The council approved the two new digital billboards by an 8–1 vote.
SACRAMENTO, Calif. — Sacramento drivers already see digital billboards rising above Interstate 5 in the Railyards. Soon, there could be more.
The Sacramento City Council voted Tuesday night to approve two additional digital billboards tied to the long-planned Railyards development north of downtown, a project city leaders say is key to transforming the largely vacant area and nearly doubling the size of downtown Sacramento.
Supporters say the billboards are a tool to help developers move forward with construction without putting the city’s general fund at risk. City staff say developers plan to invest $325 million in the first phase of the project, which includes the Republic FC stadium and Central Shops.
“We are not putting the general fund at risk and the city’s contributions to the rail yards and to the soccer stadium are pretty modest. For the most part, we are deferring some fees,” Sacramento City Councilmember Phil Pluckebaum said.
Pluckebaum said digital billboard rights are rare and highly valuable because of past city restrictions, calling them “a very exclusive, difficult entitlement to get.” Without that revenue, he said, the projects face an uphill battle. He also noted developers have already front-loaded major costs such as soil cleanup and infrastructure.
Labor leaders strongly disagree, calling the billboards a massive subsidy. Unite Here Local 49, the area union representing hotel and casino workers, says billboard revenue that typically goes into the city’s general fund will instead go entirely to developers.
“When you take 12 billboards, and you look at how much the lease is for other billboards around the city, it adds up,” said Aamir Deen, president of Unite Here Local 49. “Our estimates are that it adds up to about a $115 million dollars over the period of time that the city in this deal is giving these billboards away for completely free.”
While the council approved two new digital billboards and can approve three more at a later date, Deen says the broader developer agreement allows up to 12 billboards of all sizes in the Railyards area.
The union has called on the city to direct potential revenue toward affordable housing and a tenant stabilization fund. Deen also criticized what he described as a lack of transparency, saying the city has not disclosed its own revenue estimates for the billboards.
The council approved the two new digital billboards by an 8–1 vote. Sacramento City Councilmember Mai Vang cast the lone no vote, saying she supports the Railyards project but has concerns about accountability and the unknown value of the billboards.
“It’s really important to make sure that we know the true value of that billboard, because it’s something that the city is transferring over to the developers,” Vang said. “While I support the project, as a city councilwoman, our job is to be a good steward of city assets.”
Vang also cited the city’s budget deficit and said voters deserve clarity about the long-term cost of foregoing potential revenue.
Mayor Kevin McCarty said the billboard leases are conditional and only move forward if development does.
“If those developments aren’t built there, this whole things goes away and falls apart,” McCarty said. “So what is the upside for this, one, finally after 40 years, developing the largest in-fill site in America.”
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