Transit Advertising Sales Agreements (2004)

Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

30 CHAPTER SIX ADVERTISING ACCEPTANCE POLICIES Most transit agencies have needed to decide what types of advertising to accept and what not to accept. Advertise- ments that may be rejected include those that are offensive or embarrassing to the public, that generate controversy, or that imply agency endorsement of a product or service. Re- jecting advertisements may create controversy, however, and may also raise serious First Amendment issues. Al- though relatively few rejected advertisements draw law- suits, agencies are often unsuccessful when they defend their decisions in court. Statement of Purpose Statements of purpose articulate the basis for advertising restrictions. In setting an advertising acceptance policy, transit agencies are faced with a fundamental choice as to whether to accept advertising strictly for commercial purposes or to cre- ate a public forum for ideas. This choice has important im- plications for what advertising can and cannot be accepted. Commercial advertising has been defined as advertising “the sole purpose of which is to sell or rent real estate or personal property for profit, or to sell services for profit” (Santa Cruz Metropolitan Transit District advertising pol- icy). As noted by a free on-line legal site, FindLaw.com, the Supreme Court has held that the First Amendment “does not guarantee access to property simply because it is owned or controlled by the government” (FindLaw for Le- gal Professionals). In adopting a policy to permit only commercial advertising, transit governing boards can avoid establishing a public forum for ideas. The advantage to such a policy is that transit agencies can reject all view- point advertising. This approach is sometimes adopted af- ter court decisions force an agency to post advertising that it had rejected. This chapter describes transit industry practices and ex- periences with advertising policies and provides an over- view of the legal issues. This overview is merely intended to introduce agency staff to these issues; transit staff should consult with their legal counsel in the course of developing and applying an advertising policy. ADVERTISING POLICIES Transit agencies are not legally required to accept advertis- ing on their property and, as discussed earlier, some do not. Once agencies decide to accept advertising, however, well- developed case law applies to their decisions respecting what advertisements to accept or reject. Most transit agen- cies have a written advertising policy to guide staff in mak- ing these decisions. In the survey conducted for this study, 86% of the agencies reported that they have a written pol- icy. Consistent application of a carefully developed policy can help agencies defend their actions in the event of a challenge. Commentators have noted that if this approach is cho- sen, it is important that “the advertising space should for- mally be declared to be a nonpublic forum” (Boga 2001). The Greater Dayton Regional Transit Authority’s (RTA) advertising policy, for example, states that It is not RTA’s intent by permitting advertising on RTA facili- ties to provide a forum for all types of advertisements or for all types of expressive ideas. Rather, RTA is acting as a com- mercial enterprise seeking to derive revenue from the sale of advertising space while minimizing interference with, or dis- ruption of, RTA’s commercial function. Agencies without a written policy usually follow un- written guidelines. In some cases, agencies have deliber- ately decided not to adopt a written policy. BART allows its advertising sales contractor to take the lead in deciding which advertisements to accept or reject and to defend against any lawsuits. In the view of BART staff, the ad- vantage of this approach is that the sales contractor has greater expertise and resources to address any issues that arise. BART staff must refrain, however, from directing the sales contractor to either accept or reject any advertise- ments. Similarly, a draft policy presented to the Santa Cruz Met- ropolitan Transit District stated its purpose as the following: Santa Cruz Metro sells space inside and upon its buses for the display of commercial advertising. The purpose is to raise revenues, supplementary to those from fares and from tax pro- ceeds, to be used to finance Santa Cruz Metro’s operations. The display of advertising is solely for this purpose. It is not intended to provide a general public forum for purposes of communication, but rather to make use of property held in a proprietary capacity in order to generate revenue. Written advertising policies generally include a state- ment of purpose, itemization of prohibited or restricted ad- vertising, and a review process for individual advertise- ments (see examples in Appendix E). Policy reasons for excluding noncommercial speech, provided in various agency advertising policies, include

31 • Maintaining a desirable level of professionalism and decorum. • Maximizing revenues from advertising. Agencies may seek to prevent a reduction in income because commercial advertisers may be dissuaded from ap- plying a forum commonly used for political, reli- gious, or controversial messages. More generally, agencies may seek to establish a professional adver- tising atmosphere that is conducive to maximizing advertising revenues. • Avoiding displaying material that is not suitable for viewing by children. Limitations on Advertisements Advertising policies set standards for advertisements that can be accepted. These standards are typically expressed in terms of what is not acceptable and often include adver- tisements that • Maintaining a position of neutrality on political, reli- gious, environmental, and other public issues to pro- mote the agency’s commercial enterprise. • Protecting passengers, employees, buses, terminals, and other equipment from physical harm that might result from reactionary conduct relating to the display of political or controversial material. • Are false, misleading, or deceptive; this is sometimes put in the context of advertisements that propose a commercial transaction. • Contain obscene material, or contain profane, ob- scene, or libelous language. In addition to formally declaring the advertising space to be a nonpublic forum, an agency deciding to accept only commercial advertising should establish an eligibility pol- icy. The agency should also consistently enforce the policy and never exclude an advertisement “from the program be- cause of the viewpoint that it advocates” (Boga 2001). • Promote unlawful or illegal goods, services, or activi- ties. • Declare or imply an endorsement by the transit agency of any service, product, or point of view. • Promote the sale of tobacco or tobacco-related products. • Promote the sale of liquor or distilled spirits. Advertising policies that permit only commercial adver- tising may also, however, rule out accepting noncommer- cial advertisements, including PSAs, that some may find desirable and that may also generate revenue. Some agency boards may consider acceptance of viewpoint advertising to be a desirable public service, and some advertising poli- cies explicitly state that offering a public forum for ideas is an agency goal. • Depict violence or antisocial behavior. • Are related to products designed for use in connec- tion with sexual activities. In some cases, agency policies also address issues re- lated to how certain groups are portrayed. For example, the Metro Transit (Minneapolis) advertising standards prohibit advertising that Transit agencies that accept noncommercial advertising may take steps to ensure that the viewpoints expressed are not seen as representing the agency’s views. The CTA, for example, requires that all political advertisements include a disclaimer to the effect that the advertisement is a paid po- litical advertisement. Portrays individuals on the basis of race, color, creed, sex, pregnancy, age, religion, ancestry, national origin, marital status, disability, including those related to pregnancy or child birth, affectional or sexual orientation, or any other character- istic protected under federal, state, or local law as inferior, evil, or contemptible as a result of the individual’s protected characteristic(s). Using fewer words on the same topic, a Bi-State Devel- opment Agency (St. Louis) policy prohibits advertisements that “foster sexual or racial stereotypes.” Once a transit agency creates a public forum by accept- ing noncommercial advertising, “it may not discriminate on the basis of content or viewpoint in according access” (FindLaw for Legal Professionals). Some successful suits against agencies have been based on viewpoint discrimina- tion. Policies may also prohibit attacks on individuals or or- ganizations. The MCTS policy, for example, prohibits ad- vertising that “is intended to be disreputable to a person, business, or organization.” Whether or not agencies accept only advertisements that have a commercial purpose, transit agency advertising policies often articulate a variety of objectives that are de- signed to justify limitations on advertising. Typical stated purposes include Note that these are current practices among transit agencies and have not necessarily been tested in legal pro- ceedings. • Avoiding subjecting passengers to viewing material that may cause them embarrassment or discomfort. (This rationale applies particularly to sexual and re- productive material.) Review Process Whether as a written policy or unwritten practice, nearly every transit agency surveyed has a process for the review

32 of advertising. A standardized process ensures that reviews and decisions are made in an orderly and unbiased fashion and that decisions adhere to the advertising acceptance pol- icy and can withstand legal challenges if necessary. Transit agencies that contract to an advertising sales contractor usually have the contractor conduct the initial re- view of all advertising. The contractor may forward only questionable advertisements to the transit agency for its re- view. Alternatively, the transit agency may review all advertis- ing before acceptance. A few agencies surveyed reported that they rely on the advertising sales contractor to review and approve advertisements, possibly with transit agency feed- back. Transit agencies that sell advertising space in-house obviously review all advertisements themselves. Initial review of possibly objectionable advertisements is generally done by the transit agency staff who manage the advertising contract or who sell advertising space di- rectly. Staff may work with the advertising sales contractor and/or advertiser to resolve any issues, such as by modify- ing the art, copy, or both. Although transit agency staff may make the final deci- sion on accepting particular advertisements, there is more often further review by senior agency managers and per- haps the governing board. Several survey respondents re- ported that the governing board reviews all questionable advertisements or that the executive director has final ap- proval over all advertisements. Legal counsel may also be consulted during this review. Senior managers and the governing board may play the role of an appeals panel. For example, under the Madison Metro Transit’s advertising policy, a designated staff person decides whether to accept questionable advertisements. The advertising sales contrac- tor can appeal that decision, first to the transit general manager and ultimately to the city’s Transit and Parking Commission. Another approach is to establish a review committee to decide appeals. The Greater Dayton RTA advertising pol- icy specifies that an advertising appellate committee will review a decision to reject an advertisement upon written request by the appellant. The request must state why the appellant disagrees with RTA’s decision in light of the agency’s advertising policy. The committee reviews the ba- sis for RTA’s rejection of the advertisement and the appel- lant’s reasons in support, reaches a decision, and notifies the appellant in writing. NJ Transit follows a similar appeal procedure to a three- member committee, but with a twist. If factual issues are presented in the appeal, the committee is to transmit the case to the Office of Administrative Law for the develop- ment of a record and initial decision. The appeals commit- tee then renders a final decision, which is appealable to the state court system. REJECTING ADVERTISEMENTS Although the vast majority of advertising is acceptable without question, most transit agencies have rejected ad- vertisements at some time. In the survey, 79% of respond- ing transit staffs reported rejecting advertising at least once. The types of advertisements turned down follow the same guidelines as the list of restrictions in advertising policies—lingerie advertisements in which the models were felt to be underclad; advertisements featuring gun violence; controversial advertisements dealing with family planning, abortion, or sex education; and advertisements attacking a national retail organization(s). Some rejected advertisements were from advertisers that might not be expected to submit one that was con- troversial. For example, the graphic in an advertisement that made the bus appear to be damaged was rejected. Interestingly, larger agencies are more likely than smaller agencies to have turned down advertisements. In the survey, 90% of larger- and medium-size transit agen- cies (5 million or more annual ridership) have rejected ad- vertisements, compared with 45% of agencies with lower ridership levels. Whether this reflects greater heterogeneity of larger metropolitan areas or types of advertisers, or other factors, is not clear. Most advertisers who are turned down appear to accept the rejection without taking legal recourse. Although 79% of survey respondents have turned down at least one adver- tisement, only 20% report that their agency has been sued. Advertisements that end up in court are predominantly about a narrow range of topics, primarily family planning, abortion, and, to some extent, graphic violence. As with rejections, agencies that have been sued tend to be larger properties; five of the seven largest agencies that responded to the survey reported having been sued over a controversial advertisement. Some cases are settled before trial; however, of the others, most survey respondents re- ported that their agency lost the suit. Court cases led several agencies, including those in Phoenix and Atlanta, to adopt policies to accept only ad- vertising with a commercial purpose. Other agencies have gone in the other direction. For example, the CTA now ac- cepts advertisements on topics such as family planning and abortion that it once rejected.