Mayor wants to raise money by selling ad space on city property

October 27, 2012

(Photo courtesy of the City of Chicago)

Who says Chicago isn’t for sale?

Mayor Rahm Emanuel’s administration is unveiling plans to rake in millions next year by leasing dozens of billboards on city-owned property, selling advertising space on downtown trash bins and finding a corporate sponsor for the city’s recycling program.

The trio of so-called “municipal marketing” deals is part of a long-delayed proposal Emanuel’s administration hopes will bring extra money to the cash-strapped city, at virtually no overhead cost. The mayor’s 2013 budget proposal, now being considered by the City Council, expects the marketing efforts to bring in $18 million to help close a projected $298 million budget gap without raising taxes or fees.

“We live in an age where our taxpayers don’t want to pay any more taxes, [but] our citizens can’t accept less services,” said Chicago’s chief financial officer, Lois Scott, in an interview Friday with WBEZ. “So we have to find a third way forward. And we found that third way forward by tapping into an industry and a revenue stream that’s out there already, but it’s not benefitting our taxpayers.”

The biggest-dollar proposal would allow a private company to build and maintain 34 electronic billboards along Chicago expressways for the next 20 years. If approved by the City Council, the lease would guarantee at least $15 million in revenue next year, with the city splitting anything beyond that 50-50, Scott said. The city’s share of the revenue would shrink over time, but Scott said the plan is expected to bring in at least $154 million, and maybe up to $270 million over the next two decades.

Construction and maintenance costs would be covered by JCDecaux, the French company that is currently contracted to run ads on the city’s 2,200 bus shelters. There are already a handful of the electronic billboards, which feature ever-changing ad images, along Chicago’s highways.

The deal would also let the city put its own images into rotation, including traffic notices, emergency alerts and even public art.

While Scott said the city will be careful not to obstruct historical architecture or clutter the Loop with ads, Chicagoans will likely notice other small changes downtown and in their neighborhoods. Ads will pop up on 375 side-by-side trash bins in the Loop, under a contract signed earlier this month with New York-based Vector Media. It’s unclear how much money the deal is worth, but Scott said the city will split ad revenue with the company down the middle.

City recycling, too, may get a corporate sponsor. The city is in the “final stages” of an agreement with an undisclosed company to financially back the city’s recycling program, Scott said, which will help defer the costs of taking recycling city-wide in 2013.

City Hall’s estimate that municipal marketing will be worth $18 million next year initially raised questions from some aldermen, after a similar plan last year fell flat. When he presented his first budget in 2012, Emanuel projected a $25 million take from such advertising efforts.

But the city got nothing.

“We are a few months delayed in where we expected to be,” Scott said. “And I think that the taxpayers and the citizens will agree that we’ve made the right decision about how to do this.”

“We did not want a repeat of the bridge houses,” she said, referring to an earlier deal that put Bank of America ads on a pair of historic Chicago River bridge houses last year. The deal drew in just a few thousand dollars for the city, but was reviled by architecture critics who said it tarnished the downtown cityscape.

Alderman Danny Solis (25), who oversees the City Council Zoning Committee that must approve signs and billboards, said he was initially frustrated at how slow the municipal marketing project was moving. But he said he’s now convinced Emanuel’s administration has it right.

“It’s not gonna be any sort of ostentatious, gaudy exhibition of signs,” Solis said. “They’re gonna be very much what’s there now, or even much better than what’s there now.”

Emanuel’s administration is planning to brief other aldermen on the municipal marketing plans this week, according to a spokeswoman.