State negotiates to make money off logo advertising signs on highways - East Valley Tribune: Arizona

State negotiates to make money off logo advertising signs on highways

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Posted: Sunday, December 19, 2010 3:00 pm | Updated: 10:12 pm, Wed Dec 29, 2010.

You'd think the state would get some money from those logo advertising signs erected in the right of way of state highways.

Well, you'd be wrong.

In the more than 20 years those blue and white signs have been located near interstate highway exits touting everything from hamburgers to hotel rooms, the state has received precisely zero.

But all that may soon change. The state Department of Transportation is negotiating with Logo Signs of America, the firm that has erected those nearly 2,200 signs, for a share of the loot.

How much could be raised is still subject to the talks. But ADOT spokeswoman Laura Douglas said agency officials think they could generate about $2.5 million a year.

Legislators first authorized ADOT to contract with a private firm for the signs in 1986. But they never gave the state agency the ability to charge for that right.

Two years ago, however, legislators agreed to permit - but not require - ADOT to share in the financial benefit.

The issue came up now for two reasons.

First, the state's contract with the company expires at the end of the year. A new contract is necessary to keep the signs in place.

And second, lawmakers seeking to balance the state budget have raided the ADOT kitty - already short because of soft revenues from vehicle registration fees and gasoline taxes - to the tune of $500 million.

There's a fair amount of money changing hands for those logo signs.

Douglas said businesses that get their logos on those big signs right on the interstate highways pay $120 per month. For another $18 a month, they get their logos on the signs at the top of the exit ramps.

Non-profit operations, most likely amusements, pay $70 per month for the interstate mainline logo panels and $10 for the ramp signs.

The rates are lower along rural roads, with their lower traffic counts, where businesses and non-profits pay $44 a month.

Douglas had no figures of the gross revenues for Logo Signs of America. And using the charges on individual businesses doesn't help much: Each of the 1,453 interstate and 743 rural highway signs can have up to six logos.

If ADOT gets $2.5 million as Douglas suggested, that translates out to the state getting close to $95 a month for each sign, no matter how many logos are on each one.

Douglas said negotiations with Logo Signs are ongoing. Company officials did not return repeated phone calls.

Not every business is eligible to try to pull motorists off the freeway with the signs.

Bars are pretty much out, as are gaming casinos. Douglas said state guidelines say logos can be erected only for operations that derive less than half their sales from alcohol consumed on site or gambling.

The rules also say a business must get more than half of its sales or visitors during a normal business season from motorists not living within 25 miles. They also have to provide at least 10 parking spaces, restrooms and drinking water.

And, generally speaking, they have to be open six hours a day, six days a week, with exceptions for cultural or educational attractions. And there are special rules for wineries and dude ranches.

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