Philadelphia City Council passes beverage tax with 13-4 vote

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Thursday, June 16, 2016
Beverages are displayed at a demonstration against a proposed sugary drinks tax Wednesday, May 4, 2016, outside City Hall in Philadelphia.

PHILADELPHIA, PA -- Philadelphia City Council has passed a beverage tax despite a multimillion-dollar campaign by the beverage industry to block it.

The City Council gave final approval to a 1.5 cent-per-ounce tax on sugary and diet beverages, becoming the first major American city with a beverage tax.

The vote was 13-4.

WATCH VIDEO of the final vote:

Philadelphia Mayor Jim Kenney released the following statement on the passage of the tax:

"Thanks to the tireless advocacy of educators, parents, rec center volunteers and so many others, Philadelphia made a historic investment in our neighborhoods and in our education system today. I commend City Council for working with these community leaders to make quality, affordable pre-K, community schools and systemic improvements to parks, rec centers and libraries a reality. I also thank my colleagues in Council for working with our administration to craft a shared agenda that will improve the education, health and prosperity of children and families all across our city for years to come. Today would not have been possible without everyone coming together in support of a fair future for every zipcode."

During the meeting, proponents of both sides of the issue spoke to City Council.

"If this tax is passed, Philadelphia would create the worst black market for non-alcoholic beverages since prohibition, which was back in the 1920s and 30s. Let's not go back in history," Chris Hunter, an employee of Coca-Cola, said.

"As Philadelphia has done time and again, you are acting boldly to deal with very real concerns and needs of Philadelphians and our country as a whole. Thank you on behalf of the American Heart Association, the Philadelphia medical community, and the broader medical establishment," Dr. Ken Margulies, who served as President of the Board of the American Heart Association of Southeastern Pennsylvania, said.

Berkeley, California has a similar law. Beverage tax proposals have failed in more than 30 cities and states in recent years. Such plans are typically criticized as disproportionately affecting the poor, who are more likely to consume sugary drinks.

Democratic Mayor Jim Kenney sold the council on the idea with a plan to spend most of the estimated $90 million in new tax revenues next year to pay for prekindergarten, community schools and recreation centers.

The tax is a hard-fought win for the city. The soda industry spent millions of dollars in advertising against the proposal, arguing that the tax would be costly to consumers. The plan also attracted national attention and dollars, with former New York City Mayor Michael Bloomberg and Texas billionaires John and Laura Arnold - advocates for less consumption of sugary drinks - funding ads in support.

Many communities where soda tax proposals have failed sought it as a way to discourage consumers from buying sugary beverages for health reasons.

The case could certainly be made for a healthier Philadelphia - more than 68 percent of adults and 41 percent of children in the city are overweight or obese. But Kenney focused on public interest over public health in making the argument to tax sugary drinks.

He told The Associated Press last week that Americans generally reject other people telling them what's healthy for them, so his administration tried to stay away from that. He said any health benefits coming from the tax are just a bonus.

The tax will enter into the fiscal budget July 1, but it wouldn't start getting collected until Jan. 1.

Groups of pre-K students clustered outside City Hall on Thursday doing geyser experiments with soda and Mentos, and they gathered in the hallway near chambers with headbands reading "Pre-K rocks!"

The "No Philly Grocery Tax" group had a big display on the plaza with stacks of drinks and graphs showing how much consumers will pay if the tax passes.

The soda industry is expected to sue.


The Associated Press contributed to the report.