Amortization refers to the practice of forcing a billboard company to remove a billboard after an arbitrary period of time without compensation for the loss. One of the goals of the Scenic America Strategic Plan for 2016-2019 is to encourage communities to get rid of billboards by amortization.  There are four arguments against amortization.

• Amortization is unfair.  Amortization consists of taking something from someone without paying for it.  This is unfair.  George Will calls amortization “slow motion confiscation.”  If the government condemned your house for a road expansion and then said that it wasn’t going to compensate you because “you’ve received enough benefit of living in the house for the past 10 years” wouldn’t you be upset? You’d be just as upset if the government said “you’ve got an unsightly house which we don’t like to see by the road so we’re going to require you to take it down at the end of 10 years because you’ll have received sufficient benefit from living in the house.” Taking something without paying for it is unfair.  That applies to billboards as well as houses. 

• Amortization violates the US constitution.  The fifth amendment says this: “nor shall private property be taken for public use without just compensation.”  That’s pretty clear.

• Amortization puts a state at risk of losing 10% of its FHWA funds.  The Highway Beautification Acts of 1965 and 1978 state that “just compensation shall be paid upon removal of billboards.”  If a municipality or states violates this by requiring amortization of billboards along state routes the State in which the violation occurs could lose 10% of its FHWA funding for roads.

• Amortization is forbidden by most state laws.  All of the 46 states which permit billboards require just compensation of billboards along controlled highways like interstates, national highway system roads and federal aid primary roads.  44 of the 46 states with billboards require just compensation for removal of billboards along local roads.  The only states which don’t extend this protection to local roads are Montana and Massachusetts.  A municipality which passes an amortization law is inviting a costly court battle it the local ordinance violates state law.

OAAA members can get more information on this issue by reading the amortization issues brief  on of the OAAA website.

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