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The Supreme Court “Clarifies” the Standard of Review for Some Sign Bylaws

Long-time readers of this newsletter may remember an article from July 2015 discussing the U.S. Supreme Court’s decision in Reed v. Town of Gilbert, Arizona, 576 U.S. 155 (2015), which upended most of our understanding regarding the constitutionality of local sign regulations. In that decision, Justice Thomas articulated a bright line rule for determining if a municipal sign regulation was subject to strict constitutional scrutiny under the First Amendment: In essence, if one has to read a sign to determine if it complies with an applicable regulation, then it is a content-based regulation, subject to strict scrutiny by the courts. And when strict scrutiny is applied, the regulation will be found to be unconstitutional unless it is narrowly tailored to further a compelling governmental interest. The practical implication of this holding was to make most of the nation’s sign bylaws subject to (and unlikely to pass) strict scrutiny review.

In a follow-up article in February 2017, we noted that cities and towns across the country had begun to overhaul their sign regulations to avoid subjecting them to strict scrutiny by avoiding content-based restrictions. Some of these new regulations were then found by reviewing courts not to be subject to strict scrutiny by relying on Justice Alito’s concurring decision in Reed, rather than the opinion penned by Justice Thomas. Justice Alito’s decision included a list of regulation types that, in his view, were still permissible despite the Court’s decision, several of which seemed to be on the wrong side of Justice Thomas’s bright line.

Now the Supreme Court has blurred Justice Thomas’s bright line. On April 21, 2022, the Court held that municipal sign bylaws can regulate signs depending on whether the sign is on- or off-premises without having to be justified under strict scrutiny review. The decision, City of Austin, TX v. Reagan National Advertising of Austin, LLC, rejects the idea that any regulation that requires reading a sign is necessarily a content-based regulation subject to strict scrutiny.

Austin’s sign code prohibited the erection of new off-premises signs, such as billboards. Pre-existing off-premises signs could remain, but the nonconformity could not be increased, such as by adding illumination. On-premises signs (those that contain information relating to the same premises on which they are located), in contrast, could be digitized. Reagan National sought to replace its static billboards with those that were electronically controlled and had changeable copy. Its request was denied. It sued, claiming that the differing treatment of on-premises and off-premises signs was a violation of the First Amendment.

The Court held that Austin’s sign code was content-neutral because its only distinction was based on location, not on the “topic discussed or idea or message expressed.” Because the subject matter of the signs is irrelevant under the sign code, the regulation must satisfy only intermediate scrutiny to be found constitutional, That is, the government needs only to advance a substantial or important governmental interest in a narrowly tailored way or a way that does not substantially burden more speech than necessary.

While remanded for this finding, the Court noted the significant historical record of regulating off-premises signs at the federal, state, and local levels, and the ubiquity of sign codes that regulate off-premises signs differently from on-premises signs, all without any doubt of their constitutionality.

If your city or town previously removed a distinction between off-premises and on-premises signs in its ordinances or bylaws based on Reed, it may now want to consider re-imposing that distinction.


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