Isle liquor licenses stay steady this year

Liquor establishment numbers stay the same as the 5 years before the state smoking ban

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Honolulu's watering holes are about as numerous has they have been in the last five years, according to city records -- despite a smoking ban that many bar owners say is making it hard to make ends meet.

To date, the Honolulu Liquor Commission has issued some 1,353 licenses this year, with another 40 or so pending. The number has remained at about 1,400 since 2002.

By the number of licenses issued, it seems that liquor-based businesses are staying afloat, with new businesses balancing out those that have closed.

The Hawaii Smokers Alliance, meanwhile, says the smoking ban which went into effect on Nov. 16 has resulted in a 50 percent drop in business for many bars.

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After five years of good vibes and good times, Mike Heisler, the owner of Wahiawa neighborhood bar Rosa's Ice Tee, closed his doors on June 30, after five years in business.

He blames it on the smoking ban and increase in rent.

"It had everything to do with the smoking ban and change in rent," he said.

Oahu Liquor License Count year* -- Licenses 2007-08 -- 1,393** 2006-07 -- 1,384 2005-06 -- 1,393 2004-05 -- 1,385 2003-04 -- 1,382 2002-03 -- 1,417 * Fiscal year running from July 1 through June 30 **Estimate: Includes 40 applicants awaiting tax and other regulatory clearances BY CATEGORY*** 2007-08 Dispenser licenses: 301 Cabaret: 39 2006-07 Dispenser licenses: 307 Cabaret: 40 *** Dispenser licenses include standard bars, hostess bars, and nightclubs, which may provide entertainment and must close at 2 a.m. Cabaret licenses must provide entertainment, and allow the holders to stay open till 4 a.m. Other categories include wholesale, retail, cruise vessel, restaurant, manufacturer, general caterer, brewpub and hotel. Source: Honolulu Liquor Commission

Since the smoking ban took effect on Nov. 16, Heisler estimated revenue went down about 30 percent. Meanwhile, his rent was about to go up another 55 percent. With those two factors combined, he called it quits.

Heisler said he won't attempt to open another neighborhood bar because it just wouldn't be viable.

"For a local neighborhood mom and pop, you just can't do it," he said.

But the numbers show no shortage of people trying. The number of liquor establishments on Oahu remained steady this year at just below 1,400 -- roughly the same level it has held for the five years preceding the smoking ban.

Both pro- and anti-smoking-ban camps are watching these numbers closely.

The latest statistics available indicate that 1,353 licenses, to date, have been issued, with another 40 that are awaiting tax and other clearances. Of those issued, some 340 are dispenser licenses -- good for standard bars, open until 2 a.m. -- and cabaret licenses, good for bars with entertainment open till 4 a.m., compared to 347 last year.

A total of 41 liquor licenses were not renewed this fiscal year.

Many were due to sudden restaurant demises -- ranging from local outlets of T.G.I. Friday's and Jackie's Kitchen to OnJin's Cafe. Representatives from TGIF and Jackie's Kitchen declined to comment on their sudden closures, but an earlier Star-Bulletin interview with OnJin's cited inadequate parking as a reason.

The Hawaii Smokers Alliance, on the other hand, says there have been a high number of restaurant and bar closures due to the new smoking ban, which prohibits lighting up in public places -- including partially enclosed areas and 20 feet from entryways.

With the passage of the law last year, Hawaii became the 14th state with a smoking ban.

Jolyn Tenn, co-chair of the alliance, keeps tabs by driving around daily. She's counted several that have closed recently or are soon to close. Besides Rosa's Ice Tee, other bars in dire straits include Aquarius Lounge on Kapiolani Boulevard, and Club Sahara in Aiea.

"They're losing 50 percent of their business or more, and are not renewing their liquor licenses," said Tenn. "Everyone's continuing to struggle because of (the smoking ban). Even people who do allow people to smoke are struggling."

Jackie Chan's relied on much of its business from Japanese visitors, who expect to be able to smoke, she said, and thus, that may have been one of the causes of its demise.

But Kathy Harty, interim director of the Coalition for a Tobacco Free Hawaii, said at this point, there is not enough evidence to show the smoking ban has lead to a downfall in business.

"It's our understanding that the liquor, bar, hospitality and restaurant industry all across the board are doing very well," said Harty. "Bars and restaurants close for many different reasons."

The coalition just launched a study in which it will track liquor sales revenue for all types of businesses within the hospitality industry, including bars. Results are due by the end of October.

Harty said public reception to the new smoke-free law has been positive, from those who have children to those with asthma and other health problems.

In April, a state judge dismissed a lawsuit by the Hawaii Bar Owners Association, which sought to block the state from enforcing the smoking ban. To date, only one woman, 71-year-old Floreen Mayeda, has been fined for smoking in a downtown bar, in March. She paid a $25 fine.

Bill Comerford, co-owner of the E&J Lounge Operating Co., which runs the Irish Rose Saloon and Kelley O'Neil's in Waikiki, said it's more important to look at percentage of sales than the number of liquor licenses issued.

Comerford said it's just gotten tougher to run a business in Hawaii all around. Higher property taxes have been compounded by higher insurance rates, minimum wage increases, mandatory bottle bill law -- even higher fees for a liquor license.

The smoking ban was the straw that broke the camel's back, he said.

As a pub operator, he's caught between a rock and a hard place, because customers who want to smoke outside may create noise and liability issues, whereas customers inside would be violating the law if they light up a cigarette.

"They didn't ask us about it and they didn't make a good law," he said. "They just squashed us."

Comerford, himself a non-smoker, said the state could at least consider allowing some bars to be designated as smoking bars, instead of banning it across the entire state.