[C-U Smokefree] No impact on restrnt/bar revenue
Theotskl at aol.com
Theotskl at aol.com
Sat Feb 28 15:44:49 CST 2004
Hi all--
the material below is FYI.
There are no negative statistically significant impacts on revenue from bars
and restaurants after the implementation of smoke-free restaurants in El Paso
Texas. Opponents and skeptics of smoke free ordinance efforts in the
Champaign Urbana must be challenged, must be challenged to produce the data and
evidence, as well as the sources of such evidence and data to support either their
opposition or their skepticism, or else, they should let those knowledgeable
about the data and the use of credible evidence handle things accocrdingly.
Champaign-Urbana is an educated community and its news media, elected and civic
leaders and policy-making folks have to live up to the standard of acting on
well informed and credible scientific knowledge in local decision making
processes affecting the health and lives of over 100,000 residents in the twin
cities community.
Link for Tables and figures:
<http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5307a2.htm>
THT.
Weekly
February 27, 2004 / 53(07);150-15
Impact of a Smoking Ban on Restaurant and Bar Revenues --- El Paso, Texas,
2002
Smoke-free indoor air ordinances protect employees and customers from
secondhand smoke exposure, which is associated with increased risks for heart disease
and lung cancer in adults and respiratory disease in children (1,2). As of
January 2004, five states (California, Connecticut, Delaware, Maine, and New
York) and 72 municipalities in the United States had passed laws that prohibit
smoking in almost all workplaces, restaurants, and bars (3). On January 2, 2002,
El Paso, Texas (2000 population: 563,662), implemented an ordinance banning
smoking in all public places and workplaces, including restaurants and bars.
The El Paso smoking ban is the strongest smoke-free indoor air ordinance in
Texas and includes stipulations for enforcement of the ban by firefighting and law
enforcement agencies, with fines of up to $500 for ordinance violations (4).
To assess whether the El Paso smoking ban affected restaurant and bar
revenues, the Texas Department of Health (TDH) and CDC analyzed sales tax and
mixed-beverage tax data during the 12 years preceding and 1 year after the smoking ban
was implemented. This report summarizes the results of that analysis, which
determined that no statistically significant changes in restaurant and bar
revenues occurred after the smoking ban took effect. These findings are consistent
with those from studies of smoking bans in other U.S. cities (5--8). Local
public health officials can use these data to support implementation of
smoke-free environments as recommended by the Task Force on Community Preventive
Services (9).
To study the impact of the El Paso smoking ban on all sectors of the local
restaurant and bar industry, TDH and CDC obtained quarterly sales tax reports
and monthly mixed-beverage tax receipts from the Texas Comptroller of Public
Accounts. The sales tax reports provided revenue data for restaurants, bars, and
retail businesses, grouped by Standardized Industrial Classification (SIC)
codes. Categories were created for restaurants (SIC codes 5812, 5816, and 5817)
and bars (SIC codes 5813 and 5814) (10). The sales tax reports included revenue
generated by sales of meals and sales of beer and wine for establishments
with beer and wine retailer permits; sales tax revenue data were used for
1990--2002. Other restaurant and bar revenue data came from reports filed by holders
of mixed-beverage permits. The state's mixed-beverage gross receipts tax,
enacted in 1994, is levied on revenue generated by sales of alcoholic beverages
(e.g., liquor, beer, and wine) and nonalcoholic beverages and ice used in mixed
drinks. Mixed-beverage revenue data were used for 1995--2002.
Multiple linear regression analysis was used to examine the effect of the El
Paso smoking ban on changes in revenue over time. The following independent
variables were considered: a variable indicating whether the smoking ban was in
force, an ordinal variable to represent secular time, and three variables to
indicate during which one of four calendar quarters the revenue data were
collected. Two regression models were created for each of the following primary
dependent variables: 1) revenue subject to sales tax from all restaurants and
bars, restaurants only, and bars only; and 2) revenue subject to the
mixed-beverage tax. For each category, the first model examined the association between
the smoking ban and revenue, and the second examined the association between the
smoking ban and the fraction of revenue as a percentage of El Paso's total
retail revenues (SIC codes 5211--5999). This fraction accounts for economic
variation that might impact revenue in all sectors of the retail economy (6).
Two sets of statistics were used to evaluate the quality of the models. The
Durbin-Watson statistic was calculated for each model to determine if
first-order autocorrelation was present. Variance inflation factors were examined to
determine if multicollinearity was present in any of the models.
Restaurant, bar, and mixed-beverage revenues varied by quarter; in all
categories, revenues usually were higher during the fourth quarter
(October--December) of each year (Figure 1). During all four quarters, bar and mixed-beverage
revenues accounted for approximately 1% of total retail revenues (Figure 2).
None of the regression models for restaurant, bar, or mixed-beverage revenues
or for such revenues as percentages of total retail revenue over time showed
any statistically significant changes after the smoking ban was implemented (
Table). In addition, the results did not change when revenues were adjusted for
inflation, and adjusting for changes in price did not change the results (8).
In all models, the variance inflation factors had values of <2 for each of
the independent variables, indicating that multicollinearity was not present,
and the Durbin-Watson statistics indicated that none of the autocorrelations was
statistically significant (Table).
Reported by: P Huang, MD, Texas Dept of Health. AK De, PhD, Div of Applied
Public Health Training, Epidemiology Program Office; ME McCusker, MD, EIS
Officer, CDC.
Editorial Note:
No decline in total restaurant or bar revenues occurred in El Paso, Texas,
after the city's smoking ban was implemented on January 2, 2002. These findings
are consistent with the results of studies in other municipalities that
determined smoke-free indoor air ordinances had no effect on restaurant revenues (2,5
--8). Despite claims that these laws especially might reduce alcoholic
beverage revenues (2), the mixed-beverage revenue analyses indicate that sales of
alcoholic beverages were not affected by the El Paso smoking ban.
The findings in this report are subject to at least three limitations. First,
because sales tax reports lag revenue collection by 6 months, sales tax data
were available for only 1 year after the El Paso smoking ban was implemented.
However, analyses from other cities that included data for several years after
a smoking ban was enacted indicated no declines in restaurant or bar revenues
(6--8). Revenue data from El Paso will be monitored for any changes in
restaurant and bar revenues. Second, because limited revenue data for El Paso were
available, methods that might provide better estimates of the impact of the ban
could not be used. Regression models measuring changes in slope for revenues
before and after implementation of smoke-free indoor air ordinances might
provide better estimates of how these ordinances affect revenues (8); time-series
models also might produce better estimates. When more information becomes
available, these models should be applied to the El Paso data. Finally, because
the SIC code--based restaurant and bar categories are not mutually exclusive,
certain bars were included in the restaurant category created for this analysis.
However, mixed-beverage tax data, which provide a more precise measure of
alcohol-related revenue, support the finding that bar revenues were not affected
by the smoking ban.
Opponents of smoke-free indoor air ordinances have claimed that enacting
smoke-free indoor air ordinances will harm restaurant and bar revenues (2).
However, the findings in this report indicate that, in El Paso, Texas, restaurant
and bar revenues were not affected by the smoking ban. Such analyses of economic
data can provide local policymakers with statistical evidence to evaluate the
merit of implementing smoke-free indoor air ordinances in their communities.
Acknowledgments
This report is based on contributions by M Boerm, P Gingiss, Univ of Houston;
Research Div and Open Government Section, Office Texas Comptroller of Public
Accounts.
References
1. California Environmental Protection Agency. Health effects of exposure to
environmental tobacco smoke. Sacramento, California: California Environmental
Protection Agency, Office of Environmental Health Hazard Assessment, 1997.
Available at http://www.oehha.org/air/environmental_tobacco/finalets.html.
2. Glantz SA. Smoke-free restaurant ordinances do not affect restaurant
business. Period [Editorial]. J Public Health Manag Pract 1999;5:vi--ix.
3. American Nonsmokers' Rights Foundation. Clean indoor air ordinance counts
summary. Berkeley, California: American Nonsmokers' Rights Foundation, 2004.
Available at http://www.no-smoke.org/mediaordlist.pdf.
4. Gingiss PM, Roberts-Gray C, Boerm MC, et al. Texas smoke-free municipal
ordinance database. Houston, Texas: University of Houston, 2002.
5. CDC. Assessment of the impact of a 100% smoke-free ordinance on
restaurant sales---West Lake Hills, Texas, 1992--1994. MMWR 1995; 44:370--2.
6. Glantz SA, Smith LR. The effect of ordinances requiring smoke-free
restaurants and bars on revenues: a follow-up. Am J Public Health 1997;87:1687--93.
7. Glantz SA. Effect of smokefree bar law on bar revenues in California. Tob
Control 2000;9:111--2.
8. Glantz SA, Charlesworth MA. Tourism and hotel revenues before and after
passage of smoke-free restaurant ordinances. JAMA 1999; 281:1911--8.
9. Task Force on Community Preventive Services. Recommendations regarding
interventions to reduce tobacco use and exposure to environmental tobacco smoke.
Am J Prev Med 2001;20:10--5.
10. Occupational Safety and Health Administration. Standard Industrial
Classification (SIC) System Search. Washington, DC: U.S. Department of Labor,
Occupational Safety and Health Administration, 2003. Available at
http://www.osha.gov/oshstats/sicser.html.
Figure 1
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Figure 2
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Table
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