On Thursday, in the case of City of Austin v. Reagan National Advertising, a case on which we’ve previously reported, the U.S. Supreme Court ruled that the City of Austin, Texas’s off-premises sign regulations were permissible under the First Amendment. The Court’s ruling ensures that state billboard laws and thousands of local sign regulations that distinguish between on-premises (i.e. signs whose messages relate to an activity occurring on the same property where the sign is located) and off-premises signs (i.e. billboards) will remain intact and constitutional.
In the case, Austin denied permits to two billboard companies that were seeking to convert existing, static billboards to digital signs. The billboard companies challenged, and the city removed to federal court. The district court rejected the billboard companies’ challenge. The Fifth Circuit Court of Appeals reversed, holding that the city’s sign code, which prohibited the erection of new off-premises advertising signs and further prohibited technological changes to nonconforming signs, violated the First Amendment. The appeals court’s decision was based on the conclusion that the regulation was content based. Under prior cases, including the 2015 ruling in Reed v. Town of Gilbert, the Court determined that laws that regulate the message or subject matter of signs are constitutionally suspect. The appeals court’s holding in the case was premised upon the fact that the off-premises advertising restriction related specifically to the content of a sign. Under the sign code, if the sign’s message related to goods and services on the property where the sign was located, it would be permissible; if the message addressed other matters, it would be prohibited.
In an opinion that garnered five votes and overruled the Fifth Circuit, Justice Sotomayor concluded that Austin’s sign code was not content based, because it simply regulated signs based on location. In her opinion:
Unlike the sign code at issue in Reed, however, the City’s provisions at issue here do not single out any topic or subject matter for differential treatment. A sign’s substantive message itself is irrelevant to the application of the provisions; there are no content-discriminatory classifications for political messages, ideological messages, or directional messages concerning specific events, including those sponsored by religious and nonprofit organizations. Rather, the City’s provisions distinguish based on location: A given sign is treated differently based solely on whether it is located on the same premises as the thing being discussed or not. The message on the sign matters only to the extent that it informs the sign’s relative location.
Thus, the majority distinguished the Austin sign code from the sign code at issue in Reed, which created distinctions among political, ideological, event and other noncommercial signs. In the majority’s view, the Austin code only addressed the sign’s location, and the message was not governed by the code. The majority was also swayed by the fact that the on-premises/off-premises distinction has been a durable regulatory distinction that has existed for over a hundred years in federal, state, and local law.
Justice Breyer filed a concurrence in the decision, arguing that Reed presented the wrong analysis for common-sense speech regulations. He advocated that speech regulations should weigh the harm to First Amendment interests against the regulatory objectives at hand. Justice Alito filed a concurrence in the judgment, arguing that the plaintiff billboard companies had not presented a proper facial challenge to the Austin code. A dissent was filed by Justice Thomas—joined by Justices Gorsuch and Barrett—arguing that Reed’s statements regarding facial content discrimination compel a finding that Austin’s distinction between on- and off-premises signs is unconstitutional.
The case’s result provides much-needed clarity to a longstanding question in the regulation of signs. The Court’s ruling ensures that states and local governments that regulate signs based on whether they are on- or off-premises may continue to do so. The decision likely saves thousands of local sign codes from being rendered unconstitutional.
Otten Johnson filed an amicus brief on behalf of the American Planning Association in support of neither party in the case.