City Council
Report
City Council Meeting: May 13, 2025
Agenda Item: 4.I
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To: Mayor and City Council
From: Elaine Polachek, Interim City Manager, City Manager's Office Subject: Approval of Proposed Modified Advertising Guidelines to Allow Alcohol Ads Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and
2. Approve an update to the City’s internal advertising guidelines to permit alcohol advertisements on eligible City-owned assets, including the digital kiosk network and the interior of parking structures, with specific location-based restrictions.
Summary
Staff recommends updating the City’s internal advertising guidelines to permit alcohol advertising on select City-owned assets, specifically parking structures and the digital kiosk network. This change is projected to generate up to $1 million in annual revenue and aligns with the City’s strategy to increase revenues through public-private partnerships. To ensure responsible implementation, alcohol advertisements would be prohibited within 500 feet of schools, parks, libraries, medical facilities, and other sensitive sites. Based on these restrictions, 12 of the City’s 25 kiosks, including six on the 3rd Street Promenade, would be eligible for alcohol ads.
Discussion
To continue to help diversify Santa Monica’s revenue sources without increasing taxes or fees, staff has identified an opportunity to responsibly expand the scope of permitted advertising on select City assets to allow for alcohol advertisements. Based on industry 2 of 4
research and preliminary conversations with media partners, this change has the potential to generate up to $1 million annually in new revenue.
In alignment with industry best practices, the proposed guidelines would prohibit alcohol advertising within 500 feet of sensitive land uses, including schools, colleges, universities, libraries, museums, houses of worship, the cemetery, youth centers and organizations, day care centers, charitable institutions, public parks, playgrounds, amusement parks, hospitals, medical clinics, senior or assisted living homes, and substance abuse treatment facilities. These buffer zones aim to minimize exposure in locations frequented by minors, vulnerable populations, and community-serving institutions.
After applying these distance restrictions, staff estimates that 12 of the 25 digital kiosks citywide would be eligible for alcohol advertising (Attachment A). Notably, this includes all six kiosks located on the 3rd Street Promenade, where the recently approved entertainment zone is expected to draw increased visitor traffic and advertiser interest.
The City’s parking structures would also offer valuable inventory for alcohol advertising placements.
If the Council approves this recommendation, staff would proceed with updating the internal advertising guidelines (Attachment B) and working with our current media partners to identify and activate eligible inventory. Locations would be reviewed for compliance with the 500-foot exclusion zones, and ongoing monitoring will ensure adherence to the guidelines.
This proposal represents a strategic and responsible way to tap into a new advertising category while safeguarding the values and character of Santa Monica’s neighborhoods. The anticipated revenue from alcohol advertising, estimated to be up to $1 million annually, would support City programs and services and help reduce reliance on traditional funding sources.
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Past Council Actions
Meeting Date Description
12/12/23 (Attachment
C)
Award of parking structure advertising contract
01/10/23 (Attachment
D)
Award of digital wayfinding and out-of-home advertising kiosk franchise agreement
Environmental Impacts
The revision in the advertising guidelines is exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines. The revision to the guidelines is covered by the commonsense exemption which states that CEQA does not apply, “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 revision will affect the operations of the kiosks only to provide the opportunity for the City for increased advertising opportunities - no physical changes to the kiosks are proposed. Therefore, it can be seen with certainty that the proposed contract would not result in adverse physical impacts on the environment, and as such, is exempt from CEQA.
Financial Impacts and Budget Actions
It is anticipated that the City could generate up to $1 million in annual General Fund revenue by updating the internal advertising guidelines to allow alcohol advertising on select City-owned assets, including parking structures and the digital kiosk network.
Staff will monitor revenue generated in FY 2025-26 and provide an updated projection during the midyear budget review, adjusting the budget as needed to account for this new revenue stream.
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Prepared By: Melissa Spagnuolo, Community Partnerships Manager Approved Forwarded to Council
Attachments:
A. Preliminary Map of Kiosks Eligible for Alcohol Advertising B. Proposed Modified Advertising Guidelines
C. City Council Staff Report - December 12, 2023
D. City Council Staff Report - January 10, 2023
E. Written Comments