This post is by Janet Forgrieve, a contributing editor to Restaurant SmartBrief. Policy Matters is a weekly column that rounds up the latest state, federal and international policy news that affects the restaurant industry.
Health care reform likely to take a bite out of restaurant profits
Restaurant owners around the country will be watching closely as the health care reform bill goes into effect during the coming years. Some are already reacting, making plans to sell off stores and dropping expansion plans to avoid the cost of providing full-time staffers with health insurance. In a recent survey of McDonald’s franchisees, analyst Mark Kalinowski of Janney Montgomery Scott got a glimpse of how small operators see the coming change — namely, they expect health insurance requirements to cost between $50,000 and $55,000 per store annually.
“A lot of franchisees are small-business people and they don’t necessarily make a lot of money to begin with,” Kalinowski said in an interview Friday. “When something comes along that impacts the business for the worse, in some cases it may make sense to figure out an exit strategy.”
Respondents also said they’re likely to raise prices, pare down staff below the 50-employee mark and cut perks in other areas, including paid vacation and profit sharing.
Federal bill pits wineries against beer distributors
A bill in the House of Representatives would reverse the effects of a Supreme Court decision that struck down state bans on interstate sales of wine, and would give the states more power to regulate shipments of alcohol. Large beer and liquor distributors support the bill, while wineries in California and other states vigorously oppose it, saying a reversal would result in state laws that harm their business and curtail options for consumers.
South Dakota town to vote on privatizing liquor sales
Voters in Custer, S.D., will vote this week on whether they want city government out of the liquor business. South Dakota and Minnesota are the only Great Plains states where municipalities own and run bars and liquor stores, a custom that goes back to the days before South Dakota became a state. Today, Custer is one of 121 small towns in the state that employ government workers to run the booze business. A growing number of Libertarian-minded voters would like to kill the practice, while some cities depend on liquor sales to stay afloat, The Wall Street Journal reported last week. In Custer, citizens were spurred to their latest stand after the town’s mayor proposed spending $300,000 of the liquor profits on expanding the liquor store.
Bulgaria backs off the ban wagon
Bulgaria’s smokers barely had time to snuff out their cigarettes before they were allowed to light up again last week. Last year, the country’s lawmakers passed a ban on public smoking that was set to take effect last Tuesday. After the Legislature changed hands, the new crop thought better of banning smoking at restaurants and cafes in a country that’s second only to Greece in the number of smokers. Worried that businesses would be hurt, they passed an amendment that reversed the ban, but didn’t take effect until Friday. The result: a three-day smoking ban that establishments and puffing patrons largely ignored until it went away, the Sofia Echo reports.