Smoking ban hard on bar business

When Earl “Babe” Harriman and his wife, Tammie, decided to open a bar a few years back, they decided they were going to build a bar.

A real bar. Not one of those clubs with a giant disco ball and furry pink couches and not a place packed with wall-to-wall plasma screen televisions.

They wanted to get back to the basics. They wanted to create a place where their neighbors could stop by after a hard day’s work, grab a cold beer and complain about “the man” in the company of friends.

So that’s what they did.

The Harriman’s built the RailLine Tavern in late 2007 on a little piece of property in Marion.

“We’re a working man’s bar,” Tammie says with pride.

And workers, she said, like to smoke.

“I’m not exaggerating — 98 percent of my clientele smoke,” she said.

Since Montana’s Clean Indoor Air Act of 2005 went into full effect Oct. 1 of last year, banning smoking in all public and work places — including the bars and casinos that had previously been exempt — state revenue has decreased considerably.

Gambling-machine revenue dropped 16.8 percent in the last three months of the year. According to the state Department of Justice, taxable gambling receipts were off more than $15 million in the last quarter of the year.

In addition, liquor sales took a hit, growing just 1.9 percent in 2009 after growing at least 5 percent a year over the past decade, according to sales figures from the state Department of Revenue’s Liquor Control Division. In Flathead County, sales dropped 5.2 percent, or $669,347.

The weeks following the smoking ban was when the effect was most evident. Falling 20 percent in Flathead County alone, sales for the state were off more than $1.5 million in October 2009 compared to the same month a year before. 

The effect the ban has had on bars and casinos in the area is staggering.

Babe Harriman says business at the RailLine is down 40 percent.

Lori Bryden, who runs the Kalispell VFW, ran the numbers and discovered that while her liquor sales are only down about 6.9 percent, her casino business has dropped 42.4 percent.

“Is it from the no-smoking or people being out of work and having no money? It’s hard to predict the cause,” she said.

Bryden suspects the smoking ban is more to blame than the economy because historically people tend to frequent bars more — not less — when they fall on hard times.

What she’s seeing is that more people are buying by the bottle and taking it home, where they can relax in their recliners — a cigarette in one hand, a drink in the other.

The drop-off in business has led Bryden to drastically cut her employees’ hours. She hasn’t had to lay anyone off yet, but her workers are struggling just the same.

Donations to community organizations and fundraisers are down as well.

“It affects all the businesses,” she said.

Los Caporales on Montana 35 hasn’t fared quite so well. Manager Annie Wildebour has had to let five employees go since Oct. 1.

“The smoking ban has hurt everybody across the board,” she said.

Los Caporales remodeled its bar and casino area in September to become more of a sports bar in an effort to attract a larger clientele. It’s helped draw some people in, but not enough to offset what was lost.

“People who don’t smoke, don’t gamble,” she said.

But what bothers Wildebour the most is seeing her employees suffer.

“Eighty-five percent of the people that work in this industry are single moms and this is their income,” Wildebour said, adding that tips are way down. Wildebour said she fears that welfare enrollment will skyrocket next year because so many young women are being edged out of their jobs.

At the RailLine, the Harriman’s had to lay off their two kitchen help and two bartenders.

“I didn’t have any choice. I didn’t know what to do,” Tammie said. “I don’t have the revenue to pay them.”

But what really irks Babe Harriman is that the state allows him a license to sell cigarettes, but it’s considered a violation of the law if those cigarettes are found on the bar top. He’s thinking about letting his license go because of it, stripping the state of even more revenue. At $10 a year, it isn’t a lot of money, but it’s the principle that’s at stake.

The Hilltop Hitching Post up the street was always a nonsmoking bar. The opening of the RailLine offered an option for smokers. Those who didn’t want to deal with the health issues pertaining to second-hand smoke could go to the Hilltop. Those who didn’t care or were smokers themselves were the ones who frequented the RailLine in the first place.

“It should have been left up to the bar owners,” Tammie Harriman said.

“There’s plenty of places that have nonsmoking. I believe [my customers] can smoke here,” she said.

Since the ban went into effect, there have been five valid complaints filed with the Flathead City-County Health Department. Two have been against the RailLine.

For a complaint to be substantiated, a health inspector must find either a visible ashtray, cigarettes on the bar or a heavy smell of fresh cigarette smoke, said Leslie Deck, Tobacco Use Prevention Program Coordinator for the county health department.

The first time an establishment violates the law, it is sent an educational letter to remind them of the ordinance and its rules. That letter is followed by a written warning from a health officer if the business is found in violation again. Three or more violations in a three-year period can end in a misdemeanor, as well as fines beginning at $100, then $200, and $500 for each subsequent valid complaint.

Deck has received numerous

tips that people are still smoking at the Harrimans’ bar, but has yet to catch anyone in the act.

As far as the ban’s popularity, Deck says 80 percent of the community is for it. It’s just that the remaining 20 percent against it are more vocal.

She points to the Helena Heart Study, published in the April 2004 issue of the British Medical Journal, as proof of the necessity of the ban.

Helena enacted a smoke-free air law in June 2001. The law banned smoking in all indoor workplaces, including bars. The ban was in effect for six months beginning in June 2002 before being sidelined by legal opposition.

But even six short months was long enough for the Helena Regional Medical Center to notice a significant change in hospital admissions for heart attacks. During the life of the ban, heart attack occurrences dropped by 40 percent. When the ban was repealed, that number jumped back up.

“Only the business owners who are in trouble have complained,” she maintained.

The Deerlick Saloon in Martin City isn’t in trouble with the health department, but owner Tom Ridings says that since the ban took effect, his sales are way down.

“There is a major drop in business,” he said. “I think a little bit has to do with the economy.”

“I wouldn’t say we’re doing ‘all right,’ but we’re hanging in there,” he said.

Jared Buck, manager of Evergreen Liquor Store, said he is finally seeing a turnaround in business.

When the ban first was enacted, he saw a surge in sales of cheaper products and a lot more people taking the bottle home instead of going out to the bar. In the last month or so, he’s seen customers return to higher-quality brands, some picking up top-shelf labels again.

“I think it was probably the wrong time to enforce it,” he said, referring to the economy.

“If we can make it one more year, our kitchen equipment will be paid off,” Babe Harriman said of the future of the RailLine. When that happens, he said he and Tammie should be able to survive — as long as it’s just the two of them.

“Everything we got at stake is right here,” he said. The Harrimans mortgaged their house to build the bar.

“If we lose this, we lose our home,” Tammie echoed. “I love my bar. It’s little — quaint — but I love it.

“As long as we can pay our employees and bills, we’re happy.”

Business reporter Erika Hoefer can be reached at 758-4439 or by e-mail at ehoefer@dailyinterlake.com.