Smoking ban a boon for business?

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Smoking ban a boon for business?

The list of potential cost savings from the smoking ban is long: lower rates of fire, general liability, unemployment and workers’ compensation insurance; better worker retention; and less wear and tear on carpets, paint and HVAC systems. The anecdotal evidence and public conjecture about the relative revenue to be generated from smokers versus nonsmokers is even more abundant. And yet, it’s really too early to tell how the restaurant smoking ban effected December 1 will hit the bottom line of local bars and eateries. One Downtown Mall restaurateur put it to this way:

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“Given the current state of the economy, the harshness of this winter’s weather, the trials and tribulations of post-rebricking Downtown businesses, and the fact that winters are always slow even under the best conditions (for Downtown, anyway), trying to assess the impact of the smoking ban is a bit like trying to take the pulse of a dead person.”

Still, we can look at how this might play out by assessing the experience of some restaurants that adopted nonsmoking policies in advance of the ban.
 
Back when the Downtown Grille went nonsmoking on April 1, 2007 (shortly after an earlier smoking ban failed to pass in the General Assembly that year), many Downtown restaurant owners and patrons suspected the move would hurt business. When we interviewed manager and partner Robert Sawrey a few months later, however, he reported that he was “very happy we did it” and said the restaurant’s sales exceeded the same period in the previous year. Almost three years later, Sawrey is still singing a happy tune.
 
“I didn’t see any decrease in insurance premiums,” says Sawrey. “Obviously we didn’t have to buy ashtrays, though that’s not a big expense, but we’re very happy we did go nonsmoking when we did. We may have lost a little bar business in the beginning, but our dining customers were a lot happier, and we also gained bar business as we went along because of people who wouldn’t come in because of the smoking.”
 
Big Jim’s Catering owner and Outback Steakhouse proprietor Brent Lunnen says that going nonsmoking at the Outback has made managing the dining room a lot easier. The local franchise first limited smoking to the bar area and then went completely smoke-free on November 1, 2009. 
 
“I used to be a smoker, but it would be really frustrating on a busy night when I’d have seven or eight of 10 tables open in the smoking area and then a long wait list for nonsmoking,” says Lunnen.
 
Many other local restaurants similarly saw the downside of maintaining a smoking section and went completely nonsmoking before the ban. According to Virginia Department of Health records, 83 percent and 80 percent of full-service restaurants in city and county, respectively, were completely nonsmoking indoors just prior to the ban.
 
Just a little further up the Downtown Mall, Rapture and Club R2 owner Mike Rodi’s experience with early adoption was a bit less successful, however: 
 
“We went nonsmoking for lunch almost two years ago, and then extended that through dinner last winter. We tried to go nonsmoking this summer when the ban was announced. Our thought was that it would be easier to make that transition during the warmer months when people wouldn’t mind sitting at a table outside and smoking. The move made an extremely noticeable impact on our sales, though—to the point where bartenders from other bars came in to thank us for going nonsmoking—so we decided to renege on that until the ban when into effect, putting everyone on equal playing ground.”
 
Now that Rapture is smoke-free, Rodi says, “Honestly, I think at this point we’ve picked up about as much volume as we’ve probably lost.”
 
As for cost savings, though, Rodi is dubious, “I’m looking forward to repainting and doing some reupholstering, and I’m looking forward to my HVAC working more efficiently, but it’s really too early to say that ‘Wow! My bills are lower.’”
 
In fact, Rodi says he’s had to incur an additional cost in the form of more security personnel to monitor a side entrance that smokers now use to drop their drinks, light up outside and then go back inside.

An uneven play field

The notion that smokers will now stay home in droves and consequently hurt restaurant and, in particular, liquor sales, is a little hard to inhale. For one thing, the smoking community is a diminishing population. Plus, more than half of the states in the country enacted similar restaurant and bar smoking bans years ago, so there’s already lots of data from places like California and New York City that indicates restaurant sales do not suffer.

Rapture and Club R2 owner Mike Rodi put a smoking ban into effect early, but ultimately reneged until “everyone [was] on equal playing ground.”

But there are two major problems with Virginia’s smoking ban that render common sense and science less persuasive for business owners: a large exception and a toothless penalty. 

Virginia’s law still permits smoking on an outdoor patio and in designated smoking rooms that are structurally separate and separately vented from the nonsmoking dining rooms, which must have their own public entrance. Otherwise, all restaurants and bars must post “No Smoking” signs, eliminate ashtrays and smoking paraphernalia and keep patrons from lighting up or face a $25 fine (patrons who violate the ban face the same fine). 

Compliance with Virginia’s ban—officially called the Indoor Clean Air Act—primarily is monitored by the health department through routine restaurant inspections, which, depending on the type of establishment, occur up to four times a year. The priority for health department inspectors, however, is the prevention of food-borne illness. 

Inspectors have no power to impose a fine under the act and must notify local enforcement, which has the power (and discretion) to issue a summons for violations. According to Eric S. Myers, environmental health supervisor for the Thomas Jefferson District of the Virginia Health Department (which oversees the City of Charlottesville and the counties of Albemarle, Fluvanna, Green, Louisa and Nelson) inspectors also have no power to suspend or revoke a food service business license in connection with violations of the act. 

“I think the lawmakers either needed to give the ban more teeth—fewer loopholes so that the playing field really would be level—or else not put it in place,” says Rodi.

Myers says, “To date, we’ve had zero complaints across the five-county district,” and, according to the online records of routine restaurant inspections posted on the health department’s website, as of December 23, 2009, no restaurant in the district has been cited for any violations of the Indoor Clean Air Act. Myers says local inspectors have noted some instances of noncompliance, however, and chose to issue warnings instead. 

In New York City, by contrast, where a restaurant and bar smoking ban was enacted in 2003, The New York Times reports that violations are blatant and rampant at higher end bars and lounges—the ones with the velvet ropes and doormen. That’s not the sort of self-indulged, celebrity-saturated, rules-don’t-apply-to-me scene that we have here. Still, only weeks after the ban took effect in Virginia, USA Today included Caddy’s Lounge in Midlothian, Virginia in an article about restaurants across the country flouting their own state and local bans because “it’s good business,” to quote the headline. Caddy’s owner Judy Maxie was paraphrased as saying that the ban’s $25 fine is cheaper than the revenue she’d lose if she complied.

And already rumors are circulating about sneaky smoking going on at Downtown Charlottesville bars. Concerns are mounting about which places will use the exception of a separately vented smoking room or, as Rodi refers to it, the “loophole.” Miller’s is reported to be building out the second floor, which already has a separate entrance, to make that a separately-vented nonsmoking area. There also have been misleading media reports about C&O Restaurant’s smoking status. Though owner Dave Simpson says that under the legislation he likely could allow smoking in one of his restaurant’s many separate dining rooms, particularly in the downstairs bistro, he’s not going to do so. 

“We are nonsmoking,” he says. “Personally, I couldn’t be happier about it.” 

Rodi also says that while he easily could make R2 qualify as a separate smoking room, he doesn’t want to do it. 

Myers estimates that only about 15 of 850 or so establishments in the entire Thomas Jefferson District have already or are working with inspectors and local building officials to create a separately vented, legal smoking room.

Myers also expects that it will be a year before the health department conducts a full report on the impact of the ban.

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