Business

Tacoma's El Gaucho takes cigar lounge fight to Legislature

OLYMPIA -- For Paul Mackay, owner of four upscale El Gaucho steakhouses, a court case wasn't worth the money or the time.

The Tacoma-Pierce County Health Department had closed the cigar lounge attached to his Tacoma restaurant. He believed he had met the letter and spirit of the law that ordered strict requirements of ventilation, separation and lounge operations.

A judge offered a temporary order closing the lounge.

Mackay could have gone back to court, but dropped the case.

"We took it to the point - as far as we could go in Pierce County," he said Monday. "It wouldn't make sense to go to court."

There comes a time, he said, "to pull back and have a different strategy."

Along with the backing of the Cigar Association of Washington, Mackay has now taken his crusade to Olympia.

Bills were introduced to the State Senate and House late last week, offering a law that Mackay believes will be beneficial to state taxpayers, cigar smokers, and owners of cigar lounges and smokeshops.

The two similar bills require that the State Liquor Control Board collect fees from cigar lounges - a maximum of 100 lounges licensed at $15,000 per year; and from retail tobacco shops - a maximum of 500 statewide, each paying $5,000 a year.

The state could see up to $4 million in fees annually, Mackay said, plus the added tax revenue from sales of tobacco products, and, at least in the case of El Gaucho, added revenue from the sale of premium liquor.

When an original ban on cigars was instituted, he said, sales of "top-shelf" spirits - including high-end cognac, brandy and single-malt scotch - dropped.

Mackay figures he lost $500,000 in sales in Tacoma and $1 million in Seattle, just on premium sales.

The Cigar Association of Washington is backing the legislation, and has hired a lobbyist to shepherd the bills through the legislative process.

Jeff Arundel, association president, said Monday the group will spend approximately $15,000 to support the effort.

"I would say that our chances are good," he said.

Frank DiBiase, assistant division director of the environmental health division of the Tacoma Pierce County Health Department, said local health officials had not yet had the opportunity to study the bills.

"I think what we have to do is look at the bills more closely and make some decisions on whether we plan to testify or not," he said.

Still, the department likely would not support the effort.

"It would be hard for me to imagine that we would be in support of a bill that would allow smoking in a public place, given what we know about the health impacts of tobacco and tobacco smoke," he said.

The State Department of Health takes a similar view.

Spokesman Tim Church said Monday, "I can tell you very clearly, we know there is no safe level of second-hand smoke. Any idea that exposes more people to secondhand smoke is not the right direction to be heading. A great majority of people in the state approved the law as it stands now, and we think it's a bad idea to chip away at the law and chip away at public health at the same time."

The bills would limit the number of smoking venues and let the state collect fees. They also define employee knowledge and set standards for ventilation systems a vendor would be required to install.

For Church, the ventilation argument catches no fire.

"Filtration systems may make the air smell better, but there is no good science that they make the air any safer," he said.

Other factors could affect whether vendors allow cigar smoking in their establishments, should the law pass.

Jeff Packer, owner of Tacoma's Tinder Box, is a member of the state cigar association board of directors.

The addition of a smoking lounge at his shop, he said, would depend on his landlord and whether smoking was allowed under the Tinder Box lease.

"I like the bill, Packer said. "I think it's restrictive enough that we're not going to have every mom-and-pop tavern having smoking."

Said Mackay, "The state has a definite need for money. We worked hard to propose a bill so people wouldn't oppose it. I think public opinion is on the side of job creators."

A cigar lounge creates "fellowship. It's a comradeship. People celebrate. A lot of business is done in a cigar lounge," he said.

"We should take it out of the hands of the nanny state."

* C.R. Roberts: 253-597-8535 c.r.roberts@thenewstribune.com

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