The Tricky Business of Commercial Advertising in Public Places

Public transit systems have accepted advertising for a long time. But it’s not always without controversy.
March 2013

Advertising revenue often looks like free and easy money for cash-strapped public agencies eager to augment budgets. At its core, it’s about two inextricably linked things: attracting attention to the buyer and generating revenue for the seller. But when things go wrong, it can also attract unwanted attention to the government agency that accepted the ads.

In New Hampshire, Ohio and Washington state, persistent budget gaps have prompted legislative proposals to expand the selling of naming rights for the usual suspects -- like sports facilities -- to include other public infrastructure and attractions, such as highways, bridges and rest areas.

These bills come on the heels of a deal Virginia reached last year with Geico Insurance to sponsor “safe phone zones” at rest stops. The $2 million-a-year deal will cover one-tenth of the state’s annual operating costs for its 43 highway rest stops. Virginia is now working on a plan for selling naming rights for its bridges.

Read the March issue of Governing magazine.

We have grown accustomed to the brand names of insurance, telecommunications, logistics and retail companies, plus a handful of banks and the odd pizza chain, emblazoned on public stadiums in all parts of the country. But what about the Go Daddy Expressway or the Hallmark Cards Airport?

A number of governments have come to see ad revenue as an important if still marginal funding source for operations of certain programs. Public transit systems have accepted advertising for a long time, and their experiences are often cited as models for expanding advertising in and around other public facilities.

Take King County Metro in Washington state, which sells about $5.5 million in ads on buses and stations each year. The transit system, which serves the greater Seattle region and is the tenth largest in the country, has an advertising policy that prohibits commercial messages about tobacco, alcohol, the sale of firearms and X-rated or adult material. However, it did not account for controversial messages from other sources, such as nonprofit advocacy groups. Because of the oversight, the county ended up in court over its decision to quell an inflamed debate between pro-Palestinian and pro-Israeli groups by blocking ads from both organizations.

The controversy forced Metro to change its policy to explicitly prohibit “public-issue advertising expressing or advocating an opinion, position or viewpoint on matters of public debate about economic, political, religious or social issues.” The new policy states that advertising not jeopardize security, safety, comfort or convenience of operations; that it maintains a position of neutrality on controversial issues; and prevents harm resulting from demeaning, disparaging or objectionable ads.

Metro also set up a compliance review process that gives officials final authority on all ads, allowing the agency to take one down at any time. Under the new policy, Metro had to reject a public health campaign from the county’s own health department in which thought balloons above an 11-year-old’s head asked why stores are full of tobacco and sugary drinks instead of fruit and milk. Advocating what stores should stock proved too provocative when the ads were vetted.

The message to other governments in all of this seems clear: If you need ad revenue, go in with a clear business plan and acceptance policy. Advertising may begin to feel a lot like marrying for money. You will earn every dime.

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