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PRESS ADVISORY
COUNCILMEMBER CAROL SCHWARTZ, AT-LARGE

        FOR IMMEDIATE RELEASE                                                                                                                 CONTACT:  John Abbot
        June 14, 2005                                                                                                                                                                   (202) 724-8105

Statement of Councilmember Carol Schwartz at Today's Smoke-Free Hearing

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     D.C. Councilmember Carol Schwartz, chair of the Council’s Committee on Public Works and the Environment, delivered the following statement this morning at a Committee hearing on legislation regarding smoke-free workplaces.

     The hearing on Bill 16-187, the “Smokefree Workplaces Act of 2005,” Bill 16-193, the “Occupational Safety and Health Amendment Act of 2005,” and Bill 16-294, the “Smoke-Free Restaurant, Tavern, and Nightclub Incentive Amendment Act of 2005,” is being held in the Council Chamber (Room 500) of the John A. Wilson Building, 1350 Pennsylvania Avenue, N.W. A total of 137 people are scheduled to testify.

     The statement appears below in text.

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Statement for June 14, 2005 Smoke-Free Hearing
Carol Schwartz, Councilmember At-Large


     Good morning. I am Carol Schwartz, Chair of the Council’s Committee on Public Works and the Environment. The time is 10 a.m. and the Committee is holding a hearing today on three bills that have been referred to it. Two of those bills would mandate that smoking be prohibited in all restaurants, bars and nightclubs.

     The third one - my legislation - would encourage but would not mandate that establishments be smoke-free.

     Bill 16-187, the “Smokefree Workplaces Act of 2005,” introduced by Councilmembers Fenty, Mendelson, Brown, Gray and Patterson, would amend the D.C. Code to create smoke-free work environments in all enclosed public and private workplaces in the District and to establish penalties for the violation of smoke-free workplaces regulations.

     Bill 16-193, the “Occupational Safety and Health Amendment Act of 2005,” introduced by Councilmembers Brown, Gray, Patterson, Ambrose and Mendelson, would amend the District of Columbia Occupational Safety and Health Act of 1988 to require workplaces to be free from recognized hazards that may cause death or serious physical harm or illness to the employee. It does include a few exemptions, such as tobacco stores, nude dancing clubs established before March 1, 2005, and cigar bars established before March 1, 2005.

     The aim of both of these bills is to essentially outlaw smoking in District restaurants, bars and nightclubs.

     The third piece of legislation is Bill 16-294, the “Smoke-Free Restaurant, Tavern, and Nightclub Incentive Amendment Act of 2005,” which I introduced as a compromise. As you know, I oppose an out-and-out ban, but I do want to see more smoke-free establishments - more choices. I believe my bill, which uses a carrot-and-stick approach, will give us the desired result of bringing about more restaurants and bars that are smoke-free.

     My legislation provides for a two-year tax credit equaling 25% of annual sales taxes to encourage eating and drinking establishments to adopt smoke-free policies. That would be the carrot. Businesses that take advantage of the tax credit would have to be maintained in perpetuity as completely smoke-free or else pay back the entire credit they received.

     Since my tax credit idea may prove to be overly cumbersome from an administrative standpoint, I may propose instead that a fund be created from the increased license fees that will, under my bill, be collected from businesses that continue to allow smoking. Half of this new fund could be set aside to pay for rebates that will encourage restaurants and bars to open as, or convert to, smoke-free. That could be the new carrot. As before, businesses that take advantage of the rebates would have to be maintained as completely smoke-free, or else pay back the entire amount of the rebates they received.

     And now here’s the stick. The legislation requires the installation of high-performance ventilation systems, the standards for which are described in the legislation, in any restaurant, bar or nightclub where smoking is permitted, and quadruples annual business license fees for establishments that choose to allow smoking.

     Penalties for businesses that fail to enforce their smoke-free designations would be set at $200 for a first violation, $500 for a second offense, and $1,000 for a third and any subsequent violation. Violators also face having their business licenses revoked. Individuals who light up in establishments where smoking is prohibited would be subject to a fine of $100 - a substantial increase from the current minimum fine of $10.

     My legislation further directs that, after administrative costs, a portion of the funds collected through increased license fees and penalties be used for smoking cessation and health education programs.

     Now, you might well have heard before some of what I am going to say today. A good many of you may not agree with me. But since my views on this topic differ from those of the smoking ban proponents, and since they have made me their villainous poster girl, I am going to take advantage of this opportunity to express in detail my opposition to a total ban. I do expect to have an honest and civil exchange of views, just as we did at the 12-hour hearing I held on this same topic in December 2003.

     First of all, I have been criticized for not bringing the total smoking ban legislation out of committee. Chairmen of committees - not just here, but everywhere - have the prerogative to set the agenda. Why would anybody want to be a committee chair, with all that extra work, if they just were a funnel for every piece of legislation? What comes in must go out - where does that happen?

     It does appears this time around that the votes may be there for a total ban, regardless of what I do. And I can be circumvented. But just because you have the votes doesn’t mean you can’t compromise. It is beyond me why we, here in the District of Columbia, would go to the extreme of a total ban. Why not try a compromise - especially one that heads us in the right direction? I think I offered a good one when I introduced my bill on May 17. But another idea may be a partial ban, with exemptions in certain categories, and still use a carrot-and-stick approach to encourage exempted establishments to go smoke-free. I remain open to other suggestions for compromise so long as the opportunity for choice is preserved.

     In addition to my strong belief that government should not be in the business of removing people’s legal choices, I am also concerned about the impact that extreme measures would have on our hospitality industry. The fact of the matter is that the District of Columbia is far more reliant on revenue from its hospitality industry than any other “state” I know to fund its local budget for schools, public safety, public services - everything. Hospitality is our biggest industry; indeed, it is essentially our only industry. Without room for agriculture or manufacturing, what would our revenue options be?

     We also already have enough obstacles to revenue production that have been imposed upon us. Roughly half of the land in the District is, for one reason or another, tax-exempt. Congress won’t let us have a true residency requirement for our own government employees, nor will Congress allow us to even tax the incomes of city workers who reside outside of our borders, as other jurisdictions do. There is no doubt in my mind that business at bars and restaurants in our city would suffer - hence, the city’s revenues would suffer - if we were to enact an outright ban. A lot of our business could - and would - go to Virginia or to Prince Georges County, Maryland, or to illegal and untaxed clubs. Make no mistake, we have benefited from Montgomery County’s ban.

     Based on figures I obtained from our own Office of the Chief Financial Officer, the sales taxes collected from D.C. restaurants increased 9% between 2003, the year the smoking ban went into effect in Montgomery County, and 2004. Moreover, according to these same figures, there was a nearly 18% increase in the collection of sales taxes from D.C. restaurants in the 4th Quarter of 2003, after the Montgomery County ban took effect, over the same Quarter in 2002. This is more than double the increase in restaurant sales taxes that was collected by Montgomery County in the 4th Quarter of 2003 when compared to the 4th Quarter in 2002, based on figures from the Maryland Comptroller’s office.

     Similarly, D.C. had a larger increase in restaurant sales taxes collected than Montgomery County in every Quarter of 2004 when compared to the same quarter in 2003. In fact, D.C.’s increase was double that of Montgomery County in the 4th Quarter of 2004 compared to the 4th Quarter in 2003 and almost double Montgomery County’s in the 3rd Quarter of 2004 as compared to the 3rd Quarter in 2003.

     We are also now attracting many suburbanites - especially young people from Virginia. We are getting their entertainment dollars, and parking revenue as well. And many of them smoke. Why would we send their dollars back to Virginia?

     I often see reports in the paper or on the news about well-planned efforts in surrounding jurisdictions - in Crystal City, Ballston, Rosslyn, Clarendon, and Prince Georges County, especially its huge National Harbor project - aimed at making their nightlife livelier. Don’t forget that there are beautiful views this way from across the river in Virginia. Our ban could increase the success of these organized efforts. How foolhardy would that be!

     We have to understand the District is not California, where temperate weather enables many establishments to maintain outside patios, decks or terraces - where smoking is allowed - 365 days a year. And, if outside choices aren’t an option for smokers - well, too bad, because smoking establishments are five, six, seven hours away. Los Angeles is 270 miles from Las Vegas, Nevada, and San Francisco is 230 miles from Reno, Nevada, where smoking is allowed. It is pretty obvious that diners and bar-goers in Los Angeles or San Francisco who wish to smoke can’t choose to just cross a river or hop on a subway to find establishments that welcome them, as is the case here.

     We will hear ban supporters say today that business at bars and restaurants in New York City increased after the smoking ban was instituted there on March 30, 2003. However, the truth is that New York City’s economy declined substantially after the terrorist attacks of September 11, 2001. Therefore, to attribute increased business in New York City bars and restaurants to the city’s smoking ban is not necessarily accurate - much of this increased business may simply be a by-product of the gradually improving economy in New York City since the 2001 terrorist attacks.

     Now, I know a lot of figures and studies are going to be thrown around today to support one side or the other in this debate - figures that will be used to dispute figures that have already been used to dispute figures. There is conflicting data on the consequences of smoking prohibitions that have already been enacted in other jurisdictions. But it is a fact that most of the sales tax analysis used in pro-ban studies of New York City includes fast food restaurants, carry-out establishments, delivery locations and other industry segments that never allowed smoking prior to the ban anyway. And, it is a fact that, in June 2003, shortly after New York’s citywide smoking ban went into effect, New York City increased its sale tax rate from 4.0% to 4.125% and New York State raised its sales tax rate from 4.0% to 4.25%. Increasing the sales tax rate, of course, increases sales tax collections - thereby also calling into question the numbers disputing any negative impact of that city’s smoking ban.

     I also want to point out that, as I mentioned at our hearing on the first smoke-free legislation, I was told by someone who should know, that, as a result of the smoking ban in New York, the city lost conventions, and that international visitors have not returned to pre-9/11 numbers, in part because of the smoking ban. Washington, home to embassies as well as many international organizations, certainly has its share of foreign visitors, many of whom smoke. Where would they go if we were to ban smoking? Probably not to our hotels and restaurants, particularly with the many fine alternatives that are so close by. Embassy personnel, with their full-time staffs, could also just stay in, instead of spending their money in our businesses - and I fear many will.

     Here in Washington, we also took an economic hit after September 11, 2001. Even before that, though, the District was - with a few exceptions, like Georgetown - certainly not widely known for a vibrant nightlife. But that has changed and our nightlife is thriving - Seventh Street Northwest, Adams Morgan, Eighth Street Southeast and other areas are all booming, and our revenue from restaurants and bars is topping $200 million a year. And according to a recent Washington Post story, citing figures from the Washington Convention Center Authority, the conventions booked in DC for 2005 are almost double what they were in 2004. Those conventions are expected to bring in $705 million.

     Why would we choose to shoot ourselves in the foot and jeopardize this revival when people can choose non-smoking establishments? There are, according to Smokefree DC, already close to 200 smoke-free restaurants - nearly 300 if family style eateries are included - and we have an opportunity through compromise to provide even more - many more.

     There has been a law on the books in our city for more than a decade clearly stating that smoking is prohibited in public and private workplaces, and I fully support that. Exceptions are made for bars, nightclubs and restaurants, but the law says restaurants of a certain size must include designated non-smoking areas. There is no law that says a restaurant or a bar must allow smoking, and many don’t.

     If a complete smoking ban is implemented, rather than the carrot-and-stick approach I am offering, I have little doubt that some well-established businesses won’t survive, that jobs will be lost, and that revenues will suffer. According to the Restaurant Association of Maryland, citing figures it said were provided by the Maryland Comptroller, the number of liquor-licensed businesses in Montgomery County dropped from 507 before that county’s smoking ban went into effect to 402 such establishments a little more than a year later. Again, I know that everyone has their statistics, but if this one is even close to true, it is alarming. And we already have the highest unemployment in the area. Do we want more?

     In a city such as ours that not so long ago was crippled by debt and poor bond ratings, the newfound prosperity we are experiencing is, indeed, welcome. But can downtown’s revival continue? And can it spread to neighborhoods that were neglected for too many years? Not if we insist on becoming unfriendly to business, and that’s exactly how a smoking ban will be perceived. In the past, we killed off businesses or sent them packing to the suburbs with high taxes and counterproductive policies. When will we ever learn?

     Even the Superior Court of the District of Columbia has weighed in with an opinion on this, and the conclusion was that a total ban would be bad for business. It said that the “D.C. Smokefree Workplaces Initiative of 2004,” which the smoking ban lobby pursued after its efforts during the last Council period were not successful, would affect restaurant tax revenues “since it was undisputed that prospective patrons would more than likely elect to patronize restaurants in Maryland and Virginia, thus causing a negative fiscal impact on restaurant tax revenue assumptions relied on by the [D.C] Council.”

     The smoking ban lobby is, indeed, well-funded and well-organized, and there is nothing wrong with that. It has done its job and has made a big impression on some folks around here - people who have not said a peep about banning smoking until the foundation money flowed into this effort and the hired lobbyists started lobbying.

     The group is also cleverly recruiting allies by touting worker safety as its goal. But let’s be honest. For a great many ban supporters, the true motivator is simply their preference not to be around people who are smoking.

     I can understand preferring not to be around smokers. Even though I smoked for nearly four decades until quitting four years ago, today I don’t like being around smoke. But I find government taking away legal choices - mine as well as those of others - a far more unpleasant, and even unhealthy, prospect. And I have heard from a lot of restaurant and bar employees, as well, who resent having it decided for them whether or not they should work in places that allow smoking. And they worry that people going outside for a smoke may not reappear to pay their checks.

     I am concerned about the health of these workers. I also am concerned about them keeping their jobs and their opportunity to choose where they work. By passing my legislation we will provide hospitality workers with even more job opportunities in smoke-free environments.

     Listen, in our democratic society, people are free to choose where they spend their money. The marketplace is ordinarily pretty quick to respond to the demands of consumers, and I bet you that if those who support the ban and their friends decide to avoid those businesses that allow smoking and frequent those establishments that don’t, such action would yield results - and fast. And I would feel far more comfortable with that course of action to bring about change than I do with banning smoking in every establishment because a wealthy out-of-state foundation with a national agenda brings pressure to bear on our citizens and local legislators to outlaw a legal choice. Why shouldn’t we write our own local agenda by putting together a common-sense approach, which a compromise could accomplish.

     And we all know, as well, that a complete ban will negatively impact residential areas near restaurants and bars. What will smokers do when they want a cigarette? They will gather outside, creating litter and noise and leading to more annoyance for nearby residents and increased ill will between the establishment and its neighbors. The solution? I am sure that the Robert Wood Johnson Foundation has something in mind, and I have no doubt that it includes banning smoking on city sidewalks. And what would be next?

     There are, thankfully, fewer and fewer smokers out there, and I certainly applaud - and seek to encourage - this positive trend. In fact, as an ex-smoker myself, I feel qualified to try to cajole my friends who still smoke into quitting - and, some might say, I am relentless and annoying about it at times.

     I have no doubt that smoke-free establishments will be the norm someday, and through compromise we can hasten that day. As I noted earlier, there are already some 200 restaurants - or 300, depending on how you count - that do not allow smoking, and I am confident that there will be more.

     But because of my strong belief in allowing freedom of legal choices for consenting adults, and because of my fear of harming our revitalization, and because I feel that banning smoking in all restaurants and bars is too extreme of a measure to impose, I oppose the two bills before us that would accomplish such a blanket prohibition. But I do seek to compromise in a way that will bring about more smoke-free choices, and I hope to convince others to do the same. Why, I ask, must we go - overnight - to an extreme, when effective alternatives exist?

     Now, let’s remember, we live in a democracy and the freedom to disagree is part of it. Let’s respect each other, and our individual opinions as we debate this issue.


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