City of Austin v. Reagan: Key Facts about the Case

On November 10, 2021, the U.S. Supreme Court will hear oral arguments in a case with critical implications for the Highway Beautification Act. City of Austin v. Reagan Advertising considers whether regulation of billboards (“off-premise” signs) violates the First Amendment rights of advertising companies. The final ruling is expected in early 2022.

The docket is posted here.

Why is Austin v. Reagan such an important case?

  • This case has tremendous implications. If the U.S. Supreme Court upholds the Fifth Circuit Court of Appeals’ opinion favoring Reagan, billboard bans and sign ordinances in other communities will be unenforceable, limiting the ability of state and local governments to restrict billboard advertising and undoing much of the Highway Beautification Act.
  • The “scenic” arguments have attracted a diverse set of allies: Scenic America and its chapters and affiliates have joined an amici curiae brief in support of Austin’s position. This brief argues that billboards are a uniquely annoying type of land use that can be banned to protect property rights. For the first time, major real estate developers and chambers of commerce have also signed on to this brief, speaking directly and authoritatively on this issue. Key players in the outdoor advertising industry, including Outfront Media and the International Sign Association, have also filed amici briefs favoring Austin’s position.

What does Reagan claim is the issue with the City of Austin’s sign ordinance?

Like hundreds of communities across the country, Austin bans digital off-premise billboards along the sides of its roads due to concerns about driver safety and to preserve the scenic qualities of its roadways. The restriction dates to the 1960s when the passage of the Highway Beautification Act prompted signage restrictions along roadways across the country. Today Austin’s sign code allows businesses to install digital signs “on premise” but prohibits billboard companies from installing digital “off-premise” signs, or from converting existing static billboards into digital billboards.

What is the background behind the Austin v. Reagan case?

In 2017, Reagan National Advertising and Lamar Advantage Outdoor Company applied for permits from the City of Austin to convert static off-premises billboards to digital signs in violation of the city’s sign code, which prohibited the digitization of off-premise signs.

Reagan sued the City of Austin, arguing that the sign code’s distinction between the digitization of on-premises and off-premises signs violated the First Amendment in that it was an unconstitutional content-based speech restriction, that the sign code was invalid and unenforceable, and that Reagan and Lamar should be permitted to digitize their signs without permits. The federal district court ruled in favor of Austin and upheld the sign ordinance.

Reagan took the case to the U.S. Court of Appeals for the Fifth Circuit, which reversed the lower court’s decision in October 2020. The Court of Appeals concluded that the sign code—whose stated purpose was to protect the aesthetic qualities of the city and promote public safety—was not content-neutral and was therefore subject to “strict scrutiny.” In the Court’s opinion, the city did not provide sufficient arguments that off-premise signs created more visual blight than on-premise signs, nor that they posed a greater threat to public safety.

What legal precedents have been applied in the review of Austin v. Reagan?

The Supreme Court has previously affirmed the constitutionality of billboard laws on ten occasions, beginning with a 1919 opinion by Justice Oliver Wendell Holmes in St. Louis Poster Advertising Co. v. St. Louis. In 1939, the Court again unanimously upheld a billboard ban with an exception for on-premise business signs in Packer Corp. v. Utah, reasoning: “The radio can be turned off, but not so the billboard or street car placard. These distinctions clearly place this kind of advertisement in a position to be classified so that regulations or prohibitions may be imposed upon all within the class. This is impossible with respect to newspapers and magazines.”

In the 1981 decision of Metromedia v. San Diego, the Court again ruled that billboard bans are constitutional.

The Fifth Circuit Court of Appeals reviewed Austin v. Reagan under Reed v. Town of Gilbert, a 2015 ruling that struck down a sign ordinance that applied different limits to other kinds of signs. For example, the Town of Gilbert’s sign ordinance placed certain restrictions on political advertisements that did not apply to advertisements for churches.  

However, Justice Alito noted in a concurrence that “rules distinguishing between on-premises and off-premises signs” are permissible. This concurrence reflected the views of a majority of the Court, but the Fifth Circuit minimized it by suggesting it could have referred to bans on freestanding signs. This would be a use of “off-premise” that no city or court has ever used, including Justice Alito in a seminal and pragmatic 1994 Third Circuit opinion upholding the Delaware Highway Beautification Act as a proper balance between local business owners and other landowners and the traveling public.

What organizations are supporting the City of Austin in this case?

One factor that makes this case incredibly unique is the disparate collection of supporters that have stepped up to side with Austin in this case, as articulated in this Amici Brief signed by more than forty developers, chambers of commerce, and environmental organizations. This scenic-focused brief argues that billboards are a uniquely annoying type of land use that can be banned in order to protect property rights.

This unusual consensus helped persuade the Court in June to grant certiorari or full review of the case at oral argument on November 10. It also helped inspire an unprecedented array of merits briefs by other organizations, most of whom had never appeared in a billboard case, including:

  • Brief of Florida and 21 states (Arkansas, California, Connecticut, District of Columbia, Illinois, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Jersey, New York, Ohio, Oregon, Pennsylvania, South Dakota, Vermont, and Washington)
  • Brief of the United States of America
  • Brief of the International Sign Association & Chapters
  • Brief of Outfront Media, Inc.—second largest billboard company in the U.S.
  • Brief of the Knight First Amendment Institute at Columbia University
  • Brief of the National League of Cities, the U.S. Conference of Mayors, The International City/County Management Association, and the International Municipal Lawyers Association
  • Brief of the American Planning Association

What does the Amici Brief from the scenic community, chambers of commerce, and developers argue?

The Amici Brief filed by developers, chambers of commerce, and scenic organizations makes a unique argument that bans on billboards protect property rights—something that the lower court did not take into consideration. Striking down off-premise restrictions would be costly and onerous for landowners and developers. Almost every city in the country would have to rewrite sign codes. Even key players in the outdoor advertising industry agree that off-premise restrictions should remain in place.

A detailed summary is available here.

What can I/my community do now?

The Supreme Court’s decision is expected in early 2022. If a ruling comes down in favor of Reagan, you can expect immediate challenges to any existing billboard bans and sign ordinances. Your local officials should be prepared to respond, and you should be ready to voice your concerns when opportunities arise. Sign up for updates from Scenic America to keep apprised on this, and other, scenic issues.