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Sunday, February 15, 2009

And Another Thing

I recognize that there's a thing as posting too often on the beer tax. It's boring. I know. But I am provoked by a recent Portland Business Journal article, and some of the contents therein. In general, it is a very nice recap of the issue, no comment needed from me. But there is a bit there in the middle that fairly hollers for a rebuttal, and to this bellow I oblige. The notable passage:
Backers say the extra money would help defray the $5 billion in health care, law enforcement and social services that untreated substance abuse costs the state each year. Based on current beer-barrel sales, the taxes would generate around $250 million per biennium, compared to the estimated $7 million the tax will generate during the 2007-09 biennium. (emphasis mine.)E
Now hold on a damn second. Five billion a year? Someone's been doing more than drinking some bad barleywine. Governor Kulongoski set a $15.8 billion budget for the next biennium (two years). That's just a shade under eight billion a year. Over half the budget is devoted to schools, which leaves $3.63 billion for everything else. There may be some hare-brained calculation somewhere that adds up to a total expense of $5 billion a year in total costs, but it damn sure isn't the state's cost. And, not to put too fine a point on it, but the cost, whatever it is, damn sure isn't all the fault of beer makers. Yet this half-assed, half-considered, hysterical piece of legislation lays the tax solely at their feet.

It is this kind of blatant exaggeration that makes reasonable people want to go on jihad. There doesn't seem to be anything approaching good faith with the current proposal. A graphic in that story shows what the per-barrel taxes of neighboring states will be if HB 2461 passes, and I'll leave it as a final example of how unreasonable the bill is. Happy Sunday!
Idaho - $4.65
Nevada - $4.96
California - $6.20
Washington $8.08
Oregon - $49.61


  1. Jeff,

    Here is how they come up with the $5 billion number:

    "Whereas Oregon's untreated substance abuse costs $4.15 billion in lost earnings, $8.13 million for health care and $967 million for enforcement and social services for a total cost of $5.13 billion each year"

    as seen in:

    Nowhere in the bill does it define "lost earnings". Could it be:

    a) the hours (earnings) I could be working a second job, but don't because I'm down at the HUB.

    b) the hours (earnings) I could be working a third job, but don't because I'm recovering from my time at the HUB.

    c) some random-a$$ term and an equally random number.

  2. Lane, thanks. It remains, nevertheless, total BS. The state doesn't pick up the cost of "lost earnings" (more than 80% the total, bogus, $5 billion cost).

    And listen to the language: untreated substance abuse. So now breweries (not even everyone who makes a buck on beer, just breweries) must pick up the cost not just of alcoholism, but all substance abuse
    . Arrgghh!

  3. 4 billion dollars is what 100,000 people making 40,000 a year comes out to. In December 175,000 Oregonians were unemployed. If it weren't for beer our state's unemployment rate would fall from 9% to 4%. Stupid, delicious, beer.

  4. Jeff,

    Just one minor correction: the $49.61 is in addition to the current tax. That would make Oregon's tax $52.21.

  5. Jim, really? I am dumb as a bag of hammers when it comes to legislativese, but this makes it sound like the final amount is the $49.61 number:

    SECTION 2. { + (1) In addition to and not in lieu of any
    charge imposed under ORS 473.030 or other law, in order to
    recover a portion of the government costs incurred as a result of
    the consumption of malt beverages, a manufacturer or an importing
    distributor of malt beverages shall be subject to a prevention,
    treatment and recovery tax of $49.61 per barrel of 31 gallons of
    malt beverage.

    On a slightly unrelated note--how in the world did they come up with that figure? It's so precise, yet seems so random. Why not fifty bucks?

  6. hey all,

    Im a student at PSU and a craft brew enthusiast. I am also, however niave to house bill assembly. Is HB 2461 in constant debate? Or, will there be a specific date that there will be a decision made?

    I am planning on tabling at Portland State to raise awareness and write the proper state officials.



    ps - hit my email with any reply

  7. Jon, I don't see any email to hit, but you can email me at the_beerax(at)yahoo(dot)com if you want more info.

    The bill is currently in a Senate subcommittee and will get a hearing this Thursday. If you want to testify, it'll be at 1pm. I'll put a post up about it this afternoon.


  8. Jon, sorry, total brain freeze there. The beer tax has been introduced, but everyone's still working with budgets and it hasn't gone anywhere yet.