Washington Repeal Tax Law Amendments, Initiative 1107 (2010)
On July 2, 2010 initiative supporters submitted an estimated 395,103 signatures, exceeding the 241,000 minimum requirement. On July 28, election officials reported that I-1107 had qualified for the ballot.
|Washington Initiative 1107 (Repeal Tax Laws)|
Text of measure
The ballot title read:
According to the description prepared by the Washington Secretary of State:
This measure would reverse certain 2010 amendments to state tax laws, thereby: ending the sales tax on candy and the temporary sales tax on some bottled water; and ending temporary excise taxes on the activity of selling certain carbonated beverages, not including alcoholic beverages or carbonated bottled water. It would also reinstate a reduced business and occupation tax rate for processors of certain foods.
Initiative 1107 was proposed by the American Beverage Association in reaction to the April 2010 approval of temporary taxes on soda and other sugary beverages. The tax amounted to 2 cents on every 12 ounces of soda. Similar taxes were implemented in Maine and Colorado but beverage industry lobbyists squashed efforts to pass a soda tax in 2010 in Mississippi, New Mexico and New York state. The tax was expected to generat revenue in order to ease the $2.8 billion budget gap. The tax was estimated to raise $94 million.
Effects if measure passes
|Taxes on the ballot in 2010|
I-1107 repealed the 2010 temporary excise tax on carbonated beverages in addition to a three year temporary sales tax on bottled water that was scheduled to last from 2010 to 2013. The sales tax on candy was also repealed in addition to a revision of a tax on certain processed foods.
Conflicts with R-52
I-1107 conflicted with R-52 because the initiative abolished the temporary sales tax on bottled water if approved. R-52 called for a temporary expansion of the bottled water sales tax until 2013 if approved. Abolishing sales tax revenue through I-1107's approval including bottled water would make it difficult for the state to pay for energy efficiency projects that are contingent on that revenue. However, according to official election results R-52 was defeated.
In support of the proposed measure, the American Beverage Association (ABA), was reported to have spent an estimated $1 million gathering petition signatures for the July 2 statewide deadline. According to October 2010 reports, supporters of the proposed measure reportedly raised more than $16 million, making this the most expensive initiative campaign in Washington state history. Members of ABA included Coca-Cola Co., PepsiCo Inc. and Dr Pepper Snapple Group Inc.
According to August 2010 reports, supporters spent an estimated $2.5 million to get signatures and put I-1107 on the 2010 ballot.
In August 2010 the American Beverage Association reportedly made at least two $3.5 million contributions. The campaign was reported to have had $10.2 million in total donations. However, as of early September 2010, the supporting campaign reported raising an estimated $14.4 million, which according to news reports made I-1107 the most expensive initiative campaign in state history.
The following is a list of the top five donors to the campaign in support of I 1107:.
|American Beverage Association||$16,501,000|
|Willams Inland Distributors||$100|
Tactics and strategies
In September 2010, according to Kathryn Stenger, spokesperson for the campaign, said that supporters were preparing to launch a statewide campaign.
Opponents, including advocates for children, education and health care, argued that I-1107 was "misleading and deceptive." The main campaign group in opposition to the proposed measure was Citizens to Protect Our Economic Future and the Protect Washington (dead link) coalition. Opponents said they wanted to preserve the taxes on soda pop and candy in order to avoid drastic cuts to health care and education.
In regard to initiative campaign efforts, opposition spokesperson Sandeep Kaushik said, "I think this reinforces what we’ve been saying all along – that it’s clear the beverage association understands that in an equal debate, they would lose. So they’ve decided to try to buy the election with extraordinary record amounts of cash...They are interested in protecting their massive profits and spend extraordinary amounts to preserve them."
"This is about large soda companies coming into our state and trying to get a tax break. I really, really doubt that the American Beverage Association put more than $14 million in Washington because they’re worried about how much Washingtonians pay in taxes," said Celia Schorr, spokeswoman for No on I-1107.
According to September 2010 reports, Citizens to Protect Our Economic Future raised $304,229 to fight the repeal measure.
Below is a chart that outlines major cash contributions to the campaign in opposition of I-1107:.
|Community Health Network of Washington||$60,000|
|SEIU Washington State Council||$60,000|
|Washington Federation of State Employees||$60,000|
|Washington Education Association||$40,000|
|Group Health Cooperative of Washington State||$25,000|
Reports and analyses
OFM impact report
In 2010 the Washington Office of Financial Management released fiscal impact statements for initiatives scheduled to appear on the 2010 ballot, including Initiative 1107. Below is an excerpt:
Over five fiscal years, the initiative reduces State General Fund revenues by an estimated $352 million and state performance audit revenue by an estimated $359,000. Revenue for local jurisdictions authorized to impose a sales tax is reduced by $83 million over five fiscal years. Taxpayer noncompliance and confusion could result in additional state and local government revenue decreases up to $8.7 million and $1.8 million, respectively, in fiscal year 2011. Net state costs to administer the tax revisions are $98,200 over five fiscal years.
Budget and Policy Center
The Washington State Budget and Policy Center released an analysis of several Washington 2010 initiatives, including I-1107. According to the study, the impact of I-1107 to the state's general fund over a 5-year period was estimated at $352 million. The study concluded that the initiative would reduce state resources in current and future fiscal years. Such resources would include repealing revenue increases approved in 2010 which the organization described as having "played a pivotal role in preventing painful and economically damaging cuts to essential public services."
Media Editorial Positions
- The Pacific Northwest Inlander supported I-1107. In an editorial, the board said, "...the package of taxes our leaders pulled together as a kind of legislative Hail Mary pass — on everything from soda to bottled water to (some) candy bars — was flat-out bad policy. They knew it wasn’t a long-term solution; in fact, the Band-Aid package would expire in 2013. These are the worst of the regressive taxes Washington is known for. Big Soda doesn’t pay a penny; it gets passed along to consumers, hitting those who can least afford it hardest. And in border counties, it’s tough to compete with Idaho and Oregon."
- The Yakima Herald-Republic supported I-1107. "Among the tax increases approved in the past session were an excise tax on soda, a sales tax on bottled water and candy, and an increased B&O tax on some food processors. This initiative would repeal them, and rightfully so. Advocates say there is a three-year "sunset" provision in the taxes. But as we editorialized in July, lawmakers may be more tempted than a kid in a candy store to expand them to other edible items," said the editorial board.
- The Bellevue Reporter was in support. "The Legislature needs to stop the taxing. A 'Yes' on I-1107 will reverse the taxes and force the Legislature to do its job," said the board.
- The Seattle Times opposed I-1107. In an editorial, the board said, "It would create a $200 million hole in the state's next two-year budget — and already that budget appears to be at least $3 billion short."
- The Tacoma News Tribune opposed I-1107. In an editorial, the board said, "Now the American Beverage Association has come to Washington to mount the same assault that it’s successfully pushed elsewhere. It has contributed almost every penny of the $14 million the I-1107 campaign has in the bank. That campaign has tried mightily to bill the initiative as a fight against “grocery taxes” – a spin job that hangs by such a small thread of truth as to be nearly fraudulent."
- The Olympian opposed I-1107. In an editorial, the board said, "Or do we, instead, want to make a small sacrifice and spend an additional 2 cents for a 12-ounce soda pop to keep necessary services in place? The choice seems obvious."
- The Walla Walla Union-Bulletin opposed I-1107.
- The Stranger was opposed to the proposed initiative. The editorial board wrote, "The reason this tax exists at all is because the state has a budget shortfall, despite cutting billions from departments for the last two years. Lawmakers had to either pass this tax or cut health care for kids, essential funding for public schools, or other programs that help the poorest people in the state. So while it's an arguably regressive tax—sales taxes consume a larger percentage of poor people's income than rich people's—it produces roughly $130 million per year to help the poor. And it's their only hope for funding those programs."
- Publicola opposed I-1107. "PubliCola urges voters to oppose this initiative, which would eliminate reasonable taxes that were passed this year to help preserve critical programs that would otherwise have been cut. A few cents on a can of soda is a small price to pay for environmental, health, and education programs that benefit all Washington residents," said the editorial board.
- The Kitsap Sun opposed the measure. "We oppose I-1107 because it pulls the plug on needed revenues midway through the state’s 2009-2011 budget. The Legislature also should amend the candy tax so it is more understandable and uniform," said the board.
- See also: Polls, 2010 ballot measures
- An August 26-August 29, 2010 poll of 650 likely voters by Survey USA showed that 42% of voters were certain they would support I-1107, 34% were certain they would oppose the measure, and 24% were undecided.
- A September 9-12, 2010 poll of 500 likely voters by Elway Poll revealed that 47% supported the proposed measure, while 38% were opposed and 15% were undecided.
- A September 30-October 3, 2010 poll of 639 likely voters by Survey USA revealed that 52% supported the proposed measure, while 29% were opposed and 19% were undecided. The poll was sponsored by KING-TV Seattle. The margin of error was +/- 4 percentage points.
- An October 7-10, 2010 poll of 400 likely voters by Elway showed that 54% supported the proposed measure, while 33% opposed it and 13% were undecided.
- An October 4-14, 2010 poll of 500 likely voters by The Washington Poll showed that 56% supported the proposed measure, while 36% opposed it and 7% were undecided. The margin of error was +/- 4.3 percentage points.
- An October 24-27, 2010 poll of 504 likely voters by SurveyUSA (dead link) showed that 56% supported the proposed measure, while 36% opposed it and 9% were undecided. The margin of error was +/- 4.4 percentage points.
|Date of Poll||Pollster||In favor||Opposed||Undecided||Number polled|
|August 26 - 29, 2010||Survey USA||42%||34%||24%||650|
|Sept. 9-12, 2010||Elway Poll||47%||38%||15%||500|
|Sept. 30-Oct. 3, 2010||SurveyUSA||52%||29%||19%||639|
|Oct. 7-10, 2010||The Elway Poll||54%||33%||13%||400|
|Oct. 4-14, 2010||The Washington Poll||56%||36%||7%||500|
|Oct. 24-27, 2010||SurveyUSA||56%||36%||9%||504|
Path to the ballot
On July 2, 2010 initiative supporters submitted an estimated 395,103 signatures, exceeding the 241,000 minimum requirement. According to the Washington Secretary of State supporters scheduled an appointment with the state elections office for 8:30 a.m. on July 2.
- The Spokesman Review,"Money pours into initiative campaigns," September 5, 2010
- The News Tribune,"Ballot will shape state budget," August 30, 2010
- The News Tribune,"Initiatives draw cash," August 22, 2010
- Washington Secretary of State's: From Our Corner,"Here’s your quick guide to WA ballot measures," August 10, 2010
- The Spokesman-Review,"6th initiative makes ballot, would cut taxes," July 28, 2010
- The Daily Herald,"5 Washington state ballot measures could end up in court," July 18, 2010
- KPLU 88.5,"$8.2M Spent So Far To Get Initiatives On Wash. Ballot," July 15, 2010
- Inlander,"Taking Initiative," June 16, 2010
- Washington Secretary of State,"Initiative 1106 and 1107 brief description," accessed June 3, 2010
- Seattle Post-Intelligencer,"Food fight: Push to repeal taxes is a 'con,' foes say," June 17, 2010
- Washington's: From Our Corner,"`Direct democracy’ — A six-pack for 2010," July 2, 2010
- From Our Corner, "Initiative checks done, I-1107 qualifies," July 28, 2010
- Note: This text is quoted verbatim from the original source. Any inconsistencies are attributed to the original source.
- Stateline.org,"Industry lobbying turns soda taxes from fizzy to flat," July 7, 2010
- The Washington Post,"Soda taxes fizzle in wake of industry lobbying," July 13, 2010
- Washington Secretary of State, "2010 Voter Guide, Initiative 1107" (dead link)
- Washington Secretary of State, "Summary of I-1107 (2010)" (dead link)
- Washington Secretary of State, "2010 Voter Guide, Referred Bill 52" (dead link)
- The Stranger, "Even more money from the soda lobby?" October 12, 2010
- Associated Press,"Soft-drink industry takes stand against tax hikes," October 19, 2010
- Seattle Post-Intelligencer,"Anti-soda tax campaign tops $10 mil," August 18, 2010
- Associated Press,"Wash. initiative campaigns draw big campaign cash," August 17, 2010
- The News Tribune,"Soda makers raise ante, contribute again to tax-rollback measure," September 3, 2010
- The Bellingham Herald,"Updated: Soda industry ante on I-1107 hits $14.4 million," September 1, 2010
- MyNorthwest.com,"Most funded initiative in state history," September 28, 2010
- Washington PDC "Citizens for Responsible Spending-Campaign Detail," accessed October 19, 2010
- Washington PDC "Citizens to Protect our Economic Future-Campaign Detail," accessed October 19, 2010
- Othello Outlook,"Ballot measures could have significant impacts on state - Washington State Budget and Policy Center," August 24, 2010
- Washington State Budget and Policy Center,"New OFM Analyses Show Potential Costs of 2010 Initiatives," August 11, 2010
- "The Pacific Northwest Inlander,""Decision Time," October 6, 2010
- The Yakima Herald-Republic,"On tax initiatives, keep your money and keep it away from lawmakers," September 27, 2010 (dead link)
- Bellevue Reporter,"Vote 'Yes' on I-1053, to control taxes | editorial," October 21, 2010
- The Seattle Times,"Voters should reject I-1107 and keep tax increase on candy, water and pop," September 10, 2010
- The News Tribune,"Don't make state crisis worse with Initiative 1107," September 19, 2010
- The Olympian,"Don't be misled: I-1107 will be devastating to state coffers," October 7, 2010
- Union-Bulletin,"State can't afford loss of candy and water tax," October 7, 2010 (dead link)
- The Stranger,"VOTE, BABY, VOTE!," October 13, 2010
- Publicola,"PubliCola Picks “No” on Initiative 1107," October 16, 2010
- Kitsap Sun,"OUR VIEW | Sorting Out the Ballot Issues," October 21, 2010
- Survey USA, "Results of SurveyUSA Election Poll #17011" August 30, 2010
- PubliCola,"SurveyUSA Poll Could Spell Bad News for Progressive Coalition," August 31, 2010
- FireDogLake,"WA Ballot Measures Polling Under 50% – So Much for That Anti-Tax, Less Government Wave," September 16, 2010
- Seattle Post-Intelligencer,"Skeptical public? All initiatives under 50 percent in poll," September 15, 2010
- The Spokesman Review,"Initiative support tepid in poll," September 20, 2010
- SurveyUSA,"10 Days Until WA Ballots Mailed, New Support for Initiative 1107, Steady Support for 1053, Faltering Support for Referendum 52," October 4, 2010
- Publicola,"Poll: Candy Tax Repeal Gains Ground, Four Initiatives Losing" October 11, 2010
- Publicola,"KCTS-9/KPLU/Washington Poll" October 15, 2010
- SurveyUSA,"Final KING 5 poll shows where initiatives stand" October 28, 2010 (dead link)
- The Associated Press,"Opponents of soda, candy taxes turn in signatures," July 2, 2010
- The Port Townsend & Jefferson County Leader,"Initiative 1107 aims to repeal food and beverage tax with Nov. ballot," July 13, 2010
- Washington Secretary of State's Blog: From Our Corner,"It’s raining initiatives...," June 24, 2010
- Associated Press,"Soda initiative expected on Washington ballot," June 23, 2010 (dead link)
- The News Tribune,"Could be 6 citizen initiatives on ballot in November," June 27, 2010
- The Daily Herald,"Up to 7 initiatives could make ballot in Washington," June 28, 2010
- Washington Secretary of State's: From Our Corner,"Another initiative hurdle cleared," July 26, 2010
- The Bellingham Herald,"Pop tax repeal is 6th initiative to qualify for ballot," July 29, 2010
- Auburn Reporter,"Initiative checks done; I-1107 qualifies," July 28, 2010
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