New Study: Lexington, KY Businesses Unhurt by Smoking Ban [04/19-2]

Excerpts from: Study: Business not hurt by smoke ban

By Sarah Vos Lexington Herald Leader [04/18/05]


Lexington's year-old smoking ban hasn't affected business in the city's bars and restaurants, according to a University of Kentucky study that will be released today.

The study looks at employment figures from restaurants, bars and hotels, business openings and closings and payroll withholding taxes since the ban went into effect in April 2004. It compares the post-ban numbers to the same data from up to five years before Lexington went smoke-free in most public places.

"Given the data we have to this point ... we're not seeing a post-ban effect," said Eric Thompson, an economist at the University of Nebraska-Lincoln and one of the study's authors.

When Lexington's Urban County Council passed the ordinance, those who opposed the ban argued that it would hurt bars and restaurants in Lexington.

Maribeth Tolson, who owns Mia's, a downtown restaurant and bar, says the ban has made business slow at times, especially on cold or rainy nights. But she doesn't disagree with the UK study's findings.

"We haven't been hugely affected by it," she said.

The study, which was a joint effort by the Tobacco Policy Research Program and the Gatton College of Business and Economics, was paid for by a UK internal research grant program. It will play a roll in whether the Urban County Council decides to rewrite the ordinance, said Councilman David Stevens, chairman of a committee that will evaluate the ban after its one-year anniversary later this month.

The committee, consisting of proponents and opponents of the smoking ban, will have until July 10 to recommend any revisions to Lexington's law.

The committee will also consider a study that the Lexington-Fayette County Food and Beverage Association is expected to release within the next month. Representatives of the organization either declined to comment on the UK report or did not return phone calls.

Some of the UK study's findings are contradictory. For example, in the five months following the ban, restaurants hired about 3 percent more employees, and bar employment remained stable. (The increase in restaurant employment was deemed insignificant after taking into account population, unemployment and seasonality.)

But the study found that employee tax withholdings from restaurants decreased 12.5 percent after the ban, and employee tax withholdings from bars decreased 5 percent.

According to Mark Pyles, a research assistant on the study, the decrease did not appear to be caused by the smoking ban. Withholding taxes in the first few months of 2004 -- before the ban was enforced -- were lower than normal as well.

The study found that, after the ban went into effect, the average number of restaurant and bar openings and closings varied by less than 2 percent from the average number of openings and closings in the four years before the ban.

The study's authors concluded that, given fluctuations seen in other years, the changes were not significant, Thompson said.

Thompson said researchers were not able to obtain actual sales data, which, if obtained for all of the city's bars and restaurants, would give a better indication of whether the smoking ban had an impact.

Researchers will continue to gather data and plan to release an updated report later this year, said Ellen Hahn, an associate professor of nursing who supports the ban and worked on the study.

Thompson said the same study done with one to two years of post-ban data would give a clearer picture of any effects from the smoking ban.

The conclusions in the UK study are similar to other studies that have examined the effects of other cities' and states' smoking bans on the hospitality industry. Most recently, a Harvard study concluded that restaurant and bar business increased during the first six months of Massachusetts's ban on smoking in bars and restaurants.

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