City of Berkeley Sugary Beverages and Soda Tax Question, Measure D (November 2014)

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A City of Berkeley Sugary Beverages and Soda Tax, Measure D ballot question was on the November 4, 2014, election ballot for voters in the City of Berkeley in Alameda County, California. It was approved.

The measure was designed to impose a sales tax on all beverages sweetened with sugar at a rate amounting to $0.12 per twelve ounce can of soda. This measure was similar to the "soda tax" also proposed in San Francisco for the November election, which would have been at a rate of $0.02. The group Berkeley Vs. Big Soda lobbied for and planned to throw its support behind the measure it called the Healthy Child Initiative, which would be a $0.01 per ounce tax on all beverages sweetened with sugar, excluding alcoholic beverages, milk products or drinks used for medical purposes.[1][2]

With millions of dollars spent by the beverage industry in opposition, similar tax measures were defeated in 2012 in Richmond and the town of El Monte. The Berkeley measure was the first designed to impose a tax on soda and sugary beverages.[3]

On February 11, 2014, the Berkeley City Council approved the commissioning of a poll to find out the stance of the voters on this issue and determine whether the tax could be approved if put on the ballot. This poll was expected to be complete by April 1, 2014. The City Council made plans to revisit the issue and officially approved the measure's ballot language during its July 1, 2014, meeting.[2]

In July, the city council approved Measure D for the ballot, which was designed to impose a general tax, rather than a special tax. A special tax would have allowed revenue to be used for specific purposes such as school nutrition programs, but it would have required a 2/3rds supermajority vote for approval. The general tax option ultimately chosen by the council was designed to produce revenue that goes into the Berkeley general fund. This option only required a simple majority--50 percent plus one vote--for approval.[2]

Election results

City of Berkeley, Measure D
ResultVotesPercentage
Approveda Yes 29,540 76.17%
No9,24323.83%

Election results via: Alameda County Registrar of Voters

Text of measure

Ballot question

The question on the ballot was:[4]

Shall an ordinance imposing a 1¢ per ounce general tax on the distribution of high-calorie, sugary drinks (e.g., sodas, energy drinks, presweetened teas) and sweeteners used to sweeten such drinks, but exempting: (1) sweeteners (e.g., sugar, honey, syrups) typically used by consumers and distributed to grocery stores; (2) drinks and sweeteners distributed to very small retailers; (3) diet drinks, milk products, 100% juice, baby formula, alcohol, or drinks taken for medical reasons, be adopted?[5]

Impartial analysis

The following impartial analysis of Measure D was prepared by the office of the city attorney:[4]

The proposed ordinance would impose a general tax of one cent ($0.01) per ounce on the distribution in Berkeley of sugar-sweetened beverages and the added-calorie sweeteners (“sweeteners”) used to make them. The tax on added-calorie sweeteners would be calculated based on the number of ounces of sweetened beverage that would typically be produced using that sweetener.

The tax would be payable by the distributor, not the customer.

Beverages

Sugar sweetened beverages whose distribution would be subject to the tax would include high-calorie, low-nutrition products, like soda, energy drinks, and heavily presweetened tea, that contain at least 2 calories per fluid ounce.

Certain beverages would not be subject to the tax:

  • Baby formula
  • Beverages in which milk is the primary ingredient
  • Beverages or liquids sold for use for weight reduction as a meal replacement
  • Medical beverages (beverages used as oral nutritional therapy or oral rehydration electrolyte solutions for infants and children),
  • Beverages containing only natural fruit and vegetable juice
  • Alcoholic beverages

Added-calorie sweeteners

Added-calorie sweeteners would include any edible product that is perceived as sweet and adds calories, and is used to make sugar-sweetened beverages, including but not limited to sucrose, fructose, glucose, other sugars, and high fructose corn syrup.

Added-calorie sweeteners would not include natural, concentrated, or reconstituted fruit or vegetable juice or any combination thereof.

Applicability and exemptions

The tax would apply to:

  • distribution of sugar-sweetened beverages to stores and restaurants;
  • distribution of sweeteners to restaurants; and
  • distribution of sweeteners to stores where they are used to make sugar-sweetened beverages for customers.

The tax would not apply to:

  • distribution of sweeteners to food stores;
  • distribution of sugar sweetened beverages or sweeteners to retailers with less than $100,000 in annual gross receipts.

The proposed ordinance would also establish a panel of experts to advise the City Council on how and to what extent the City should establish and/or fund programs to reduce the consumption of sugar-sweetened beverages in Berkeley and to address the effects of such consumption.

The panel would consist of 9 members, who must satisfy at least one of the following criteria:

  • have experience in community-based youth food and nutrition programs; or
  • have experience in school-based food and nutrition programs and be referred by the Berkeley Unified School District; or
  • have experience in early childhood nutrition education; or
  • have experience in researching public health issues or evaluating public health programs related to diabetes, obesity, and sugary drink consumption; or
  • be a licensed medical practitioner.

This proposed ordinance was placed on the ballot by the City Council.[5]

—Berkeley City Attorney, Zach Cowan[4]

Full text

The second section of the ordinance, entitled Purpose and Intent, is below:[6]

Section 2. Purpose and Intent

A. Based on the findings set forth above, the purpose of this Ordinance is to diminish the human and economic costs of diseases associated with the consumption of sugary drinks by discouraging their distribution and consumption in Berkeley through a tax. Specifically, the purpose of this ordinance is to tax the distribution of sugary drinks and the products used to make them.

B. This Ordinance is not intended for the purpose of regulation.

C. This Ordinance does not authorize the conduct of any business or activity in the city, but merely provides for the taxation of distribution of specified products as it occurs.

D. This Ordinance imposes a general tax on the distribution of sugar-sweetened beverages such as high-calorie, low-nutrition products, like soda, energy drinks, and heavily presweetened tea, as well as the added caloric sweeteners used to produce these sugar-sweetened beverages, such as the premade syrup used to make fountain drinks. Certain drinks containing sugar are exempted, including infant formula, milk products, and natural fruit and vegetable juice.

E. This Ordinance provides for a small business exemption for Retailers who transport sugar-sweetened beverage products into the City themselves and then sell those products directly to consumers.

F. This general tax will provide revenue to be available for the general governmental needs of the people of Berkeley.

G. This Ordinance provides for a Sugar Sweetened Beverage Product Panel of Experts, composed of experts in the areas of public health, child nutrition, nutrition education, and food access programs. The Panel will make recommendations on how and to what extent the City should fund programs to further reduce the consumption of sugar-sweetened beverages in Berkeley and address the consequences of such consumption.[5]

The full text of the ordinance enacted by this measure is available here.

Support

  • The group Berkeley Vs. Big Soda supported the measure.[1]
  • City Council Member Darryl Moore said, “No city has been able to successfully pass a sugar-sweetened beverages tax. But it will happen here in Berkeley."[2]
  • Laurie Capitelli, Berkeley City Council Member, said, “It will be a daunting task, because the sugar industry if we proceed with this [sic], will throw millions and millions of dollars at this. They will try to divide us by race, they will try to divide us by class. They will accuse Berkeley of being a nanny state. You can count on a piece of mail in your mailbox every three or four days. It scares the pants off me to think about what they’re going to do when they come after us. They will try to buy people. They will accuse Berkeley and the council of trying to dictate what you can buy. We’re going to get all of that, and we’re going to get it in an avalanche. But we’re letting people poison us and we’re letting them get off scot-free.”[2]
  • Vicki Alexander, co-chair of Berkeley Health Child Coalition, said, “The reason for such a tax is clear. Forty percent of Berkeley Unified ninth-graders are overweight. An African-American resident is four times more likely than a white resident to have been diagnosed with diabetes. It is unconscionable to stand by and do nothing. Please be for Berkeley and against Big Soda. The health of our children and our families is at stake.”[2]

Opposition

Opponents

Californians for Food & Beverage Choice, an organization formed and supported by the American Beverage Association, actively opposed both the beverage tax in Berkeley and the one in San Francisco.

Arguments against

Roger Salzar, spokesman for the organization, said, "Our view basically is that beverage taxes aren’t the solution for changing behaviors or teaching people about healthy lifestyles. A regressive tax on common grocery items like sugar-sweetened beverages in Berkeley won’t make people any healthier, but it does have an impact on businesses and consumers who are already struggling to make ends meet."[7]

Path to the ballot

The Berkeley City Council voted unanimously to put this measure on the November ballot during its July 1, 2014, meeting.[7]

Similar measures

DefeateddCity of San Francisco Sugary Drink Tax, Proposition E (November 2014)
Defeatedd City of Richmond Tax on Soda, Measure N (November 2012)
Defeatedd City of El Monte Soda Tax, Measure H (November 2012)

See also

External links

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References