It’s hard to predict what would happen if Philadelphia instituted a soda tax because so few other places have done it. Will corner stores close their doors? Will thousands of jobs really be lost? Could this tax cripple the budgets of low-income families? And will this really cut down on obesity and diabetes if it passes?
Berkeley, Calif. is the only other city in America to have approved a soda tax. In Nov. 2014, voters approved a one-cent-per-ounce tax (a third of what Philadelphia Mayor Jim Kenney wants) in order to reap health benefits and fund programs for school kids. In the first year, the tax brought in about $1.5 million.
Of course, it’s different in Berkeley. The city has a population of 117,000. It’s one of the most liberal cities in the country and has a much lower poverty rate than Philadelphia does. On top of that, it was voters who made the decision to levy a new tax — not City Council and the mayor.
But despite the differences, analyzing what happened in Berkeley is one of the only ways we can predict what *might* happen here. Billy Penn spoke with Berkeley City Councilman Laurie Capitelli, who spearheaded the effort to pass the sugary drinks tax there. Here’s our conversation, which was lightly edited for clarity and brevity:
Tell me how the idea of instituting a soda tax in Berkeley began. When did local officials start seriously discussing this?
The election was Nov. 14 and the original meetings were in April and May of 2013. So the original motivation was some programmatic funding. We had a cooking and gardening program in our public schools that was pretty much a citywide program, and those programs had been federally funded and that money was going away. So there was a motivation on the part of a lot of public school parents that we wanted to see that program preserved.
I realized early on that without the public school parents that we didn’t have the critical mass to move forward. The intent was to fund nutrition and education programs from birth to 18, basically. So that was the spring of 2013, and then we made some decisions. Your situation is different in Philadelphia because the council can pass a tax.
What was the strategy early on for making sure this got done?
Richmond is a neighboring city to Berkeley. They put a soda tax on in 2012, and they got their asses kicked. Big Soda came in with over $3 million and basically just bought up everybody. So we wanted to keep a low profile. In September 2013, we decided to go out and start getting endorsements.
We went to Latino Sunidos, a significant player in Berkeley. We went to the NAACP. We went to the faith community. Obviously UC Berkeley is here with significant opinions across the board. We were basically getting unanimous support as we moved along. For us, it was a matter of making some strategic decisions and planning early.
Part of that planning was for Big Soda and lobbyists coming to town?
It was like a tsunami. They bought every billboard they could in town. They hired precinct workers to come in from all over the Bay Area, paid them very good money. We have three underground subway stations in Berkeley. At one point, they bought every square inch of advertising in a station, including the stores. When you came up an escalator you came onto a rubberized carpet that said ‘vote no, don’t trust your politicians.’
The interesting thing is it all backfired. We tried to tell people to be prepared. We said, in August and September and October, you are going to get an avalanche of mail and phone calls. So people were really ready for it, so when it happened people went ‘oh yeah, we heard this was going to happen.'”
It was a very successful campaign. It was a little bit of a David and Goliath story. The soda industry kind of trampled all over everyone. They tried to confuse people. And we won.
So what advice do you have for Kenney’s administration? The tax is seen as regressive and one that could kill jobs in the city, but his people say that rhetoric comes straight from Big Soda.
I can’t tell you how many times I said ‘you know what’s really regressive? Diabetes is really regressive.’ It impacts Latino and African American communities almost twice the rate as white communities. In the East Bay of San Francisco, there’s almost a 50-50 chance that a teenage African American or Latino person will get diabetes in their lifetime. And we were very careful. We did not just take on soda. We were taxing the Frappuccinos. We were taxing the sports drinks, which really cut across class lines.
What are your thoughts on Kenney’s tax proposal? Yours was one cent. His is three. Is his too high?
I don’t think it’s high, because from my perspective, I’ve sort of evolved over a year and a half. At one point, I realized I didn’t care about the money anymore. If I were in his position and it were a matter of getting it passed and I had to compromise at two cents an ounce vs. three, I would do it.
The level of education that takes place in a campaign like that — here it is almost two years later, and people are still talking about it. My guess is the consumption went down when we started the campaign, not when the tax went into effect.
Really? Why do you say that?
There was a buzz in this community like, ‘oh, taxing sugar and, oh my God liquid sugar, what does it do to the body?’ Just the discussion started people thinking about sugar-sweetened beverages.
We have a doctor who had been treating a young man, I guess he was 12 or 13 and he was obese. And at some point several months later, it might have been just before the election, the young man came back in and had lost 15 pounds. The kid said, ‘Haven’t you heard about soda and what it does to you? I stopped drinking soda.’ It was very heartwarming. So I would say to the mayor: Get it done and don’t make too many compromises.
One of the other arguments out here is the Teamsters were concerned about jobs. I went to the Teamsters and I said ‘Look, you delivered sugar-sweetened beverages. People are still going to be thirsty, and you’re still going to be delivering bottled drinks.’
Here in Philly, the Teamsters have said they stand to lose 2,000 jobs. How many jobs were lost in Berkeley after this was instituted?
We have not heard one whisper of a job loss, of business falling off, of a store closure. Not one. And we’ve been now collecting the tax for well over a year. It’s been remarkably smooth.
What about revenue? Did it match projections?
The projections were all over the map. On the whole, they’ve come in higher. The estimates were $500,000 to 1.2 million. In the first year we collected $1.5 million and that money now is being allocated to precisely the programs that will help us reduce sugar-sweetened beverage consumption.
You get calls a lot from other cities wanting to do this?
Yes, all over the place. Getting calls from three cities likely to put it on the ballot in the Bay area. Boulder, Col. is considering it. Watsonville in California. I’ve had calls from England, even the Northern Marianas in the far western Pacific.
Looking back, what would you have done differently in terms of the tax roll-out?
I wish we had made it two cents instead of one cent.