Item #11
Date: September 1, 2026
To: Mayor and City Council
From: Mike Luken, Planning Consultant
Dan Flores, Community and Economic Development Director Subject: Public Hearing - Urgency Ordinance Amending Section 18.64.093(e) of the Marysville Municipal Code to Authorize the Replacement of Three Static Billboards with Two Electronic Billboards on State Route 70 in Connection with the State Route 70 Safety Improvement Project; and Direction to Negotiate a Billboard Relocation and Financial Agreement with Outfront Media, LLC
RECOMMENDED ACTION
It is recommended that the City Council:
1. Conduct the public hearing and receive public testimony;
2. Find that adoption of the urgency ordinance is exempt from the California Environmental Quality Act (CEQA) pursuant to State CEQA Guidelines Section 15061(b)(3) and Sections 15301 and 15302, and direct staff to file a Notice of Exemption;
3. Adopt, by a four-fifths (4/5) vote pursuant to Government Code Section 36937(b), Urgency Ordinance No. 1477 (Attachment 1) amending Section 18.64.093(e) of the Marysville Municipal Code to authorize, on a strictly limited basis, the replacement of three existing static off-site advertising displays on Union Pacific Railroad property along State Route 70 with not more than two electronic off-site advertising displays at two designated locations, effective immediately upon adoption; and
4. Direct staff to process a companion non-urgency ordinance containing the identical amendment to Section 18.64.093(e) (Attachment 2) through the regular zoning amendment procedure – including a duly noticed Planning Commission public hearing and recommendation pursuant to Government Code Sections 65353 and 65854, followed by first and second readings before the City Council – so that the amendment remains in effect in the event of any legal challenge to, or expiration of, the urgency ordinance; and
5. Direct staff and the City Attorney to negotiate a billboard relocation and financial agreement with Outfront Media, LLC consistent with California Business and Professions Code Section 5412 and the framework described in this report, and to return to the City Council on September 15, 2026, with (a) the billboard relocation and revenue-sharing agreement – structured as a percentage-based revenue share with quarterly or semi-annual reconciliation, and including the City’s revenue-share percentage, audit rights, City advertising and public service announcement time, commencement Item #11
and construction milestones, term, and a reopener provision requiring review of actual revenue performance and adjustment of the agreement terms at two (2) years following the first display’s operational date and every five (5) years thereafter – for City Council approval, and (b) the use permit for the two electronic displays required under Section 18.64.093(e), with all required findings and conditions of approval, for City Council approval following a duly noticed public hearing conducted by the City Council as the approval authority designated by the urgency ordinance.
BACKGROUND
The California Department of Transportation (Caltrans), in cooperation with regional and local agencies, is undertaking a project to widen and improve State Route 70 (SR-70) in the vicinity of the Union Pacific Railroad (UPRR) bridge for the purpose of eliminating documented safety hazards and reducing the incidence of injury and fatal collisions along that corridor (the “SR 70 Safety Project”). The real property required for the SR 70 Safety Project includes property owned by the Union Pacific Railroad Company on which three lawfully erected and permitted static off-site advertising displays (billboards) operated by Outfront Media, LLC presently exist. Removal of the three billboards is necessary for the SR 70 Safety Project to proceed.
California Business and Professions Code Section 5412 and related provisions of the Outdoor Advertising Act (Business and Professions Code Section 5200 et seq.) provide that a lawfully erected advertising display that is compelled to be removed by governmental action may be relocated pursuant to an agreement between the display owner and the affected public entity. Absent a relocation path, the display owner may be entitled to compensation, and the removal of the displays – and therefore the SR 70 Safety Project itself – could be delayed.
Chapter 18.64 of the Marysville Municipal Code (Sign Code) currently permits off-site advertising displays only in the C-3, M-1, and M-2 zoning districts subject to a use permit (Section 18.64.093(e)), and requires that all billboards be externally illuminated with white light (Section 18.64.093(e)(1)). Section 18.64.060 separately prohibits animated, moving, flashing, changeable copy, electronic message board, and video display signs. The combined effect of these provisions is to prohibit electronic (digital) billboards anywhere within the City. An amendment to the Sign Code is therefore required to accommodate the relocation and modernization of the displays.
Staff has prepared an urgency ordinance (Attachment 1) that authorizes, on a strictly limited basis, the replacement of the three static billboards with not more than two electronic displays at two designated SR-70 locations. The static-for-digital exchange results in a net reduction of one off-site advertising structure along the corridor. A public hearing notice for this item was published in the [AppealDemocrat] on August 11, 2026, at least twenty days prior to this hearing, in accordance with Government Code Sections 65090 and 6061, and was posted with the agenda in accordance with the Brown Act.
City staff met with Caltrans right-of-way and project staff and Outfront Media’s regional real estate manager to confirm the project path. At that meeting, Outfront confirmed that the replacement displays due to the narrow area next to the railroad at Binney Junction will be small-format digital faces of approximately 10.5 feet by 22 feet (approximately one-third the display area of a standard 14-foot by 48-foot bulletin which is the approximate size of the Yuba County Electronic Billboard at the Olivehurst Avenue Overcrossing on Highway 70), one face per location – a reduced footprint relative to the existing static faces, which staff considers an additional community benefit. Outfront also confirmed that each Item #11
face will include a dedicated advertising slot for the City. OutFront Media will pursue a variance from the state Outdoor Advertising Act 1,000-foot spacing requirement for digital displays, as the two proposed locations are approximately 600 feet apart, separated by the highway and the UPRR structure and facing opposite directions. Caltrans also advised that the north display could be out of service for up to two years during bridge and track construction, with a shorter outage for the south display.
Yuba County Electronic Billboard (14’ x 48’ – Double Sided) Highway 70/Olivehurst Avenue Overcrossing
Average Daily Traffic=43,000 AADT
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Roseville Billboard (14’ x 48’ – Double Sided)
Highway 65/Galleria Boulevard Overcrossing
Average Daily Traffic=120,000 AADT
Marysville Static Billboard SB (Proposed 10’ x 22 Single Sided) Highway 70/Binney Junction UPRR Overcrossing Southbound Average Daily Traffic= 16,600 AADT(Caltrans)
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Marysville Static Billboard SB (10’ x 22’ proposed Single Sided) Highway 70/Binney Junction UPRR Overcrossing Northbound Average Daily Traffic= 15,700 AADT(Caltrans)
Site Location Map/Property Ownership – Binney Junction Billboards
PROPOSED URGENCY ORDINANCE
The urgency ordinance adds a new subsection (6) to Section 18.64.093(e) of the Marysville Municipal Code. Existing subsections (e)(1) through (e)(5) remain unchanged. The key provisions of new subsection (6) are summarized below.
Limited Purpose and Scope. The ordinance authorizes only the replacement of the three lawfully permitted static billboards on UPRR property along SR-70 that must be removed for the SR 70 Safety Project. It does not authorize the conversion of any other billboard to an electronic display, or the erection of any additional billboard, anywhere else in the City.
Maximum Number; Mandatory Removal. Not more than two (2) electronic displays may be authorized in the aggregate, and all three existing static billboards must be removed as a condition of the permits.
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Designated Locations. The two displays may be located only at two designated sites on SR-70: one north of the UPRR bridge oriented to serve southbound traffic, and one south of the UPRR bridge oriented to serve northbound traffic. Site legal descriptions and Assessor’s Parcel Numbers will be confirmed through the use permit and relocation agreement process.
Use Permit and Development Standards; City Council Approval Authority. Each display requires a use permit and must comply with the height, area, location, and setback standards of Section 18.64.093(e)(2) through (e)(5), except as expressly modified by subsection (6). The ordinance designates the City Council – rather than any other approval body – as the approval authority for use permits under subsection (6), acting after a duly noticed public hearing conducted in accordance with Government Code Sections 65090 and 65091, with the Council’s decision final. The use permit for the two displays will be presented to the City Council for public hearing and approval on September 15, 2026, concurrently with the revenue-sharing agreement.
Display Operating Standards. Each display must comply with operating standards addressing static messages with a minimum eight-second display interval (or longer as required by Caltrans); instantaneous transitions with no scrolling, motion, animation, or video; no flashing or variation in intensity during a message; automatic dimming responsive to ambient light with a maximum luminance standard; a malfunction default that freezes or extinguishes the display; and compliance with all Caltrans requirements.
Public Service Announcements. At all times, each display’s message rotation must include not fewer than one (1) message slot reserved for a public service announcement authorized by the City of Marysville, displayed at no charge to the City of Marysville, in the same format and for at least the same duration as commercial messages. Emergency messages, including Amber Alerts and public safety notifications, must be displayed upon the City’s request.
Relocation Agreement and State Permits. No permit may be issued until a relocation agreement consistent with Business and Professions Code Section 5412 has been executed and all Caltrans permits under the Outdoor Advertising Act have been obtained.
Urgency Findings. The ordinance is adopted pursuant to Government Code Section 36937(b) for the immediate preservation of the public peace, health, and safety, in that any delay in authorizing the removal and replacement of the displays would delay the SR 70 Safety Project and prolong the exposure of the traveling public to the documented safety hazards the project is designed to eliminate. Adoption requires a four-fifths (4/5) vote and the ordinance takes effect immediately.
COMPANION NON-URGENCY ORDINANCE
Consistent with the City’s recent practice for the Downtown Specific Plan sign and fence amendments (November 18, 2025), staff recommends that the City Council pair the urgency ordinance with a companion non-urgency ordinance containing the identical amendment (Attachment 2). The urgency ordinance provides immediate effect so that the Caltrans SR 70 Safety Project schedule and the September 15 use permit and agreement items are not delayed; the companion ordinance follows the regular zoning amendment procedure – a duly noticed Planning Commission public hearing and recommendation, first and second readings before the City Council, and effectiveness thirty (30) days after adoption – and serves as a safeguard so that the amendment remains in effect in the event any legal challenge is brought against the urgency ordinance or its urgency findings.
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Staff anticipates the Planning Commission hearing in [September/October] 2026, with first reading before the City Council thereafter and second reading at the following regular meeting. The companion ordinance is identical in substance to the urgency ordinance in every respect, including the two-display limitation, the designated locations, the display operating standards, the public service announcement requirement, the City Council’s use permit approval authority, and the relocation agreement and Caltrans permit preconditions.
FINANCIAL AGREEMENT FRAMEWORK AND COMPARABLE AGREEMENTS Staff will be preparing a comparable-agreement and revenue analysis benchmarking executed municipal digital billboard agreements in California, including the City of Roseville’s 2022 subleases with Clear Channel Outdoor, the City of Fresno’s 2016 Digital Billboards Master Lease with Outfront Media (implemented 2017–2021), the City of Lemon Grove’s 2019 Billboard Lease with Outfront Media (a full executed agreement), and the City of Elk Grove’s 2023 Outfront Media Billboard Relocation Agreement (a three-for-one static-to-digital exchange on State Route 99 that is the closest structural precedent to the proposed Marysville project).
Key findings of the analysis include the following:
The comparable agreements remain the appropriate structural template for the Marysville agreement – reporting and reconciliation, audit rights, City advertising time, emergency messaging, maintenance, removal, insurance, and indemnity provisions – but they are not valid revenue benchmarks for this transaction. Roseville, Fresno, and Lemon Grove comparables involve large-format 14-foot by 48-foot displays involve large-format 14-foot by 48-foot displays in markets with substantially higher traffic volumes (approximately 90,000 to 205,000 vehicles per day, versus approximately 15,700 to 16,600 on SR-70 at the project site).
Outfront Media has advised that it cannot commit to a minimum annual guarantee for a new, smallformat product with no sales history in this market, and that the agreement will instead be structured as a percentage-based revenue share reconciled quarterly or semi-annually. Union Pacific Railroad, as landowner, will receive a share of display revenue before the City’s share, and the north display may be out of service for up to two years during construction.
Staff’s recommended negotiation positions under the percentage structure are: a City share of advertising revenue (or the equivalent percentage of net revenue with a contractual cap on deductible commissions and a defined landowner deduction); quarterly or semi-annual reconciliation with annual audit rights, with the operator responsible for audit costs if revenue is understated beyond a stated tolerance; an escalating share or true-up if occupancy exceeds defined thresholds, to capture upside as development at the City’s northern gateway (including the new hotel and ballpark-related investment) increases traffic and advertiser demand; the dedicated City advertising slot on each face, plus free emergency and Amber Alert messaging, in addition to the ordinance’s mandatory public service announcement requirement; and a mandatory reopener under which the parties will review actual revenue performance and adjust the agreement – including the City’s revenue-share percentage and any occupancy thresholds – at two (2) years following the first display’s operational date, and every five (5) years thereafter for the remainder of the term. The initial two-year reopener is timed to coincide with the anticipated completion of Caltrans construction and the return of both displays to full service, ensuring the agreement is recalibrated against actual sales history once the new product is established; Item #11
the five-year cycle thereafter captures growth from development at the City’s northern gateway. If the parties cannot agree on adjusted terms at a reopener, the then-current terms would remain in effect, with any unresolved adjustment subject to a defined dispute-resolution process.
The City of Stockton’s digital billboard program on city property failed approximately a decade ago because revenue expectations were anchored to a much larger market, and no operator participated.
Calibrating expectations to this market’s size and this sign format is essential to completing the transaction. The primary value of this project to the City is the delivery of the SR 70 Safety Project, the net reduction in billboard structures, the reduced display footprint, and the dedicated City advertising and emergency messaging capability; revenue is a secondary, incremental benefit.
Consistent with Recommended Action No. 4, staff and the City Attorney will negotiate the relocation and revenue-sharing agreement with Outfront Media, LLC using this framework and will return to the City Council on September 15, 2026, with both the proposed agreement and the use permit for the two displays – including all required findings and conditions of approval – for City Council action at a single meeting, with the use permit considered at a duly noticed public hearing conducted by the City Council asthe approval authority designated by the urgency ordinance. The City Clerk will publish and mail notice of the September 15 use permit hearing in accordance with Government Code Sections 65090 and 65091, including mailed notice to owners of property within 300 feet of the display sites. Processing the use permit concurrently with the agreement keeps the entitlement and the financial terms on the same schedule and preserves the timeline of the Caltrans SR 70 Safety Project. Building permits will not be issued for either display until the agreement is approved, the use permit is granted, and all Caltrans approvals, including the Outdoor Advertising Act spacing variance, are obtained.
ENVIRONMENTAL REVIEW
Adoption of the urgency ordinance is exempt from the California Environmental Quality Act (CEQA) pursuant to State CEQA Guidelines Section 15061(b)(3) (Common Sense Exemption), in that the ordinance is a limited regulatory enactment that authorizes the replacement of three existing billboard structures with two structures – a net reduction of one structure along the corridor – and it can be seen with certainty that there is no possibility the ordinance may have a significant effect on the environment.
The replacement displays are additionally addressed by Sections 15301 (Existing Facilities) and 15302 (Replacement or Reconstruction) of the CEQA Guidelines. The appropriate CEQA determination for each individual display will be confirmed prior to issuance of any use permit, and staff will file a Notice of Exemption upon adoption.
FISCAL ANALYSIS
There is no direct cost to the City associated with adoption of the urgency ordinance. All construction, operation, maintenance, permitting, and removal costs for the electronic displays will be borne by the display operator. Staf will prepare a revenue analysis reflecting the small-format displays and percentage-based structure confirmed by Outfront Media The City is also pursuing a dedicated advertising slot on each face and free emergency messaging, which carry in-kind value for City communications. Final fiscal terms will be presented with the proposed financial agreement on September 15, 2026. Other fiscal and community benefits of the ordinance are the delivery of the SR 70 Safety Project without relocation-compensation exposure or delay, the net reduction of one billboard structure, and the reduced display footprint at the City’s northern gateway. Staff will also request Item #11
historic cladding of the proposed billboards to reflect the historic district of Marysville that could be highlighted at the entry to the community.
ATTACHMENTS
1. Proposed Urgency Ordinance Amending Section 18.64.093(e) of the Marysville Municipal Code
2. Proposed Companion Non-Urgency Ordinance Amending Section 18.64.093(e) of the Marysville Municipal Code (identical substantive text; regular adoption procedure)
3. Public Hearing Notice