Pamela Cruz. Peninsula 360 Press [P360].
A measure that would have undone a 2018 legislative deal, where soda companies won a ban on California cities and counties creating taxes on sugary drinks, was shelved without a hearing, despite vehement protests from lawmakers.
Despite its tarnished reputation, the U.S. soft drink industry continues to exert political influence in the nation's most populous state, spending millions of dollars on politically connected lobbyists and handing out campaign contributions to nearly every state legislator.
According to Kaiser Health News (KHN), bills long opposed by Coca-Cola Co., PepsiCo and other beverage companies continue to fail.
"Big soda is a very powerful lobby," said Eric Batch, vice president of advocacy for the American Heart Association, which has called on lawmakers across the country to crack down on sugar-laden drinks that health advocates say contribute to diabetes, obesity and other costly medical conditions.
"They've spent a lot of money in California to stop groups like ours from passing good policy. And they've been doing it for a long time," Batch told KHN.
He also detailed that in the last four years, soft drink companies spent about $5.9 million lobbying California lawmakers and donating to their campaigns or favorite charities.
According to a California Healthline analysis of campaign finance records from Jan. 1, 2017, through Dec. 31, 2020, it found that the American Beverage Association, Coca-Cola and Pepsi have given donations to nearly every statewide officeholder, from Gov. Gavin Newsom to roughly five-sixths of the 120-member Legislature.
KHN explained that in 2018, the industry spent $8.9 million to push a statewide ballot measure sponsored by the California Business Roundtable that would have made it harder for cities and counties to collect taxes -- not just those on sugary drinks -- by requiring them to be approved by two-thirds of voters instead of a simple majority.
So, fearing that local governments could face a higher voting threshold for taxes and fees that would fund libraries, public safety and other services, lawmakers then said they had no choice but to negotiate with the industry.
In a deal that several lawmakers described as "extortion" and a "Sophie's choice," the legislature agreed to pass a bill banning new local taxes on sugary drinks until Jan. 1, 2031, if industry and other supporters dropped the ballot measure.
Then-Gov. Jerry Brown, who had dined with industry executives several weeks earlier, signed the bill into law.
Thus, legislation that would have imposed a state tax on sugary drinks died a year later, as did a bill that would have required health warning labels on sugary drinks and another that would have banned soft drinks from supermarket checkout aisles.
And despite a fight, this year's bill, which would have restored the ability of cities and counties to submit soda taxes to voters, was all but dead.
"They're gaming the political system," said Assemblymember Adrin Nazarian of the North Hollywood District, the author of AB 1163.
Nazarian said he hopes to revive the measure before April 30, the deadline for political committees to hear legislation for the year.
"It's one thing for us to make a bad policy decision once, it's another thing to give a signal to all the industries that will then use this loophole against us. How many more times are we going to do this?" he said.
Public health advocates point to such taxes as a way to reduce consumption of soft drinks, sports drinks, fruit juices and other sweet beverages, citing studies showing that the more they cost, the fewer people buy them.
On average, a can of soda contains 10 teaspoons of sugar, almost the entire recommended daily amount for someone who eats 2,000 calories a day; however, some energy drinks contain twice as much.
Four California cities - Albany, Berkeley, Oakland and San Francisco- had soda taxes before the 2018 legislative deal that allowed them to remain. Boulder, Colorado; Philadelphia; Seattle; and the Navajo Nation also have soda taxes, with proposals under consideration in Rhode Island and Washington, D.C.
Last year, San Francisco earmarked $1.6 million of soda tax revenue for local programs that feed residents affected by school closings and job losses due to COVID-19, while Seattle leveraged soda tax revenue to give shopping vouchers to hard-hit residents.
Nazarian said he expected his attempt to undo the soda tax moratorium to be an uphill battle, but he's frustrated that the bill was denied even a hearing.
While countries such as the United Kingdom, Mexico, Portugal and South Africa have imposed national taxes on sugary drinks, U.S. efforts have stalled on this point.
Political power in the soft drink industry
According to KHN, in California, soda companies spent $4.4 million over the past four years lobbying state lawmakers and state officials by inviting them to dinners and sporting events. "They hired veteran political firms staffed by former government employees who know the workings of the Capitol and often already have relationships with lawmakers and their aides."
In that regard, he noted that until earlier this year, the American Beverage Association had Fredericka McGee on its payroll as its chief lobbyist in California. She had worked for five Assembly speakers. Now, McGee is chief of staff for Los Angeles County Supervisor Holly Mitchell, a former state lawmaker who in 2018 was the chairman of the powerful Senate Budget Committee, which oversaw the deal banning new local soda taxes.
In addition to lobbying, the industry spent just over $1.5 million on contributions to legislators, including large checks written to charities on their behalf.
The largest contributions went to the most influential legislators.
Pepsi and Coca-Cola gave a total of $25,000 to charities on behalf of Assembly Speaker Anthony Rendon, according to the state Fair Political Practices Commission, which tracks the donations, known as "pay-to-play." That's on top of the $35,900 Rendon raised in his industry campaign account over the past four years.
Senate President Pro Tempore Toni Atkins cashed $26,000 in campaign checks from Coca-Cola and Pepsi and accepted a $5,000 donation to one of her charities from the Coca-Cola bottling plant in her San Diego district, the media outlet said.
Public health groups are not willing to admit defeat and are mobilizing a grassroots effort to get a hearing for Nazarian's bill. They say California must address the disproportionate health effects of sugary drinks on African American and Latino communities, which COVID-19 only exacerbates.
