Soda tax
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Big Soda’s big spending: $45M of lobbying (and counting) to keep taxes at bay

The American Beverage Association once spent $11 million in a six-month period to defeat a New York soda tax proposal.

The American Beverage Association will win the spending war in Philadelphia. It always does.  

Soda taxes proposals have sprung up across the United States more than 30 times in the last 10 years, and the common thread among almost all of them — other than they usually fail — is heavy spending by the American Beverage Association on lobbying.

Billy Penn tracked down lobbying expenditures for seven states and five cities for which lobbying data was readily available and found the amount spent on lobbying by the American Beverage Association in years when soda taxes were considered to be $45.6 million. These numbers don’t include Pepsi, Coke or local branches of the American Beverage Association (ABA), which often spend thousands of dollars on local lobbying, or the $33 million it spent on federal lobbying from 2009 to 2014.

A deeper look into specific states and cities illustrates how powerful and vast the ABA’s money is:

New York

A statewide soda tax was considered in the first half of 2010. After having spent about $804,000 on lobbying in 2009, the ABA’s spending on lobbying shot up to $11 million in the first six months of 2010. It spent another $1 million in the last six months. The $11 million it spent in those first six months represented more than all but three groups spent on lobbying in New York in years 2007 through 2014 combined.

Kansas

The $394,000 spent by the ABA in 2010 represented nearly one-third of the overall amount spent on lobbying in Kansas that year.

Washington

Washington passed a soda tax of two cents per 12 ounces in April 2010. That didn’t make Big Soda happy. So the ABA spent $1 million to gather nearly 400,000 signatures that allowed for a referendum to reverse the decision. The tax was reversed later in the fall. That year, the ABA pumped in about $15 million that year, according to the Seattle Times.

Other cities

Soda taxes have been more commonly proposed at the state level, but a few other cities have been like Philadelphia, largely in California. Before Berkeley, Golden State cities Richmond and El Monte tried to get one passed. The ABA spent about $155,000 on lobbying in El Monte and then in 2012 and 2013 about $2.6 million in Richmond, population 107,000 (if the ABA spent the same per resident in Philly its lobbying expenses would reach $20 million).   

In Berkeley, where the tax actually passed in 2014, the ABA spent $2.4 million over a two-year period. In San Francisco, where it failed the same year as Berkeley, the amount was $9.2 million — about three times what was spent on San Francisco’s mayor spent when he was first elected in 2011. The money is used for ads, phone calls, direct lobbying of public officials and messaging (here the opposition goes by No Philly Grocery Tax; elsewhere it’s been Kansans Against Food and Beverage Taxes and New Yorkers Against Unfair Taxes).  

“You have a very deep-pocketed influential association coming in and drowning out regular people because they have the resources to do so,” said Denise Roth Barber, managing director of National Institute on Money in State Politics. “They can easily convince the deciders, whether it’s the citizens or lawmakers.”

Philadelphia has seen the same types of spending and initiatives (City Hall employees are calling the soda tax “a lobbyist employment program”). The ABA poured $1.4 million into lobbying the first three months of the year. In the same timeframe, all other lobbying expenses in Philadelphia totaled about $500,000.     

As the ABA has showed in places like San Francisco and New York, that total will likely rise much, much higher as the tax moves closer to vote. How high? Double-digit millions are a possibility. The ABA has pulled it off here before.

Though this doesn’t count as lobbying, the ABA dug deep into its pockets in 2011, creating a nonprofit called Foundation for a Healthy America. The foundation’s inaugural grant was providing money to a Philadelphia institution. It gave $10 million to CHOP, a year after the hospital’s doctors testified about the dangers of soda.   

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