San Francisco, California, Soda and Sugary Beverages Tax, Proposition V (November 2016)

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Local ballot measure elections in 2016

Proposition V: San Francisco Soda and Sugary Beverages Tax
San Francisco City and County Seal.png
The basics
Election date:
November 8, 2016
Status:
Approveda Approved
Topic:
Local business tax
Amount: 1 cent per ounce
Expires in: Ongoing
Related articles
Local business tax on the ballot
November 8, 2016 ballot measures in California
San Francisco County, California ballot measures
City tax on the ballot
See also
San Francisco, California

A soda and sugary beverage tax measure was on the ballot for San Francisco voters in San Francisco County, California, on November 8, 2016. It was approved.

A yes vote was a vote in favor of imposing a tax on all soda and sugary beverages at a rate of 1 cent per ounce.
A no vote was a vote against this proposition, thereby leaving no additional city tax on soda and sugary beverages.

Election results

Proposition V
ResultVotesPercentage
Approveda Yes 237,168 62.49%
No142,34737.51%
Election results from San Francisco Department of Elections

Text of measure

Ballot question

The following question appeared on the ballot:[1]

Shall the City collect a tax of one cent per ounce from the distributors of sugar-sweetened beverages?[2]

Simplification digest

The following summary of Proposition V was provided by San Francisco's Ballot Simplification Committee:[1]

The Way It Is Now: The City does not impose a tax on the distribution of sugar-sweetened beverages.

The Proposal: Proposition V would place a tax of one cent per ounce on the distribution of sugar-sweetened beverages.

A sugar-sweetened beverage is a beverage that contains added sugar and 25 or more calories per 12 ounces. These include some soft drinks, sports drinks, iced tea, juice drinks and energy drinks. The tax would also apply to syrups and powders that can be made into sugar-sweetened beverages, for example, fountain drinks from beverage-dispensing machines.

The distributors of sugar-sweetened beverages in San Francisco would be responsible for paying the tax. The tax would not apply to retail sales of sugar-sweetened beverages.

Some beverages would not be subject to the tax, including:

• Diet sodas;

• Beverages that contain only natural fruit and vegetable juice;

• Infant formula;

• Milk from animal or vegetable sources, including soy, rice and almond milk;

• Nutritional therapy, rehydration and other beverages for medical use; and

• Alcoholic beverages.

A 16-member Advisory Committee would be established to evaluate the impact of the tax on beverage pricing, consumer purchasing behavior, and public health. The Committee would also advise the Mayor and Board of Supervisors about how to reduce the consumption of sugar-sweetened beverages in San Francisco.

The City could use the proceeds of the tax for any governmental purpose.

A “YES” Vote Means: If you vote “yes,” you want the City to collect a tax of one cent per ounce from the distributors of sugar-sweetened beverages.

A “NO” Vote Means: If you vote “no,” you do not want this tax.[2]

Fiscal impact

The following fiscal impact statement about Proposition V was provided by the San Francisco Controller:[1]

Should this ordinance be approved, in my opinion, it would result in an annual tax revenue increase to the City of approximately $7.5 million in fiscal year (FY) 2017–2018 and $15 million in FY 2018–19. The tax is a general tax and proceeds would be deposited into the General Fund.

The measure would amend the City’s Business Tax and Regulations Code to impose a one cent per fluid ounce tax on the initial distribution within San Francisco of sugar sweetened beverages, beginning on January 1, 2018. Administrative costs to implement this ordinance would have a minimal impact on the cost of government.

The proposed amendment would establish a Sugary Drinks Distributor Tax Advisory Committee that would make recommendations to the Mayor and the Board of Supervisors on the effectiveness of the tax. Starting in 2018 the committee would submit an annual report that evaluates the impact of the tax on beverage prices, consumer purchasing behavior, and public health, and makes recommendations on the potential establishment and/or funding of programs to reduce the consumption of sugar-sweetened beverages in San Francisco. The committee would be in place until December 31, 2028 unless extended by the Board of Supervisors.[2]

Full text

The full text of the measure is available here.

Support

Vote Yes on V, was the primary campaign effort in support of Proposition V. Endorsements for Vote Yes on V included: American Heart Association, American Diabetes Association, California Dental Association, Latino Coalition for a Healthy California, Public Health Institute, Prevention Institute, Michael Bloomberg, The American Academy of Pediatrics, Physicians of Social Responsibility San Francisco Bay Area, San Francisco Medical Society and more.[3]

Supporters

The following individuals and organizations signed the official argument in favor of the measure:[1]

Arguments in favor

Vote Yes on V campaign stated:[3]

It’s time to stop letting big soda put profits above our children’s health. On November 8th, the health of children in San Francisco relies on us. Proposition V will tax distributors of soda and other sugary drinks that have direct links to obesity and chronic diseases such as diabetes, heart and liver disease.

Since passing a similar measure in Berkeley, self-reported consumption of sugary drinks has fallen by 21%, while raising $1.2 Million for school nutrition and public health programs.

Simply put, this tax works—and now San Francisco can be a part of the progress.[2]

Official argument

The following official argument was submitted in favor of the measure:[1]

Scientific evidence demonstrates that there is a direct link between sugary drinks and diseases like obesity, diabetes, dental decay and even liver disease, driving up healthcare costs for everyone. San Francisco pays over 87 million dollars for direct and indirect costs of diabetes.

Sugar is a toxin that goes straight to the liver and other vital organs. 46 percent of the population has diabetes or is on the path to getting it. For Latinos and African Americans, the rate is even higher. One of every three children born after 2000 will develop diabetes during their lifetimes. Prop V will help to turn these trends around.

Prop V is a one-penny per ounce tax, paid only by the distributors of sodas and sugary drinks, generating $15 million annually that can be used to support health education programs, improving access to drinking water, expanding school nutrition programs, to improve children’s health.

Prop V requires the distributors of sugary beverages pay the tax. It is not a grocery tax or a tax on consumers.

Berkeley approved a similar measure in 2014, and has been a success. It has raised almost two million dollars per year for health programs, with no negative impacts on businesses or jobs.

Prop V is a result of advocates from low-income and communities of color, asking policy leaders to address the health needs of their communities.

The American Heart Association, San Francisco Medical Society, San Francisco Dental Society, local doctors, dentists, nurses and public health professionals all urge your support of Proposition V.

Please vote yes for children’s health. Vote Yes on Prop V.[2]

Opposition

Enough Is Enough: Don’t Tax Our Groceries was the primary campaign effort in opposition to Proposition V, supported by the American Beverage Association California PAC.[4]

Opponents

The following individuals signed the official argument against the measure:[1]

Troy Reese, owner of Queen’s Louisiana Po Boy Cafe

Arguments against

Enough Is Enough: Don’t Tax Our Groceries campaign stated:[4]

San Francisco costs enough already – now grocery prices could go way up!

The San Francisco Board of Supervisors approved a ballot measure that could raise prices across the board at restaurants and grocery stores in city limits.

San Franciscans are demanding answers!

The fact is we have higher priorities for City government than the regulation of our food and beverage choices with new taxes. Before we are forced to pay more at the checkout counter, we deserve some kind of guarantee that those dollars will be spent on the initiatives that matter to us. Without that guarantee, we see these tax proposals for what they are: Half-baked, expensive distractions.

San Francisco is already an expensive place to live—we don’t need taxes that make it more expensive to raise a family. We know that these tax proposals will have no real impact on complex diseases like obesity and diabetes. What we do know, however, is that these taxes would disproportionately hurt those who are already struggling to get by.[2]

Official argument

The following official argument was submitted in opposition to the measure:[1]

The politicians say this tax is about health, but not one penny is dedicated to health programs. The official digest states, “The City could use the proceeds of the tax for any governmental purpose.”

San Franciscans are already being priced out of our city.

Now a few politicians want to make San Francisco even more expensive with a grocery tax — even though voters rejected a similar tax in 2014.

The politicians call it a tax on sodas. If you do your own research you will see that is not true.

Instead of being imposed directly on beverages, this tax is imposed on “distributors,” including small business owners like me. This is because state law restricts the ability of local governments to impose a sales tax directly on most beverages. Nothing prevents this tax from being passed on to any item in our grocery stores and restaurants.

Small businesses like mine are under so much pressure from rising costs we will be forced to pass this tax on to customers – meaning higher food and grocery prices.

So even if consumers don’t buy sodas, their grocery bills could still go up. That is not fair.

Senator Bernie Sanders disagrees with these types of regressive taxes, saying it is “…a regressive grocery tax that would disproportionately affect low-income and middle-class Americans.”

Even the chief sponsor of this tax admits it hurts poor people the most. Her direct quote is: “This tax definitely affects those folks at the bottoms.”

Over a thousand neighborhood grocers and restaurant owners oppose Proposition V because it is a tax on groceries.

Enough is enough. We have higher priorities, and the last thing we need is a grocery tax. Vote NO on Proposition V.[2]

Campaign finance

Total campaign contributions:
Support: $2,557,531
Opposition: $9,796,500

Support

In support of Proposition V, there were $2,557,531 in contributions and $2,613,127 in expenditures.[5]

Top donors

As of October 23, 2016, the following were the top donors in support of the measure:[5]

Donor Amount
Michael Bloomberg $275,000
Action Now Initiative $185,000
Laura Arnold $130,000
John Arnold $130,000
Dignity Health $50,000

Opposition

In opposition to Proposition V, there were $9,796,500 in contributions and $10,026,262 in expenditures.[5]

Top donors

As of October 23, 2016, the following was the top donor in opposition of the measure:[5]

Donor Amount
American Beverage Association California PAC $9,795,000

Media editorials

Support

  • The Bay Area Reporter recommended a yes vote for Proposition V.[6]
  • San Francisco Bay Guardian: "Don’t believe the hype, well-funded by the soda industry: This is not a “grocery tax.” It’s a tax on soda, levied on the distributor, not on the store. Its aim is not so much to bring money into the city but to discourage people (particularly kids) from buying a product that can lead to serious health problems...But here’s the main point: It’s time for the country to start looking at soda the way we’ve looked at other health threats like tobacco. If SF approves this, it will push the national issue. Vote yes."[7]
  • San Francisco Chronicle: "The punishing effects can’t be ignored. In San Francisco, the city’s budget analyst blames overconsumption of sugary drinks for up to $28 million in public health treatment bills. The connections and scientific findings should be clear. Frequent sips of soda can damage health and impose social costs. That’s why it’s wise to back a tax on sugar-laced sodas, sports and energy drinks that will drive down consumption and pay for the public damage. It’s not a nanny-state intrusion when the public seeks to lessen the broad impacts of a sugar-loaded diet. Voters in San Francisco, Oakland and Albany have a chance to further a sensible public health trend by supporting levies on sugary drinks. Berkeley has already imposed a tax credited with helping lower use in that city. There’s another level to the story. If three cities of differing size and demographics approve a tax, a nationwide push will gather strength. A more positive and healthy trend could reach an irreversible turning point."[8]
  • San Francisco Examiner: "Some have criticized the measure for trying to police public health with what they have called a regressive tax. Cohen countered that the health risks associated with drinking soda, like type II diabetes and heart disease, disproportionately affect low-income residents. A similar measure in Berkeley passed in 2014. Researchers from UC Berkeley found that after the tax was passed, consumption of soda in Berkeley was reduced in low-income populations by more than 20 percent."[9]

Opposition

Email editor@ballotpedia.org to submit media editorials that should be posted here.

Path to the ballot

See also: Laws governing local ballot measures in California

San Francisco's city code allows four or more members of the San Francisco board of supervisors to sponsor a measure and put it before voters by signing the proposed ordinance and submitting it to the San Francisco department of elections. The following supervisors signed the ordinance proposed by Proposition V and submitted it on June 21, 2016:[1]

Recent news

The link below is to the most recent stories in a Google news search for the terms San Francisco soda tax Proposition V. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

See also

External links

Footnotes