Smoking Debate Drags On (Restaurants USA, May 1998)

May 1998 issue

Smoking Debate Drags On

Restaurants USA magazine's final issue was published in September 2002 but these archived articles remain available for our readers' convenience.

Restaurants USA, May 1998

As further restrictions on smoking loom on Capitol Hill's horizon, restaurateurs around the country share their experiences with the patchwork of smoking bans now in place and their effect on business.
By Ira Apfel

New legislative issues raise the blood pressure of restaurateurs more than restaurant-smoking ordinances. In recent years, operators have had to cope with new smoking laws and the financial fallout that they cause, as local and state authorities responded to calls to ban smoking in public places.

Then the legal settlement between tobacco companies and state attorneys general, announced on June 20, 1997, ratcheted the pressure on restaurants up another level. Now operators await legislation from Congress that will implement the tobacco settlement. This pending legislation could further restrict smoking in restaurants or ban it outrightÑa prospect that has some restaurateurs hot under the collar.

In the meantime, this much is clear: It is increasingly difficult for restaurants to serve smoking customers and it will be even harder to do so in the future. The only relief for restaurants is bittersweetÑa statewide or federal smoking ban that would "level the playing field," as one operator put it, by preventing smoking in any restaurant.

Sparks on Capitol Hill

When the state attorneys general reached a legal settlement with tobacco companies last summer, it unleashed a feeding frenzy in Congress. It seemed like every committee chairman with a passing interest in the smoking issue proposed legislation that would enforce the settlement. "The settlement is so broad that a number of different committees have jurisdiction over the bill," says Lee Culpepper, vice president of federal relations for the National Restaurant Association. "They have taken the settlement and shaped it as they see fit."

There are no fewer than five tobacco proposals currently under consideration before Congress. Two favor a partial ban, such as S. 1415 from Sen. John McCain (RAZ), which would ban smoking in quickservice restaurants, in theory to keep tobacco away from children. Another proposal, S. 1648 from Sen. James Jeffords (RVT), does not include a smoking ban, but would direct the Occupational Safety and Health Admin-istration (OSHA) to enact tough new indoor-air-quality rules. A fourth proposal S. 130 from Sen. Orrin Hatch (RUT), would completely ban smoking in restaurants (excluding bars).

The National Restaurant Association has long opposed any smoking ban, and its Board of Directors reaffirmed that position at its meeting in January. The Association supports giving operators the chance to set smoking policies according to customersÕ preferences and local customs. "Our position is the federal government shouldnÕt decide whether restaurants nationwide should allow smoking," says Culpepper. "There are so many different industry segments and different geographical interests that writing a national Ôone-size-fits-allÕ law would be almost impossible."

Michael Sternberg, owner of Sam & HarryÕs and Music City Roadhouse in the Washington DC area, recently testified before the Senate Environment and Public Works Committee. "I told them that IÕve spent the last 21 years developing my business," he says. "If customers want to smoke, I should have the right to accommodate them. If they donÕt want to smoke, IÕll make the appropriate adjustments."

Congress will debate the proposed bills throughout the spring and summer, and a vote is likely by the end of the current session. Public- and private-interest-group pressure is so intense, Culpepper says, that President Clinton could call a special session of Congress just to vote on a bill this year. "If anything passes, itÕll be a smorgasbord from the current bills," he adds.

While Congress debates federal legislation on smoking in restaurants, state and local communities are left to decide the issue for themselves. Some states, like Massachusetts, set smoking ordinances on a town-by-town basis. Others, like Maryland, favor a statewide law

but allow local communities the right to create their own ordinances. And at the extreme end of the legislative spectrum is California, which instituted a statewide ban on all smoking in restaurants on January 1, 1998.

Smoke screen

Because of the extreme nature of CaliforniaÕs Labor Code Section 6404.5Ñwhich bans smoking in restaurants that feature bar areas, bars, taverns and gaming and bingo clubsÑCalifornia is at the forefront of the restaurant-smoking debate.

Many operators and smokersÕ-rights groups howled in protest when the law went into effect. They succeeded in getting the California State Assembly to pass AB 297, which would have lifted the smoking ban less than a month after it began. However, the California State Senate rejected the bill on March 25, and a repeal of the ban is dead.

The law is harsh, but even-handed, because it applies to all establishments, ensuring a competitive balance. It is for that reason that the California Restaurant Association (CRA) supports the law. "We felt that a consistent ban was important," says Kendall Edwards, senior director of government affairs and general counsel to the CRA. "Obviously, not all of our members are happy with it, but the majority believes it was the right thing to do."

A few operators have found loopholes in the law to accommodate their smoking patrons. For example, Jeff Welch, operator of Players Pub and Players Sports Pub in Sacramento, California, takes advantage of the fact that the law allows smoking at outside patio areas or in banquet rooms where employees are not present. Welch put an awning behind his Players Sports Pub for his smoking customers. Soon, nonsmokers joined the smokers outside. Now he is considering whether to install a full-fledged patio. "ItÕs actually created another area for business," he says. The smoking ban is proving to be popular with WelchÕs customers and employees. "The crew is totally happy with it," he says. "Even smokers said they loved the way the place smelled."

Pietro Torza, owner of HarlowÕs Restaurant and Nightclub in Sacramento, California, sidestepped the ban by opening a retail cigar shop on the second floor of his establishment. "Not one person has complained," he says. "They just go upstairs."

Perhaps in part because they are able to accommodate customers who smoke, Welch and Torza support the ban. "I was totally apprehensive about it at first," says Welch. "I thought, ÔWhat am I going to lose?Õ At our sports pub it may have affected the late-night single business smoker, but overall I havenÕt noticed a decrease in business, although itÕs hard to track. In fact, we had one of our busiest days ever in the month of February," which was after the smoking ban went into effect.

Torza says one reason he supports the ban is because it was designed to help employees. "ItÕs for the employees, not the patrons," he says. "Employees donÕt have a choice of where to be. I just think there should be an optionÑand IÕm glad IÕm able to offer one. Our freedom seems to be diminishing."

Welch concurs. "ItÕs a workplace issue. ThatÕs where the biggest second-hand-smoking lawsuits are coming from," he says.

The biggest problem that Welch and Torza have with the ban is that not all operators abide by it. Welch says that only one or two of the eight bars within a one-mile radius of his operation adhere to the new regulation. "If everybody would give it a chance to make it a level playing field, I think itÕs a really good thing," he says.

State of confusion

Smoking legislation in other states has been pieced togetherÑsometimes on a community-by-community basisÑinto a confusing quilt of conflicting regulations.

For example, Boston recently passed a proposal banning smoking in restaurants unless the establishments feature bar areas that take up less than 33 percent of the seating capacity and do not have common access to restroom areas for the general public. However, a total smoking ban is in effect in the adjoining town of Brookline. That inconsistency helps some operators and hurts others. "I can tell you four places that went out of business in Brookline," says Peter Christie, executive vice president of the Massachusetts Restaurant Association (MRA). "What we have now is divisive and discriminatory. One restaurateur just by luck will benefit, whereas a person who has done nothing wrong may lose guests."

Depending on the town, smoking ordinances have either boosted or blunted business at Stuart HurwitzÕs three Pizzeria Unos. One unit is located in Springfield, which has no smoking ban for restaurants. Another unit is in the neighboring town of Holyoke, where three years ago the cityÕs Board of Health instituted a citywide smoking ban. Hurwitz estimates the law cost the unit $150,000 in bar sales. "We got clobbered," he says. "What we found is, contrary to popular belief, if one person smokes and two friends donÕt, the nonsmokers accommodate the smoker. WeÕd lose one smoker and two nonsmokers to establishments in nearby towns."

Recently, a business-friendly Holyoke Board of Health awarded the Pizzeria Uno in Holyoke Mall a variance to allow smoking in one half of its bar. "ItÕs an amazing difference," says Hurwitz. "WeÕre not advertising that we allow smoking, but by word of mouth we are seeing an increase in business at the bar."

Ron Lusso, owner of WakefieldÕs Grill in Wakefield, Massachusetts, is not as fortunate as Hurwitz. Wakefield, which banned smoking in restaurants three years ago, is surrounded by five towns that do allow smoking in eating establishments. "Our business is off at least 30 or 40 percent," says Lusso. "They say the first year of the ban is toughest and business is supposed to come back by the third year, but IÕm not seeing it. Other towns are only a mile away."

Lusso and Hurwitz would prefer that all bans be lifted, yet they admit that theyÕd quickly settle for a statewide smoking ban. But the MRAÕs Christie thinks a statewide ban like the one in California is not feasible in his state. "We have over 2,000 restaurants within a 5- to 10-minute drive to the border of several states. WeÕre not an island," he says.

Instead, Christie wants federal protectionÑand he doesnÕt mean a national restaurant-smoking ban. "This stems from the Environmental Protection AgencyÕs finding that secondhand smoke is a Class A carcinogen," he explains. "Congress found the report flawed, and OSHA has yet to regulate it. Why? I suspect theyÕre afraid [that] if they try to regulate it, theyÕll lose in court, and restaurant owners will be off the hook.

MarylandÕs restaurant-smoking law lies somewhere between CaliforniaÕs sweeping statewide ban and MassachusettsÕ hodgepodge of local ordinances. In Maryland eating establishments, smoking is allowed only in bar areas and adjacent tables or in dining areas that are separate, have a door and are enclosed by walls that rise from the floor to the ceiling. There are no state smoking restrictions on bars.

However, MarylandÕs Howard County enacted a law on January 1, 1997, that banned smoking in all dining areas. Smoking in restaurants is only allowed in those establishments that have separate and enclosed bar areasÑa competitive imbalance that hurts some restaurateurs, says Tony Moynagh, general manager of ClydeÕs, a restaurant and bar in Columbia. "It hurt our bar business tremendously, on the order of a 10 to 15 percent loss in business a month for the first six months," says Moynagh. "We had to discount food at the bar to get people back. From here to Baltimore County is only a 10-minute drive. ItÕs less time to get to Montgomery County."

The Howard County business community will suffer because of the tougher smoking law, says Brendan Flanagan, director of government affairs and public relations for the MRA. "This law sends a message to those in economic-development circles, particularly the hospitality industry, that doors arenÕt fully open to the smoking public, particularly foreign visitors, in Howard County," he says.

A fumeless future?

The National Restaurant Association and the state restaurant associations continue to fight for the freedom of restaurateurs to decide whether or not to allow smoking in their establishments, but many operators fear that when the smoke clears there will be a universal ban on smoking in restaurants.

Michael Sternberg says he testified that he eliminated the nonsmoking bar in his Music City Roadhouse in Washington DC, because all of his customers flocked to the smoking bar. "Let the market dictate to the business," he says, "not the government."

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Ira Apfel is a staff writer at the National Restaurant Association.