Mayor Kirk Caldwell on Friday signed into law a bill that allows private sponsorships of parks and other city facilities in exchange for visual recognition, despite warnings from the Outdoor Circle that it could trigger legal action over possible violation of the state’s strict outdoor-advertising laws.

Bill 78, introduced by City Councilwomen Kymberly Pine and Ann Kobayashi, allows the city to set up a five-year pilot program for organizations, businesses and individuals to sponsor city facilities, parks, programs, equipment and other tangible property. Sponsorship recognition would be given in return to those making contributions, provided that all recognition “must blend in with the surrounding environment.” The bill was approved by the Council last month with a 7-2 vote.

“We’re all coming together here to do a better job to make sure people can celebrate life together on a very small island,” Caldwell said at a news conference in Waikiki. “All the laws in place today that control and regulate outdoor advertising are incorporated into this bill. I think the way the law is written will stand up to any kind of challenge.”

But the Outdoor Circle, which led the opposition, had maintained that the measure’s vague language could lead to billboards or gaudy advertising and that it violates the state’s ban on billboards and other off-site outdoor advertising.

Kathy Whitmire, former Outdoor Circle president, said Friday that the group is working with Council members to include changes to another bill, which was introduced by Councilman Ikaika Anderson in response to concerns raised. Bill 49 would change the five-year pilot program to one year and require all contributions exceeding $10,000, instead of $50,000, to be approved by the Council.

Anderson’s bill also lists additional requirements for sponsorship recognition, including that it must “preserve and protect the Hawaiian sense of place” and would be limited to a plaque if placed in a city park. The bill passed the first of three readings Wednesday.

Whitmire said some of those changes, including more specifics on recognition in the city’s parks, is a step in the right direction. But she said the nonprofit is proposing other amendments, such as not allowing any sponsorship recognition on city property other than in parks, adding further descriptions of allowable plaques in parks and requiring that all agreements be presented to neighborhood boards.

She said legal action against the city is still a possibility if those changes are not included in the follow-up bill, adding that the group’s goal is to prevent sign clutter and preserve Hawaii’s natural beauty. An attorney for the organization had said that the state’s 1965 outdoor-advertising law bans the city from adopting a bill that would allow what essentially amounts to signage in exchange for money.

“Bill 49 appears to create some effective restrictions on sign clutter and visual pollution in parks,” Whitmire said in testimony submitted this week to the Council. “However, it does very little to control sign clutter on other city property and is therefore unlikely to conform to the state outdoor advertising (law).”

The city Department of the Corporation Counsel had said attorneys approved the form and legality of the language in the new law and would defend it if challenged.

Caldwell said the bill he signed clearly states that all sponsorship recognition would need to conform to all laws, including the state’s billboards law. Pine also said she is not concerned about the prospect of legal action against the city.

Supporters of the bill maintained that the measure would help fix up the city’s languishing parks and facilities in exchange for modest displays of recognition. The city would also be able to use sponsorships to help finance upcoming improvements at the Neal S. Blaisdell Center. The bill was backed by the city Parks and Recreation and Enterprise Serv-ices departments.

Nanakuli resident DeMont Conner said the bill allows him and others to raise money for improvements at nearby Kalanianaole Beach Park. He said by having sponsorship recognition, which he envisions as a small engraved pohaku, or stone, at the beach park, it would deter vandalism because residents would know that a community group helped to improve the area.

Dave Benson, a Rotary Club of Honolulu member who is spearheading an effort to build a park in Waikiki, said donor recognition would help the nonprofit collect more money. He said it has raised about $130,000 of a $550,000 goal and hopes to break ground in June. Benson said there will be stones with etchings to recognize donors.

Pine said Friday that the new law will lessen the burden on taxpayers by using private funding. She said she would not support limiting sponsorship recognition to city parks only, pointing out that some residents want to help improve the Waianae District Park’s gymnasium, where the second floor has been closed for more than two years.

“Sometimes we make government too hard for the people,” Pine said. “We’re going to get rid of all the red tape that says you can’t do this, you can’t do that, you can’t be part of giving to the city and taxpayers, who have had enough of giving from themselves.”