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Gallatin County businesses can now stay open until 2 a.m.

The Gallatin City-County Health Board voted unanimously on Thursday to let restaurants, coffee shops, bars, bowling alleys and casinos close four hours later than previously allowed.

The change is effective immediately.

Other rules remain in place, including the requirements to operate at 50% capacity and limit tables to six people.

The health board also decided to continue to cap most public gatherings at 25 people.

‘We’re not changing the whole rule, we’re changing one aspect of the rule,” said Joe Skinner, a board member and county commissioner. “…Public policy is about finding balance, and, of course, on the health board, we’re most concerned about the health of the community, but we carry a heavy load on our shoulders where we have to also look at the socio-economic impacts of what we do.”

Board members said they chose to extend businesses’ hours because the county is seeing significantly fewer COVID-19 cases, hospitalizations and deaths than it was in November when they enacted the rule.

Last week, the number of COVID-19 cases dropped to 35.3 per 100,000, the lowest in about a month, and the positivity rate reached 5%. Hospitalizations tied to COVID-19 have remained in the single-digits for the last few weeks.

Board member Buck Taylor said the data are good news but cautioned, “We’re not out of the woods yet.”

Members also cited a pledge from the Gallatin County Licensed Beverage Association, a group of local business owners, to work with the health department to follow the new rule and to comply with the other safety measures, including the mask mandate.

“Our Members would like to work together with the Health Department and have an internal board of License holders/owners who will work with any bad actors and help bring them into compliance,” the association said in a letter. “This offer is contingent on our members having the opportunity to remain open until 2:00 a.m.”

In a letter dated Jan. 22, the association’s lawyer, Rhett Nemelka, said member businesses were preparing to stay open past the then-mandated 10 p.m. closing time.

“We implore you to support us in doing so,” Nemelka wrote. “If you fail to respond to this request, to remain open until 2:00 a.m. and adhere to the Governor’s Directive, within (5) five days of this letter, we will assume you disagree with a collaborative effort and we will move forward with what is in my clients’ best interest.”

Several bar owners, including association members, spoke at Thursday’s meeting to urge the health board to allow them stay open until 2 a.m. They said they have and will continue to operate safely but that the 10 p.m. closing time has devastated them financially.

Justine Palmer, who owns the Pour House in Bozeman with her husband, Josh, said they and other members of the association want to keep Gallatin County safe but also want to find a way to keep their businesses viable.

“We sincerely hope that we can work in a collaboration,” Palmer said. "We’re not interested in idle threats. It’s certainly not what our intention is. And we want to work with you. We don’t want to work against you.”

Residents also submitted public comments saying the rules were harming small businesses.

“Cases, hospitalizations, and deaths on the decline and vaccinations are way up,” emailed Kurt Klewin. “Stop killing Montana small business.”

Others urged the health board to keep all the rules in place until more residents are vaccinated and the number of new COVID-19 cases comes down further.

“Until enough people are vaccinated, it is in the best interest of the community to keep measures in place to contain virus spread, especially as there are new variants now in play,” emailed Sheila Bonnard.

The decision to extend business hours comes as several other counties have loosened business restrictions following Republic Gov. Greg Gianforte’s elimination of similar statewide rules.

The local rule change will end an ongoing lawsuit.

The health board and Health Officer Matt Kelley sued the Rocking R Bar in November for staying open past 10 p.m. on several occasions. A judge granted the county a preliminary injunction and ordered the bar to comply with the closing time until March.

But given the new rule, County Attorney Marty Lambert said he and Brian Gallik, the bar’s attorney, have agreed to drop the case.

At its next meeting, on Feb. 25, the health board plans to look at local case information and data on how well businesses are complying with the new hours before deciding whether to maintain them.

The board also will decide at the Feb. 25 meeting whether to loosen the limits on gathering sizes.

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Perrin Stein can be reached at pstein@dailychronicle.com or at 582-2648.