Six Months Into HB2, Small Business Owners Feel Economic Impact of Law

Sep 30, 2016

It's lunchtime at Ghassan's, a quick service Mediterranean restaurant  in Greensboro. Meat hits the grill,  fries drop into hot oil and ice collects in paper cups. The local restaurant chain specializes in chicken kabobs, falafel, tabouli, hummus – all the tasty Lebanese staples. One restaurant is just a block away from the Greensboro Coliseum.

"That is a lower volume store for us, so we're largely dependent on events that come to the coliseum and tourism and people that come to this area," said the restaurant's Operations Manager Ziad Fleihan. His parents started the business 41 years ago, and Ghassan's now has five locations and a food truck.  
 
Because of HB2, Bruce Springsteen canceled a concert in April in Greensboro. Earlier this month, the NCAA and ACC canceled nearly two dozen games that would have been played in the coming year. Fleihan said his restaurant has already lost $20,000 in revenue.

"It's scary to think about how much more we're going to lose especially with the NCAA and the ACC pulling out," he said. "It makes us reassess and think about, you know, if this thing doesn't get repealed how long can we last here and when is it time to maybe make hard decisions as far as closing up shop."

The General Assembly passed House Bill 2 six months ago this week. House Bill 2 requires people to use the bathroom corresponding to the sex listed on their birth certificate. This applies to government buildings, public schools and universities. The law also bans municipalities from passing a non-discrimination. Since March, North Carolina has been at the heart of a national debate over transgender rights, government powers, and perceived safety issues.

The state's economy has been affected by the law – with plans for hundreds of new jobs abandoned, concerts canceled, and major sporting events relocated out of state. The fiscal damage is estimated to be in the hundreds of millions of dollars, according to multiple economists. Throughout this contentious time, small business owners have tried to carry on as usual.

Ziad Fleihan, manager of Ghassan's Restaurant in Greensboro, says the restaurant has lost $20,000 in revenue since the Legislature passed HB2 and events have been canceled in Greensboro.
Credit Jeff Tiberii / WUNC

HB2 impacts other service businesses, too

Along with vanished revenue at restaurants and hotels, the cancelation of events has affected caterers, linen rental shops, transportation services, pesticide companies, even banks and credit unions that handle payroll for many of these contractors.
 
The results of HB2 have had a ripple effect throughout the local economy, according to Henri Fourrier,  president of the Greensboro area Convention and Visitors Bureau.
 
"It certainly tarnished us," Fourrier said. "We have worked very hard to establish a brand in the sports market, for one. And I feel that has just deteriorated."
 
Fourrier believes it’s just a matter of time before something is done. Change could come from the legislature, or the courts, but nothing appears imminent. And, he said, Greensboro can't truly work on fixing the damage until the law is gone.

Several events have been canceled at the Greensboro Coliseum since the state Legislature passed HB2.
Credit Jeff Tiberii / WUNC

A change in tone from customers
 
Meanwhile, in Durham, Tina Travis is on the go. She started Errand Girl in 2009. It’s a small concierge company that handles transportation, babysitting, dry cleaning, picking up retail items, and whatever other errands people may need.
 
HB2 has not been a big blow to her business, she said, adding that other concierge services in the Triangle are also doing okay.
 
"We all get together at the end of our quarters and say 'How did you do?' 'What are you doing different?' she said. "I must say I have not heard that statement – that because of HB2 my business is down a little bit, or my business is up a little bit. It seems to be something we are flowing with."
 
Travis estimates 10 to 15 percent of her business come from out-of-town visitors and the company is diverse enough in the services it offers that HB2 hasn’t had a noticeable impact.
 
But she has noticed a change in tone with some of her customers, particularly with wedding parties, who have heard about the controversial legislation.
 
"I'm noticing that they may not bring up House Bill 2 – but they’re trying to find their comfort zone. They’re trying to find 'Is this a nice, friendly concierge business who truly respects everybody for who they are and what they are, or is this a company that may not be so accepting'?" she said.
 
Travis said her business has remained successful largely due to the positive energy she puts out and a philosophy of inclusivity toward the customers.

But, she acknowledges not everyone sees North Carolina as an inclusive place right now, and it’s hard to find small business owners who say the economic effects of HB2 have been positive.