ALBANY, N.Y. (AP) — A proposed new tax on sugary drinks appears unlikely to pass the state Senate, despite passionate campaigning by New York Gov. David Paterson and his health commissioner.
Supporters have pushed the tax as a way to combat obesity while bolstering funding for state health programs. But a number of Democratic senators are opposed, along with the entire Republican conference. With a 31-30 Democrat-Republican split in the chamber, the measure isn't expected to draw the minimum 32 votes needed for passage.
"If a party says that it's dead, then they either have to replace the revenue from another source, or pull that back out, cut more," said Dr. Richard Daines, the state commissioner of health. "The debate (with) the health care industry now is that our cuts are too deep ... even with the soda tax."
The proposal would add a penny per ounce to the price of soda and sugary drinks with less than 70 percent fruit juice. It's been projected to generate $1 billion annually when fully implemented and reduce consumption of the drinks by 15 percent.
At an event Monday in White Plains, Paterson was met by more than a dozen workers for the Coca-Cola Co. and PepsiCo, makers of Pepsi, who oppose the sugar tax and fear it will result in job losses. Both companies have facilities in New York state. Paterson met with union leadership privately.
"I can't predict what the Legislature is going to do," Paterson said. "We obviously had a talk with some representatives from Pepsi and Coke today. They made some valid concerns ... that an excise tax would theoretically cause all beverages, whether they were sugared or not, to increase in price."
Paterson said he would look into that, but it still doesn't change the epidemic of obesity, or the massive hole in the budget.
"We're not interested in seeing anybody lose any jobs, or to diminish business — which is one of the biggest problems of our state," Paterson said. "If the Legislature chooses not to do this tax they're going to have to find hundreds of millions of dollars to replace it in balancing the budget."
A spokeswoman for Assembly Democrats declined to speak specifically about the tax's prospects in that chamber. Austin Shafran, a spokesman for Senate Democrats also wouldn't comment specifically on the soda tax, but several Democratic senators have opposed the measure.
Democratic Sen. Diane Savino, of Staten Island, led a rally protesting the tax during the weekend. She has said the tax would be bad for working families. Like many Albany politicians, Savino has long received campaign contributions from Coca Cola, Pepsi and the Teamsters — groups that oppose the tax.
"My opposition to the beverage tax is a result of the negative impacts that this regressive tax will have on local retail stores, who must already compete with less heavily taxed items in New Jersey, as well as the loss of solid, middle-class jobs," Savino said in a statement.
Supporters think the size of the deficit could bring a last-minute reprieve for the tax on sugary beverages, because no opponent has offered other ways to fill that gap in the budget, which is due April 1.
"This tax is still very much on the table because the budget deficit is so huge — even with borrowing," said Nancy Huehnergarth, director of the New York State Healthy Eating and Physical Activity Alliance. "They just can't afford to toss it aside."
However, Huehnergarth noted that it's an election year, and traditionally politicians are loath to create new taxes when facing campaign season.