A company wanting to put up an electronic billboard in Wangaratta has argued that a blanket prohibition on the signs is unreasonable.
The $150,000 proposal from Citizen Outdoor will be the fourth attempt at having a billboard in the city.
The latest attempt is for a smaller billboard.
It would be 9.18 square metres in size, a reduction of 34 per cent from the previous 27 square metre proposal, and drop in height from 10 metres down to 5.4 metres.
Citizen Outdoor director Wes Randerson said the changes would alleviate the concerns of the council and VCAT.
"The local advertising sign policy appears to be designed to be a prohibition on promotion signs. In the past, such policies have been determined to be unreasonable in many VCAT cases," he said in the planning application.
"While council may wish to refuse applications of this nature, as signs are generally discouraged or 'are to be avoided', this tribunal has declared this as not a reason to prohibit or place a blanket ban on promotional signs as they are a legitimate and lawful land use."
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The single-sided billboard would face traffic heading west into Wangaratta and operate 24 hours per day, with each advertisement on screen for at least 30 seconds.
Wangaratta Council had argued in VCAT earlier this year that billboards were against its planning policy.
"It aims to achieve high quality visual standards for the sitting of major signs and aims to ensure that signs are not detrimental to the appearance of their surroundings," the council stated.
"The proposal will be detrimental to the gateway approach to Wangaratta given the size and height of the sign proposed."
In a letter sent to Mr Randerson in September, Regional Roads Victoria said there would be no objection to the billboard, following a traffic engineering assessment.
Mr Randerson argued there would be positive benefits from the billboard, which would promote goods, services and events.
"The presence of strategically-located promotional signs has proven to be a great catalyst for economic growth in local areas, particular where signage is linked to key economic development strategies," he said.
"The proposed sign addresses the Tone Road commercial and industrial streetscape and adds vibrancy and colour to the surrounding area."