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AMOA Weighs Action On State And Local Smoking Bans

Posted On: 2/16/2005

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AMOA Weighs Action On State And Local Smoking Bans

CHICAGO - The Amusement and Music Operators Association is revisiting the smoking ban issue this year and, for the first time, seriously contemplating an integrated national approach to an issue previously viewed as a strictly local concern. Prompted by vigorous lobbying from state association leaders in New York and elsewhere, AMOA leaders are reexamining their long-held assumptions that smoking bans are inevitable and that fighting bans would be a waste of members' money.

On the table is whether certain state and local smoking bans, like video content legislation in the state of Indiana several years ago, may actually represent fights that can be won, and that must be fought in order to defend an existing, viable, national market. Plenty of evidence is available to support either side of the argument. Ultimately, the outcome of this internal industry debate will determine whether or not AMOA reverses its traditional "hands off" policy of refusing to help state and local operator groups with funds to combat the smoking ban issue.

"AMOA recognizes that virtually every state , and municipality , has its own unique legislative threats and challenges," according to AMOA executive vice-president Jack Kelleher. In a statement to VENDING TIMES in January, Kelleher reiterated the association's traditional policy on smoking bans, and the rationale for it, as follows: "Unfortunately, AMOA cannot 'engage' in even a small number of [these local challenges] because the costs to do so would quickly cause a major financial drain, and also, because it would not be deemed fair to assist one state or local group and not another."

However, Kelleher conceded that the most recent official formulation of this policy was adopted several years ago while the association was "in the throes of dealing with video content legislation that was sweeping the country," and that the policy was formulated to address requests by state associations for help with local video bans.

"The exception" to AMOA's policy of no local involvement, said Kelleher, "is if there is a scenario in one state or municipality that holds a unique precedent that could be used to help other groups around the country." In such a situation, he stated, "AMOA will seriously consider it, as it did with the Indianapolis video content case. AMOA and [legal counsel] Elliott Portnoy recognized [Indianapolis] as a test case , one where there was a strong likelihood of prevailing."

The next major public round of discussion on smoking ban policies (state and national) takes place Feb. 17-19 at the Rosen Center Hotel (Orlando, FL). There, AMOA leaders will convene with officials of more than a dozen state operator associations for the annual Council of Affiliated States. Present will be AMOA president Marion Paul (Fannie Farkle's, Gatlinburg, TN) and Kelleher, along with operator Gary Brewer, Brewer Amusement Co. (McMinnville, TN). Brewer chairs the AMOA smoking ban initiative subcommittee, which was created last fall to study the issue and recommend possible policy responses.

Among the state leaders participating in the States Council will be Frank Calland, E&S Music Corp. (Holbrook, NY). Calland serves as executive secretary for AMOA of New York. He and his group have been highly vocal advocates for national activism on smoking bans. Calland is also a member of the AMOA smoking ban initiative subcommittee.

According to Kelleher, the subcommittee's mission is "to serve as a receptacle and filter for the vast volume of data related to smoking ban legislation, and to discuss ways for coin-op businesses to address the issue , before, during and after they are enacted." At the States Council, chairman Brewer is expected to make a very preliminary report on the findings to date of the subcommittee, which AMOA leaders say is in the earliest phases of "ramping up."

Also at the States Council, leaders of various state associations are expected to provide at least some before-and-after statistics about the financial impact of smoking bans on operator revenues. AMOA-NY's Calland will certainly do so. Calland has advised VENDING TIMES that New York operators have suffered 50% drops in cigarette sales due to the statewide ban, and 25-30% drops in music and game revenues, due to decreased patronage of bars and restaurants by smokers.

No before-and-after operator earnings data has yet been collected by the AMOA subcommittee itself, AMOA leaders say. But in general terms, AMOA leaders acknowledge that "in Massachusetts, Florida and most of the other states and municipalities that have smoking bans in place, there is a definite decline in collections, and virtually all are in the double digits."

In addition, AMOA performed a member survey on smoking bans in the summer of 2004. AMOA received 126 surveys from 37 states. Specific survey data has not been released, but Kelleher said the responses "reflected a considerable negative impact on operators' businesses."


The industry has been coping with local smoking bans for 28 years, ever since Berkeley, CA, enacted the first public smoking prohibition in 1977, followed by thousands of cities, towns and counties since. The industry has been struggling with statewide smoking bans for 12 years (with some exceptions in some states for certain venues), ever since Vermont banned smoking statewide in 1993, followed by California (1998), Maine (1999), Delaware and South Dakota (2002), Florida, New York, and Connecticut (2003), and most recently Massachusetts (2004). (See sidebar.)

Often, the local industry's response has been passive acquiescence. Operators frequently just pack up their cigarette vending machines and "lump it" as amusement machine revenues plummet in taverns, and as convenience stores, or even the black market, absorb the operators' former share of tobacco distribution. In some cases, however, individual operators, along with certain state and city associations, have lobbied hard against the bans, with decidedly mixed results.

"We kept anti-smoking regulations at bay for years by playing Santa Claus to state and city politicians," one large operator of a tobacco vending route has often told industry members (speaking not for attribution by the trade press). "Every year I visited city hall or the statehouse, where I went from office to office with a big bag of money for campaign contributions," the operator continued. "For many years it worked. But in recent years, as the anti-smoking movement has attracted more public support, and as powerful interest groups have joined the anti-smoking cause, local political leadership has been immovable on this issue , no matter what."

AMOA-NY's Calland agrees that money is a crucial factor; his association has spent more than $100,000 on lobbyists and PR campaigns so far. "How," he asked, "do you fight the American Cancer Association, the American Heart Association and the state governments with their budgets , including billions of dollars that 29 states got from a class-action lawsuit settlement against the giant tobacco companies? We're small businessmen. You need money. There are lawsuits to fight. There are political donations to give. Whenever we lobby for industry-friendly regulation, we're inundated with fundraising appeals from politicians. If you don't give, you don't get."


Calland says that AMOA-NY has proved that the battle against smoking bans is far from hopeless, and that money spent on fighting smoking bans can be well-spent. To support these claims, he points to what the association believes is a crucial legal victory on the local level. And, he says, that local victory , combined with New York's status as a bellwether state that frequently sets a precedent for other state governments , qualifies New York's smoking ban battle as an "exception" to the general AMOA policy against local political involvement. As such, he and AMOA-NY believe their battle merits AMOA's financial support.

The local victory to which Calland refers occurred last October. Three Suffolk county, NY, tavern owners won a victory when Suffolk County Supreme Court Justice Paul J. Braisley, Jr., threw out fines levied on the taverns, ruling that the "Clean Indoor Air Act" only requires bar owners to post "no-smoking" signs in their establishments and to inform customers who light up in defiance of the law that they are smoking in an area where smoking is prohibited. The statute does not, according to Braisley's ruling, require bar owners to enforce the law by ordering customers to extinguish their cigarettes and refusing to serve them. The judge vacated and annulled a ruling against the tavern owners, which included $650 fines, after finding that a county official failed to interview any of the employees at the taverns about whether or not they informed individuals about the smoking ban.

According to Calland, "Our Suffolk county victory could be used as a model throughout the country. In my opinion, you'll never overturn the statewide ban today. But, if you can take the blame from the bar owner and put it on the smoker, making individual smokers the targets of any enforcement action, in our experience it would be a tremendous win."

To this end, AMOA-NY is working with the state's tavern owners to encourage lawmakers to introduce a bill that would amend the enforcement of the current statewide smoking ban law by placing accountability on the smoker rather than on the tavern owner. On Jan. 21, AMOA-NY leaders, in concert with representatives of bar and restaurant owners, met with New York City mayor Michael Bloomberg, the city's health commissioner and the city commissioner for consumer affairs, to address the city's ban on smoking in public venues.

AMOA-NY secretary Ken Goldberg, PLK Vending (Woodside), characterized the meeting as "positive," although he cautioned that Bloomberg made no official commitments one way or another. "Bloomberg didn't make the defensive remarks we so often hear that 'at least our regulations aren't as bad as some others,'" Goldberg said. "So it gave me a little ray of hope that he might be willing , not to overturn the ban , but to amend it somewhat. He didn't defend the city's laws by saying others were worse, so we're optimistic that he may be open to suggestions."

Now that a dialog has been opened, Goldberg said, Bloomberg indicated he would be receptive to future meetings and to further discussion of the issue. Goldberg added that the city's ban was "not well thought out" and has resulted in unforeseen negative consequences. Among them are a noise problem caused by smokers who congregate on city streets, and a growing black market for tobacco with resulting scofflaw attitudes and loss of cigarette tax revenues. AMOA-NY believes that its desired revisions to the city and state smoking bans could help alleviate those problems.

Optimism on the national level is also voiced by AMOA-NY's Frank Calland, who told VT: "I'm very happy that AMOA finally woke up and is doing something about the smoking ban issue. I'm hoping we can change their minds about staying out of state and local battles. Maybe they could come up with a formula by which every state could get a percentage of what it spends on this fight from AMOA."