I can't make my logo into a vector image and make the background transparent

I have a logo in psd that I bring into illustrator. I need to turn it into a vector image because it's going on a billboard. But when I do I can't get rid of the white background, make it transparent. Can anyone offer any solutions?

Click on the properties icon in the top tool bar and choose ignore white, then the trace will trace everything except the white.

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