How's business since smoke has cleared?
Restaurants bemoan year-old ordinance, but many patrons praise it
10:40 PM CST on Sunday, February 29, 2004
A year after Dallas' smoking ordinance went into effect, locals are breathing easy inside city restaurants and hotels.
But business owners say fresher air has come at a high cost. And while the numbers to conclusively prove it are not yet in, some have reported losses, while others have closed their doors for good.
"My sales went to dirt, and I was just piddling around," said Matt Martinez, who sold Matt's No Place in Lakewood this fall when tourist groups and cigar smokers stopped coming in. "I got angry and didn't feel like messing with this city anymore."
On the other side is Michael Grimstad, a Lakewood resident, who speaks for many restaurantgoers.
"It's a real pleasant change – I don't like smelling smoke when I eat," he said. "My dry cleaner might disagree."
City Council members voted last January to make Dallas restaurants, hotels and bingo halls smoke-free. Under the ordinance, which went into effect March 1, 2003, smoking is still permitted in freestanding bars and on outdoor restaurant patios. It is banned in most other establishments, including grocery stores, bowling alleys and hotel meeting rooms.
Lobbyists for the hotel and restaurant industry have approached council members often during the last year, hoping to win support to soften the ordinance. But Dallas Mayor Laura Miller said no smoking is here to stay.
"I do not want to reopen the smoking ordinance," she said. "I think it works, and people like it a lot."
Ms. Miller was just back from a trip promoting Dallas tourism and dining in New York, where smoking is outlawed in bars and restaurants. California and Delaware have similar statewide bans. Maine, Utah and Vermont allow smoking in bars only.
"I know there will be a time when people say, 'How did we ever put up with cigarettes in public places?' " Ms. Miller said.
Tracey Evers, executive director of the 1,000-member Greater Dallas Restaurant Association, said by talking to members of the association she'd estimate that revenue is down 25 percent. Members believe this is a result of smokers shortening their stay in restaurants. She said restaurant bars – the profit-makers – have been the hardest hit.
"This has created a very un-level playing field for them," said Ms. Evers, noting that Dallas diners may be heading to cities where smoking is permitted. "Some say it has absolutely been devastating."
Ms. Evers said now that the ordinance is a year old, the association will survey local restaurants to accurately assess how much damage has been done. So far, the evidence has been anecdotal but shows that restaurants in the association have reportedlosses ranging from tens of thousands to hundreds of thousands of dollars.
According to figures from the Texas Comptroller's Office, in the second quarter of 2003 – the first three months of the smoking ban and the last quarter available for review – Dallas restaurants selling alcohol reported their lowest revenue in recent years.
But the revenue per establishment has been steadily dropping each quarter beginning in 2000 – well before the ordinance.
Kathy Hayes, an economist and associate dean at Southern Methodist University's Dedman College of Humanities and Science, said the decline is probably the result of a stagnant economy. And she said despite news of a recovery, spending hasn't picked up as fast as businesses had hoped.
"People typically spend less at restaurants when their income has gone down," Dr. Hayes said. "It's not a required expenditure. When they aren't sure what their recovery is going to be like, it's one of the first things they cut."
But restaurant and hotel managers say the numbers don't tell the full story. In today's economy, they say they can't take a single customer for granted.
Frank Naboulsi, chairman of the Hotel Association of Greater Dallas, said that four months after the ordinance went into effect, 11 downtown hotels reported a combined revenue loss of $1.5 million. The Fairmont Hotel he manages has lost about $500,000 since last March. The losses extend to restaurants, which also depend on business from conventioneers.
Convention groups that come to Dallas every year changed their plans in 2003, Mr. Naboulsi said, adding that it's hard to know how many new groups passed the city up when they learned of the ordinance. He cited the loss of conventions for Cigar Afficianado magazine and tobacco giant Philip Morris as examples.
"People now know of the law, and instead of calling Dallas, they say, 'Let's go somewhere else,' " he said. "In this economy, every dollar counts."
As a landlord for the state-sanctioned charitable games of chance, David Schindler says his Strike It Rich bingo hall on Gus Thomasson Road has seen attendance drop 20 percent in a year.
"People like to light a cigarette when they're playing bingo, so they're going to Richardson, Plano and Lancaster," he said. "They haven't quit playing, they're just going elsewhere."
If the smoking ban has hurt business in Dallas, there's little evidence restaurants and bingo halls in adjacent cities are benefiting.
At Town East Bingo in Mesquite, manager Renea Tucker said the number of smokers is steady.
"As far as business, maybe we've seen just a little increase," she said. "But mostly, it's the same as it always was."
At Houston's restaurant in Addison, general manager Michael Lawless said profits have been rising steadily every year – but not as a result of Dallas' smoking ban.
"We've always had pretty steady business," Mr. Lawless said. "And we haven't seen an increase in smokers."
Despite reports that Dallas restaurants are struggling, two of the city's top-grossing establishments have seen business grow. At Al Biernat's, revenue rose about $1 million from 2002 to 2003 – the biggest jump Mr. Biernat has ever had. And Bob's Steak and Chop House reported a 10 percent increase in revenue, owner Bob Sambol said.
But both men, who were early opponents of the smoking ordinance, still say the ban has had a negative impact.
"We might have been up 20 percent," Mr. Sambol said. "People always liked coming here, having a steak and a smoke afterward. We're losing them, and they're never coming back."
Mr. Biernat was determined not to lose a single customer. After an early decline in liquor sales, he found investors to help build a $100,000 patio for smokers.
"I let my customers know I did it for them, because I didn't want them going someplace else," he said.Mr. Biernat said he believes the biggest loss has been in convention sales.
"Now we count the conventions as gravy – we can't count on them anymore," he said.
Dallas was the first large city in North Texas to approve a smoking ordinance, but not the first in the state. El Paso has the strictest ordinance in Texas, banning smoking in restaurants and bars with fines as high as $500.
In Austin, City Council members overturned a comparable smoking law in October. A revised ordinance allows smoking in bars and restaurants that purchase annual $300 permits.
Mr. Sambol said he believes "hundreds" of Dallas restaurants turn a blind eye to the ban, allowing smokers to light up. But he said he feels a responsibility to his nonsmoking diners.
"I have no bones about saying I would allow my patrons to smoke if I could," he said. "[The ordinance] is unenforceable."
Of the 300 complaints received at the Dallas Environmental and Health Services Department since the smoking ordinance went into effect, the city has handed out 92 citations, said Karen Rayzer, director of the department.
"We feel the ordinance has had an impact," she said. "It's reduced the number of persons smoking in restaurants, which was the intention."
Ms. Rayzer said she saw more complaints immediately after the ordinance went into effect than she sees today. And she said she's unsure how much money the city has collected in fines – which range from $25 to $500 each.
Dallas City Council member Lois Finkelman said the ordinance has worked well and said many people are "delighted" not to be exposed to secondhand smoke.
"I have yet to be in a restaurant where someone has lit up a cigarette," she said. "I think this is one of those ordinances that has become self-policing."
Beth Cunningham agreed. The Dallas resident, who works for a Plano sports marketing firm, said the ban is a relief and should be extended to bars.
"If people 'need' to smoke, they can go outside," she said. "People who smoke may consider that inconvenient, but I consider all their smoke I'm inhaling as inconvenient."
Business owners say the fight is not over. Representatives from hotels, restaurants and bingo halls say they hope to come up with a compromise in 2004.
"This is not a dead issue; it has not dropped off," said Steve Vissotzky, general manager of the Hyatt Regency Dallas at Reunion. "We're continuing to look for opportunities in the future to change the ordinance."
Ms. Finkelman said currently there are no plans to reconsider.
"It all depends on whether or not a majority on council want to look at it again," she said. "If there is, I would be willing to look at it."
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