Oakland, Albany, S.F. to weigh soda taxes
Record money pouring in, much of it from outside state
The tooth-and-nail fight between opponents and supporters of a soda tax has produced an unprec- edented amount of fundraising, campaign mailers and television ads.
The stakes are big. If Measure HH in Oakland and Proposition V in San Francisco pass on Nov. 8, the cities will be the largest so far with voter-approved soda taxes. Albany also has a tax on the ballot, Measure O1.
All three measures would impose a penny-- per-ounce tax on distributors of sugar-sweetened beverage products, with proceeds going into the cities’ general funds. They each require a simple majority to pass.
The beverage industry has successfully defeated about 40 soda tax measures in other U.S. cities, including Richmond.
Adding to the intrigue is that most of the money is coming from out-oftowners. Soda foe billionaire and former New York City Mayor Michael Bloomberg has poured $2.2 million to support the tax measure in Oakland. “Big Soda” — the American Beverage Association — has dropped $4.4 million to derail it.
For months, the oppo-
sition has flooded voters with mailers, TV commercials and sponsored content on social media opposing what they call a “grocery tax.” Bloomberg and the Action Now Initiative struck back in the past month, with millions raised to dispel the “grocery tax myth” and a campaign focusing on the health effects of soda and other sugary beverages.
Just last week, U.S. Sen. Bernie Sanders told the anti-soda tax folks to stop using him in ads to try and defeat the taxes in the Bay Area. Sanders opposes a Philadelphia tax that is much higher than those proposed here.
In all, nearly $8.6 million has been raised for campaigns for and against Measure HH, according to city records.
“I haven’t seen something like this in terms of the dollars spent, but the fact that some major corporations would put money and muscle into this local race is a demonstration that they’ve seen them lose in other places,” said Oakland resident Joe Tuman, a San Francisco State professor of political and legal communications.
Supporters say Measure HH could raise about $6 million a year in Oakland, which would be used to fund programs to highlight the health risks of soda, particularly among poorer residents, and reduce consumption.
Albany’s Measure O1 would exempt distributors serving businesses with less than $100,000 in gross receipts per year. The No on O1 campaign has so far spent $76,000, or about $4 per resident, according to campaign documents filed with the state.
The Yes on HH campaign says 1 out of 2 African-American or Latino children is likely to get diabetes in large part because of consumption of sugary beverages. The campaign also says 52 percent of Alameda County’s population has diabetes or is prediabetic.
Despite millions spent by opponents, supporters are entering the final weeks of the campaign with “a certain sense of confidence but not arrogance,” said campaign consultant Larry Tramutola. “We have a lot of work to do. But people are getting it.”
The measures are modeled after one passed by a 3-to-1 ratio in Berkeley in 2014, which made that city the first in the country to pass a soda tax. A UC Berkeley study released in August found the Berkeley tax was on track to collect about $1.5 million a year. The poll conducted by researchers found a 21 percent reduction in consumption of sodas and other sugary beverages by low-income residents since the tax went into effect.
Oakland council members Annie Campbell Washington, Rebecca Kaplan and Desley Brooks have said reducing consumption is their primary goal.
But there are ques- tions about how the tax on distributors would work. Soda distributors must apply the tax on products sold to stores and remit the funds to the city. But there is nothing in the language that prevents retailers from passing on the increased costs charged by soda distributors to other items in their stores, such as groceries, rather than soda and sweetened beverages.
The American Beverage Association has said small businesses will be hurt by the tax. Mom-andpop stores that buy their soda from wholesalers such as Costco could be considered distributors and would be responsible for applying the tax and giving the funds to the city.
“We firmly believe that this is a tax on groceries that will get passed on to consumers and make it more expensive for the lowest-income residents of Oakland to buy their household items,” said Joe Arellano, a spokesman for the No on Measure HH campaign. “We view these taxes as highly regressive grocery taxes which do not send the funds to where they say they do. These funds go into the general fund. Because of that, we view these measures as bad public policy.”
In Berkeley, this has confused a handful of small businesses, but supermarkets and large retailers such as Starbucks have smoothly applied the tax, said Berkeley Councilman Laurie Capitelli, who pushed for it.
“It’s gone remarkably smoothly,” Capitelli said.