Club owner opposes smoking ban

The economic impact on private clubs and taverns will be devastating if SB19 (Utah Indoor Clean Air Act) passes. When you add this bill to all the other laws that have changed in the past five years, it could be the final straw for many private clubs and taverns.

As a licensing condition, all Class D private clubs submit financial statements to the Utah Department of Alcohol and Beverage Control. All the data necessary to support the financial condition of the industry is available. It appears that no agency has made the effort to analyze and project the impact this bill and others have, and will have, on our industry. Many Class D private clubs in the state are experiencing financial problems. Bogey's Private Club in Clearfield has experienced losses for the past two years. For calendar year 2005, Bogey's experienced a loss of $35,541 before depreciation and at the same time paid approximately $197,300 in various taxes to the state, county and city. In essence, this bill could have a negative impact on our ability to generate state and local tax revenue.

Some critics may argue that this might be due to mismanagement. We have been in business since 1978, and our financials will reflect that management is not the issue. Utah liquor laws have changed and have significantly affected sales and profitability. Even though the Utah DABC has posted record sales, the Class D private clubs are experiencing hardships due to continual changes. For example: Licensing fees have tripled. Retail costs have increased. Liquor liability insurance has at least doubled.

For years, state officials have told the public and legislators that Utah's laws, as a control state, are like other control states. When one looks at the total picture, it becomes apparent these statements are misleading. In fact, Utah liquor laws are unique and lead people to believe you cannot get a drink in Utah.

With data from the National Alcohol Beverage Control Association, we would like to identify areas where Utah's liquor laws are unique. Among 18 control states and one control county in Maryland, Utah is the only state that requires nightclubs and lounges to pay full retail for alcohol, wine and high-point beer. All other states allow either wholesale or discounts. Licensees in Utah pay the highest cost for liquor, wine and high-point beer in the nation and sell in a highly competitive market in a low-income state.

Utah is the only state that requires private membership laws for nightclubs and lounges. Most states have private membership laws for fraternal and country club organizations but not for nightclubs.