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California prepares for a new war over soda taxes – and it could spill over into the 2020 election

Key Points
  • A proposed ballot measure backed by California doctors to tax sugary drinks was given the nod by the state to start collecting signatures to qualify for the 2020 ballot.
  • The measure seeks to use state taxes on the sugary beverages to fight childhood obesity and dental disease.
  • But the measure also seeks to change the state constitution and could upend a compromise reached in June between California lawmakers and the beverage industry that banned new local taxes on soda until 2031.
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California prepares for a new war over soda taxes

There's a new effort to bring a statewide sugar-sweetened drink tax to California.

The measure is meant to fight childhood obesity and dental disease. But it could upend a compromise reached with the beverage industry in June that banned new local taxes on soda until 2031.

The California secretary of state's office late Thursday gave proponents the green light to start collecting signatures to qualify the sugary-drink tax measure for the 2020 ballot. It follows previous attempts to pass a statewide soda tax in California.

The tax could raise $2 billion to $3 billion by 2022-23 to pay for public health programs, according to estimates by the nonpartisan state Legislative Analyst's Office. The proposed measure exempts diet sodas, milk and juice, as well as infant formula and medical beverages.

In June, the state legislature banned new local soda taxes until 2031, but that measure doesn't currently apply to statewide taxes. Assembly Bill 1838, which was signed into law by Gov. Jerry Brown, was a compromise with the beverage industry, which had funded a ballot measure that would have made it tougher for local governments in California to raise new revenues.

The California Medical Association and California Dental Association proposed the statewide tax on soda and other sugary beverages after the beverage industry prevailed in its efforts to defeat new new local soda taxes.

"For too long, California has lacked adequate support for programs that address the health effects of consumption of sugary beverages," said Natasha Lee, practicing general dentist and president of CDA. "With this initiative, our state has the opportunity to improve public health, especially among children."

If passed, the proposed initiative would create a new two-cent-per-ounce excise tax on sugary drinks. The majority of the revenue would go to fund prevention and treatment programs for medical and dental diseases linked to sugary drinks. A portion of it would pay for improving access to fresh fruits and vegetables as well as research on diseases linked to sugar-sweetened drinks.

Compromise threat

In addition, the CMA and CDA measure seeks to unwind the state legislature's compromise reached in June with the beverage industry. It would amend the state constitution to allow new local taxes on sugar-sweetened drinks.

The proposal still needs the signature of 585,407 registered voters to qualify for the 2020 ballot. Proponents have until early March 2019 to submit the signatures.

The American Beverage Association has spent millions of dollars around the country in the past decade to defeat soda tax efforts or to fight warning label requirements.

"Everyday grocery shoppers in California are struggling with affordability in the state — from housing to transportation to taxes," the ABA said in a statement. "Rather than further driving up costs at the supermarket, we believe there is a better way for health advocates, government and California's beverage companies to work together to help people reduce sugar consumption while at the same time protecting consumers' pocketbooks and the small businesses that are so vital to our communities."

Last year, California Assemblyman Richard Bloom, D-Santa Monica, introduced a statewide measure that would have taxed sugar-sweetened beverage products to fund programs in communities to reduce diabetes, obesity and heart disease, as well as dental disease.

However, Assembly Bill 1003 failed to pass the legislature. There were also earlier attempts to tax sweet drinks statewide, but they too were defeated by the industry although the city of Berkeley passed the nation's first tax on sugary drinks in 2014.

According to AB 1003's analysis presented to the Assembly Health Committee last year, "California is facing a diabetes and obesity epidemic, yet spends less than any other state on prevention." It estimates nearly 2.5 million Californians, or almost one out of every 10 people in the state, live with diabetes and another 13 million residents have what's considered "pre-diabetes."

At the same time, the state analysis indicated that the national obesity rate more than doubled among adults and tripled among children in the period from 1980 to 2010. It also claims the rates are higher in low-income communities.

Besides Berkeley, three other cities in San Francisco Bay area have taxes on sugary drinks, including Oakland, San Francisco and Albany. The sugary-drink taxes from the four cities combined generate an estimated $25 million annually, according to state estimates.

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