Smoking Bans Hurt Small Business

Delaware's indoor public smoking ban cost one establishment 70 percent of its business and a $350 fine from the state's health department.

Small Business in Financial Trouble After Delaware Smoking Law Forces Patrons Across State Lines

The Delaware legislature has outlawed smoking in all public enclosed indoor areas. This ban extends to bars, restaurants, nursing homes, prisons and all other publicly owned buildings.

The ban economically endangers many local establishments, such as Desiree Mulford's Breakers Bar and Billiards in Newark. Many of Mulford's customers have taken their business to neighboring states, where they can still enjoy smoking indoors. "I'm ten minutes from the Maryland line," said Mulford. "Not only do smokers go, but the nonsmokers go, too. They want to go where the crowds are."

While 25 percent of Delaware's population smokes, Delaware bar owners estimate that about 80 percent of their patrons do.

After a 70 percent decrease in business, Mulford decided to allow smoking at Breakers despite the new law. "For every one person I lost because there was smoking here, I gained ten," she said. But things changed after these practices were published in a newspaper article, and Breakers received a $350 fine from the Delaware Division of Public Health. Mulford began to receive registered letters from the state that described complaints it had received and unannounced visits state officials had made. The bar's previously-approved permits to construct a kitchen were revoked as a result of the decision not to enforce the ban. This compelled Mulford and her business partner to enforce it once more. After reinstating the ban, they lost more than 50 percent of their business and had to stop paying themselves just to keep the bar open.

The Delaware House of Representatives passed an amendment to their Clean Indoor Air Act in March of 2003. In an effort to help small businesses, this legislation would have allowed smoking in some bars. But strong campaigning by anti-smoking activists led to the bill's defeat in the state senate by a two-to-one margin. Delaware's Governor Ruth Ann Minner was also strongly opposed to the amendment despite the crippling effect the bill has had on some local businesses.

Dwindling crowds are making it difficult for Desiree Mulford's business to survive. She considered closing Breakers and opening a restaurant and nightclub in New Jersey, but New Jersey adopted a ban on smoking in public buildings, except gambling areas in casinos, in January 2006.

Sources: Desiree Mulford, Washington Post (July 7, 2003), Baltimore Sun (June 22, 2003), Associated Press (January 27, 2003), News Journal (April 9, 2003; June 1, 2003), The Record, Smokefreeworld.com

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Reprinted with permission from The National Center for Public Policy Research.