Alcohol

Governor sidesteps straight talk about alcohol vetoes

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More than a month after Gov. Michelle Lujan Grisham vetoed tentative steps that state legislators had taken to address New Mexico’s worst-in-the-nation rate of alcohol-related deaths, her office offered rationales that don’t square with her actions. The governor vetoed the first increase in alcohol tax rates in 30 years but she does not oppose increasing alcohol taxes, her spokesperson Maddy Hayden emailed New Mexico In Depth. The one-penny increase — watered down from a proposed hike of a quarter-per-drink—“would not have a material effect on alcohol prevention and treatment,” Hayden added, declining to say whether the governor supported a larger hike. The governor also vetoed a measure that would have directed tens of millions of dollars of existing alcohol tax revenues to alcohol treatment and prevention but she “believes unequivocally” that New Mexico needs to devote more resources to addressing alcohol misuse, according to Hayden. The governor felt the Legislature’s tax package represented “a potentially untenable hit to the general fund” and vetoed the reallocation of alcohol tax revenues “out of fiscal responsibility,” Hayden said, declining to clarify why the governor didn’t then retain the alcohol tax hike, which would have generated $10 million annually. 

The vetoes continue to puzzle and disappoint Democratic legislators and senior members of her own administration.

Alcohol

Lujan Grisham axes tax increase on booze

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Gov. Michelle Lujan Grisham on Friday struck down the first alcohol tax increase in 30 years meant to address a public health crisis that claims thousands of New Mexican lives a year.Lujan Grisham’s veto came as a surprise to state lawmakers. During weeks of negotiations with the governor’s office and each other during the legislative session, lawmakers had shaped a $1.1 billion tax package only to learn that she had liberally crossed through line after line in the 119-page bill.The decision to eliminate the alcohol tax, in particular, contradicted the rhetoric coming out of the governor’s office this week leading up to the vetoes. 

Lujan Grisham sounded the alarm about the potential for the tax package to undermine the state’s long-term financial health. The proposed tax cuts represented future dollars the state would not collect, which some pointed to as a risk given the state’s volatile revenue stream. New Mexico is overly dependent on the boom and bust cycles of the oil and gas industry.However, the nominal increase to the state alcohol excise tax — less than 1 cent on a 12 ounce beer and about one and a half cents per servings of wine and liquor — would have generated roughly $10 million a year. 

The tax bill would have directed those dollars as well as about $25 million in money that currently goes to the state’s general fund to a new Alcohol Harms Alleviation fund for treatment. 

Unclear is why the governor didn’t eliminate the harm alleviation fund in the tax bill, while keeping the tax increase, given her concerns over shoring up the state’s revenues. 

Among those stunned by the governor’s decision Friday was Sen. Antoinette Sedillo Lopez, D-Albuquerque, a co-sponsor of the proposal to increase the state alcohol tax.“I would expect an increase in alcohol excise tax would be welcome in light of the harm to the communities and cost to the state due to alcohol,” Sedillo Lopez said Friday afternoon.Maddy Hayden, the governor’s spokeswoman, declined to say why Lujan Grisham had vetoed the alcohol excise tax increase when it would have put dollars into New Mexico’s coffers.She did say, however, “The governor spoke at length to the media (Friday) about the continued need for dedicated resources to address alcohol misuse. As you know, she recommended creating an office at the Department of Health dedicated to alcohol misuse and the budget as signed includes $2 million for that purpose.”Hayden was referring to a Friday afternoon press conference Lujan Grisham held in Santa Fe.In 2021, alcohol killed 2,274 New Mexicans in 2021, at a rate no other state comes close to touching.

Alcohol

How a 25¢-per-drink alcohol tax fell apart

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The Santa Fe New Mexican chronicled how efforts to increase taxes on alcohol over the past 30 years have hit a brick wall at the Roundhouse. Lawmakers budged in 2023, raising the tax per drink by a penny — far short of a 25 cent proposal. Illustration by Marjorie Childress. Ever seen someone make a quarter disappear? You did if you watched this year’s legislative session, where advocates seeking to stem the state’s tide of alcohol-related deaths proposed a 25¢-per-drink tax — and lawmakers shrank it down to hardly a penny.

Alcohol

Lawmakers water down alcohol proposals amid public health crisis

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ALBUQUERQUE, NEW MEXICO – JUNE 26, 2022: The alcohol department at a grocery store Albuquerque, NM on June 26, 2022. CREDIT: Adria Malcolm for New Mexico In Depth

The alcohol industry notched a victory Saturday as the Legislature approved an alcohol tax hike of less than a penny-a-drink on beer and hardly more than that for liquor and wine, a fraction of the 18- to 20-cents public health advocates pushed for in this year’s session. 

Lawmakers also rejected a $5 million request from the Department of Health for a new Office of Alcohol Prevention, despite the state’s historic budget surplus. A DOH spokesperson said its epidemiology division would create a smaller version of the office anyway, using an additional $2 million lawmakers added to the agency’s budget. 

Public health experts say the tax increase is so small that it’s unlikely to have any effect on excess drinking, let alone tackle New Mexico’s worst–in-the-nation rate of alcohol-related deaths. The chair of the House tax committee, Rep. Derrick Lente, D-Sandia Pueblo, who had rejected a compromise 5¢-per-drink proposal passed by his counterparts in the Senate, acknowledged the final increase was minor on the floor of the House of Representatives on Saturday morning. “If we want to call it minimal, we can call it minimal,” he said.

Money in Politics

Powerhouse lobbyists on tap for alcohol industry

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ALBUQUERQUE, NEW MEXICO: The alcohol department at an Albuquerque grocery store. CREDIT: Adria Malcolm for New Mexico In Depth

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.

Alcohol

Do alcohol taxes hurt poor people?

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Illustration by Shelby Criswell

A bill that would raise state alcohol taxes for the first time in 30 years is in the hands of Democrats, who have a firm hold on both legislative chambers. But a major obstacle to passing the legislation is the concern voiced by some of their members about how an alcohol tax hike would affect low-income New Mexicans. 

In an interim legislative meeting In October, Rep. Susan Herrera, a Democrat whose district in northern New Mexico has a higher share of residents in poverty than the state, said she refers to levies on alcohol and tobacco as ‘poor man’s taxes’ rather than as ‘sin taxes’. 

“Not that I think poor people sin more than rich people,” she said, prompting laughter from her colleagues, “I just think they pay more for their sins.”

Paul Gessing, president of the local free market think tank The Rio Grande Foundation, testified to lawmakers that a tax on alcohol is regressive. Business interests and conservatives are making the argument, too. On Monday as the House Taxation and Revenue Committee discussed House Bill 230, which would raise state alcohol taxes to a quarter a drink, Sam DeWitt of the national Brewers Association tarred the proposal as “regressive.” So did Paul Gessing, president of the local free market think tank The Rio Grande Foundation, and Adam Hoffer of the Washington, D.C.-based Tax Foundation. 

Sen. Antoinette Sedillo-Lopez, a Democrat representing the south side of Albuquerque who is sponsoring companion legislation, insisted the measure is meant to improve the health of lower-income New Mexicans, not to impoverish them. “This bill is about changing behavior.”

Alcohol taxes are regressive by definition, according to former state tax policy director Kelly O’Donnell, at least from a technical standpoint.

Health

Proposed Office of Alcohol Prevention steps up ambition, but is short on vision

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The New Mexico Department of Health has asked the legislature for $5 million to build an Office of Alcohol Prevention, which would expand the staff focused on reducing excess drinking from a single epidemiologist to a team of 13. If created, the office would represent a significant increase in resources and personnel focused on the state’s epidemic of alcohol-related deaths, by an agency long cowed into inaction against the challenge. But some experts who reviewed an internal description of the proposed office, which New Mexico In Depth obtained by public records request, said the plan was not bold enough to meet the crisis. Tim Naimi, who directs the Canadian Institute for Substance Use Research at the University of Victoria, said that to reverse the state’s climbing death rate would require sustained strategies that influence drinking by everyone in the state, not just those who have already developed serious problems with alcohol. But he said the activities highlighted in the plan were redundant with existing practices and lacked focus and resolve.

Alcohol

Deaths due to drinking rose sharply in 2021

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More than 2,200 New Mexicans died of alcohol-related causes in 2021, according to new estimates from the Department of Health, capping a decade in which such fatalities nearly doubled and setting a new high-water mark in a state already beset by the worst drinking crisis in the nation. The updated data arrive as lawmakers draft legislation to reduce alcohol’s harms for the upcoming session. 

Laura Tomedi, an assistant professor at the University of New Mexico College of Population Health, drew on the data at a late-November hearing of the interim Legislative Health and Human Services Committee. Tomedi, who from 2013 to 2018 led the health department’s substance abuse epidemiology section and served as its alcohol epidemiologist, told lawmakers the state’s death rate had been “going up and up and up” for years. But she described the latest trends — a 17% uptick in 2020 and another 13% jump in 2021 — as a “concerning, sharp increase.”

This spike in deaths coincided with the pandemic, she said, when “​early indications are showing that alcohol use increased quite a bit.”

The mortality data, which are the most comprehensive estimates of alcohol’s full impact on New Mexicans’ health, account for all causes of death brought on by drinking including injuries in motor-vehicle crashes and violence in which the victim was intoxicated, and illnesses such as liver disease and cancer. Illness deaths due to chronic drinking made up a growing share of alcohol-attributable deaths, accounting for 62% in 2021, compared to 38% resulting from acute intoxication such as injuries and poisonings.

Alcohol

Alcohol taxes across country are “very, very low”

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Lawmakers shouldn’t read too much into the fact that New Mexico has some of the highest alcohol taxes in the country, a national expert told them today. Because “alcohol taxes across the country are very, very low.”And Richard Auxier, Senior Policy Associate, Urban-Brookings Tax Policy Center, gave lawmakers at the Legislature’s Revenue Stabilization & Tax Policy Committee hearing a clear answer to questions about whether raising taxes helps improve public health. Yes, he said, research shows that raising taxes reduces consumption and improves health. In the state that leads the country in alcohol deaths, that’s important. But when you get into the weeds of tax policy, everything becomes complicated. Lawmakers should start with understanding their ultimate goal, Auxier said. Is it to eliminate or drastically reduce consumption of alcohol? If so, it might make sense to increase taxes significantly. Or is it to improve public health while not making drinking alcohol so expensive that it becomes out of reach?