Smoking ban sparks dilemma for supper clubs

Friday, Nov. 24, 2006 | 7:02 a.m.

Tavern owners trying to decide whether to continue offering food at their Las Vegas establishments when a tough new smoking ban takes effect should be grateful for one thing: at least they have a choice.

Not so for the 48 supper clubs in the city.

Under the terms of supper clubs' licenses, more than half of their revenue must come from food sales. As a result, even if the owners wanted to close their kitchens to avoid having to go smoke-free, they couldn't.

Question 5, passed by 54 percent of voters on Nov. 7, prohibits smoking inside any place of employment other than a casino floor or in bars that do not prepare their own food.

That has left many tavern owners weighing a difficult business choice - whether to ban smoking or stop serving food. For most taverns, food provides only a relatively small percentage of overall revenues, with liquor sales and gaming machines being the major money generators.

For supper club owners, however, the choice is complicated not only by the bottom-line considerations, but also by the terms of their city business licenses.

Only about two weeks before the smoking ban takes effect Dec. 8, city officials seem confused about how to accommodate supper clubs - distinguished from restaurants primarily by their ability to serve liquor - looking for answers.

Las Vegas Mayor Oscar Goodman said he has received calls from supper club owners exploring their options.

At this week's council meeting, Goodman and Assistant City Attorney Brian Scott appeared to have different interpretations of the city's rules.

Goodman insisted that supper clubs could choose between allowing smoking or serving food. Scott countered that, by definition as well as statute, a supper club without food could not exist.

At meeting's end, the issue was no closer to resolution than when the discussion began.

"I'm not going to argue with you, you're our lawyer," Goodman said. "I'm just telling you that I think we're going to have huge problems."

City officials say they have not notified supper club owners that the smoking ban won't alter the obligation to serve food as required by their license.

And while officials note that there will be no increased effort to verify compliance, a supper club that stops serving food when the ban goes into effect would be in violation of its license and could be closed.

Officials also do not plan to offer a grace period for supper club owners seeking a change to a tavern license, which would allow them to discontinue food service.

Not only is such a license change easier said than done, but that option will be of no value to supper club owners during at least the early months of the smoking ban.

Under the most optimistic circumstances, it takes between four and six months to get a tavern license approved, according to officials in the city's licensing bureau.

City restrictions on tavern licenses also would make it difficult, if not impossible, for many supper club owners to switch their licenses.

A new tavern, for example, must be at least 1,500 feet away from another liquor establishment and maintain the same distance from a church. Those and other restrictions are what led some owners to seek a supper club license in the first place.

"Many of these businesses are really trying to skirt the rules for owning a tavern," said Ron Drake of the Nevada Tavern Owners Association.

By getting a supper club license, Drake said, owners can serve alcohol and have up to five gaming machines.

"Most of them would rather have a tavern license because they can have more machines and don't have to serve food unless they want to, but they can't get one," he said.

Although the council can waive the license restrictions, that could be problematic for supper clubs, which often are in residential areas.

"What do we do when we license a supper club ... where they make the choice to cut out the food?" Goodman said. "They may then become a bar. Those types of establishments will be in neighborhoods where the people might be up in arms."

Paul Hennessey, owner of Hennessey's Tavern on Fremont Street, who had restaurants in California when a similar smoking ban took effect there, offered some advice to local supper club owners.

"I think a lot of the places are overreacting," he said. "If they just let it go for a month before they make decisions ... they might be surprised."

Hennessey said his business in California actually increased after the smoking ban because he didn't lose any regular customers and nonsmokers who previously stayed away started frequenting his restaurants.

As they ponder an uncertain future, that scenario is one local tavern and supper club owners would welcome.

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