Op-ed: Judge voids airport billboard contract after San Jose failed to follow its own rules

When our organization, No Digital Billboards in San Jose, called out the city for not following its own rules in approving new digital billboards along the Guadalupe River Trail on San Jose Mineta International Airport property, no one at City Hall listened.

When the San Jose Airport Commission studied the plan and issued a detailed recommendation opposing the project—not once but twice—its input wasn’t even entered into the record during the San Jose City Council meeting on Feb. 15, 2022 at which the airport billboards were approved.

But when one billboard company, Clear Channel, is awarded a contract through a backroom deal and another billboard company, Outfront Media, takes notice and files a lawsuit, the city has to listen.

Superior Court Judge Thomas Kuhnle, in presiding over the case of “Outfront Media vs. the City of San Jose,” issued a ruling against the city on Dec. 20. The ruling cited San Jose’s failure to follow its own policy of awarding city contracts—in this case for billboards—as a function of competitive bidding.

The case exposed San Jose’s failure to follow the most basic tenets of good governance stated in city policy, which include:

• Transparency and accessibility
• Clarity in policies, practices and procedures
• Detailed accountability

Furthermore, the city’s Council Policy 6-4, which relates to its sign ordinance, states the city “will solicit proposals for [billboards] to be approved pursuant to this Policy.” The process has been used to solicit bids for digital billboards at other city-owned sites, but city officials attempted to bypass this requirement for the airport, citing an existing concessionaire agreement with Clear Channel.

The city’s incoherent legal defense of awarding a non-competitive contract for the proposed airport billboards to Clear Channel made a mockery of the guiding principles referenced above.

For starters, the city attorney argued that the city could cherry pick which provisions of Council Policy 6-4 it had to follow. Back in September 2018, the council quietly amended the city’s sign ordinance to allow new billboards on public property. This happened at the behest of the billboard lobby and without sufficient public outreach or justification, which revoked a 46-year ban on billboards on public property. It allowed for the establishment of new more profitable digital billboards presumably after a process of soliciting competitive bids from billboard companies.

The city attorney assured the court that “substantial” compliance of policies is acceptable vs. “strict” compliance. Going even further, the city argued that its policies in terms of compliance by relevant city agencies and officials were merely “directory” and not “mandatory.” They further argued when a city policy or municipal code says “shall,” the city can interpret it as “may,” contrary to basic contract law language.

Furthermore, the city’s position in the Outfront case implied that whether specific city policies were enforced depended on which special interests needed to be rewarded. Lest we forget, Clear Channel was referenced by former Mayor Sam Liccardo at a council meeting on Nov. 30, 2021 when he reminded councilmembers that “we shouldn’t forget…our friends.”

So rather than following written rules and in so doing affirming what the law actually requires, the council compromised what should be the common sense language of city policies. It did so by transforming those policies into an Orwellian lexicon in which the policy requiring airport billboards “shall” be bid competitively is to be understood as “may” be bid competitively. Accordingly, city policies must sometimes be followed, but sometimes must not.

To make matters worse, the council then allowed out-of-control, rogue city agencies such as the airport administration and economic development office to mismanage the revocation of the 1972 billboard ban and the expected implementation of new digital billboards on public property.

Since ending the ban in 2018, we estimate the city has spent millions of taxpayer dollars in staff time supporting the introduction of dozens of new digital billboards. That’s without constructing even one after five years of trying, a process and objective we have repeatedly insisted to be without merit and deserving of immediate termination. The court’s ruling will necessitate restarting the entire billboard company selection process certainly at the airport and perhaps at other public properties declared eligible for digital billboards.

Consider this a wake-up call to the current city council. Let’s get the city out of the billboard business, not only for the environmental, aesthetic and economic reasons our organization has thoroughly documented and publicized, but because doing business with  billboard companies is a financially losing proposition for municipal governments.

Just ask Los Angeles for details of its money-draining relationship with litigious billboard companies which are intent to erect an unlimited number of digital billboards across that city’s public and private landscape. Instead, San Jose should avoid LA’s predicament by focusing resources on the basic issues the community cares about.

Run the city in the public interest. Most important of all, follow the damn rules.

Jason Hemp, Les Levitt and John Miller are co-chairs of No Digital Billboards in San Jose.