Measure AA: Measure AA - City Of Berkeley - Initiative - Soda Tax Measure

In plain language

Measure AA changes Berkeley's tax on sugary drinks. A YES vote would replace the current tax with a new one. The current tax is a 1 cent per fluid ounce general tax. The new tax would be a 2 cent per fluid ounce special tax. It would apply to businesses that distribute sugar-sweetened beverages. The money would fund public health, nutrition, and drinking water programs. Nonprofits, the City, or Berkeley Unified School District would run these programs. Small retailers would stay exempt, as they are now. Milk, baby formula, alcohol, and medical or weight-loss products would also stay exempt. The tax would raise about $2,200,000 a year. It would continue until voters end it. A NO vote would keep the current 1 cent per ounce general tax in place.

Fiscal impact

The tax rate would rise from $0.01 to $0.02 per fluid ounce of sugar-sweetened beverages distributed, expected to raise about $2,200,000 per year, with no end date until repealed by voters.

Impartial analysis

This measure was placed on the ballot by an initiative petition signed by the requisite number of registered voters in the City of Berkeley. It requires a majority vote for passage. This measure would replace Berkeley’s existing $0.01 per fluid ounce general tax on the distribution of sugar-sweetened beverages (SSB) with a $0.02 per fluid ounce special tax. The tax is estimated to raise approximately $2,200,000 annually, an increase of approximately $1,000,000 over revenue from the City’s current SSB tax. Tax proceeds would be placed in a special fund and dedicated to specified public health, nutrition, and drinking water projects and programming. The measure provides a list of eligible project types. For example, funds could be used for chronic disease prevention efforts, community nutrition education, healthy food access programs, and initiatives aimed at reducing the availability and marketing of sugary drinks. Funds would be allocated approximately as follows: (1) at least 42.5% for grants to community-based organizations or City departments to pursue authorized projects and programming; (2) at least 42.5% for grants to the Berkeley Unified School District to pursue authorized projects and programming; and (3) up to 15% for administration and implementation costs. No funds could be used to support lobbying activities or political campaigns. The City’s Sugar-Sweetened Beverage Product Panel of Experts would be empowered to develop requests for proposals, review grant applications, and issue funding recommendations to the City Council, which would have ultimate responsibility for approving grant applications. Like the current SSB tax, the proposed tax would apply to distributors of SSB products, with the tax base determined by the volume of beverages distributed or, for concentrates, the largest typical volume producible from them. The measure would retain the current exemptions for alcoholic beverages, beverages used for medical purposes, beverages used for weight loss, drinks where milk is the primary ingredient, infant formula, and distributions to small retailers with less than $100,000 in annual gross receipts. The tax would be levied once within the chain of distribution and would be adjusted annually for inflation beginning in 2028, with adjustments capped at 5% annually, though the tax rate would never fall below two cents per ounce. Under the measure, the current SSB tax would be suspended for as long as the new special tax is in effect. The City Council would be authorized to repeal the current SSB tax if the proposed special SSB tax has been in effect and continuously collected for at least 10 years and no court proceeding is pending or has found the proposed special SSB tax invalid or unenforceable. The City Council could amend the proposed special SSB tax without a vote of the people if such amendments are technical, procedural or administrative in nature and further the measure’s purposes. If the measure passes, tax collection would begin April 1, 2027. /s/ Farimah Faiz Brown Berkeley City Attorney

Official ballot arguments

Filed for the official voter guide by each side, printed as submitted.

The official arguments will appear here once both sides’ arguments are on file.