They claim it's about food. But this initiative is funded by Big Soda | KUOW News and Information

They claim it's about food. But this initiative is funded by Big Soda

Jul 9, 2018

Soda companies have poured $4.7 million into an anti-tax measure in Washington state, enough for the initiative to pop up on the November ballot. 

The campaign, which calls itself YES! TO AFFORDABLE GROCERIES, reported turning in more than 360,000 signatures by the July 6 deadline, a big gulp more than the 259,622 needed to qualify for a statewide initiative.

Almost all the campaign's funding has come from four out-of-state beverage companies: the Coca-Cola Company, Pepsico, Dr Pepper Snapple Group and Red Bull North America.

Anti-tax Initiative 1634 would prevent local governments in Washington from following Seattle's lead and taxing sodas or other sweetened beverages.

It would also stop cities from taxing food—a hypothetical threat that the I-1634 campaign admits no one has proposed in Washington state.

Even so, the campaign's name and its advertising emphasize the supposed threat of a government deciding to tax food.

One ad shows a mom and her kids loading cereal, bananas, eggs and tomatoes into their grocery cart.

No soda bottles in sight.

Another ad features a grocery store owner from Spokane, who says, "Food taxes hit working people the hardest. That's just wrong."

The initiative itself begins, “Whereas access to food is a basic human need of every Washingtonian.”

Its “whereas” section never mentions beverages or drinks, only “groceries,” a term that lumps together the basic human need of food and non-essential, obesity-worsening sugary drinks.

Makers of such drinks would take a hit if Seattle's tax on sugar-sweetened drinks were to spill over to other locations.

Coca-Cola officials did not respond to interview requests. A Pepsico spokesperson declined to comment, directing requests to the Initiative 1634 campaign. 

The campaign's biggest expenditure to date, according to the Washington Public Disclosure Commission, has been $1.3 million to the California signature-gathering firm AAP Holding Company.

Firms like AAP Holding pay signature gatherers for each John Hancock they cajole out of a registered voter. Many gatherers roam from state to state to work on different campaigns.

While initiative promoter Tim Eyman of Mukilteo, Washington, is sometimes called Washington's "initiative king," AAP Holding CEO Angelo Paparella of Westlake Village, California, may be better deserving of the title.

As KUOW has reported, his companies have earned more money gathering signatures in Washington than Eyman's has. Another Paparella firm, PCI Consultants, earned $4 million gathering signatures in Washington and $9 million in California in 2016.

The dominant contributors to the I-1634 campaign are the Coca-Cola Company at $2.3 million and Pepsico at $1.7 million. The Dr. Pepper Snapple Group has given $709,000 and Red Bull North America, $56,000.

The Washington Food Industry Association has contributed $20,000.

No other businesses or individuals have contributed, according to the PDC.

"This is not just about big soda companies, as some will try to incorrectly assert," campaign director Michael Mandell told reporters on Monday. "It's regressive taxation—preventing regressive taxes that overwhelmingly impact Washington families."

The carbonation-funded campaign points to an opinion piece in The New York Times that called for a carbon tax on beef as an example of the threat of food taxation. 

The initiative would not roll back Seattle's new sugar-sweetened beverage tax or prevent statewide tax proposals.

Seattle started charging 1.75 cents per ounce of most sugar-sweetened beverages in January, though it exempts sugary drinks like lattes that list milk as their first ingredient.

The city of Seattle expects to collect about $15 million with that tax this year.

The biggest chunk of that money, $3.8 million, is slated to provide poor families with healthy and affordable groceries, including expanding the city's Fresh Bucks program that makes healthy food more affordable for people who use food stamps.

Additional reporting by John O’Brien

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