Berkeley prepares to implement nation’s 1st ‘soda tax’

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Chen Gong/Staff

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In between victory speeches, Yes on D campaigners were already gearing up to begin implementing the nation’s first “soda tax” the day after Berkeley voters overwhelmingly passed the measure.

Measure D, which 75 percent of Berkeley voters supported, is a 1-cent-per-ounce tax on the distribution of sugar-sweetened beverages, with an exemption for distribution to businesses that make less than $100,000 annually. In doing so, the city hopes to raise funds for health programs and discourage the consumption of drinks believed to be related to obesity and heart disease. The tax goes into effect Jan. 1.

“By the time Big Soda came to town to squash us, it was too late,” said Vicki Alexander, a physician and co-chair of the campaign, at a press conference Wednesday. “They tried to pit low-income communities against it, but we banded together and stood in solidarity.”

In San Francisco, a similar measure, which 54 percent of voters supported, did not pass, because the measure, which earmarked revenue specifically for health programs, needed a two-thirds majority vote.

On Tuesday night, Measure D needed only a simple majority to win, as any revenue will go into a general fund for the city to spend at its discretion.

The measure stipulates the creation of a panel of experts to help consult City Council on supporting health programs with the collected revenue.

Councilmembers Laurie Capitelli and Linda Maio, both long-time supporters of the tax, placed an item on an upcoming City Council agenda creating a subcommittee to establish such a panel — developing the application form, determining the screening process and disseminating the application throughout the city.

Unlike Measures R and S, which were divisive issues among council members, Measure D garnered City Council’s unanimous support.

The city will also delineate guidelines and regulations for tax collection, a process that involves figuring out who the distributors are and how exactly to levy the tax. Capitelli said this process could take anywhere from three to six months.

Despite the landslide victory, Roger Salazar, spokesperson for the No on D campaign, imagines there will be issues over who will end up paying the tax, arguing that the “lack of clarity” moving forward will make it difficult to determine who will bear the brunt of the tax.

“I actually think it’s pretty simple: The price is going to get passed onto the consumer,” said Alan Auerbach, economics professor at UC Berkeley. “And the main result is people will go on buying things they’re buying or will buy a little less, which is the point of the legislation.”

Auerbach also said the tax’s effects will likely have two components: a general decline in the purchase of sugary drinks as well as shifts in purchases from Berkeley to neighboring cities that don’t tax these drinks.

After the Yes on D campaign’s considerable victory, the city also plans on publicizing its success over the next several months, providing guidance to help other communities move forward on their own measures.

But Salazar was skeptical that Berkeley’s victory could be neatly mapped onto other cities, because Berkeley’s unique demographic and political makeup, he argued, can’t be found even in other progressive areas of the country.

“Take a look at what happened Tuesday night nationally,” Salazar said, referring to the Republican sweep of Congress. “The mood of the American electorate in most other places in this country is not exactly conducive to increased regulation and taxation.”

But at Wednesday’s press conference, Capitelli defended Berkeley’s precedent-setting tax.

“Unlike Las Vegas, where what happens in Vegas stays in Vegas,” Capitelli said, “what happens in Berkeley spreads.”

 

Bo Kovitz covers city news. Contact her at [email protected] and follow her on Twitter @beau_etc.