Earlier this month, the Shreveport
City Council enacted an indoor smoking ban for bars and casinos which
broadens existing ordinance to apply to all purveyors of commerce, excepting
only those that had smoking as an integral part of their business and some
limited lodging facilities. The casino inclusion, which the proposal originally
didn’t cover, bars owner greeted warmly as they now wouldn’t see a competitive disadvantage
for smokers with the two riverboats’ bars in Shreveport.
However, the ban doesn’t
include a significant minority chunk of the economy that resides just to the
east across the Red River. Bossier City apparently has no plans to emulate despite
the significant
triumph for individual liberties that would represent, particularly for
those with health conditions aggravated by ambient smoke thrust into the environment
by thoughtless others.
On the surface, that obstinance stands to reason due to the conventional wisdom that bar and casino smoking bans mean less business. With its economy so disproportionately dependent upon its three riverboat casinos, now down one with DiamondJacks shuttering, for now it won’t want to do anything it thinks will detract from tax revenues, even if it just limited a ban to bars and exempted casinos as the original Shreveport ordinance had read.
This stance will create
a lesser version of what faced New Orleans in 2015 when it enacted a similar
ban. It has just the one, land-based casino while Jefferson Parish and its
cities, which include a couple of riverboat casinos, haven’t followed. In fact,
with Jefferson slightly larger than Orleans in population, it was a matter of
the lesser partner making a decision that, at the time, many claimed would harm
bars and particularly the land-based casino, as opposed to the
Shreveport/Bossier environment where the larger entity instituted the ban.
And a review of the data from the fiscal
year 2014-19 period, and an extrapolation through the first half of FY 2020,
gives a preview of what might come. The New Orleans ban went into effect two
months before the end of FY 2015, and revenues dropped a noticeable 6.68 percent
that year and 7.46 the next. Relative to small gains made in Jefferson, Orleans
lost compared to it 9.54 and 10.67 percent in those years.
But things began turning
around in 2017, with a loss narrowed to 4.12 percent and comparatively of 5.61.
(The casino did open
a courtyard with slot machines for smokers in the middle of that year, but
it represents just a fraction of its total gaming space.) The past two fiscal years
have seen increases just shy of 2.5 and 1 percent, respectively, and comparative
gains just short of 3 and 1 percent. Extrapolated for the first half of 2020,
the trend continues with a comparative gain near 2.5 percent.
This suggests that after
an initial period where the parish with smoking in bars and casinos initially
does gain at the expense of the one that doesn’t, the tables turned perhaps as
punters who disliked smoking began to outnumber those who engaged in it and
chose venues accordingly. If this trend were to hold, it might actually benefit
Shreveport’s casinos.
That’s because, in the
2014-19 period, Shreveport casinos have suffered much more revenue degradation
than Bossier’s. The pair lost 17.5 percent over that time, while the four in
Bossier slipped just over 2 percent. Even subtracting DiamondJacks from 2019,
Bossier still would have lost a lesser percentage over the period.
Assuming the relative
change in fortunes witnessed in Orleans and Jefferson replicates over the next
few years along the Red River because of the new ban, Shreveport’s boats might
actually do better that they would have otherwise. Sales tax and beverage tax
revenues from bars may follow, although measuring these data and isolating any
impact to the ban would be extremely difficult.
But if that’s what happens,
maybe Bossier City, now with Lake Charles (which has an economy just as
dependent on gaming if somewhat more diversified) and Kenner (which has one of
the Jefferson boats) the largest cities (all a few thousand people around
70,000 in population) in Louisiana without a smoking ban in bars and casinos,
might tag along.
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