Despite Lamar Advertising's threatened lawsuit, complaints from a state senator and his own misgivings, Mayor Luke Ravenstahl has decided against trying to kill city council's controversial billboard tax.
The 10 percent tax on billboard proceeds will go on the books for 2013 and, if it withstands a legal challenge, would generate an estimated $2 million to $4 million annually.
City council President Darlene Harris and Councilwoman Natalia Rudiak introduced the measure in September, saying Lamar should pay more for hundreds of lucrative billboards it owns in the financially strapped city. Council gave the legislation final approval on a unanimous vote last week.
Mr. Ravenstahl's options were to sign the bill into law, veto the bill or let it become law without his signature. On Monday, he returned the bill unsigned to the city clerk's office.
"He didn't veto it. I'm happy about that," Mrs. Harris said.
The mayor opposes the tax, but decided against a veto because council appeared to have more than the six votes required to override it, his spokeswoman, Joanna Doven, said.
While the measure may not be as harmful as a property tax increase, she said, "it is still something that may affect small businesses. That's not something we can support."
Lamar attorney Jonathan Kamin warned that the tax would be passed on to companies that lease billboard space. He said the tax is illegal and, after council's vote last week, vowed to sue to overturn it.
Mr. Kamin, who could not be reached Monday, was not the only one protesting the tax. State Sen. Jim Ferlo, D-Highland Park, last week called on Mr. Ravenstahl to veto a bill that he called "blatantly illegal and counterproductive."
When he was on city council, Mr. Ferlo said, he fought for legislation that placed new restrictions on billboards and required annual permit fees. Instead of taxing billboards now, he said, council should raise permit fees.
The city website lists a number of sign-related fees, including an annual $62 billboard inspection and maintenance fee.
In all, Mr. Kamin said last week, Lamar pays $120,000 to $140,000 annually in real estate taxes and permit fees on about 900 signs it has in the city. Council members say it's unfair that Lamar pays taxes only on small plots holding the billboards, not the lucrative signs themselves.
Joe Smydo: email@example.com or 412-263-1548.