DATE: 06/03/2026
TO: Honorable Mayor and City Council Members
FROM: Economic Development Department
2026-216
REQUEST FOR CITY COUNCIL ACTION
SUBJECT:
PROPOSAL BY TOYOTA OF CORONA FOR CITY PARTICIPATION IN FREEWAY
SIGN REPLACEMENT
EXECUTIVE SUMMARY:
This staff report asks the City Council to consider a proposal from Toyota of Corona, located at 1700 W Sixth Street, for the City to participate in the replacement of a freeway sign.
RECOMMENDED ACTION:
That the City Council authorize staff to enter into an agreement with Toyota of Corona to fund 50% of the proposed freeway sign, with a not to exceed amount of $396,015.
BACKGROUND & HISTORY:
Toyota of Corona has a freeway sign located immediately adjacent to the 91 Riverside Freeway, which has been in place since 1990. The sign is 48 feet high and approximately 24 feet wide, with an electronic screen of 347 square feet and required a variance for additional sign area above the 129 square feet that was permitted by right. That variance was approved by the City Council on August 2, 1989.
The electronic sign is beginning to degrade in clarity and legibility, and the Toyota of Corona ownership is contemplating replacing the sign. The dealership has requested financial assistance from the City to replace the current sign with a larger, modern sign, to better allow it to advertise its dealership to drivers on the 91 Riverside freeway.
The request by the dealership is for the City to fund 50% of the cost of the sign replacement, which is estimated to $396,015 of the total project cost of $792,030. The dealership would be responsible for the maintenance and operation of the sign once installed and would provide the City nine minutes of every hour for public messaging. The intent of this upgrade is to improve visibility for the stand alone dealership that is located on the opposite side of the 91 Freeway from the Corona Auto Center and where the dealership building and car inventory is located on the south side of Sixth Street, entirely out of view from freeway traffic, which is a unique condition compared to all other major dealerships in the city.
City participation in freeway signs is a common practice, with twelve recent examples, funding by nine cities in Southern California identified as examples and models for the requested participation. For those examples, city funding ranges between 50% and 80% of total sign costs, with two cities providing supplemental funding up to 100% of the new sign cost in the form of a loan, which is repayable over time. In exchange for the funding, dealerships also provide time on the signs for public messaging by the cities, ranging for from 6 to 12 minutes of each hour.
The City of Corona also recently assisted the Corona Auto Center dealers with a refurbishment of its sign, providing $150,000 in 2021. The City receives 12 minutes of messaging time per hour on this sign.
ANALYSIS:
The current Toyota of Corona ownership purchased the dealership in the middle of 2025.
Under the prior ownership, the dealership, on average, sold an average of 5.05 (2023) and 4.67 (2024) cars per day. For the first half of 2025, the previous owner sold 4.28 cars on average per day. The new (current) owner sold an average of 10.85 cars per day for the second half of 2025, and 9.49 cars per day for the first quarter of 2026. This significant increase in volume, based on a new operational approach by the current owner, has already generated an estimated $200,000 to $300,000 in increased sales tax over previous years performance. If this pattern holds through the end of 2026, the increase in sales tax generated will match or exceed the requested funding assistance.
The proposed sign structure is approximately 51 feet high and 33.7 feet, with an electronic sign of 668 square feet. The sign would include text to identify the dealership, the Toyota logo, and the City of Corona on both sides of the structure.
Should the City Council authorize staff to enter into a funding agreement with the dealership, staff will return to the City Council in the near future with the final agreement and a budget appropriation request. The applicant would then be responsible for submitting a request for a variance for Planning Commission consideration. The variance is necessary as the Zoning Ordinance allows for a pylon sign up 40 feet in height for freeway adjacent properties, and 129 square feet for this specific site based on the length of its freeway frontage, in the C-3 Commercial Zone, which is the zoning for the dealership.
Should the Planning Commission approve the variance, the applicant could then move forward with permitting and sign fabrication and installation. Should the Planning Commission deny the variance, the dealership ownership could appeal to the City Council for a final determination. This entire process is expected to be completed by early 2027, assuming the variance request is submitted in late June or early July, with the new sign installed and operational by summer 2027.
FINANCIAL IMPACT:
The City’s participation in the freeway sign replacement is $396,015, which is 50% of the new sign cost. The new sign may assist in increasing vehicle sales from this dealership, thereby generating additional sales tax revenue for the City. Staff will return to the City Council in the near future with the final agreement and a budget appropriation request.
ENVIRONMENTAL ANALYSIS:
This action is exempt pursuant to Section 15061(b)(3) of the Guidelines for the California Environmental Quality Act (CEQA), which states that a project is exempt from CEQA if the activity is covered by the commonsense exemption that CEQA applies only to projects that have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. This action seeks Council authorization to enter into a funding agreement to assist with sign replacement in a fully urbanized area where a similar sign already exists. Therefore, no environmental analysis is required.
PREPARED BY: JOEL BELDING, ECONOMIC DEVELOPMENT MANGAGER REVIEWED BY: JUSTIN TUCKER, ASSISTANT CITY MANAGER
ATTACHMENTS:
1. Exhibit 1 – Presentation