MADD about lobbying tactics

Advocates say liquor industry is applying 'full-court press' against higher tax on booze

Posted: Wednesday, March 28, 2001

Supporters of an increased excise tax on alcohol say liquor lobbyists are undermining the resolve of legislators in closed-door meetings.

Those lobbyists are tight-lipped about their activity at the Capitol, declining to respond to allegations that they're thwarting majority will both in the Legislature and in the public.

Meanwhile, Rep. Lisa Murkowski, an Anchorage Republican who is chairwoman of the House Labor and Commerce Committee, says she will introduce a bill this week to raise the tax. But she said she probably won't shoot as high as she'd like because support is soft.

Cindy Cashen of Mothers Against Drunk Driving and Matt Felix of the National Council on Alcoholism and Drug Abuse say they are supporting the equivalent of a 20-cent increase in taxes per drink, which are now about 3 to 5 cents on different kinds of alcohol. Cashen said that would increase state revenue from $12 million a year to $76 million, which is still well below the estimated $250 million the state spends on services related to alcohol abuse.

Murkowski said she is looking at an increase of 7 to 10 cents, bringing in an additional $33 million or so. Other estimates are that a 10-cent increase would increase state revenue by $44 million.

Cashen and Felix, Juneau residents who have been lobbying at the Capitol, say most legislators want some increase but that votes are being swayed by heavy-handed lobbying tactics.

"What happens is, right behind me slither in the alcohol lobbyists," said Cashen, whose father was killed by a drunken driver last year. The lobbyists use percentages to make the proposed increase sound excessive, ignoring the fact that the tax hasn't increased since 1983, she said.

Felix said four Seattle-based wholesalers "with a tremendous amount of money," along with national beer companies, have made defeating a tax increase in Alaska a high priority.

"They're literally getting rich off the blood of our citizens," Cashen said.

"They fear if Alaska passes a tax (increase), it might start a national trend," Felix said. "They're having a dramatic effect this week confusing the issue, histrionic about the impact on their industry, which is minimal. They're putting a full-court press on. ... We're at the very critical juncture on this issue."

Comment from lobbyists was scarce.

Jerry Reinwand, lobbyist for Alaska Wine and Spirits Wholesalers, referred calls to an association official, Bob Bailey, who could not be reached for comment. Norman Gorsuch, representing Miller Brewing, said only that his client opposes a tax increase.

"I'm representing my client; that's all I can say," said Joe Hayes, lobbyist for Anheuser-Busch Companies, Inc.

Kim Hutchinson, lobbyist for Cabaret, Hotel and Restaurant Retailers, did not return calls.

Murkowski said CHARR's legislative reception last week was the only time she has been lobbied.

"It certainly wasn't heavy-handed," she said. "I can tell you I've heard the same rumors you've just mentioned to me. I haven't been the recipient of it."

Geoff Larson, co-owner of Alaskan Brewing Co. in Juneau, said he has been involved in some limited lobbying of local legislators. He said he has stressed the fact that Alaska, with an excise tax of 35 cents a gallon on beer, imposes by far the highest burden among six states in his distribution area. Under the so-called "dime a drink" increase, Alaska's tax on beer would go to $1.42 per gallon, according to House majority staff.

Larson said the per-drink estimates are misleading, both because it's not a retail tax and because the numbers understate the cost to the consumer of beer by about 50 percent.

"When you talk about triple-digit increases, I think of inflation in South America or inflation in Third World nations," Larson said. But the industry is divided, and some people do support a more reasonable increase in the excise tax, he said.

An attempt by House leadership to work something out with the industry failed to produce a consensus, according to Murkowski.

There are three groups of legislators, she said: Those who oppose tax increases categorically; those who would support a tax increase sufficient to fund about $5 million to $10 million in new programs moving through the Legislature, such as the therapeutic court concept being advocated by House Speaker Brian Porter; and those who believe that the tax revenues should begin to reflect state costs in responding to alcohol abuse.

Offsetting more of those costs is the primary purpose of her upcoming bill, although a secondary benefit might be reducing purchases by minors, Murkowski said.

"At the end of the day, it's all politics what can I sell," she said.

"The one side of me just wants to go out and aim high, but the realist says if you can't get it through the (legislative) bodies, the exercise is somewhat futile. I don't want to make a gesture just to make a gesture. I want to see an increase."

Pam La Bolle, president of the Alaska Chamber of Commerce, said raising the tax would penalize responsible drinkers along with abusers.

"It sounds an awful lot like social engineering through taxation," she said.

Terry Harvey, a microbrew operator and co-owner of the Armadillo Tex-Mex Cafe in Juneau, said the proposed increase seems "really excessive."

"We think this is going to make it very difficult for us to do business in the future," Harvey said. "I don't understand how more expensive drinks are going to keep drunk drivers off the road wreaking havoc."

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