existing "off-premises" sign structures. The City denied all the permit applications, stating that "[t]hese applications cannot be approved under Section 25-10-152 (Nonconforming Signs) because they would change the existing technology used to convey off-premises commercial messages and increase the degree of nonconformity with current regulations relating to off-premises signs." In June 2017, Lamar submitted permit applications to digitize its existing "off-premises" sign structures. The City denied Lamar's applications for the same reasons it denied Reagan's.

The City of Austin regulates signs in Chapter 25-10 of the Austin City Code. The Sign Code defines an "off-premise[s]  [*700]  sign" as "a sign advertising a business, person, activity, goods, products, or services not located on the site [**3]  where the sign is installed, or that directs persons to any location not on that site." The Sign Code does not expressly define "on-premise[s] sign," but it does use the term "on-premise[s] sign" in some of its provisions. The Sign Code allows new on-premises signs to be built, but it does not allow new off-premises signs to be built. A "nonconforming sign" is defined as "a sign that was lawfully installed at its current location but does not comply with the requirements of [the Sign Code.]" Preexisting off-premises signs are deemed "nonconforming signs."

Persons are permitted to "continue or maintain nonconforming signs at [their] existing location," and can even change the face of the nonconforming sign, as long as the change does not "increase the degree of the existing nonconformity." However, persons are not permitted to "change the method or technology used to convey a message" on a nonconforming sign. The Sign Code permits "on-premise[s] signs" to be "electronically controlled changeable copy signs" (i.e., "digital signs"). Consequently, on-premises non-digital signs can be digitized, but off-premises non-digital signs cannot. The City's stated general purpose in adopting the [**4]  Sign Code is to protect the aesthetic value of the city and to protect public safety.

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