| LOS ANGELES/NEW YORK, Sept 5
LOS ANGELES/NEW YORK, Sept 5 Two small
California cities are the latest battlegrounds in the $111
billion U.S. soda industry's fight to defend a near-perfect
record of defeating proposed taxes on sugary drinks.
In November, voters in cash-strapped Richmond and El Monte
will decide whether to pass penny-per-ounce taxes on
sugar-sweetened drinks to bolster municipal coffers and fight
Approval could open the floodgates to similar taxes around
the country. Calls to tax sugary drinks have gathered steam as
more cities and states struggle to close budget gaps and
American waistlines continue to expand.
A few decades ago, cigarette taxes in several small
California cities paved the way for what are now significant
taxes on tobacco products -- and the soda industry does not want
to suffer the same fate.
"The first few victories make an enormous difference," said
Kelly Brownell, a soda tax proponent and director of Yale
University's Rudd Center for Food Policy & Obesity.
The American Beverage Association -- which represents
PepsiCo Inc, Coca-Cola Inc, Dr Pepper Snapple
Group Inc and other beverage companies -- has spent
millions of dollars to beat back soda taxes around the country.
Jeff Ritterman, the Richmond city council member who
championed the tax, expects a "tsunami" of spending from the
beverage industry after its focus shifts from this month's vote
on New York City Mayor Michael Bloomberg's proposal to ban
large-sized sugary drinks at restaurants and other food outlets.
The ABA has said taxes on soda would hurt poor people and
local businesses, while unfairly targeting one product. They
also challenge the link between soft drinks and obesity, saying
obesity rates have risen even as U.S. consumption of
full-calorie sodas has declined.
TSUNAMI OF SPENDING
Americans on average drink 44.6 gallons of soft drinks each
year, down from a peak of 54 gallons in 1998, according to
Beverage Digest. Diet drinks, water and teas now account for a
bigger portion of sales, fueled by consumers' health concerns.
A Tufts University review of studies published over 17 years
found that consumption of sugar-sweetened beverages was the most
consistent dietary factor associated with weight gain.
Richmond and El Monte have the dubious distinctions of
having some of California's highest proportions of obese and
overweight children, with rates above 50 percent.
Richmond, which has more crime and is poorer than many of
its San Francisco Bay Area neighbors, was first to propose the
tax. El Monte, a relatively low-income and mostly Hispanic
suburb of Los Angeles, quickly followed.
Supporters of the soda tax range from medical groups like
the American Academy of Pediatrics to actor Danny Glover, star
of the "Lethal Weapon" movies.
The two main groups supporting the Richmond tax have raised
$32,060 as of the end of June, according to campaign filings.
That's a drop in the bucket compared to the millions of
dollars that beverage companies spent a few years ago to repeal
soda taxes in Maine and Washington State. For example, the ABA
and the Washington Beverage Association in 2010 spent almost $17
million to knock down the Washington tax, according to
Not all of the spending is so direct. An ABA-created group
last year donated $10 million to Children's Hospital of
Philadelphia to fund research into childhood obesity. That
donation came after the city's soda tax proposal failed,
sparking outrage in the public health community.
ABA spokesman Chris Gindlesperger said the donation built on
an ongoing philanthropic relationship that preceded the city's
proposal and that the gift had "absolutely" nothing to do with
the fate of the soda tax. A spokesman for the hospital told
Reuters he couldn't say what impact the donation may have had on
the tax proposal and that there were no conditions imposed on
how the gift was used.
In Richmond, the ABA has funded nearly all of the $153,628
that the city's Community Coalition Against Beverage Taxes
received as of June 30.
The group has put up billboards saying the tax would hit
Richmond's working and poor residents the hardest, since
groceries eat up a larger portion of their paychecks. The
coalition planned to spend $354,898 on advertising, consultants
and other campaign expenses, according to campaign disclosures.
"We're going to spend what it takes to make sure voters
understand who is going to pay the price for this tax,"
said Chuck Finnie, a coalition spokesman who called the city's
tax proposal "misguided".
ABA is also flexing its muscle in El Monte, backing a
lawsuit that challenges the soda tax ballot language as "clearly
biased, misleading and false," and polling residents. It has
formed El Monte Citizens Against Beverages Taxes. Financial
filings related to the city's proposal are not yet available.
Arthur Barrios, an El Monte planning commissioner and
plaintiff on the lawsuit, called the soda tax an attack on the
city's small businesses.
"Industry is going to spend all kinds of money challenging
every little thing," said El Monte Mayor Andre Quintero, who
said the ballot language is similar to what has been used in