HASSO HERING

A perspective from Oregon’s mid-Willamette Valley

An Albany soda tax? How Albany, CA, does it

Written July 26th, 2019 by Hasso Hering

Diet soft drinks like these presumably would be exempt from an Albany “soda tax” the city council is considering.

If the Albany City Council is going to pursue a “soda tax” as a new source of city revenue, it might be of interest to look at how Albany, California, has dealt with such a tax.

Indeed, a table of nine possible sources of new revenue lists Albany’s namesake down south as one of four cities that have soda taxes. The other three are Boulder, Seattle and San Francisco.

Albany, CA, is a municipality on the east side of San Francisco Bay, surrounded by the cities of Richmond, El Cerrito, and Berkeley. With around 21,000 people, its population is about two-fifths the size of Albany. In land, though, it’s much smaller, with 1.9 square miles versus 17 square miles here.

In the 2016 general election, voters in the California town approved what the city calls a “Sugar-Sweetened Beverage Product Tax” with a rate of 1 cent per fluid ounce. It applies to soft drinks as well as energy drinks and pre-sweetened tea. It also applies to syrup supplied to restaurants, at a rate of 1 cent per ounce of beverage that the syrup is meant to make. If one ounce of syrup makes 12 ounces you can drink, the tax is 12 cents.

On its web site, California’s Albany says this is not a sales tax because it’s collected from distributors, not the retailers. It’s up to retailers whether to increase their prices accordingly.

(Albany, CA, sounds like an interesting place wholly aside from its tax policy. It has KALB, a public-access TV station. One of the frequently asked questions on its website is whether KALB allows programs showing people naked. Yes, apparently that’s OK, as long as there’s no obscenity.)

In the current fiscal year, Albany expects to collect $305,000 from the sugared-beverage tax. It plans to spend $130,000 on school crossing guards, relieving its police budget of that item; and $90,000 on providing “water bottle filling stations” in six city parks. Smaller amounts are going to support free classes in nutriition, cooking and gardening; free fitness classes in the parks; a bike education program for school children, and a “Healthy Me” music and movement program for young kids.

At first, $305,000 from a 1-cent/ounce drink tax seems like a lot. But maybe not. Albany, CA, apparently figures that 30.5 million ounces of beverages will be taxed. That breaks down to about 1,425 ounces per person per year, or 121 12-ounce drinks per person a year, or one such drink every three days. Or one a day if only one-third of California Albanians buy sugared drinks.

Those consumption figures look plausible. Albany, OR, is almost three times the size. The same kind of tax here might generate amost three times as much, or close to $900,000 a year.

You can see why the soda tax ended up on the list of possibilities the council is considering.

Last week, Manager Peter Troedsson asked each council member to rank the nine potential revenue sources on their list, as well as three listed ways to cut city expenses. Whether the soda tax survives this exercise, we’ll find out when the rankings are compiled and announced. (hh)



18 responses to “An Albany soda tax? How Albany, CA, does it”

  1. Gordon L. Shadle says:

    Voters in Albany, California approved it, so if they want to exercise economic violence on a legal product, they have nobody to blame except themselves.

    Voters in Albany, Oregon probably won’t have a choice. What’s the probability that Mayor Konopa and Councilor Olsen will fight a referendum to voters? Pretty close to 100% I’d say.

    I have first hand knowledge that they prefer to dictate their agenda. Allowing voters to have the final voice on a new tax is not in their political DNA.

    Hopefully the city council has 4 rational members who will shoot this silly idea down before it gains any traction.

    • Albany Mayor Sharon Konopa points out that as a tax, and not a fee, any soda tax would need the voters’ approval in an election.

      • Gordon L. Shadle says:

        Yes, and like I mentioned, the Mayor would probably fight a council soda tax referendum to voters. She does have veto power.

        The easy choice for her is to call it a “fee” and keep the issue away from voters.

        The Mayor, and some on the council, must be salivating at the thought of imposing almost $1,000,000 per year on soda drinkers.

        This is easy money. It is probably #1 on the list of 9.

        • Gordon L. Shadle says:

          By the way, if you want to see an example of a soda “fee”, not a “tax”, just Google “California Assembly Bill No. 138, Assembly Member Bloom.”

          The “fee” will be for the privilege of distributing sugary drinks, syrups, powders, and concentrate in the City of Albany, Oregon.

          Presto majico….no voter approval needed.

          (I’m betting half the council is burning up their computers right now looking this up.)

  2. HowlingCicada says:

    I expect the usual “nanny-state” and “all they ever want is more money” comments, and maybe some crocodile tears for “poor” people and “small” business.

    Those are some of the arguments used against higher tobacco taxes. There’s little doubt that smoking was one of the worst health disasters of the last 100 years. Higher taxes played a part (one can argue how much) in cutting smoking rates, with the most important drop in young people, who tend to have less disposable wealth. That drop in youth smoking rates is probably what fuels the opposition to high taxes by the proven-liar tobacco industry.

    Are sugared drinks comparable? Maybe, to some extent. Should they be taxed? No, if you think government has no business nudging people in a healthy direction. Yes, if you think taxes can be applied smartly to encourage or discourage behaviors with good evidence of consequences. Congestion pricing is a slam dunk; sugared-drink tax may not be worth fighting all the loud naysayers.

  3. Bill says:

    California is in very deep trouble. People are fleeing the state in large numbers. Hopefully they are not a guide for how to proceed in Oregon.

  4. Schmuck281 says:

    I think it is a great idea. I live in Tangent, just outside of Albany. I wonder how much soda I could sell.

  5. hj.anony1 says:

    Your photo, HH, shows a diet soda in the forefront. Good. Those should be included in this latest sin tax. After all, the chemicals of sugar free soda are equally harmful as all that sugar in the regular.

  6. Ken Walter says:

    We can’t live within our means, “be thankful I don’t take it all”.

  7. Country Boy says:

    Somehow following the lead of a city in a state that is sinking like a rock due to following “Progressive” politics seems like a bad idea. San Francisco (once the most beautiful city in the U.S.) is turning into a literal open sewer; and is the epitome of that ideology. If that is Albany, Oregon’s choice, it’s your choice to live with the results.

  8. Craigz says:

    The solution to continual and growing fees and taxes…..elect fiscal conservatives to your City Council ! STOP re-electing Mayors and Council Members (goes for other areas of Government as well) that pass on new fees and taxes. YOU must live within your means….it is about time Government learns the same !

  9. MsJ says:

    And impose term limits on all councilor and mayor positions so they do not have decades-long strangleholds on city policies & become desensitized to their constituents.

  10. Jeremy says:

    This is insanity, the very proposal of a soda tax makes me want to vote the entire lot out on their ears. They do not understand their constituency, Albany is not Corvallis, Sharon and her ilk need to take their nonsense somewhere else. Shame on them!!!!!!!!!!!!!!!!!!

  11. Fred says:

    I wonder what the other eight “new tax” options are? How about they just do better at controlling their operational costs. I would think based on the 28 million dollar bond ask a couple of years ago and the whole CARA situation, any new tax measure would have no chance with the voters.

 

 
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