A BILL TO BE ENTITLED
AN ACT TO clarify the standards for determining just compensation for the removal of off‑premises outdoor advertising.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 136‑128 reads as rewritten:
"§ 136‑128.  Definitions.
As used in this Article:
(1)	Erect. – To construct, build, raise, assemble, place, affix, attach, create, paint, draw, or in any other way bring into being or establish. This term does not include the repair or reconstruction of any off‑premises outdoor advertising, as authorized under G.S. 136‑131.2, or the relocation of an off‑premises outdoor advertising sign as authorized by State law.
(1a)	Illegal sign. – One which was erected and/or maintained in violation of State law.
(1b)	Information center. – An area or site established and maintained at safety rest areas for the purpose of informing the public of places of interest within the State and providing such other information as the Department of Transportation may consider desirable.
(2)	Interstate system. – That portion of the National System of Interstate and Defense Highways located within the State, as officially designated, or as may hereafter be so designated, by the Department of Transportation, or other appropriate authorities and are also so designated by interstate numbers. As to highways under construction so designated as interstate highways pursuant to the above procedures, the highway shall be a part of the interstate system for the purposes of this Article on the date the location of the highway has been approved finally by the appropriate federal authorities.
(2a)	Nonconforming sign. – A sign which was lawfully erected but which does not comply with the provisions of State law or State rules and regulations passed at a later date or which later fails to comply with State law or State rules or regulations due to changed conditions. Illegally erected or maintained signs are not nonconforming signs.
(3)	Off‑premises outdoor advertising. – The use of land consisting of a sign erected and maintained for the purpose of (i) displaying, advertising, identifying, or directing attention to business products, operations, or services sold or offered at a site other than the site where the sign is erected or (ii) promoting an attraction, activity, idea, opinion, or other noncommercial messaging that is unrelated to the site where the sign is erected. A sign meeting this definition is commonly known as a billboard, where space is commonly made available or rented to advertisers to display their messages to the traveling public.
(3a)	Outdoor advertising. – Any outdoor sign, display, light, device, figure, painting, drawing, message, plaque, poster, billboard, or any other thing which is designed, intended or used to advertise or inform, any part of the advertising or information contents of which is visible from any place on the main‑traveled way of the interstate or primary system, whether the same be permanent or portable installation
(4)	Primary systems. – The federal‑aid primary system in existence on June 1, 1991, and any highway which is not on that system but which is on the National Highway System. As to highways under construction so designated as primary highways pursuant to the above procedures, the highway shall be a part of the primary system for purposes of this Article on the date the location of the highway has been approved finally by the appropriate federal or State authorities.
(5)	Safety rest area. – An area or site established and maintained within or adjacent to the highway right‑of‑way by or under public supervision or control, for the convenience of the traveling public.
(6)	State law. – A State constitutional provision or statute, or a rule or regulation enacted or adopted by a State agency pursuant to the State Constitution or a statute.
(7)	Unzoned area. – An area where there is no zoning in effect.
(8)	Urban area. – An area within the boundaries or limits of any incorporated municipality having a population of five thousand or more as determined by the latest available federal census.
(9)	 Visible. – Capable of being seen (whether or not legible) without visual aid by a person of normal visual acuity."
SECTION 2.  G.S. 136‑131 reads as rewritten:
"§ 136‑131.  Removal of existing off‑premises outdoor advertising.
(a)	The Department of Transportation is authorized to acquire by purchase, gift, or condemnation all off‑premises outdoor advertising and all property rights pertaining thereto, provided the off‑premises outdoor advertising is in lawful existence on the effective date of this Article as determined by G.S. 136‑140, or provided that it is lawfully erected after the effective date of this Article as determined by G.S. 136‑140. Notwithstanding any law to the contrary, this section shall apply to all acquisitions, purchases, condemnations, or takings by the Department of Transportation that cause the removal of any lawfully erected off‑premises outdoor advertising, regardless of the outdoor advertising sign's location and proximity to the interstates or primary systems. The unit rule for valuing property shall not be used in determining just compensation under this section. For purposes of this section, the term "unit rule" means paying the undivided interest in real property, rather than the value of each owner's partial interest.
In any acquisition, purchase, condemnation, or taking, just compensation to the owner of the off‑premises outdoor advertising, where the owner of the off‑premises outdoor advertising does not own the fee, shall be limited to the fair market value at the time of the taking of the off‑premises outdoor advertising owner's interest in the real property on which the off‑premises outdoor advertising is located and such value shall include the value of the off‑premises outdoor advertising.
In any acquisition, purchase, condemnation, or taking, just compensation to the owner of the fee or other interest in the real property upon which the off‑premises outdoor advertising is located where said owner does not own the off‑premises outdoor advertising located thereon shall be limited to the difference in the fair market value of the entire tract immediately before and immediately after the taking by the Department of Transportation of the right to maintain such off‑premises outdoor advertising thereon and in arriving at the fair market value after the taking, any special or general benefits accruing to the property by reason of the acquisition shall be taken into consideration.
In any acquisition, purchase, condemnation, or taking, just compensation to the owner of the fee in the real property upon which the off‑premises outdoor advertising is located, where said owner also owns the off‑premises outdoor advertising located thereon, shall be limited to the fair market value of the off‑premises outdoor advertising plus the difference in the fair market value of the entire tract immediately before and immediately after the taking by the Department of Transportation of the right to maintain such off‑premises outdoor advertising thereon and in arriving at the fair market value after the taking, any special or general benefits accruing to the property by reason of the acquisition shall be taken into consideration.
The following factors shall be used in determining just compensation for off‑premises outdoor advertising and all property rights pertaining thereto:
(1)	The sales price of similar off‑premises outdoor advertising and all property rights pertaining thereto.
(2)	The physical condition of the off‑premises outdoor advertising sign, including its useful life.
(3)	The income generated by the rental of advertising space on the off‑premises outdoor advertising sign.
(4)	The effects of zoning or other land‑use restrictions.
(5)	The value of the outdoor advertising permit issued by an appropriate governing body.
(6)	The ability or inability to relocate and reconstruct the off‑premises outdoor advertising to a site reasonably comparable to or better than the condemned location within the same zoning jurisdiction, taking into account the similarity of advantages arising from lease terms, visibility, traffic flow, and other criteria that affect the value of outdoor advertising. The factor in this subdivision shall not be considered if the zoning jurisdiction allows for numerical increases in outdoor advertising signs.
(7)	The advantages arising from leasehold or other property interests, including length or term of property interest, renewal rights, options to purchase, or rights of first refusal.
(8)	Reasonable expectations of lease renewal for a period in excess of that stated in the lease for original and renewal terms.
(9)	Any other factor that may affect the value of the property rights affected by the condemnation.
(b)	Prior to any acquisition by the Department of Transportation under this section, the Department of Transportation shall undertake the project necessitating the acquisition in accordance with G.S. 133‑11 to minimize adverse impacts to the displaced off‑premises outdoor advertiser and reduce the costs of acquiring the off‑premises outdoor advertising and all property rights thereto, including allowing the off‑premises outdoor advertising to remain until actual construction or other physical site work is commenced on the project and within 100 feet of the off‑premises outdoor advertising sign.
(c)	In addition to receiving just compensation in accordance with this section, the owner of off‑premises outdoor advertising shall be entitled to recover from the party causing the removal of the off‑premises outdoor advertising the reasonable costs of relocating and reconstructing the displaced off‑premises outdoor advertising, including an amount equivalent to the income received by the off‑premises outdoor advertiser from the availability or rental of space on the off‑premises outdoor advertising sign for a period of up to 30 days if the income is lost during the relocation of the sign."
SECTION 3.  G.S. 153A‑143 reads as rewritten:
"§ 153A‑143.  Regulation of outdoor advertising.
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(d)	No county may cause or require the removal of any nonconforming, lawfully erected off‑premises outdoor advertising sign without the payment of monetary compensation to the owners of the off‑premises outdoor advertising, except as provided below. The payment of monetary compensation is not required if:
(1)	The county and the owner of the nonconforming off‑premises outdoor advertising enter into a relocation agreement pursuant to subsection (g) of this section.
(2)	The county and the owner of the nonconforming off‑premises outdoor advertising enter into an agreement pursuant to subsection (k) of this section.
(3)	The off‑premises outdoor advertising is determined to be a public nuisance or detrimental to the health or safety of the populace.
(4)	The removal is required for establishing, extending, enlarging, or improving any of the public enterprises listed in G.S. 153A‑274, and the county allows the off‑premises outdoor advertising to be relocated to a comparable location.
(5)	The off‑premises outdoor advertising is subject to removal pursuant to statutes, ordinances or regulations generally applicable to the demolition or removal of damaged structures.
(d1)	No county may condition the grant of any development approval on the removal of off‑premises outdoor advertising without the payment of monetary compensation as prescribed by this section. For purposes of this section, the term "development approval" includes approval for rezoning, variances, building permits, and permits authorized by quasi‑judicial proceedings.
(e)	Monetary compensation is the fair market value of the off‑premises outdoor advertising in place immediately prior to its removal, including consideration of the value of (i) the off‑premises outdoor advertising owner's interest in the real property on which the off‑premises outdoor advertising is located, (ii) the off‑premises outdoor advertising sign structure, and (iii) any rights, including permits, appurtenant to the off‑premises outdoor advertising use, and without consideration of the effect of the ordinance or any diminution in value caused by the ordinance requiring its removal. Monetary compensation shall be determined in accordance with G.S. 136‑131.

(f)	If the parties are unable to reach an agreement on monetary compensation to be paid by the county to the owner of the nonconforming off‑premises outdoor advertising sign for its removal, and the county elects to proceed with the removal, the county may bring an action in superior court for a determination of the monetary compensation to be paid. In determining monetary compensation, the court shall consider the factors set forth in subsection (e) of this section. Upon payment of monetary compensation for the sign, the county shall own the sign.
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(n)	Except as specifically provided otherwise in this section, the provisions of this section shall not be used to interpret, construe, alter, or otherwise modify (i) the exercise of the power of eminent domain by an entity pursuant to Chapter 40A or Chapter 136 of the General Statutes or (ii) the rights of off‑premises outdoor advertising set forth in Article 11 of Chapter 136 of the General Statutes. The standards set forth in G.S. 136‑131 shall apply to any county that causes the removal of off‑premises outdoor advertising through exercise of its power of eminent domain.
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SECTION 4.  G.S. 160A‑199 reads as rewritten:
"§ 160A‑199.  Regulation of outdoor advertising.
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(d)	No city may cause or require the removal of any nonconforming, lawfully erected off‑premises outdoor advertising sign without the payment of monetary compensation to the owners of the off‑premises outdoor advertising, except as provided below. The payment of monetary compensation is not required if:
(1)	The city and the owner of the nonconforming off‑premises outdoor advertising enter into a relocation agreement pursuant to subsection (g) of this section.
(2)	The city and the owner of the nonconforming off‑premises outdoor advertising enter into an agreement pursuant to subsection (k) of this section.
(3)	The off‑premises outdoor advertising is determined to be a public nuisance or detrimental to the health or safety of the populace.
(4)	The removal is required for opening, widening, extending or improving streets or sidewalks, or for establishing, extending, enlarging, or improving any of the public enterprises listed in G.S. 160A‑311, and the city allows the off‑premises outdoor advertising to be relocated to a comparable location.
(5)	The off‑premises outdoor advertising is subject to removal pursuant to statutes, ordinances, or regulations generally applicable to the demolition or removal of damaged structures.
(d1)	No city may condition the grant of any development approval on the removal of off‑premises outdoor advertising without the payment of monetary compensation as prescribed by this section. For purposes of this section, the term "development approval" includes approval for rezoning, variances, building permits, and permits authorized by quasi‑judicial proceedings.
(e)	Monetary compensation is the fair market value of the off‑premises outdoor advertising in place immediately prior to its removal, including consideration of the value of (i) the off‑premises outdoor advertising owner's interest in the real property on which the off‑premises outdoor advertising is located, (ii) the off‑premises outdoor advertising sign structure, and (iii) any rights, including permits, appurtenant to the off‑premises outdoor advertising use, and without consideration of the effect of the ordinance or any diminution in value caused by the ordinance requiring its removal. Monetary compensation shall be determined in accordance with G.S. 136‑131.

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(n)	Except as specifically provided otherwise in this section, the provisions of this section shall not be used to interpret, construe, alter or otherwise modify (i) the exercise of the power of eminent domain by an entity pursuant to Chapter 40A or Chapter 136 of the General Statutes or (ii) the rights of off‑premises outdoor advertising set forth in Article 11 of Chapter 136 of the General Statutes. The standards set forth in G.S. 136‑131 shall apply to any city that causes the removal of off‑premises outdoor advertising through exercise of its power of eminent domain.
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SECTION 5.  Notwithstanding any provision of Article 2A of Chapter 150B of the General Statutes, no later than six months after the effective date of this act, the Department of Transportation shall adopt rules to implement the provisions of this act. The Department of Transportation shall use the following procedure to adopt rules to implement the provisions of this act:
(1)	At least 15 business days prior to adopting a rule, submit the rule and a notice of public hearing to the Codifier of Rules. The Codifier of Rules shall publish the proposed rule and the notice of public hearing on the Internet within five business days.
(2)	At least 15 business days prior to adopting a rule, notify persons on the mailing list maintained pursuant to G.S. 150B‑21.2(d) and any other interested parties of the Department of Transportation's intent to adopt a rule and of the public hearing.
(3)	Accept written comments on the proposed rule for at least 15 business days prior to adoption of the rule.
(4)	Hold at least one public hearing on the proposed rule no less than five days after the rule and notice have been published.
A rule adopted in accordance with this section becomes effective on the first day of the month following the month the Department of Transportation adopts the rule and submits the rule to the Codifier of Rules for entry into the North Carolina Administrative Code. Any rule adopted more than six months after the effective date of this act shall comply with the requirement of Article 2A of Chapter 150B of the General Statutes.
SECTION 6.  Any rule or policy adopted by the Department of Transportation that does not comply with the provisions of this act shall be null, void, and without effect.
SECTION 7.  If any provision of this act or its application is held invalid, the invalidity does not affect other provisions or applications of this act that can be given effect without the invalid provisions or applications, and to this end, the provisions of this act are severable.
SECTION 8.  Section 2 of this act, G.S. 153A‑143(e), as amended by Section 3 of this act, and G.S. 160A‑199(e), as amended by Section 4 of this act, are effective when this act becomes law and apply to determinations of just compensation on or after that date. The remainder of Sections 3 and 4 of this act are effective when this act becomes law and apply to outdoor advertising that has not been removed as of that date. The remainder of this act is effective when it becomes law.