California lawmakers and Gov. Jerry Brown have banned cities and counties from enacting new taxes on soda and sugary-drink products.
They rushed through a bill on Thursday to meet the deadline for proponents of November ballot initiatives to withdraw their measures.
In exchange for this new law, the soda industry and a California business group are rescinding an initiative from the November ballot that would raise the voter threshold to approve general purpose local sales tax increases and extensions from a majority to two-thirds.
“We’re certainly ready to help lawmakers keep groceries affordable in California,” said William Dermody with the American Beverage Association, which has spent tens of millions of dollars in recent years fighting soda taxes in cities throughout the state — with mixed success.
Dermody said the bill signed by the governor “would guarantee that local businesses and our consumers wouldn’t be harmed by these kinds of grocery taxes.”
Many Democrats could hardly restrain their fury.
“This industry is aiming basically a nuclear weapon at government in California and saying, if you don’t do what we want, we’re gonna pull the trigger, and you are not going to be able to fund basic government services,” said Sen. Scott Wiener (D-San Francisco).
Wiener urged health advocates “not to criticize the Legislature for making a perfectly reasonable choice to protect the ability of local governments to fund services, but to criticize this rogue industry that is willing to burn down the house to get what it wants.”
Republicans snapped back.
“I find it comical that trying to avoid being overtaxed is considered a shakedown by some members of this Legislature, but that’s just the general nature of the population that’s seated in this body,” said Asm. Matthew Harper (R-Huntington Beach).
“If you feel this is a shakedown,” Harper added, “if you feel this is a Hobson’s choice, don’t cry your crocodile tears at me. You have an opportunity to vote no.”
Senate President pro Tem Toni Atkins (D-San Diego) said she felt stuck between “the biggest rock and the smallest hard space” and issued a not-so-subtle warning to the initiative’s backers, the American Beverage Association and the California Business Roundtable.
“We certainly will not forget the position we were put in,” she said.
The bill passed the Senate 21-7, with only Democrats in support and most Republicans abstaining. The Assembly approved it 60-1.
The local soda tax ban sunsets in 12 years.