A new bill proposed in the Oregon Legislature would significantly raise wine and beer taxes in order to fund addiction treatment, including for Alcohol Use Disorder (AUD). As you might suspect, not everyone is happy about the measure.

Most unhappy are the state's breweries and wineries, who say the tax would reduce sales and in turn cost jobs.

"It's a ludicrous tax," Ecliptic Brewing founder and brewmaster John Harris told KGW reporter Devon Haskins. "To go from $2.60 to $72.60 is just like bonkersville."

House Bill 3296 (aka The Addiction Crisis Recovery Act) would indeed increase the tax on a barrel of beer by $70. The price of a barrel of wine would also rise -- from $0.65 to $10.65. Then again, the respective $2.60 and $0.65 rates breweries and wineries currently pay is one of the lowest in the country. Furthermore, add proponents, the last time beer tax rates were raised was when Jimmy Carter was president. Wine taxes? They’ve been in place since Ronald Reagan's first term.

A Public Health Crisis

Three years ago Oregon Governor Kate Brown signed an order declaring addiction a public health crisis. One of her office’s first moves was to team with the good folks at Oregon Recovers. The team immediately set out to compose a gameplan. Not just any gameplan, mind you. But one big and bright and enlightened enough to meet the dire need. Before they could get up and go-go though, the Jolly Green Giant of all crises stomped into town. From that point on the only drugs anyone wanted to talk about began with a “v” and ended with an “e.”

Yes, of course, we mean COVID-19. And yes, we mean vaccine. Most folks would’ve understood if  the governor and her office set aside the substance abuse issue, especially considering the incomprehensible magnitude of this new devastation. To their great credit, the office did no such thing. Neither did Oregon Recovers. And for the past three years the two have been mad at work devising that long sought plan. Better still, they teamed with all-star Statehouse Representatives Tawna Sanchez (D-Portland) and Rachel Prusak (D-West Linn), a pair of gung-ho lawslingers who are just as eager to fully address the substance abuse epidemic. And just as driven. 

Good thing too, because the pandemic only made the epidemic worse. Much, much worse. 

The Addiction Crisis Recovery Act is designed to make things much, much better. To begin with, HB 3296 would establish an "addiction recovery district" for each geographic region and tribe in the state. That designation, in turn, comes with an increase in residential treatment beds and detox units, as well as more in-patient and out-patient centers.

"Probably 1,200 residential treatment beds scattered around the state’s 36 counties," Oregon Recovers Mike Marshall told Willamette Week reporter Nigel Jaquiss. Plus "another 1,200 detox beds, [and] I think 3,000 outpatient slots in addition to what we currently have."

A Numbers Game

Those are considerable numbers. Then again, substance abuse remains a considerable problem. Oregon Recovers has long been pushing the Oregon Health Authority to increase beer and wine taxes in order to fund more addiction treatment. Now the advocacy group has a highly favorable chance of seeing that come to pass. After all, Sanchez is chair of the House Behavioral Health Committee, and Prusak is chair of the House Health Care Committee. That means they’re not just the bill’s co-sponsors; they’re also incredibly well-placed legislators.

They -- and everyone else involved -- also want folks to know that treatment-seekers won’t be the only Oregonians to benefit from the new bill. In fact, to bolster the tax proposal, OHA released a new ECONorthwest report that shows just how much the state is burdened by excessive alcohol consumption. The consulting firm’s findings? $4.8 billion annually, about half of that from lost productivity.

Sanchez was especially vocal about the need to address alcohol’s overall impact.

“I'm proud to sponsor the Addiction Crisis Recovery Act after four years of stakeholder involvement and methodical planning," Sanchez said in a statement. "The COVID pandemic has made Oregon's long-standing addiction crisis significantly worse. As we recover from the pandemic, it's critical that we adopt strategies to protect our families and increase prosperity."

Pennies for Heaven

In percentage terms, those may indeed be eye-popping increases: 2,600% for beer and more than 1,400% for wine.

On the other hand, the retail price rise pegged by proponents -- 21 cents more for a 12-ounce beer and about 31 cents more for a glass of wine -- doesn't seem at all extreme.

Those pennies will add up too. Fast. Estimates say the new tax will generate nearly $750 million. That’s a whole lot of addiction treatment.

The Oregon Beverage Alliance has another number they want folks to consider: $12.5 billion. That’s how much positive impact the Alliance claims the alcohol industry has on the state’s economy. And yes, all of that is already in some way taxed, albeit at existing rates. The Alliance wonders why there’s a sudden need for even more.

"OHA has never even attempted to fund these programs through existing alcohol revenues collected by the state," the group said. "Don't put the cart before the horse, asking for increased taxes before developing metrics to measure success."

The Alliance wants folks to know though that their opposition to the bill in no way means they oppose addressing the issue.

"As local business owners and residents, brewers and winemakers care deeply about our communities," the group continued. "That's why we invest and create so many jobs here in Oregon. Without question, more needs to be done to address addiction, and we stand ready and willing to work with lawmakers and stakeholders on these issues. The resources are already there, we just need to use them better."

Resources for All

Oregon’s alcohol producers do indeed already generate a lot of resources. In fact, the state’s beer industry alone generated $6.6 billion in sales even before the pandemic kicked in. No telling how much more revenue’s been generated since then. Or from now on. Craft beer is a large part of Portland’s culture. Craft beer makers simply want to be sure it stays that way.

Oregon Recovers isn’t unsympathetic; they’re just facing the colossal. So co-chair Tony Vezina asked the industry to table any objection and instead realize the very real enormity of the problem . 

"I publicly urge Oregon's beer and wine distributors to not lobby against ACRA," Vezina said in a statement. "For the better part of 40 years, they have made money hand over fist while Oregon's addiction crisis has led to tens of thousands of unnecessary deaths. Complicated problems require comprehensive solutions, and ACRA is just that: a comprehensive solution that will improve and save the lives of Oregonians in every corner of the state."

AUD is a Thing

Recovery Boot Camp applauds Oregon lawmakers for so significantly stepping up and addressing all Substance Abuse Disorders. AUD too is a thing. A real thing. And it's important for that thing to co-exist at the forefront of any and all addiction battles. It's equally important AUD is included in any and all treatment initiatives. Engaging the alcohol industry itself will obviously ensure all of the aforementioned -- and then some.

Should breweries and vintners suffer the brunt of a state's substance abuse issues? Of course not. But it's certainly not unreasonable to recast taxes that haven't risen in nearly half a century. Nor is it unreasonable to want to help some of our most vulnerable citizens. The Addiction Crisis Recovery Act will do both.

Bill 3296 may not be perfect. But it's still the early stages. And it'll need to be approved by three-fifths of both the Senate and the House in order to pass. Let's hope both sides can alight on some enlightened compromise.

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