What's An "Undue Financial Hardship"?

The fate of the smoking ban in Maryland was still up in the air this week, although all indicators are the differences between the House version and Senate counterpart will be hashed out prior to the session's expiration next week.

One of the sticking points revolves around an 'undue financial hardship' clause and who should determine the merits of the individual cases. There's another issue as to whether service organizations, such as the American Legion and VFW, should be exempted from the law.

If the state is going to pass a smoking ban, it needs to have some teeth in it and not include exceptions. Compromise is a good thing, but the smoking ban is either a public health issue or it's not. It needs to include everyone or nobody, and veteran's organizations should not be exempt and there should not be an 'undue financial hardship' clause.

The two chambers disagree on whether it should be the state health department and the comptroller, as the House sees it, or the county health department, which the Senate likes. We say it should be neither because the clause should not exist.

The whole 'hardship' argument is absurd. There's no guarantee in business. A profit is not a given for any operation. Any successful bar and restaurant operator will report keys to staying profitable and afloat is adapting, keeping your product fresh and hiring capable staff. There are so many given variables to operating a business.

Apparently, under this part of the smoking ban bill, a business can seek hardship compensation if it experiences a decline in revenue directly attributable to the prohibition of smoking in Maryland. This should be interesting. We predict numerous businesses will be applying for this hardship waiver after the first year of the ban, but there will need to be tools available to whoever is the ultimate decision maker to determine whether the loss of revenue was truly a result of the smoking ban or dependent on numerous other factors, such as, and not limited to, competition, bad management, weather and increased costs of business.

How that hardship will be defined is unknown, but one thing is certain - the smoking ban will have this clause in it. The wording will likely be debated in the closing days of the General Assembly session, but there will be a hardship waiver included in the legislation.

With that appearing to be a certainty, our view is the health department should not be involved. Yes, the smoking ban is a public health issue, but determining the financial impact through economic factors is independent of the health issue. If the legislature is going to pass a smoking ban with a hardship clause, the Comptroller's Office is best to determine the individual case's merits because it's the numbers that will be subject to interpretation.