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Lawmakers propose higher beer tax

February 04, 2010 @ 10:30 PM

CHARLESTON -- Several West Virginia delegates are proposing to increase the tax on beer to pay for substance abuse treatment and recovery programs across the state.

Upshur County Republican Bill Hamilton, one of the delegates sponsoring the legislation, said he knows a tax increase during an election year and amid an economic slump is not viewed as a favorable move among his peers. He also knows beer wholesalers will oppose the measure, as they were successful in derailing similar legislation last year.

But drug abuse has become such an epidemic in West Virginia that its societal costs can no longer be ignored, he said.

"It may be political suicide, but I'm not here to focus on getting re-elected," Hamilton said Thursday. "I want to work on issues affecting my constituents, and at this point, it would be hard to find a family that hasn't been touched by it."

Hamilton said he knows first-hand how drug abuse can uproot families. His son and daughter-in-law served time in prison for crimes related to their methamphetamine addictions. Both are now out of prison and are recovering, but their experience was a wake-up call to Hamilton that treatment and recovery efforts in the state are woefully underfunded.

Hamilton's bill, co-sponsored by Delegates Don Perdue, D-Wayne, Jim Morgan, D-Cabell, Nancy Peoples Guthrie, D-Kanawha, and Mary Poling, D-Barbour, would raise the barrel tax on beer from $5.50 to $11. That translates into an additional penny on a bottle of beer, Hamilton said. The tax would generate approximately $10 million in revenue for treatment and recovery programs, he said.

Hamilton said he's heard the argument from delegates in border counties that convenience stores will be put at an economic disadvantage to their competition in neighboring states.

"That's nonsense," Hamilton said. "I can't believe someone will drive from Huntington to Chesapeake to save 24 cents on a case of beer."

Beer wholesalers also say it's not a good time to raise taxes because of the economy. Hamilton said this was the same argument the industry used last year, even though one of the largest brewing companies in the country raised the price of its beer by 3 cents a bottle in West Virginia in October.

"I won't say their name, because they'll be getting plenty of publicity from their Super Bowl commercials," Hamilton said.

Gov. Joe Manchin focused his attention on addiction in November when he presented a statewide strategy for countering the effects of drug and alcohol abuse. The plan was developed at the governor's request by the West Virginia Partnership for Community Well-Being, a state policy and planning board.

The plan proposed spending $23.5 million a year in prevention, early intervention, treatment and recovery efforts.

Also included in the plan is the establishment of county prevention partnerships to develop local solutions and serve as a channel for state resources, surveys of students at all secondary schools every two years, annual reports to the governor and Legislature and a review of state law as it applies to substance abuse.

That last component is expected to relate to how the criminal justice system treats people convicted of nonviolent drug offenses.

Hiking the beer tax is a good first step to reaching the $23.5 million goal, said Bob Hansen, executive director of the Prestera Center, which provides behavioral health services, including treatment for substance addictions.

"Locally, it would go a long way toward opening The Healing Place, which is a recovery model that can be used statewide," he said. "The state really needs to start making an investment in the four areas of prevention, early intervention, treatment and recovery, because the costs to fight this problem are astronomical."

The direct and indirect costs of substance abuse in West Virginia are $1.86 billion annually, according to a 2006 report conducted by a consulting firm for the state Bureau of Behavioral Health and Health Facilities. The direct costs accounted for $470 million of that total.

Yet, the state spends only $8 million a year on treatment efforts, said Dr. Wayne Coombs, staff leader for the Partnership to Promote Community Well-Being. There is no state funding for prevention, early intervention or recovery efforts, he said.

"We have this huge problem and just a fraction of the resources to deal with it," Coombs said. "We're not unique, though. There are states all over the country like this."

Hamilton said he won't limit his efforts to tax hikes on beer. He plans to introduce similar legislation to increase taxes on wine and liquor, he said. He also will sponsor a bill raising the beer tax to $22 a barrel, which would generate approximately $40 million for treatment and recovery efforts, he said.

Proposed tax hikes to pay for drug abuse programs should not be viewed as ways to punish the beer industry, Perdue said.

"As the state continues to absorb this $2 billion cost for substance abuse, the amount of disposable income to purchase things like beer is going to decrease," Perdue said. "The beer industry should recognize that they should be part of the broader solution."