A game of quarters may soon cost a few more pennies.
Rep. Edwin Pacheco, D-Dist. 47, introduced a bill Feb. 1 in the Rhode Island General Assembly that would raise the state beer tax to finance substance abuse treatment programs.
Supporters of the proposal say it would help the state's financially strapped rehab centers, while critics argue the legislation would do nothing more than drive beer-drinking Rhode Islanders to Massachusetts, where alcohol is already less expensive.
Pacheco said Rhode Island's substance abuse treatment programs need help.
"If we want (substance abuse) services to be available, we have to fund them in some way, shape or form," he said. "Unfortunately in Rhode Island, they're lacking."
His bill would raise the pre-sales tax price of beer and stipulate that revenue generated by the price hike go toward combating substance abuse.
Currently Rhode Island beer consumers pay an excise tax - which is added to the price before the sales tax is calculated - of $3 per 31 gallons (roughly 30 cents for a case of 30 beers), but the money goes toward the state's general expenditure fund, not toward combating substance abuse, Pacheco said. The proposed bill would double that tax, making it $6 per 31 gallons (roughly 60 cents for a case of 30), and mandate that substance abuse rehabilitation centers and programs receive the additional income.
Though the House Finance Committee has not analyzed how much revenue the proposal could generate, Pacheco said it could yield roughly $2.3 million dollars per year. However, he said would be open to stripping the tax increase from the bill if lawmakers would agree to allocate money from the existing beer tax toward alcoholism treatment programs.
"I think that would be great," he said. "The ultimate goal here is to provide sufficient services for substance abuse treatment and prevention."
The Providence Journal reported Feb. 9 that the measure was intended to curb underage drinking, but Pacheco said this is not a goal of the bill because the price increase is not large enough to act as a deterrent.
Pacheco said the bill targets specifically beer because beer taxes have remained stagnant since 1989 and because research indicates that most alcoholics abuse beer more than hard liquor or wine.
He contended that the additional cost to consumers would not be large enough to spark a change in beer purchasing habits.
"I don't think there are many people that actually would go out of their way to go to Massachusetts to save pennies," he said.
Opponents argue more than a few pennies are at stake and that the proposed legislation would send more beer business out of Rhode Island and into Massachusetts.
Rep. Jan Malik, D-Dist. 67, who owns Malik's Liquors in Warren, said Rhode Island alcohol vendors are already hard-pressed to compete with their Bay State counterparts. To avoid a possible conflict of interest, Malik will not vote on the measure.
"In this day and age, you have to be competitive," he said. "Why are we looking at another disadvantage for the (alcohol) industry? We're trying to cut spending, not raise taxes."
Jim McCarthy, who owns Spiritus Fermenti on Meeting Street, said liquor store parking lots in Massachusetts are already filled with cars bearing Rhode Island plates. He said the proposed tax increase would "of course" send more people across the state line.
"You're not going to run out there to save a dollar, but if you were going to have a big party in your home, you might," McCarthy said.
Driving from the Brown campus to Seekonk, Mass., for 15 cases of beer would save about $15, after subtracting the cost of gas for two cars, based on last week's average price of regular unleaded fuel in Rhode Island. Under the proposed tax hike, that same trip would save approximately $20.
But some students told The Herald they wouldn't mind a slight increase in the price of beer if money from the tax went toward alcoholism treatment programs.
Mark Connolly '07, chair of Greek Council and a member of Delta Phi, said he would be willing to pay a little more for beer if it meant better funding for substance abuse treatment.
"Being able to meet the need for alcohol treatment programs should be a priority for Rhode Island. I wouldn't mind spending the extra money," Connolly said. But he added that he could understand why some people would go to Massachusetts. "I could see how, if you're buying large quantities, going to Seekonk might make sense."
Shane Whittet '08 echoed that sentiment.
"I'd be willing to pay an extra 60 cents if it's going toward a good cause," he said.
Alper Celik '08 said he questioned just how much money the beer tax increase would generate.
"The tax is small enough that it wouldn't affect my beer-buying decisions," he said. "But I doubt it would raise $2 million."
Pacheco said the House of Representatives will likely vote on the measure in late May or June.
