April 9, 2009

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Topping it Off

In 1974, then-Washington state resident Dan Ferrell traveled through Utah on ...Read More

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Article

Topping it Off

New Liquor Laws Aim to Woo Businesses & Tourists

Heather Stewart

April 9, 2009


In 1974, then-Washington state resident Dan Ferrell traveled through Utah on a business trip. After checking into a hotel in downtown Salt Lake City, he headed to a nearby bar for a Bloody Mary—only to be told by the bartender that he would have to go around the corner to the state liquor store, where he could purchase some mini bottles of vodka. Bars were not allowed to stock or sell hard liquor, but would create mixed drinks if patrons brought their own alcohol. Although laws surrounding alcohol sales have changed quite a bit since that time, Ferrell was left with the distinct impression that Utah was a quirky place, to say the least. And he never came back—for business or for vacation. However, Ferrell is quick to explain that he would be more than happy to visit Utah, despite its liquor laws. “It’s like traveling to the Middle East: you just know that there will be some restrictions based on culture that you have to be prepared for.” The comparison certainly stings—and it’s these kind of misperceptions about Utah that have been a huge stumbling block for those working to bring new businesses and more tourists to the state. “Perception is reality in marketing,” says Bryan Borreson, general manager of Lumpy’s Downtown, a sports bar in Salt Lake City. “The perception has been that it’s impossible to get a drink in Utah.” Open for Business This belief is largely based on Utah’s now-overturned private club law, which has required drinking establishments to charge membership fees and collect information about patrons. Getting into a club is often as simple as paying a $4 cover charge and presenting valid identification—but the term “private club” has confused many a newcomer to the state. In a pragmatic push to do away with the confusion, Governor Jon Huntsman announced months before the 2009 Legislative Session that overturning the private club law was among his top priorities. And in a landmark collaborative effort, a major reform of Utah’s liquor law passed the legislature on the final day of the 2009 session. The new law overturned private club provisions and effectively opened bars to the general public. “This was high on Governor Huntsman’s list,” says Jason Perry, executive director of the Governor’s Office of Economic Development (GOED). “He wanted to normalize some of our antiquated liquor laws—some of the old laws that had been on the books for a long time and were really out of step with the rest of the United States.” Confusion over Utah’s liquor laws has had a real impact on GOED’s ability to bring new companies to the state, according to Perry. “That is a common discussion with businesses we are trying to relocate. As we do our pitch, that is a subject we always have to go into, because they ask us about it and their employees ask us about it,” he says. Myths and misperceptions about Utah’s liquor laws may be widespread, but media coverage of the repeal of the private club law has been equally pervasive. In fact, Perry says the state won’t have to do much to re-educate out-of-state business leaders. “The message is out. The business community was watching this closely,” Perry says. “I’m not overstating the perceptions that exist outside of the state of Utah. Many people are watching this—there are news reports all over the country about this.” Some businesses within the state are equally pleased with the new law. The tourism and hospitality industry is “curious to watch how this is unrolled and how we start managing its provisions,” says Perry. “The industry is overwhelmingly supportive of this. It has been 40 years in the making.” Raise Your Glasses The industry is sizing up some new provisions that are meant to discourage and reduce underage drinking. Bars will have to validate the identification of patrons who appear to be under the age of 35 using new scanning technology. Restaurant bars must pour mixed drinks outside the view of the public to shield minors from the activity. However, the so-called Zion Curtain—a glass barrier that prevents drinks from being passed directly across the bar—has now fallen. Lumpy’s Downtown is excited to embrace the new law and all its provisions, says Borreson. In fact, the bar has already been using a scanning device to validate IDs. “Our goal is to offer a great product to our customer, and the customer that we market to is over 21,” he says. “We’re glad to be taking another step to ensure those who are under 21 are not being served.” Utah’s liquor laws were a hot topic among Lumpy’s customers during the legislative session, says Borreson. “Our out-of-state customers think [the private club law] is silly, they think it’s funny.” Overall, Borreson is extremely pleased with the repeal of the private club law, even though the bar will actually lose a revenue stream from the membership fees. “It’s something that we’re willing to give up in the attempt to open our doors to a wider group of people.” Bars aren’t the only local businesses to benefit from the new law. “In a word, we’re thrilled,” says Steve Lindburg, general manager of the Hilton in Salt Lake City. “The number one cause of lost business for us was the sense that you couldn’t get a drink.” Lindburg first came to Utah in 1993 after spending years in the hospitality industry on both coasts. “It took me awhile to get used to Utah’s unique liquor laws,” he says. Over the years Lindburg has seen his own early confusion reflected in the daily queries from hotel guests about how to get a drink. And that confusion has made it more difficult for the hotel to book business meetings and conventions. “We were carrying a little bit of extra baggage when promoting Utah as a great destination,” Lindburg explains. “The new law will enhance the state’s ability to attract economically successful conventions and meetings. Utah has recognized that it is an issue in the meeting planning world and is taking steps to make a change.” In Southern Utah, where hundreds of thousands of foreign tourists come each year to experience the awe-inspiring national parks, tourism officials have consistently encountered confusion over alcohol laws in Utah. “People very often think we’re a dry state,” says Roxie Sherwin, director of the Washington County Convention and Visitors Bureau. “This new law is taking away some of the weirdness from Utah’s liquor law.” The story is much the same up on the slopes. “A lot of our guests have been baffled for years by Utah’s liquor and private club laws,” says Jared Ishkanian, public relations director for Snowbird Ski & Summer Resort. “This new open bar law will help break down the notion that it’s impossible to get a drink in Utah and significantly help our standing from a tourism perspective on both a national and international level,” he says. Tourism is a $6 billion industry in Utah. Growth in that industry has been a strong focus since the beginning of the Huntsman administration, and an update of the liquor law has been viewed by GOED as essential to those efforts. “Now more than ever it’s important to remove any obstacles that would keep people from visiting Utah. We’re very excited and encouraged by these recent changes, and applaud the legislature and government for their efforts,” says Ishkanian. Hard to Swallow The hospitality and tourism industry may be applauding, but the measure faced determined opposition in the legislature. At the start of the session, many insiders would have bet against a repeal of the private club law. In fact, the bill’s Senate sponsor, Senator John Valentine, was staunchly opposed to overturning the state’s private club law. “It started out as a very small bill defining how many square feet a convention center should have,” explains Valentine. “It got caught up in many other issues and grew from there.” This was not the first year that Governor Huntsman had pushed for a repeal of the private club law—but for somewhat inexplicable reasons, all of the various interests came together with a whole new approach. Valentine says negotiations included the Hospitality Association, the Utah Restaurant Association, Mothers Against Drunk Drivers (MADD), the Parent Teacher Student Association, The Church of Jesus Christ of Latter-day Saints, individual restaurants and bars and several additional civic groups. “I was really becoming a mini-expert in alcohol policy,” Valentine laughs. His overriding concern was ensuring any new legislation focused on controlling underage drinking, preventing over consumption and ensuring public safety. At one point, he says, the proposed law would have required scanning identifications at every drink purchase and storing the information in a permanent database. “Even I could see that was an extreme, even Orwellian, approach,” says Valentine. Instead, under the new law IDs will be scanned upon entry to a drinking establishment, and the information will be stored for one week. And the new open club law was passed in conjunction with a bill that toughened the penalties for driving under the influence of alcohol. “We’re serious about taking drunks off the road,” says Valentine. “You can lose your license. And if you continue to drive, your car will be impounded and sold, and the proceeds will go to the state’s school fund. It’s as simple as that.” Valentine was never convinced that boosting tourism or luring new businesses to the state were, by themselves, compelling reasons to change Utah’s liquor laws. However, he says the final results of this year’s liquor law reform will do much to reduce underage drinking and increase public safety. “The new system is better than it was before,” he says. “We took a very tough policy issue and found a balanced approach.” For Better or Worse Many competing interests had a say in how the bill evolved—but not all of them are pleased with the result. Art Brown, president of Utah MADD, doesn’t believe the tougher DUI laws or ID scanning technology will make up for the harm caused by open access to bars. “Open bars are a safety problem all across the country and a major source of DUIs,” he says. According to Brown, open bars encourage bar hopping, which is a problem because bartenders have no way of knowing how much alcohol a patron has already consumed. “Law enforcement can only catch a small percentage of the drunk drivers on the road,” Brown says, adding that the detection rate is around 2 percent. “Before you can apply enhanced penalties, you have to catch them.” He isn’t convinced the ID scanners will reduce underage drinking either. “What the scanners will do is shift underage drinking out of the bars. The majority of young people already get their alcohol elsewhere anyway.” Utah currently has the lowest rate of alcohol-related traffic fatalities in the country, according to the National Highway Traffic Safety Administration. In 2007, Utah had .19 deaths per 1 million vehicle miles traveled, compared with a national rate of .43 deaths per million. In total, 51 Utahns lost their lives in 2007 in traffic accidents in which at least one of the drivers had a blood alcohol content above the legal limit. Only time will tell if the state’s new open bar law will cause the number of fatalities or DUIs to rise. For his part, the Hilton’s Lindburg calls the new law a “win-win scenario” that balances the economic development needs of the state with a concern for public safety. “I just send a huge ‘thank you’ to Governor Huntsman, Senator Valentine, Representative Hughes and all those who worked to find a solution,” Lindburg says. “This is no question a win for the state of Utah and a great win for the Utah State Legislature,” says Perry of GOED. “A lot of negotiation went into this legislation. Not only were we able to have significant reform, but there are also some very good provisions to protect our youth.” Other Provisions of SB 187 • Offers a new “resort license” to ski resorts for the sale of alcohol, under which four sub-licenses may be issued. • Removes the requirement for an official state label on alcohol products sold in the state. • Allows state liquor stores to remain open on election days. • Doubles the amount of dramshop insurance coverage bars are required to carry to $1 million for single claimants and an aggregate of $2 million for incidents involving multiple parties. • Requires restaurant bars to mix drinks out of the view of the public; however, restaurants can be grandfathered in to avoid remodeling. • Enables restaurants that choose to remodel to receive a credit of up to $30,000. • Defines a convention center as a facility that is at least 30,000 square feet—which will limit the types of facilities that can receive a banquet license to serve alcohol.
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