Study says 2 a.m. booze ban would cost Miami Beach hospitality industry $227 million per year
A new economic study projects that banning latenight alcohol sales in Miami Beach would cost bars across the city millions each year in sales — losses that would extend to the hotel and restaurant industry and impact the city’s tax revenue.
The study, paid for by the Miami Beach Chamber of Commerce, was released Thursday as Miami Beach voters decide whether they want the City Commission to impose a 2 a.m. ban on alcohol sales and consumption across the city.
Economist Hank Fishkind, who authored a similar study in 2017 during a previous fight over booze sales on Ocean Drive, projected wide-ranging economic impacts if a 2 a.m. ban were imposed. He extrapolated sales data from five late-night bars and used survey responses from business owners and tourists to conclude that such a proposal would cut more than 4,000 jobs and cost bars and clubs $29 million in liquor sales annually.
The study also found an earlier last call would result in annual losses to Miami
Beach businesses of $227 million in hospitality revenue and $14.6 million in tax revenue to the city.
“The issue is not just the loss of sales at that time,” Fishkind said. “It’s the loss of those customers who like to party late into the evening.”
The findings bolstered arguments made by bar owners and other opponents of the 2 a.m. ban, who have banded together behind a political committee called Citizens for a Safe Miami Beach, which relaunched after defeating the 2017 referendum.
“This study by the Chamber should be alarming to everyone who loves and believes in Miami Beach,” said Joshua Wallack, chief operating officer of Mango’s Tropical Cafe, in a statement.
The study was criticized by Mayor Dan Gelber, a proponent of the 2 a.m. ban, for relying on assumptions rather than hard figures. He pointed to a 2020 study the city paid for that showed the South Beach entertainment district costs taxpayers $6 million a year when police and other city spending is compared to business tax revenues to the city.
Fishkind criticized the city’s study because he said it focused only on South
Beach when the whole city benefits from the tourist attractions in the entertainment district.
“This argument about money is so absurd,” Gelber said. “I believe our residents will see through it.”
Gelber said his vision for South Beach is to replace the “all-night party” with offices, residential buildings and cultural spaces. It is difficult to attract that kind of investment, he said, when more than 120 businesses have the ability to serve alcohol until 5 a.m.
“The problem right now is you can’t bring in any other kind of investment because who’s going to want to put a home office or a condo or a gallery in an area that is a 24-hour party zone?” Gelber said.
Fishkind said part of Miami Beach’s allure is its late-night party. So even if the city decides to move away from its role as an entertainment hub, that process would cause an economic decline and take many years.
“That’s part of its brand,” he said. “So to compromise that brand is going to compromise a portion of the business.”
He said a 2 a.m. ban would negatively impact the city’s short-term recovery from COVID-19 and its long-term financial footing. He noted that a recent budget document warned the city’s budget would be “structurally imbalanced” by $10.4 million in Fiscal Year 2022, and that deficits would likely increase for the next five years.
“The city indicates that the general fund is ‘structurally imbalanced’ already, with projected deficits in the tens of millions now,” Wallack said. “This study indicates they will make the situation far worse, costing the local economy and residents enormously.”