Cigar Weekly

KING

SALEM, Ore. - Those bluish clouds of cigarette smoke wafted away last September when the owner of Magoo's Sports Bar decided to get out ahead of a coming state ban and snuffed out smoking inside his Salem hangout.

Going smokeless has hurt business a bit -- mainly in reduced video poker play, owner Jim Eastridge says. But the move has been well received by most patrons and brought in some new customers as well, he says.

"A lot of my customers wanted it. They said they were tired of smelling like cigarette smoke when they went home," Eastridge says.

Come Jan. 1, smoking will be outlawed in bars, taverns, bar areas inside restaurants, bowling alleys and bingo halls across Oregon under a law passed by the 2007 Legislature.

Lawmakers concluded that protecting public health trumps concerns over a possible revenue hit -- either to bar and tavern owners or to the Oregon Lottery, which has 12,000 video gambling terminals in more than 2,300 retail outlets statewide.

More than 35,000 Oregonians work in those establishments, and a U.S. surgeon general's report issued in 2006 made it clear that their health is put at risk by exposure to secondhand cigarette smoke.

"This policy change protects the health of people who right now have to work around cigarette smoke," said Dana Kaye of the American Lung Association of Oregon. "This issue is all about health."

About half of the states now ban smoking in bars and taverns, she added.

A recent state survey indicates that about two thirds of Oregon's bars and bar sections inside restaurants already are smokefree as owners prepare to comply.

Still, there's concern among many retailers that the ban will be bad for business and, by extension, reduce the amount of money the state lottery generates for schools and economic development as well as state parks and salmon restoration.

Many gamblers like to smoke while they're playing video poker or video slots, and there's concern they will spend less time at the machines if they have to step outside to indulge their tobacco habit.

Lottery officials and state fiscal analysts believe there will be some drop in video poker revenue, although they say it would be pure guesswork now to predict how much.

But lottery spokesman Chuck Baumann said lottery managers already are looking for ways to promote video poker play to make sure it continues to produce more than $500 million a year in revenue for state programs like schools and parks.

"New video terminals are going into the field, and we're putting new games onto the terminals that are already there" to keep players interested, Baumann said. "You'll be seeing more advertising for video lottery in the coming year."

The Oregon Restaurant Association, representing 3,000 bars and restaurants, had strongly opposed past bills to ban smoking in bars and taverns, but didn't take a position during the 2007 session.

Association spokesman Bill Perry said his group still thinks the ban "takes away the rights of adults to do what they want to do," but he said the key concern now is the possible revenue hit in these rocky economic times.

Based on the experiences of Canadian provinces that banned smoking in bars that offer government-sponsored video gambling, Oregon's video poker play could decline by 10 percent, Perry said.

Some retailers will be able to compensate for part of those losses by working to ramp up sales of food and beverages, he said.

"Retailers that sell microbrews and higher-end liquors and have more extensive food menus will have a better chance of overcoming losses in your video poker play," he said.

But he said the smoking ban will be harder on more blue-collar establishments.

"If you just sell Budweiser, and have just lottery and a few pool tables, you're going to have a tougher time," he said.

Eastridge, owner of Magoo's, said bars can adjust like he did by creating an outside patio where customers can step outside for a smoke break.

Most of his customers who smoke have taken the ban in stride, he added.

"We didn't lose that many smokers as customers," he said. "They all go outside and smoke together, and they all come back in."