Kansas soda bottlers lobbyist against proposed sugar tax as Senate committee ponders budget

Talk in Kan. of soda tax fizzes in budget debate

TOPEKA, Kan. — Soda bottlers and distributors lobbied Kansas legislators Tuesday against a proposed surcharge on sugary drinks, as a Senate committee worked on a state budget that’s likely to require raising taxes.

The Ways and Means Committee is drafting a plan allowing state government to spend more than $13 billion during the fiscal year that begins July 1. Members already have conceded that the budget’s not likely to balance, requiring them to consider tax proposals later this week.

The committee had hoped to finish its plan on Tuesday, but disagreements about social services spending slowed its work, which will spill into Wednesday.

State officials and economists are projecting a $510 million gap between anticipated revenues and spending commitments. A proposed penny-per-teaspoon tax on sugar in canned and bottled beverages is among the revenue-raising ideas before legislators.

The prospects of such a tax — new for Kansas and relatively rare across the country — brought dozens of employees of bottling and distribution companies to the Statehouse. Some wore yellow “SAY NO” stickers.

“We’re concerned,” said Kevin Morris, a vice president for the Coca-Cola Bottling Co. in Lenexa. “It would result in lost jobs.”

Committee Chairman Jay Emler, a Lindsborg Republican, is predicting that the panel’s proposed budget will require at least $350 million in tax increases.

Members of the GOP-dominated committee so far have been unwilling to seek further cuts in aid to public schools, an idea Democratic Gov. Mark Parkinson also opposes. Such aid consumes half of the state’s general tax dollars.

Legislators are under increasing pressure from educators and advocates for the disabled and needy to increase taxes to avoid cutting school funding and social services.

“Let us all stand together to save Kansas for the future of our children and grandchildren, in ways that resemble the state we are proud to call home,” a coalition of such advocates, Kansans for Quality Communities, said Tuesday in an open letter to legislators.

A key issue for committee Democrats is reversing cuts previously made in social services. Sen. Janis Lee, a Kensington Democrat, said legislators will face criticism for any tax increases and therefore should address the needs of the poor, disabled and elderly.

GOP committee members did agree to add $31 million, restoring some previous cuts in mental health programs, in-home services for the disabled and other public assistance. Democrats didn’t think the committee went far enough.

The proposed soda tax would raise $90 million a year for such programs, education funding and general government operations.

Legislative researchers say it would increase the cost of a 12-ounce can of soda by 10 cents; beverage industry officials say a 2-liter bottle would cost 56 cents more.

Morris said the tax would amount to a levy of 30 percent to 50 percent, depending on the product.

The tax would apply to packaged sweetened, nonalcoholic beverages, including soda, root beer, ginger ale, lemon-lime drinks and beverages that are 10 percent or less “natural” fruit or vegetable juice.

Only three states — Arkansas, Washington and West Virginia — have such a tax, said Dan Thorp, a spokesman for the American Beverage Association. Thorp said the Kansas proposal is unusual because the tax would vary with the amount of sugar in each drink.

“It would be a logistical nightmare,” he said.

But Thorp said the biggest concern is increasing costs for consumers — and a resulting drop in sales. Morris said about 14,000 jobs are tied to the industry in Kansas.

The industry is sponsoring full-page ads in eight Kansas newspapers and plans to broadcast radio ads across the state, Thorp said.

Proposed soda tax is SB 567.

On the Net:

Kansas Legislature: www.kslegislature.org

American Beverage Association: www.ameribev.org

Kansans for Quality Communities: www.thekansastruthis.com/