A controversial tax on billboards has qualified for the March ballot in West Hollywood.

Outdoor advertising magnate Mike McNeilly and his supporters submitted enough signatures last month to ask voters if they want a 7 percent tax on billboard leases. The tax would bring more than $4 million a year into city coffers.

Why would the head of a billboard company push a tax on his signs? Because the measure would also give his company and others the right to put up building-covering supergraphic signs along Santa Monica and Beverly boulevards, where they are now banned.

McNeilly’s SkyTag Inc., a supergraphics company with offices in Beverly Hills and Las Vegas, would benefit from this expansion. McNeilly told the Business Journal that advertisers would be willing to pay extra in order to fulfill the tax requirement.

But several members of the West Hollywood City Council oppose the tax measure.

Councilman Jeffrey Prang has stated that he believes the initiative is a “Trojan horse,” sold to voters as a way to raise revenue for the city when the real intent is to allow the spread of billboards and supergraphics.

City Attorney Mike Jenkins is reviewing the initiative to see if it’s constitutional. Because it addresses two issues – taxation and zoning – it could violate the state’s single-subject rule for initiatives. It could also violate the free-speech rights of advertisers by taxing their signs. If Jenkins finds the initiative unconstitutional, the council could try to keep it off the March ballot.

Meanwhile, in Los Angeles, vigorous opposition from business groups and the outdoor advertising industry appears to have derailed a 12 percent billboard tax on the March ballot, although it could return.

The Los Angeles City Council’s budget committee had proposed the ballot measure to raise revenue to help close a $300 million budget deficit; if approved, the tax would raise $24 million a year. But the committee rejected the tax Oct. 19 after hearing protests. The proposal then went to the council’s rules committee, which did not schedule it before the Nov. 3 deadline for the March ballot.

Film Fees Up

Despite fierce opposition from local business groups and the entertainment industry, the Los Angeles County Board of Supervisors has approved steep hikes in fees for film permits in unincorporated areas and several contract cities.

The county Fire Department proposed the fee increases to cover the $1.3 million cost of its film permit unit. The hikes were approved last month and will take effect in January.

Among the items in the new fee schedule: The cost of a basic film permit will increase to $282 from $104, while the cost for special effects permits will jump to $288 from $125. A new $277 fee will be levied on still-photography production crews with more than 15 workers.

The Central City Association, which has promoted production in downtown L.A. venues, was among the business groups opposing the fee increases.

“This will send the wrong message to the entertainment industry, which brings thousands of direct and indirect jobs and over a billion dollars in revenue annually to the Southern California region,” the association stated in written testimony.

Green Chemistry’ Rules

A broad coalition of business groups, trade associations and major companies has stepped up its opposition to the state’s attempt to overhaul the way California regulates chemicals in consumer products, saying huge costs could be imposed on a wide array of industries.

In September, the state Department of Toxic Substances Control released a consumer products regulation, the first major step in Gov. Arnold Schwarzenegger’s Green Chemistry program to identify and regulate the chemicals that pose the greatest health risks to people. State officials hope that the regulations will force manufacturers to use safer chemicals in their products. Pending administrative review, the regulation is set to go into effect in January.

“This regulation will facilitate California’s transition from managing toxic chemicals at the end of their life cycle to designing products and processes that are more environmentally benign,” Maziar Movassaghi, acting director of the department, said in a press release.

Business and industry groups say the regulation is too vague and could sweep up chemicals that pose only slight health risks or are present in very small quantities in consumer products.

In recent weeks, businesses and trade associations concerned over the potential impacts of this regulation have swelled the ranks of the Green Chemistry Alliance, a coalition of major business groups formed two years ago to provide industry input into the regulation. Locally, the alliance includes Northrop Grumman Corp. and North Hollywood-based OPI Products Inc. as well as trade groups such as the Southern California Metal Finishers Association.

“It’s distressing and disappointing to see a big idea made small by a bureaucratic process and by rules that simply will not work in the real world,” said Dawn Sanders-Koepke, alliance co-chairwoman.

Staff reporter Howard Fine can be reached at hfine@labusinessjournal.com or at (323) 549-5225, ext. 227.

For reprint and licensing requests for this article, CLICK HERE.