Gov. Jared Polis wants lawmakers to exempt big beer companies from a bill that would impose new fees on alcoholic beverages in Colorado.
The fees would apply to alcohol manufacturers and distributors and would come to about $0.02 for every gallon of beer, cider and wine, and about $0.20 for every liter of hard liquor. Sponsors estimate the current version of the bill would raise about $20 million every year, although they initially hoped to raise as much as $120 million. The revenue generated would fund alcohol use disorder prevention, treatment, harm reduction and recovery services.
The fee is not considered a tax under state law because the revenue it generates can only be used for substance use disorder services that are related to the alcohol industry. Taxes must also be approved by voters while a fee can be implemented through legislation.
The legislation comes as alcohol misuse is on the rise in Colorado. Coloradans suffer from alcohol use disorder and alcohol-related deaths at higher rates than the national average. Two-thirds of the state’s substance use treatment admissions last year were for alcohol use, and the U.S. Centers for Disease Control and Prevention found an average of 3,700 people die annually from alcohol-related causes in Colorado.
“(It’s) a health crisis that's affecting people's jobs, their livelihoods, their families,” bill sponsor Sen. Kevin Priola said. “We, as legislators, have friends and colleagues and family members that have struggled with substance use disorder, alcohol related and non-alcohol related. It cuts across all socioeconomic, all racial lines.”
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In the current version of the bill, only a few dozen of the largest alcohol companies in Colorado—those that sell over a certain volume of alcoholic products every year—would be subject to the fees. Small to medium-sized breweries, distilleries and wine-makers, which are the vast majority of alcohol producers in the state, would be exempt.
Gov. Polis, however, is proposing that lawmakers also exempt all beer and cider companies, including industry giants like Golden-based Coors Brewing Company and Budweiser-maker Anheuser-Busch. If that exemption moves forward, the change would mean only the largest wine and spirit makers would have to pay the fees. Spirits are the most commonly-consumed alcoholic drinks in Colorado, closely followed by beer.
Polis has expressed concerns that charging fees to beer companies could increase costs for consumers.
“The Governor appreciates the intent of the legislation and the importance of tackling substance use disorder,” Polis’ office said in a written statement to KUNC. “(He) wants the legislature to ensure that, as we look at creating new revenue streams for this critical need, we try to keep costs low for consumers.”
Sen. Priola said large companies contribute most to the state's alcohol proliferation and exempting them would undermine the core intent of the proposed bill.
“Beer is one of the most largely consumed alcoholic drinks. It follows that they are a part of the problem,” Priola said. “It's a wise proposal, and honestly, I think it would help influence other states to start moving this route and to focus dollars on interdiction of substance use disorder related to alcohol."
The bill’s sponsors and other advocates for the measure oppose Polis' proposed beer and cider exemption, including organizations like Advocates for Recovery, which has been helping Coloradans with substance use disorder for decades. The group’s Executive Director Tonya Wheeler, who is in active recovery from alcohol use disorder, rejected Polis’ proposed exemption for big beer.
“I don’t get it,” Wheeler told KUNC. “We're talking about the substance that is the most accessible, and that's the one that he wants to exclude.”
Wheeler said substance use treatment providers desperately need a sustainable source of funding, especially now that federal COVID funding is expiring this summer.
“We need continuous funding,” Wheeler said. “The importance of this one is that it is a sustainable, non-grant base. I don't want to have to fight for a grant that's for two or three years and then lose that funding and not be able to maintain the support across our state.”
According to Wheeler, a continuous, reliable source of funding will also help organizations like hers reach Coloradans who have limited access to substance use resources, like rural residents and non-English speakers.
The bill was approved by both the Senate Finance and Appropriations Committees this week and is now awaiting debate on the Senate floor.
