Regulatory Reform

I Saw The Sign

I saw the sign,” sang pop band Ace of Base in the early ‘90s. They probably didn’t realize it, but their song draws attention to a frequently overregulated part of our lives: seeing signs. In cities across the United States, local regulation makes it increasingly difficult to see the signs advertising goods and services to our communities. These restrictions on commercial speech are prevalent and harmful to our small businesses and their owners’ First Amendment rights.

Examples abound across the country, and they can be quite ridiculous. Haymarket, VA has a sign ordinance that names no fewer than 46 different types of signs (with pictures) and stipulates different sign areas in which certain types are prohibited. Murfreesboro, TN enforces an excessive 85-page sign ordinance on its residents. Until it was struck down in court, Nashville prevented short-term rental owners from putting up signs to advertise their short-term rental on their own property. Dallas passed an ordinance that prohibits the display of commercial signs on the top two-thirds of a business’ window and also restricts window signage to 15% of the window’s area. Good luck seeing those signs.

Nothing seems to aggravate the urge to overregulate quite like signs advertising beverages. The District of Columbia has an ordinance that prohibits any advertisements of alcohol from covering over 25% of a window’s area. Additionally, the sign must be hung in the interior of the window and not the exterior, and no signs advertising alcohol may appear on doors. The Commonwealth of Virginia prohibits bars and restaurants from advertising prices on happy hour signs. Not to be outdone, San Francisco takes it a step further and regulates advertising for soft drinks. It passed an ordinance (which was mercifully enjoined by the Ninth Circuit Court of Appeals) that mandates all sugar-sweetened beverage advertisements must display a warning about the adverse health effects of added sugars.

These may seem like trivial local laws that are goofy but harmless. However, these sign regulations are restrictions on the commercial speech rights of Americans running businesses from sea to shining sea, and they are no laughing matter. The Supreme Court defines commercial speech as “speech where the speaker is more likely to be engaged in commerce, where the intended audience is commercial or actual or potential consumers, and where the content of the message is commercial in character.” Signs are a very important vessel for commercial speech, and the courts are becoming more receptive to challenges on sign regulations, as the aforementioned decisions in Nashville and San Francisco show.

It is paramount to consumers’ ability to make informed decisions that they have access to truthful information about commercial activities. Signs are the most ubiquitous way to spread that information, and when localities overregulate signage, they undercut consumers’ knowledge of the market. For the sake of commercial speech and empowering consumers, it would be wise of all of us to take up Ace of Base’s words as a mantra and make sure everyone can see the signs.

In Depth: Regulatory Reform

In his first inaugural address, Thomas Jefferson said that “the sum of good government” was one “which shall restrain men from injuring one another” and “shall leave them otherwise free to regulate their own pursuits of industry.” Sadly, governments – both federal and state – have ignored this axiom and…

+ Regulatory Reform In Depth