A proposal to raise New Mexico’s alcohol tax to a flat 25-cents per drink in a bid to curb the state’s exceptionally high rate of alcohol-induced deaths has disappeared behind closed doors.
Both House Bill 230 and its companion in the Senate were tabled by their respective tax committees, leaving them in legislative limbo, even while lawmakers said they’d be considered for inclusion in a larger tax bill in the late hours of the session.
From the start, the legislation faced a rocky path. In a year when the state is swimming in oil and gas money, opponents questioned raising alcohol taxes at all, even if public health experts say the primary reason to do so in this case is not to raise revenue but to hike the price of excess drinking in order to deter it. Others wondered if the bill would hurt small brewers, distilleries and wineries or would impoverish low-income New Mexicans who don’t cut back on drinking.
But another factor weighs on the measure: the alcohol industry itself and the lobbyists it employs to make its case. They have attended every hearing, sometimes muddying the discussion about whether raising alcohol taxes can save lives, as most scientific evidence suggests.
Year in and year out, well-known professional lobbyists push the alcohol industry agenda, some of whom have decades-long relationships with policy makers. But they don’t need to rely on friendship alone: over the past 10 years, the industry has showered nearly three-quarters of a million dollars on New Mexico’s elected officials and competing candidates, mainly to governors and to lawmakers who sit on committees important to the industry.
This largesse isn’t unusual in New Mexican politics. Businesses that profit from alcohol sales don’t contribute as much to politicians as the oil and gas sector, which spent more on state lawmakers in 2022 than the alcohol lobby has over the past decade. Attorneys, as a group, easily surpass the alcohol industry’s level of giving.
But campaign finance reports reveal consistent, targeted donations from a small set of large alcohol interests.
By far the largest donor is Anheuser-Busch, the maker of Budweiser, owned by a multinational corporation that bills itself as the world’s largest beer maker, with sales of $54 billion in 2021. Premier Distributing is a New Mexico-based distributor soon to be purchased by another Anheuser Busch distributor Hensley Beverage. National companies Admiral Beverage and Southern Glazer’s Wine and Spirits distribute Coors beer, wine and liquor throughout New Mexico. The New Mexico Restaurant Association is a trade group that actively lobbies at the state Legislature. And the New Mexico Brewers Guild, which makes smaller contributions, includes familiar local brands like Tractor Brewing Company, who can offer compelling testimony as small businesses, even if they are dwarfed by the other corporations on their side.
Since 2013, these six entities have together given almost $750,000 in campaign contributions, with more given during election years preceding the longer 60-day sessions where alcohol-related legislation will likely be heard.
More than 200 candidates accepted the cash over that time but two of every three dollars went to governors and a subset of lawmakers with significant power to decide the fate of bills affecting the industry. They include the leaders of the House and Senate chambers who control how easily a bill travels through the Legislature, and members of the tax and finance committees who decide whether critical bills reach the full membership of each chamber. Above all, alcohol interests have given to governors, who can veto bills directly or dissuade lawmakers from passing them in the first place.
Over the past six years, current Democratic governor Michelle Lujan Grisham accepted almost $100,000 from the alcohol industry, in donation after donation. The latest on record was a $2,500 check from the New Mexico Brewers Guild, filed last October 18.
During the 2022 election cycle, which spanned 2021 and 2022, these six groups gave more than $140,000, including $92,000 from Anheuser-Busch alone. More than two-thirds of that company’s contributions went to the governor, the leadership of the House and Senate, and members of the House and Senate budget and tax committees.
The biggest concern isn’t that money buys votes outright, but that it opens doors.
“The clearest thing that we can say about the influence of money in politics is that it buys access to elected officials,” said Timothy Krebs, a professor of political science at the University of New Mexico, during a December panel discussion hosted by New Mexico In Depth.
Krebs is quick to say that lobbyists are essential to the process of lawmaking. “I think legislatures all across the country would sort of collapse without the presence of lobbyists providing the information that they do,” he said.
The tension in the system, he said, is how much weight some lobbyists have compared to others with a stake in the lawmaking process, like the general public. “The main difficulty, of course, is a concentration of power among moneyed interests, and how that distorts the policy agenda away from the public interest.”
Representing the alcohol industry this year are some of the most powerful professional lobbyists in the state, who New Mexico Ethics Watch called “super-lobbyists” in a recent report.
During a Feb. 10 hearing of the House Health and Human Services Committee when House Bill 230, the alcohol tax proposal, was first discussed, several of those super-lobbyists stepped up to a microphone to register concerns.
“Anheuser Busch is definitely in favor of responsible consumption,” Brent Moore, a lobbyist for the beer-brewing giant told the committee members. But the proposed increase was “quite large” he added, calculating it was a several hundred percent increase over the current tax rate. What went unsaid was that raising the current 4-cent tax to 25 cents per beer represents only an 8% increase in the price of a $2.50 beer.
Jason Weaks, a lobbyist for the New Mexico Brewers Guild, said the bill would jeopardize local alcohol producers.
“Local beer and liquor and spirit manufacturing create a lot of local jobs,” Weaks said.
None of the lobbyists disputed that New Mexico leads the nation in its rate of alcohol-related deaths. Several acknowledged the significance of the crisis and after Joanne Ferrary, D-Las Cruces, one of the bill’s sponsors, told her colleagues that her niece had recently died of an alcohol-related fall, Moore told her he was sorry for her loss.
After opponents spoke, supporters of the bill made their case.
The first voice to come over the committee room’s public address system was that of Jennie Wei, a Harvard-trained internal medicine physician who had called in from the Gallup Indian Medical Center, where she has worked for a decade. Speaking rapidfire, Wei described what it feels like to work on the front lines of the state’s alcohol crisis.
“There is no way to exaggerate the extent of alcohol-related harms in our hospitals,” Wei said. Despite the prominence of DWI accidents, data show that most New Mexicans killed by alcohol die of chronic illnesses in a handful of emergency rooms and intensive care units.
“I never get used to seeing a 28-year-old mother of three in fulminant liver failure, yellow from head to toe because she can’t clear her toxins, bleeding from every orifice in her body because she can’t make the proteins needed to clot blood. I never get used to telling her children and her mother that she has died from a preventable illness — yes, a preventable illness, but only if sound, evidence-based public health practices are enacted like HB 230.”
Wei’s experience and Ferrary’s personal loss presented state lawmakers with powerful human stories about a crisis that continues to devastate New Mexico, where alcohol kills double the number of people killed by fentanyl, heroin, and methamphetamines combined.
But Wei, Ferrary, and a slew of other clinicians and public health advocates who support the bill are relative newcomers to the statehouse compared to the high-octane lobbyists the alcohol industry has assembled.
In the Roundhouse, as in any legislative body, relationships matter. Many lobbyists are themselves former state lawmakers, government officials, or legislative staffers who have known sitting legislators for years or even decades. Some are children of former state lawmakers, legislative staffers, or longtime lobbyists.
Take, for instance, Al Park, who now represents the Brewers Guild but was a member of the House from 2001 through 2012, where he chaired that chamber’s Judiciary Committee.
Or Brent Moore, the Anheuser Busch lobbyist, who served in state government as the general counsel and deputy superintendent for the Insurance Division of the New Mexico Public Regulation Commission before his lobbying career.
Then there are former staffers who’ve been around the Legislature for decades like Scott Scanland and Dan Weaks. Both have walked the statehouse corridors since at least the 1980s, time to learn the intricacies of law making and to build close relationships with its elected members.
The world of these professional lobbyists can feel like a family affair. Dan Weaks, who represents the New Mexico Wine and Grape Growers Association and the California-based Wine Institute, is the father of Jason Weaks, the New Mexico Brewers Guild lobbyist.
In addition, Scanland is married to Rep. Doreen Gallegos, D-Las Cruces, who sits on the House Taxation and Revenue committee.
At the hearing on House Bill 230 before that committee, Scanland and other super-lobbyists like J.D. Bullington, who represented the Albuquerque Chamber of Commerce, offered members reasons to oppose the measure.
“Ratcheting up a tax of this magnitude is not the answer to combating alcohol abuse because it needlessly and unfairly punishes very responsible adults and it would harm local businesses,” Bullington said.
John Thompson, who represents the alcohol distributors Admiral Beverage Company, L&F Distributors, National Distributing Co., and Southern Wine & Spirits of New Mexico, said the state already has higher taxes than its neighbors. “The idea that problematic drinkers are going to stop drinking as a result of this bill is difficult to understand,” he added.
And Scanland, speaking as a lobbyist for San Juan County, cast doubt on science showing increased alcohol taxes reduce consumption. “Multiple studies over the last several years show that those who abuse alcohol do not curb their consumption in response to higher prices,” he said, without citing his sources.
Scanland said San Juan County opposed the bill because it would reduce the percentage of alcohol tax revenues made available for DWI prevention. Sponsors of the bill later clarified that the percentage was reduced because the higher tax rate would raise much more revenue, and the county would receive more money than it does now, even accorded a smaller share.
A fiscal impact report prepared by legislative staff estimated that Farmington, the largest town in San Juan County, would receive $270,000 more each year; the state’s local DWI fund would benefit by $2 million; and the drug court fund would grow by $570,000. These amounts are in addition to roughly $180 million that would be generated by the tax each year and go into a new alcohol harms alleviation fund for use statewide.
After listening to supporters and opponents, the House tax committee voted to table the bill. Lawmakers on the committee said this was the usual practice for legislation with a fiscal impact on the general fund or taxes. A similar fate greeted its companion in the Senate, SB 259, after it was heard by the Senate Tax, Business and Transportation Committee.