But new figures from OpenTable suggest that Arizonans are once again warming to the idea of dining out — and doing so with more exuberance than much of the rest of the country.
The most recent data from the organization that help people book reservations finds that dine-in seating at the restaurants surveyed is down about 60 percent from the same time a year ago.
That’s not great. But it comes after weeks of no in-house dining following the March 20 order from Doug Ducey allowing restaurants to provide only curbside and take-out service. It took until May 11 for the governor to partly lift the order, allowing dine-in services with new service protocols and limits on numbers of diners.
And that 60 percent reduction is better than most of the rest of the country, where dine-in service, on average, is still about 87 percent below last year. Steve Chucri, president of the Arizona Restaurant Association, said it appears that only South Carolina and Alabama, among states that shuttered restaurants, are doing better.
What’s keeping the numbers from being better?
Chucri said some of it is a matter of physics and geography.
He noted the requirement for physical distancing between dining parties. So a restaurant has to get rid of perhaps half their tables to make that a reality.
At the same time, Chucri said, some restaurants are waiting until the next phase to reopen to diners. Here, too, he said, distancing can matter.
For example, he cited one Phoenix restaurant which under normal circumstances would have 30 tables. But the size and configuration, Chucri said, might currently allow for perhaps just eight.
“So the models aren’t there to make the money in order to bring everyone back in,” he said.
That’s not all.
“Others are wanting to make sure all the wrinkles are ironed out in the supply chain issue that we’ve been experiencing,” Chucri said.
And even when restrictions are fully lifted — whenever that occurs — there’s the question of whether people are going to feel comfortable enough to go out and sit down at a fancy restaurant or even a fast-food table.
“I think some of it’s going to be word of mouth,” Chucri said, as those who have gone out spread the word about the experiences they have had.
And then there’s the question of what people read — or don’t read — in the paper. Chucri said a story about someone contracting COVID-19 from going out to eat would get a lot of attention.
“But, so far, so good,” he said.
All this has financial implications.
Chucri figures that the ban on in-house dining has cost restaurants statewide a collective $27 million a day in lost revenues. What that left them, he said, is what some were able to make with take-out and curbside services, a figure he said amounts to just 10 percent of what they were making before.
And Chucri said he presumes that, at least for some time to come, there will be Arizonans who remain more comfortable with getting their meals from their favorite restaurants and taking them home.
Few Arizona industries suffered more during the COVID-19 pandemic than bars, which faced severe operating restrictions, drastically reduced business and a backlash from public officials.
In addition, bars faced closures at the instruction of an executive order from the state. Since those first devastating days in March through the fall, bars and many businesses around the state struggled to stay afloat.
With Covid on its way to eradication thanks to a flurry of approved vaccines, bars now face another existential threat. Proposed legislation gives the thousands of restaurants in the state some of the same privileges to sell alcohol to go that bars maintain.
I’ve operated Kactus Kate’s in cottonwood for 25 years. Pre-coronavirus, many of the bars across the state prospered despite some uncertain economic times. Bars have long been a place of refuge after a long day’s work or a relaxing gathering spot for friends and family.
Covid began hurting bars almost immediately. When the state shut down the economy, bars were ordered closed to help stop the spread. As spring turned to summer, Arizona began to open up and employ commonsense measures to slow the spread of the virus, such as wearing masks and staying six feet apart. At bars, we planned to reduced capacity, expand outdoor seating and encouraged social distancing among our patrons.
However, bars faced additional hurdles that other retailers and restaurants avoided. The state forced many of us to remain closed to patrons who wanted to drink and socialize. After suing the state to overturn the closure order, bars won the right to again serve patrons in a responsible way.
However, just as bars start to recover, the state is proposing to give restaurants a competitive and economic advantage.
Restaurants had been given authority during the pandemic to package alcoholic beverages to go. The theory was that in a time of economic distress with no ability to serve patrons in their dining rooms, restaurants would be able to sell alcohol along with a burger or spaghetti to go. While the law did not allow this, most people looked the other way because of the temporary nature of the pandemic.
Restaurants weathered the COVID storm and the industry remains vibrant and growing. New eateries pop up weekly to accommodate a public desirous of new options.
Some in the Legislature want to give restaurants the permanent authority to sell liquor to go, a right that exclusively belong to bars and retail establishments like convenience stores and grocery stores. In some parts of the state, bars earn a substantial amount of revenue selling package liquor.
To be sure, bars pay a premium for this right. A license to open a bar costs at least $100,000 from the state, whereas a restaurant pays just a few thousand dollars to serve liquor onsite. HB2773 proposes to give restaurants a significant competitive advantage, paying just $1500 for rights that a bar must shell out at least $100,000.
It’s obviously neither fair nor right to create a permanent solution to this temporary problem. Covid will be a thing of the past as the vaccines become more available. To change state law and provide a significant competitive advantage to an industry that is now flourishing is just wrong. The bar owners around the state hope the Legislature rejects this unfair competitive advantage in HB2773.
Restaurants will be able to sell mixed drinks to-go under a law the Arizona House passed overwhelmingly Monday.
The House voted 50-9 to pass HB2773 on final reading, which lets bars sell cocktails for off-premises consumption and lets restaurants apply for permits to do the same. Now that the House has concurred with the Senate’s amendments, it heads to Gov. Doug Ducey’s desk for his signature.
Bar and liquor store owners had originally opposed the bill, saying it is unfair to let restaurants, which have far less expensive liquor licenses than them, sell cocktails to go. As amended, the bill would let restaurants lease to-go cocktail permits from restaurants and liquor stores through the end of 2025. After that, restaurants could apply for such permits in their own right.
“As I committed to people, I continued to negotiate along with a large group, a bipartisan group, and the bars are now in favor and groceries are now neutral because of the changes that we made,” said Rep. Jeff Weninger, R-Chandler, the bill’s sponsor.
Rep. Aaron Lieberman, D-Paradise Valley, said during Monday’s House Democratic caucus that the bill as amended would let bars reap some of the financial benefits of letting restaurants sell to-go cocktails over the next few years through the leasing system. He said allowing to-go sales is both important for restaurants and popular with consumers and with constituents he has heard from.
“As I understand it, this has been a really good stakeholder process to get to this point,” he said.
Ducey let restaurants start selling cocktails to-go as a way to help them stay afloat at the beginning of the Covid pandemic despite the other restrictions placed upon them. A group of bars sued, and a Maricopa County judge sided with them in November. If Ducey signs HB2773, restaurants that want to sell cocktails to-go will once again be able to under the newly established licensing rules.
Four Democrats and five Republicans voted against the bill in the House. It had passed the Senate 22-8, also with bipartisan majorities but drawing the handful of “No” votes from both parties.
Lawmakers say they’re close to reaching an agreement that would let restaurants resume selling cocktails to go without costing bar owners who paid dearly for the privilege to sell alcohol to go.
Historically, bars, which hold Series 6 liquor licenses, and liquor stores, which hold Series 9 licenses, have been able to sell alcohol to go in sealed containers. Restaurants, with far cheaper Series 12 licenses, can sell alcohol on site but can’t let their patrons take it home.
That started to change during the pandemic when Gov. Doug Ducey closed bars and restaurants but granted restaurants the ability to sell beer, wine and cocktails to customers picking up takeout orders. Bars protested and eventually sued, winning in court in September and ending the short-lived – but popular among consumers – practice of ordering to-go margaritas and mimosas.
Rep. Jeff Weninger, R-Chandler, sought to permanently allow both restaurants and bars to sell mixed cocktails to go. He and seatmate Sen. J.D. Mesnard, R-Chandler, have reached a conceptual agreement between bars and restaurants, but they’re still ironing out technical details, Mesnard said.
“For every class 6 and class 9, there would be an equivalent license for to-go cocktails,” Mesnard said. “It’s essentially a state-facilitated leasing program.”
The tentative deal, which he eventually plans to present as a floor amendment, is meant to preserve the high value of Series 6 and 9 licenses. They’re limited based on population and easily cost upwards of six figures – just seven each were available in Maricopa County in 2020, with a fair market value of $99,900 for Series 6 licenses and $272,800 for Series 9, according to the Arizona Department of Liquor. Restaurants, on the other hand, pay a $2,000 one-time fee and $585 to renewal.
Bar owners can sell their Series 6 licenses when they decide to get out of the industry, and it’s effectively the only equity they have, said Al McCarthy, owner of Duke’s Sports Bar and Grill in Scottsdale. He and his daughter spent $85,000 on theirs when they opened the bar 23 years ago, and they count on being able to sell it if they need to.
“Tables and chairs are worth pennies, it’s like trying to sell a used couch or a used bed,” he said. “So the only thing you have left is how much business you do, how much profit you make and the liquor license. Worst case scenario, we can get $100,000 for the liquor license.”
McCarthy’s bar sells enough food that he could qualify for a cheaper Series 12 restaurant license, but he said he chose the Series 6 to have options. He doesn’t sell alcohol to go – he asked his insurance company about it when he had to shut down during the pandemic and learned that it would add thousands more to what he already pays in liquor liability insurance – but he said he didn’t begrudge restaurants who took the option when Ducey offered it at the start of the pandemic.
The idea of making that option permanent – with a law that likely wouldn’t take effect until August, well after all Arizonans have access to Covid vaccines – didn’t sit right with McCarthy.
“It’s gonna make something that was meant to be a temporary fix to help people into a permanent thing that just dilutes the value of a 6 license,” he said. “There’s no need to buy a 6 license if you can buy a 12, spend $1,800 a year and have a drive-in window with to-go drinks.”
Sen. Tony Navarrete, D-Phoenix, voted Wenninger’s original measure out of committee with reservations on March 24 and said he is still concerned about making sure bar owners and grocers who purchased licenses for a significant price are made whole. He’s not sure that the bill is quite there yet, he said, but he looked forward to continuing conversations.
“I think there can be some middle ground,” he said. “Does it happen this session? I’m not sure. Will it happen at some point? Absolutely.”
Gov. Doug Ducey broke the law when he told police and liquor agents not to enforce statutes that prohibit restaurants from selling alcoholic beverages to go, a judge ruled Monday.
But, for the moment, it appears the governor is going to ignore the ruling — and allow the restaurants to keep competing illegally with bars — as he contemplates an appeal.
In an 18-page decision, Maricopa County Superior Court Judge Pamela Gates brushed aside most of the claims by more than 100 owners of bars throughout the state that it was wrong of the governor to single out their establishments for closure while other alcohol-serving establishments like restaurants were allowed to remain open.
Gates said there was sufficient evidence that bars posed more of a threat to public health due to the spread of COVID-19 than other kinds of business establishments. And with the legislature having granted the governor broad powers during an emergency, he had sufficient justification for the orders.
But the judge said nothing in the Arizona Constitution or even the emergency powers statutes entitles Ducey to ignore laws entirely. And in this case, she said, legislators had expressly prohibited the off-premises sale of alcoholic beverages by restaurants, reserving that privilege for those who obtained licenses to operate bars.
“A provision that bars the enforcement of unlawful conduct is contrary to state law and thus, exceeds the power delegated to the governor,” Gates ruled.
Both Ducey and the Arizona Restaurant Association had argued that the special privilege was necessary to help keep the businesses financially afloat.
They, like the bars, had initially been shuttered entirely. And even now they have to operate with limited capacity.
Gates said that is all legally irrelevant.
“The court takes no position on whether the law should be changed to allow to-go alcohol,” the judge wrote. “It merely holds that action is outside the power delegated to the governor … during a state of emergency because the action is contrary to current Arizona law.”
One reason bar owners brought the claim is that, under state law, they are the ones who can sell drinks and alcohol to go.
That is one of the privileges they get by buying the more expensive bar license versus a restaurant liquor permit. The other is not having to maintain 40% of sales in food as do restaurants.
Attorney Ilan Wurman said that his clients, already harmed by a ban on indoor operations — more recently changed to restrictions — are being further hurt financially as those off-premises sales were going to the restaurants which can be their direct competitors.
Gates as much as acknowledged that in ordering Ducey to rescind his illegal order.
She pointed out that, under other circumstances, anyone who suffers monetary damages from the actions of another can seek to recoup. But that’s not the case here.
“The court … finds the governor’s immunity will likely preclude plaintiffs from collecting damages,” Gates wrote. And that, the judge said, tips the balance in favor of her enjoining Ducey from continuing his order allowing the off-premises sale of alcohol from restaurants.
Ducey press aide Patrick Ptak said that the governor is reviewing the decision.
But there apparently are no immediate plans to actually comply while he contemplates an appeal. And here, too, the issue is providing financial relief to the restaurants.
“We want to make sure that we continue to help small businesses, and the Arizonans they employ, navigate through this pandemic,” Ptak said.
Dan Bogert, chief operating officer of the Arizona Restaurant Association, called the ruling “unfortunate,” pointing out they were closed for all of April and part of May and remain limited now to 50% capacity. The result, he said, is increased reliance on to-go orders — with those picking up meals also wanting alcoholic beverages.
“Without the ability to include alcohol with to-go orders, a key lifeline has been stripped from these businesses,” Bogert said. “This will no doubt lead to less profitability and possibly more permanent closure of our favorite gathering spots.”
For the moment, though, Gates said that other restrictions on bars can stand, even if they don’t apply to restaurants and other similar businesses. She said testimony covinces her there are certain things that happen in bars that make them “likely high-risk environments for the spread of the virus.”
“For example, bar patrons often move between groups and tables, mixing with other groups with whom they did not arrive,” the judge said.
“Also, bars are often loud, which causes individuals to draw closer to hear one another and to speak louder, thus increasing the risk of transmission,” Gates continued. “Furthermore, mask wearing is incompatible with drinking, and drinking alcohol impairs decision-making.”
Then there are the dance floors. The issue, the judge said, is that people not only mix but that limited ventilation and turbulent airflow patterns result in an environment where respiratory droplets are more easily spread.
And, if nothing else, it comes down to who are the patrons.
“Bars also tend to attract a younger adult population, which currently represents a significant demographic carrying COVID-19 in Arizona,” Gates said.
Wurman said the ruling is not the last word.
While Gates refused to immediately enjoin what Wurman said is the disparate treatment of bars, he said that still gives him a chance to make his case at a full-blown trial that there is no legitimate reason for discrimination. And that, he said, is buttressed by testimony from John Cocca, head of the Department of Liquor Licenses and Control, that in many cases there really is no difference between the activities of bars and restaurants.
Gov. Doug Ducey is cutting off the $300 a week in extra federal jobless benefits in a bid to help the restaurant and hospitality industry find more people willing to work for what they are paying.
But they will get a one-time $2,000 bonus if they take a full-time job by Sept. 6. And the state is offering some child care assistance and even a semester of community college tuition for those who go back to work.
“In Arizona we’re going to use federal money to encourage people to work … instead of paying people not to work,” the governor said in a video announcement on Thursday.
The move most immediately affects more than 200,000 Arizonans who qualify the extra $300 a week currently appropriated by Congress to help those affected by the Covid.
Ducey’s position, according to press aide C.J. Karamargin, is that there are plenty of jobs out there and little reason for people to be collecting benefits. More to the point, he said that restaurants and hotels are struggling to find workers.
“The hospitality industry in Arizona, a critical part of our economy, was perhaps the hardest hit sector,” Karamargin said.
“They cannot find enough workers for the jobs they have to fill,” he continued. “And this plan is aimed at helping them fill those positions.”
But Karamargin said this extends to other sectors of the economy where employers are having trouble finding workers.
Inherent in that is the governor’s belief that there are those for whom the total benefits — the $240 a week maximum paid by the state plus the extra $300 — provide a disincentive to go out and find a job. That comes out to $13.50 an hour, before taxes are deducted.
By contrast, the state minimum wage is $12.15 an hour; restaurants can pay $3 an hour less if the tips that servers get bring them up to the minimum.
Steve Churci, president of the Arizona Restaurant Association, said there are establishments of all sizes that are “ready to hire new employees and expand their teams.” And he said the situation now is far different than it was last year.
“Millions are vaccinated, we know how to keep patrons and staff safe, and people are ready to eat at restaurants again,” Chucri said. “Restaurants need to ensure they have enough staff to meet the demand but many are struggling to fill positions.”
That, however, still leaves the question of whether the problem is the underlying wages — and whether it would be resolved simply by paying more.
In the restaurant industry, for example, data from the governor’s Office of Economic Opportunity shows that the average salary for fast food and counter workers in Arizona ranges from $12.15 an hour to $13.42. And restaurant cooks earn from $12.44 to $15.38 an hour.
“That’s a fair question,” Chucri told Capitol Media Services. But he said those pre-pandemic numbers no longer reflect what the industry is offering.
“We’re paying far above what we would typically pay,” Churci said.
“We’re seeking dishwashers making $25 an hour,” he said. “McDonald’s is paying $50 just to show up for an interview.”
And yet, he said, restaurants are still having trouble finding workers.
Chucri conceded that some part of the problem the industry is having has nothing to do with people deciding they’d rather collect unemployment benefits.
“You’ve got people that have cared for or are caring for Covid patients, family members, that have to be there,” he said. And there are other reasons.
“Some in the restaurant workforce said, ‘You know what? I don’t want to be this vulnerable in the future if another Covid were to strike or Covid came back strongly, I don’t want to be in the same situation,’ ” Chucri said. “So they’ve gone into health care, they’ve gone into a different profession.”
So in those circumstances, the governor’s decision to cut jobless benefits won’t make a difference.
But Chucri said there are situations where Ducey’s maneuver will matter.
“I know for a fact that some people who are on unemployment would rather sit home and not come back to work because they’re making at or maybe a little below — and in some cases, above — what they were making,” he said.
Anyway, Chucri said, it’s about more than the restaurant industry, saying retailers also are having trouble finding help.
The big carrot in all this is that $2,000 bonus for those who are currently collecting benefits who go back to work by Labor Day. For those who take part-time jobs, the bonus is $1,000.
But they have to work at least eight of the following 10 weeks to qualify.
There also is the promise of a single semester of tuition at the community college along with cash to help those without a high school diploma prepare for their GED exam.
And the state will provide subsidized child care for those who return to work if they are earning $25 an hour or less.
Arizona lawmakers are considering legislation, backed by the business community, to increase that maximum state benefit. That $240 a week is not only the second lowest in the nation — only Mississippi pays less — but has not been raised in 17 years.
But that legislation has stalled amid differences between House and Senate versions, one moving the cap to $320 a week and the other at $300. That leaves the question of whether either version can be enacted before that additional $300 expires on July 10.
And that assumes the governor goes along. Ducey has been chilly to even raising the basic state benefit even though it is not paid through state taxes.
Instead, the payments are financed through a tax that employers pay on the first $7,000 of each worker’s salary. The average cost, according to DES, is $160 a year per employee.
The governor’s announcement also comes as the state’s official seasonally adjusted unemployment rate is 6.7%. While that is down from the peak of 14.2% it hit a year ago, it still is higher than the pre-pandemic figure of 4.7%.
This is actually the second move by the governor in less than two weeks to force people back into the workforce.
Earlier this month the governor rescinded an order he had signed in March 2020 suspending the job-search requirements normally part of the ability of people to collect benefits. That was based on not wanting to force people who were infected with Covid, or were caring for others with the virus, to go out looking even as the pandemic was raging.
Now, effective the week of May 23, anyone wanting to keep unemployment benefits will again have to make contact with potential employers at least four days a week.
And after four weeks, they have to take any job that’s offered, regardless of whether it is in their field or not.
Ducey is hardly the first Republican governor to make the move. At least nine others have already done the same.
But President Joe Biden earlier this week rejected the idea that the enhanced federal benefits are why some people are not going back to work.
“The line has been because of the generous unemployment benefits, that’s a major factor in labor shortages,” the president said at the White House on Monday.
“Americans want to work,” he said. “I think the people claiming Americans won’t work even if they find a good and fair opportunity underestimate the American people.”
Saying Arizona can handle the projected toll of the COVID-19 pandemic, Gov. Doug Ducey Monday quickened the pace for his plan to reopen the state.
Starting Friday, people can get a haircut and come next week, they can go to a restaurant with their family. Barbershops and salons can also voluntarily open on Friday if they limit how many customers they see, follow strict public health requirements and mask their workers.
This week’s phased reopening of retailers continues; today, shops can voluntarily open with social distancing measures and no in-store service, and on Friday they can open their stores if they can follow those same strict guidelines. But Ducey’s announcement that restaurants can reopen was a slight change, a day earlier than the “best-case scenario” he proposed last week.
That date was moved up because the state is testing more people and is starting to see a decline in COVID-like and flu-like illnesses and a smaller percentage of people being tested are testing positive. While Ducey said promising and adequate hospital capacity is a “green light” for more steps forward, if trends flip, Arizona will be ready to adjust, and that could mean rolling dates back
“We’re a lot smarter today than we were in January, February, March and April around this pandemic,” Ducey said. “If, God forbid, things were to turn in the wrong direction and spike, which we’re not seeing that side right now anywhere, Arizona is prepared.”
Department of Health Services Director Cara Christ said she and the state are aware of the concerns of opening up too quickly and want to avoid the possibility of prompting a “second wave” of cases, which is why they have been cautious to act. That’s also why the state isn’t giving future dates for further steps, because the situation could change as seasonal illnesses could rise and stress more resources.
“The concern is what do you do when you have a flu season, in addition to potential COVID cases that may be looking for the same resources,” Christ said. “That’s why we continue to work on getting alternate care sites in place, in case there were a surge coming in the fall at the same time.”
If positive trends do continue, Ducey said the state plans to continue to phase in a return to some kind of normal based on state and federal public health data and guidance through May and June. When restaurants and barbershops reopen, they can serve as many as they are able to if they can make the space and abide by public health guidelines, which for some could mean very close to full capacity.
As Ducey continues narrowing the list of closed businesses, gyms will be next, he said, though he gave no date. Still, in the face of mounting pressure to reopen the economy, the governor urged people to continue to have patience with his plan, which mirrors what he called “flexible” guidelines from the White House for economic reopening.
That three-phased plan aims to slowly open up businesses to normal operations while slowly reeling back social distancing measures for states that see fewer reports of COVID-19 and influenza-like illnesses for two weeks.
Under Phase One of Trump’s plan, all “vulnerable individuals” would stay home when they can and those who go out would continue to practice social distancing and avoid gatherings of 10 or more people. Some businesses would reopen with social distancing measures in place. Arizona has yet to satisfy the requirements of that phase, as it is still waiting for cases to drop consistently.
Ducey pushed back against the idea that the only thing that has changed since his last announcement was the mounting protests and Trump’s pending visit to Arizona, saying those factors had nothing to do with his decision. The governor called his first weekend of the “testing blitz” a resounding success and cited statistics showing that the number of tests coming back positive are decreasing.
But the pressure on Ducey to allow the economy to reopen comes from not just the more libertarian elements of his own Republican Party.
House Speaker Rusty Bowers, R-Mesa, told Capitol Media Services the pure numbers show that the harm to the economy is far outstripping the actual physical danger.
Bowers said he has done some analysis of the 362 deaths in Arizona so far. The vast majority — more than three-quarters — are among those 65 and older who may have had other health conditions.
What that leaves, he said, are the 82 for those age 20 through 64.
“Thirteen one hundred thousands of a percent that have perished, and we say we can’t trust the rest of enterprise to open up and use wise business practices,” Bowers said. “I’m just hoping that he will recognize that he can trust the rest of the working population to try to exercise themselves smartly in order to help us all put this behind us.”
Anyway, Bowers pointed out that the “essential” businesses the governor has allowed to remain open probably make up the vast majority of all of the firms in the state. Yet even with that, he said, the number of cases of the virus has remained small.
Senate President Karen Fann, R-Prescott, did not get into the numbers. But she told Capitol Media Services that Bowers is correct in his conclusions that businesses have figured out how to keep employees and customers safe.
“I’m hoping the governor sees it that way, too,” Fann said.
Ducey defended the speed of his changes.
“This is a step forward,” he said. “If you want to say I’ve been too cautious, I accept that.”
The governor said that pace is appropriate when talking about this kind of rapidly spreading virus.
“We understand much more today than we did six weeks ago,” Ducey said. “And I’m hopeful and optimistic as to what can happen over the next several weeks.”
Ducey said he plans to talk to Trump Tuesday about increasing Arizona’s testing now that some of the hot spots in other states have cooled off.
One of those places the state plans to ramp up testing is in long-term care facilities, which Ducey and Christ have been reluctant in being fully transparent in, refusing to list exactly where cases are being reported. Christ said DHS is working with its lawyers to determine if and when it releases more detailed data.
In the meantime, per an executive order Ducey signed today, relatives of those in those facilities who test positive or whose fellow seniors test positive for COVID-19 will be notified by that facility within 24 hours. If a family chooses to move their loved one out of a facility with cases and inquires about another facility, that facility will be required to say how many COVID-19 cases and deaths it’s recorded.
Howard Fischer of Capitol Media Services contributed to this report.
Gov. Doug Ducey is justifying his directive to liquor investigators and police to ignore violations of some state laws by restaurants because they need the money from the otherwise illegal sales they are allowed to make.
In new court filings, attorneys for the governor do not dispute that Arizona law prohibits restaurants from selling alcoholic beverages to go. That right is reserved for holders of other types of liquor licenses, including grocery stores and bars.
And they acknowledge that Ducey in March specifically directed that agents of the Department of Liquor Licenses and Control “shall not enforce the provisions of the Series 12 (restaurant) liquor license that prohibit the sale by restaurants of beer, wine and spirituous liquor off premises.” In fact, the governor’s order also keeps police from enforcing those laws.
Attorney Ilan Wurman who is suing Ducey on behalf of more than 100 bar owners, said that’s not fair.
“Giving the restaurants the off-sale privilege and letting restaurants stay open, all while closing down bars seems to be a clear act of economic favoritism,” he said.
“It’s a powerful industry,” Wurman said. “And a lot of them give him money.”
But Brett Johnson, the private attorney who Ducey hired to defend all of his executive orders, said the governor was acting within his emergency powers.
What Johnson is arguing is that giving restaurants the “privilege” to sell beer, wine and liquor out the door “qualifies as a recovery and response activity because it aids restaurants.”
That, said the attorney, is justified because they were previously closed for in-house dining.
They have since been allowed to serve patrons. But Johnson said the restaurants still need the financial help because they remain “subject to capacity restrictions.”
Ducey press aide Patrick Ptak defended the governor’s decision to block enforcement of the laws that prohibit restaurants from making off-site sales of alcoholic beverages. He called it one of many “tough decisions” his boss had to make during the pandemic.
“This has been a way for many establishments to maintain their operations safely and responsibly while continuing to prioritize public health,” Ptak said. And he said Ducey has “broad authority” relating to the enforcement — or non-enforcement — of laws.
Wurman said Ptak is partly right.
He said the laws do give Ducey the power to suspend laws dealing with things directly related to the pandemic, like regulation of doctors, hospitals and emergency medical technicians. The governor, in fact, already has done that, expanding the scope of practice allowed under state law to certain medical providers.
But Wurman said there is no basis for Ducey’s argument that he has pretty much unfettered ability to do anything as long as he says it involves “response and recovery” to the underlying emergency caused by COVID-19.
That, he said, would include “anything that alleviates secondary economic, political, cultural, social damage or whatever.” And Wurman said that is unconstitutional.
“It gives him essentially unlimited power,” he said.
What makes all this relevant to Wurman’s clients is that the governor initially closed both bars and restaurants. Yet Ducey unilaterally took away the one legal advantage the bars had over the restaurants: the ability to sell alcoholic beverages to go even if they could not have customers.
Meanwhile, restaurants have been reopened while bars have not. But the governor continues to allow them to violate state liquor laws and sell beer, wine and liquor out the door.
There is reason to believe that Maricopa County Superior Court Judge Pamela Gates, who is hearing the legal arguments, may side with Wurman and against the governor on the question of whether he can simply direct that certain state liquor laws be ignored.
She ruled earlier this month that the governor did nothing wrong in shutting down bars while continuing to allow operation of restaurants with liquor licenses. Gates said Ducey’s orders “are rationally related to expert data and guidance on minimizing the spread of COVID-19 in our community.”
But Gates said it appears to be quite something else for the governor to direct liquor investigators and police to ignore clear state laws which say that those with Series 12 licenses — meaning restaurants — cannot sell alcoholic beverages to go.
“The court finds the executive order banning enforcement of a Series 12 licensee violation of off-premises sales of spirituous liquors impermissibly stretches the governor power he is granted under state laws, the judge said. Said another way, the court fails to find that the enforcement ban against Series 12 licenses in (the executive order) effectuates the purposes of (the laws on emergency powers).”
Gates, however, didn’t overturn Ducey’s order, setting the stage for more legal filings.
Instead she wanted to hear more arguments. And that, in turn, led to Johnson’s arguments that the financial health of the restaurant industry justifies the governor’s actions.
The governor’s attorney has another justification for Ducey’s directive. He said that closing bars for in-person operation while giving off-sale privileges to restaurants “encourages individuals to stay home, reducing the risk of COVID-19 transmission.”
Johnson provided no specifics.
Wurman, however, sees the action through a different lens: politics and campaign donations.
“That doesn’t mean it’s pay-to-play,” he said.
“And it’s not corrupt,” Wurman said. “But it’s favoritism.”
Ptak did not answer questions about who from the restaurant industry lobbied Ducey for the right to ignore state laws about out-the-door sales of alcoholic beverages.
Separately on Monday, attorney Ilan Wurman filed a $12.5 million claim against the state on behalf of the more than 100 shuttered bars he represents.
The number, Wurman said, is an estimate of 70% of what the bars have lost in business from April through the end of August. He said the other 30% is probably what the bars would have lost anyway due to the pandemic.
Wurman contends if the state wants to close them it has the legal responsibility to make up at least some of their lost profits.
As of right now, bars in nine of the state’s 15 counties can reopen.
But don’t expect them to look and operate the way they did before the governor ordered them closed in March.
No darts or pool.
And forget about wandering around in hopes of finding someone with whom to hook up.
Put simply, they have to operate more like a restaurant, complete with food. And the number of customers is limited to just half normal capacity.
The nine counties on Thursday all have achieved at least “moderate” status as far as the spread of COVID-19. And that permits not just bars but also gyms, fitness centers, movie theaters and water parks to reopen.
Only thing is, they have to agree to a laundry list of restrictions as state health officials say there still is a risk from the coronavirus. So for each of these businesses, the mission now is finding ways to open with limited capacity and limited activities and still make a living.
The counties at moderate are Apache, Cochise, Coconino, La Paz, Maricopa, Navajo, Pima and Yavapai.
And the infection rates in Greenlee County are so low that the Arizona Department of Health Services says they have achieved “minimal spread” status. That will give businesses there even more flexibility.
Pinal County did not make the cut as expected. State Health Director Cara Christ said a new set of test results received late Wednesday kept it in the category of “substantial” risk of spread.
Christ acknowledged that test results from inmates are included in the county’s tallies. But she doubted that these infections are what has kept the county from moving into the “moderate” category.
“They’ve had a pretty steady rate over the last three weeks,” she told Capitol Media Services, with no spike.
“My guess is that final bump was not related to the prisons,” Christ said. “It was likely related to something in the community.”
But Rep. Bret Roberts, R-Maricopa, is questioning why inmates who test positive are even being considered.
He said counting positive tests among staff make sense.
“They’re out in the community,” Roberts said. But he said inmates are not, meaning they’re not able to spread the disease to other Pinal County residents.
Christ, however, said it’s not that simple.
“COVID is highly contagious,” she said.
“So if it is at a prison, the correctional officers are at-risk of getting it and taking it out into the community and bringing it back into the prisons, especially if you’re going with things like restaurants and bars and gyms where they may go when they are off,” Christ continued. “There are people that work in the prisons that do things in the community.”
It’s not just bars in these nine counties where bars will again be allowed to operate, albeit in a scaled-back fashion.
Gyms and fitness centers can also reopen their doors to half of the normal capacity, with requirements for other restrictions. Ditto movie theaters, water parks and tubing operations.
But traditional bars and nightclubs won’t be able to reopen as they used to operate until the county rate for positive tests comes back at 3%.
Still, there are current options for bars that can reconfigure how they do business.
The list of dos and don’ts is extensive. And it goes beyond the ban on dancing, singing and games.
It starts when people arrive.
The state wants at least 10 square feet for each person in the waiting area, with anyone in the queue required to mask up. Overflow has to go outside, even to the point of would-be customers waiting in their cars.
Customers can choose between sitting at the bar or a table with the obligatory six-foot distance between parties. But once someone is seated, that’s it — except to go to the bathroom. And that, in turn, requires putting back on the mask.
Salad bars and buffets where people can serve themselves are forbidden.
And customers are unlikely to find a bottle of ketchup on the table. It’s not a gourmet thing. It’s just that the health department wants single-service helpings, whether in packets or small bowls.
Even the experience of paying is likely to be altered, with staff required to wipe down any pens, touchpads or other hard surfaces between each use.
Gyms and fitness centers present a different set of hurdles. Here, too, it starts at the door with a requirement for customers to submit to temperature checks or at least be screened for COVID-19 symptoms.
They can operate only at 25 percent capacity except in Greenlee County where 50 percent is OK.
Masks are required at all times, along with physical distancing of at least six feet.
There can be classes for Pilates, Zumba and other fitness exercises. But expect to find lines on the floor to demonstrate where people can safely stand.
Theaters can fill up to half their seats — but only if they can do so by limiting groups to no more than 10, separating groups by at least six feet, and keeping every other row empty.
Customers should count on having to wear a mask other than while eating or drinking at a seat. And look for more time between shows to avoid crowds and allow better air circulation.
Water parks also can operate at 50 percent capacity, with distancing between deck chairs and other actions to keep participants apart.
Gov. Doug Ducey and the Department of Health Services released benchmarks today on how bars, gyms, movie theaters and other businesses can safely reopen.
The guidelines piggybacked on the state’s guidance for schools released last week. Like the guidelines for schools, reopening is largely based on counties’ virus statistics, which are broken into three groups: Minimal spread, moderate spread and substantial spread.
The plan doesn’t allow for any reopenings until counties have reached at least a moderate spread — except it includes one huge caveat: Businesses can apply for a waiver even if their county is overwhelmed with COVID-19.
Currently, most counties have a substantial spread, though Yavapai and Coconino counties qualify for the moderate spread category because they meet all three reopening requirements. Pima County is close, Dr. Cara Christ, the state’s health director, said. They have reached the positivity rate measure for one week, but two consecutive weeks is the requirement.
Before reopening, businesses must first attest they have developed and implemented best practice policies from Centers for Disease Control and Prevention, such as enforcing social distancing.
Substantial spread means counties are seeing a more than 10 percent positivity rate, more than 10 percent of hospital cases showing COVID-like illnesses and more than 100 cases per 100,000 residents. Moderate spread is between 5 and 10 percent positivity rate, 5 to 10 percent of hospital cases showing COVID-like illnesses, and 10 to 100 cases per 100,000 residents. Minimal spread is less than 5 percent positivity rate, less than 5 percent of hospital cases showing COVID-like illnesses and fewer than 10 cases per 100,000 residents. Like schools, the data used to reopen business will be on a 12-day lag, and will also have its own page on the Department of Health Services dashboard.
One major difference between today’s announcement and the one for schools is schools put in a 7% threshold for moderate spread to be met rather than just meeting a 5-10% measure. So some of these counties do not meet the school requirement, but Yavapai at 7.8% percent positivity rate for the week of July 19 and 9.4% positivity rate for the week of July 12 and Coconino at 9.6% meet the requirement for businesses. Maricopa County is not close yet, still sitting at 13.2% positivity and 16.9% the week prior.
Gyms can reopen at 25 percent capacity once a county has reached moderate spread, though the guidelines still require symptom screening, face masks and other preventative measures. Movie theaters, waterparks and tubing can resume in counties with moderate spread, with protective measures like face masks for everyone and symptom screening for staff. Bars and nightclubs are slightly more complicated.
Bars and nightclubs with food permits can implement a plan to operate as dine-in restaurants, such as having hostesses seat people at a table for dine-in services, and reopen at 50 percent capacity when their county reaches moderate spread. Even if counties reach the minimal spread category, they must remain at 50 percent capacity until positivity rates drop below 3 percent.
Bars and nightclubs that don’t convert to a restaurant style, must remain fully closed until positivity rates drop below 3 percent in their county, then are allowed to reopen at 50 percent capacity with additional preventative measures in place.
For businesses that go through the attestation process and are denied by the Department of Health Services, they can fight the decision through a multi-step process that can eventually go to the Superior Court for a final decision. The Department of Health Services dashboard will update the data for each county every Thursday.
Last week Maricopa County Superior Court Judge Timothy Thomason ruled that the state had to provide gyms and fitness centers an opportunity to show they could operate safely. What was announced Monday may be legally sufficient.
In issuing his order last week, Thomason gave wide berth to the decisions being made by Ducey and state Health Director Cara Christ.
“It is not the function of the judiciary to second-guess policy decisions on matters of public safety,” the judge wrote. But he said it is his role to ensure that the constitutional rights of business owners are protected.
“The injuries to these businesses have to be staggering,” Thomason wrote.
“The order only gives the gyms a chance to apply for reopening,” he continued. “It does not order that any fitness center be opened or that anyone be immediately put back to work.”
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