BILLBOARD BONANZA LOBBYIST STANDS TO MAKE MILLIONS IF L.A. LIFTS FREEWAY BAN.

Byline: Beth Barrett Staff Writer Copyright 2002, Daily News of Los Angeles 

A billboard industry lobbyist, who doubles as a member of the city task force on sign policy, stands to make several million dollars if City Hall lifts the ban on freeway advertising in Los Angeles, the Daily News has learned.

Lobbyist Ken Spiker Jr., appointed by Councilman Hal Bernson as an industry representative to the task force, has lobbied key council members intensely for more than a year without disclosing his lucrative contract. Originally, it would have paid him up to $10 million, based on a sliding fee starting at $250,000 for each of the first 15 freeway billboards approved and reduced fees for the rest. That has been cut by about a third, sources said.

The city's ethics law - unlike state law and the Metropolitan Transportation Authority's lobbying law - does not bar lobbyists from contingency contracts, which provide handsome rewards if they successfully get favorable legislation approved. Nor does the city require lobbyists to disclose the nature of the contracts, except for the amount they ultimately are paid.

The lobbying contract exposes just how profitable billboards are and how much is at stake in the debate over street advertising in Los Angeles. The companies that hired Spiker - a majority of those operating in Los Angeles - pumped more than $500,000 into city election campaigns last year, most notably with numerous billboards for City Attorney Rocky Delgadillo and Mayor James Hahn.

``This is staggering. I never heard of this before; at the state level it's prohibited,'' said Robert M. Stern, president of the Los Angeles-based Center for Governmental Studies.

``The (city's) ethics law should be amended to prohibit this, or if there is an arrangement, the arrangement should be disclosed at the time it is made. It is obviously important for the public to know what is at stake when a decision is being made. It gives the public an idea how important the issue is in a fiscal sense. If a lobbyist is being paid $5 for this as opposed to $250,000 it's a big difference.''

Bernson response

Stern questioned the dual role played by Spiker, whose father was a top bureaucrat at City Hall for years, but Bernson dismissed such concerns as out of hand.

``They're honorable people, more honorable than 90 percent of the lobbyists around,'' Bernson said. ``Obviously they're out to make a buck. You can't blame anyone for that.''

Reached by cell phone on a golf course Thursday, Spiker said the March 31, 2000, contract signed with Regency Outdoor Advertising has been reduced, but is still based on the number of signs delivered.

``If I can get it done, I get paid,'' Spiker said. ``If not, I wasted two years of my life. It's all up to the City Council, they make that decision. They liked it once.''

Spiker said he lobbied Councilman Mark Ridley-Thomas - who drafted the freeway billboard ordinance - and planning officials in dozens of meetings without disclosing his contingency arrangements with three major billboard firms.

``(It was) nobody's business,'' he said.

Spiker added that had the task force discussed recommendations on the freeway billboard ordinance, he would have recused himself, but that it did not.

The task force was created to make a comprehensive review of the city's signs, from billboards to inflatable signs, and then to make policy recommendations, including ways to reduce the number of illegal signs.

LeeAnn Pelham, executive director of the City Ethics Commission, said that while the office doesn't comment on specific cases, the commission might now want to review whether lobbyist disclosure requirements should be broadened to include contingency agreements to give the public a better understanding of how money influences city decisions.

At the state level, violation of the ban on such agreements is a misdemeanor that can carry heavy financial penalties of up to three times the fees that were not properly disclosed.

Bernson said he didn't know about Spiker's deal, but doesn't consider it important, assuming most lobbyists work that way.

``My experience is most lobbyists have some kind of contingency or success fee whether it's billboards or housing projects. That's the business world. I don't want to know anything about that, I prefer not to know.''

Bernson said billboard companies haven't helped him politically with signs and that he's gotten just $3,500 in contributions from Spiker and the companies he represents over the past three years. He insisted there is merit to the freeway program, which would require billboard companies to take down old, worn and sometimes illegal billboards that are eyesores.

Ridley-Thomas, whose intent is to combat urban blight with the ordinance, said he had ``no clue'' that Spiker was working under contingency.

``My hunch is that there's huge money in play in terms of the industry.''

Attacking blight

His primary concern, Ridley-Thomas said, is to get rid of 2,500 or more billboards now blighting communities, and that the exchange for some 70 billboards along industrial stretches of freeways is a more progressive approach than either banning new billboards or relying on an understaffed enforcement division to crack down on illegal billboards, including those that have been enlarged in violation of permits.

``I'm a lover of neighborhoods that need to be protected,'' Ridley-Thomas said. ``This is the most progressive ordinance fashioned to address this issue. The council has stumbled and fumbled for over a decade.''

Records show two of the companies Spiker lobbies for, Regency Outdoor Advertising and Eller Media, now Clear Channel Outdoor, contributed more than $530,000 in political billboard advertising as independent expenditures on behalf of candidates in the past election, including Hahn and Delgadillo.

Hahn and Delgadillo did not return calls Thursday.

George Manyak, president of Clear Channel Outdoor's Western region, confirmed that the renegotiated fees with Spiker were ``substantially lower'' as a result of greater city demands on the industry and ``wild swings'' in the advertising business, but declined to specify the new deal.

Vista Media of La Mirada also has a contingency ``understanding'' with Spiker, though its president, Glenn Emanuel, said no contract has been signed.

Regency Outdoor Advertising officials did not return calls.

Spiker was a central figure, too, in the city's recent successful blocking of an attempt by STI/Outdoor LLC, a company in which Viacom Inc. has a minority stake, to put up billboards on Metropolitan Transportation Authority property. Spiker called the firm a ``rogue billboard company'' and alerted Bernson, leading to Delgadillo getting a restraining order against the Viacom company.

Out of control?

The in-fighting over increasingly scarce and valuable billboard space has caused some council members to conclude that the billion-dollar industry is out of control, with some suggesting a ban on all new billboards in the city.

Councilwoman Cindy Miscikowski said the freeway billboard plan has opposition among residents, and that she's concerned it amounts to ``trading zoning,'' a practice the city has never allowed.

She said Spiker's contingency contract ``takes your breath away,'' illustrating what a premium billboards now command. She said some developers have come to the city with a billboard component required to make their projects viable.

``That's not urban planning at its best. It's nuts.''

Miscikowski said rather than risk a questionable ``quid pro quo,'' the city should ``put our teeth'' into enforcement.

City officials estimate that up to 40 percent of the city's approximately 10,000 billboards are illegal. While many of those have a permit, they have been illegally enlarged or heightened, said Dave Keim, chief of the city's code enforcement bureau.