@SkyBlue is a bit, not a boolean. Try:
DECLARE @SkyBlue Bit
SET @SkyBlue = 1
IF @SkyBlue = 1
Select 'the sky is blue!'
ELSE
Select 'the sky is not blue!'
Please note that this also does not work.
if 1
Select 'the sky is blue!'
ELSE
Select 'the sky is not blue!'
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