As city begins to implement Measure D, businesses already impacted by ‘soda tax’

Ariel Hayat/Senior Staff

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The city of Berkeley is now taking further steps to implement the nation’s first soda tax, with local businesses already feeling the impacts of Measure D.

Colloquially known as the “soda tax,” Berkeley’s 1-cent-per-ounce tax on distributors of sodas and sugary drinks passed in November of last year. With such a tax in place, city retailers will ultimately have the choice of whether to pay the tax themselves or raise the price of their products. Revenue generated by the tax will go into a general fund, the city’s discretionary funding source.

As part of the ordinance, a Berkeley City Council subcommittee was given responsibility to delegate a 9-person panel of experts that will help decide how to use revenue collected from the tax to fund health programs and reduce sugary-drink consumption. In addition, the panel will provide information for both City Council and residents concerning the impacts of the tax on public health.

Shortly after the tax passed in November, the subcommittee disseminated applications throughout the city, allowing residents who might be interested in joining the panel to apply.

The city received 46 applications, according to Councilmember Laurie Capitelli, who will present to City Council a list of qualified candidates. Council members can also recommend their own candidates, given that they fulfill the requirements outlined on the application.

While there is no set deadline for the council to choose the final panel of experts, Capitelli said the panel should be formed in the next four to six weeks.

For Capitelli, the city has “done all of its work,” and council members are looking forward to seeing what findings the panel of experts will bring to the city.

But as City Council prepares for the next step in the soda tax’s implementation, few soda retailers have actually felt impacted by the city’s new ordinance. Yet others have raised prices or decreased their stock.

For instance, Dollar Tree, a bargain store with two locations in Berkeley that sells items for one dollar or less, has discontinued its sales of sodas and sugary drinks altogether.

Randy Guiler, Dollar Tree’s vice president of investor relations, said the store, though committed to “providing great value for customers,” can no longer cover the tax’s costs on beverages with a one-dollar price tag.

While some local businesses have felt the effects of the citywide ordinance, sales of sugary drinks sold on campus have not and will not be affected because the UC system is not bound by city laws.

Shawn LaPean, Cal Dining executive director, said both the university and beverage distributors that work with the campus, such as Pepsi and Coca-Cola, have not indicated a plan to raise the price of sugary drinks.

Adrienne Shih is the lead city reporter. Contact her at [email protected] and follow her on Twitter @adrienneshih.