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Merchants say sugar tax a concern

by Thomas K. Pendergast

Supporters claim it is about public health and fighting diabetes, while opponents counter that it will just be another factor pushing blue-collar working people out of San Francisco. So, it is easy to see why a proposal for a new tax on sugar-saturated sodas and other such sweetened drinks might deliver a big gulp of controversy at the next election.
Even a major opponent of the proposed Sugar-Sweetened Beverage Tax ordinance, which would levy a 2-cents-per-ounce tax on sodas and other sugar-sweetened drinks, admits that there is likely enough support at the San Francisco Board of Supervisors for it to go before the voters this November. Brewed coffee and tea are not included in the ordinance, although bottled coffee drinks would be taxed.
San Francisco Supervisor Scott Wiener says the ordinance is a public health measure meant to address the “explosion of diabetes” that is directly attributable to the consumption of soda and other sugar-sweetened beverages. The revenue generated by the tax, he explained, is estimated at $31 million and will be dedicated to nutrition and health programs.
“The two goals of the tax are to reduce consumption and improve people’s health, and then to fund programs that also help improve people’s health,” Wiener said at a meeting of the Outer Sunset Merchants Professional Association (OSMPA) on Feb. 12.
“Right now in the United States we really are seeing a huge increase in diabetes in particular. Thirty percent of teen­agers are currently pre-diabetic. We’re heading toward one-in-three Americans having diabetes, as opposed to 10 percent today,” Weiner said.
“This is just going to be a major problem for our society. The science is very, very clear that one of the, perhaps the leading factor, in the increase of diabetes is sugary beverages,” he continued.
According to language in the proposed ordinance, sodas and fruit drinks with sugar added contribute an average of more than 10.5 teaspoons of extra sugar to the American diet every day. Yet, the American Heart Association recommends children consume no more than three teaspoons of added sugars each day (not including naturally occurring sugars, such as in 100 percent fruit drinks or milk), which averages about 50 calories. Most Americans, however, consume an average of more than 22 teaspoons, or 355 calories, of sugar each day.
The funds from the ordinance will be dedicated to health-related programs, with 40 percent going to the SF Unified School District for improving school lunch programs, physical education, after-school activities and other health-nutrition programs. Some 25 percent will go to the SF Recreation and Park Department, and 25 percent will go to SF Department of Public Health for its Food Access Program. The remaining 10 percent will go to a grant program administered by the SF Department of Public Health, targeted at community-based organizations doing nutrition and physical activity work.
Low-income families are more likely to be affected by obesity and diabetes, according to the proposed ordinance, noting that the Bayview Hunters Point neighborhood had more per capita emergency room visits due to diabetes between 2009 and 2011 than any other neighborhood in San Francisco.
The politically-connected firm BMWL has been hired by the American Beverage Association to campaign against the proposal.
Nick Panagopoulos, a political consultant with the firm BMWL, said it will do nothing to affect how much soda people drink, but will instead just make life more difficult for people already struggling to live in an expensive city.
“The fact of the matter is when you’re poor, which is essentially who this is targeting, you have a limited amount of money to eat and you need to get a certain amount of calories to sustain your life and soda is kind of like a treat as part of that diet when you’re living off of $5 a day to eat,” said Panagopoulos. “You have tough decisions to make and you have to make it last. And that’s the reality of the situation. … What we’re talking about is making this city more unaffordable and the last I checked you don’t make poor people healthy by taking money out of their pockets.”
Panagopoulos conceded that there will probably be enough support from at the Board of Supervisors to get the proposal on the next ballot, but he cautioned that two states have already tried this kind of tax and it has not had the effect that supporters hoped for.
“Arkansas is one of them and one of the last things that Bill Clinton did before he became president was to sign these taxes into law,” he said. “At the time the obesity rate in Arkansas was 17 percent. Twenty years later, it’s now 34 percent or 37 percent, something like that. The point is it has almost doubled while this tax has been in effect. West Virginia has a similar tax, similar situation.”
Wiener pointed out a University of California, San Francisco (UCSF) study, which projected that a one-penny-per-ounce tax on sugared beverages would reduce overall consumption by about 10 percent. Since then, UCSF has indicated that the proposed two-cents-per-ounce ordinance would reduce consumption by about 20 percent.
Sam Dabit owns a general variety store on Irving Street called Easy Money. He expressed concern that, if passed, the tax would encourage further taxation along the same lines in the future.
“Will it be ice cream next, or chips?” he rhetorically asked.
Wiener claims that sugary beverages present a much more significant risk for diabetes than any kind of food.
“Sugary beverages, the way they are consumed or absorbed into the body, is very unique and very different than foods. Some people say, ‘if you’re going to tax sodas, why aren’t you taxing cakes and donuts and cookies and all the other things that you get sugar from.’ But the way that liquid sugar is absorbed in the body is extremely unique,” Wiener said. “When you’re eating a piece of cake or a donut or a cookie or a Ho-Ho, eventually your brain will tell your stomach; it will shut off your appetite and you’ll stop eating.
“When you’re drinking soda or other sugary beverages your body interprets it as water and it will never turn off your appetite, and you can just keep drinking it until, basically, you get sick to your stomach at some point, but your appetite will never shut off. That is why it is such a big percentage of the sugar that’s being consumed in this country.”
But OSMPA President Angela Tickler expressed misgivings about what she called a “nanny tax.”
“Supervisor Wiener, there are so many diseases that so many people are at risk for and it seems a bit focused to propose this attacking diabetes. So, what are we going to do next, do heart disease and put a $2 a pound tax on red meat?” Tickler said. “I understand and I admire the outcomes that you’re seeking but it feels extremely intrusive and as merchants who know initially, for example, with the 10-cent bag charge supermarkets in the City saw business go straight to Daly City, until they enacted the same thing. Merchants here are very concerned that it will do the same thing here, that people will opt to make their purchases … in Daly City.
“It feels like a nanny tax,” Tickler said. “It’s admirable to not want people to drink things that are dangerous for them but it’s also a personal choice and it feels like the Board of Supervisors is very much intruding on that.”
“I don’t think it’s any more nanny state than, you know, we have a tobacco tax,” Wiener responded. “We tax alcohol because of some of the health problems that those products cause. We require people to wear a seat belt, to wear a helmet when you ride a motorcycle.”

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