Fiscal Note
Fiscal Services Division
SF 548 – Outdoor Advertising (LSB2489SV)
Staff Contact: Austin Brinks (515.725.2200) austin.brinks@legis.iowa.gov
Fiscal Note Version – Final Action
Description
Senate File 548 relates to outdoor advertising along interstate highways. The Bill amends the
definition of “advertising device” by making it contingent on renumeration paid or earned in
exchange for erection, display, or existence of the device. The Bill also strikes various
provisions in Iowa Code chapters 306B and 306C that are obsolete under the new definition of
“advertising device.” Current Iowa statute may not be in compliance with federal law regulating
outdoor advertising along federal interstates and primary highways.
Background
Under federal law, the State of Iowa must maintain effective control of outdoor advertising along
interstates and primary roadways as defined in 23 CFR §750.705. If Iowa’s current law is out of
compliance with federal regulations, the State would be subject to a 10.0% penalty to annual
federal aid funding to highways pursuant to 23 U.S.C. §131.
Currently, outdoor advertising along interstates and primary State highways is regulated based
on reading the content of a sign, such as a sign providing directions and times of special events,
and then applying regulation based on the type of sign. Past court cases such as Reed v. Town
of Gilbert and Willson v. City of Bel-Nor have challenged regulation of this nature as a violation
of the First Amendment (Freedom of Speech), and Iowa currently regulates signs in a similar
manner. If Iowa regulations are found to be unconstitutional, the State would no longer have
effective control of outdoor advertising and would be subject to penalty.
Texas, Oregon, Tennessee, and Kentucky have similar forms of sign regulation and have not
had constitutional challenges.
Fiscal Impact
Senate File 548 is expected to keep Iowa’s outdoor advertising regulations in compliance with
federal law. Enactment of the Bill would prevent the loss of approximately $53.2 million annually
in federal highway funds.
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Sources
Legislative Services Agency
Department of Transportation
/s/ Holly M. Lyons
June 8, 2021
Doc ID 1219135
The fiscal note for this Bill was prepared pursuant to Joint Rule 17 and the Iowa Code. Data used in
developing this fiscal note is available from the Fiscal Services Division of the Legislative Services
Agency upon request.
www.legis.iowa.gov
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Statutes affected:
Introduced: 306B.1, 306B.2, 306C.10, 306C.11
Enrolled: 306B.1, 306B.2, 306C.10, 306C.11