Bar owners in the Mission District contend that a proposed alcohol fee averaging 7 cents per drink, which will be considered by the Board of Supervisors today, is badly timed and will do little to curb drinking. Many of their patrons agree, and say that owners are likely to raise prices by more than 7 cents.
“Many of the stores around here are already struggling,” said Adrian, a 69-year-old retiree who emigrated from El Salvador 23 years ago and is a regular at El Farolito Bar at 24th and Mission. “The thing is, at a bar you can’t raise the price of a drink by 7 cents. They will go up 50 cents, or even a dollar. This will affect business.”
At 2 p.m. on a Tuesday, only a few Latino regulars were nursing Coors Lights at this small neighborhood favorite, but soon it would fill with the Mission’s working class. Adrian, who asked that his last name be withheld, said that most of the regulars get by on one or two cheap beers, and a 50-cent price hike makes a big difference. But he doesn’t think a hike would stop them from coming in. “We humans are animals of custom.”
The fee, introduced by 11th District Supervisor John Avalos, would tax alcohol wholesalers delivering to the city’s bars, restaurants, grocery stores and liquor stores. It would be based on volume—the price of a gallon of liquor would increase by $3.20—and is intended to help hospitals and paramedics recoup the expense of alcohol-related services.
Bar owners said the tax would affect them more than other businesses. “This legislation has the potential to be far more costly to bars that sell and purchase less-expensive liquors,” said Sean Manchester, owner of the SOMA/Mission bars Wish and Mighty, and president of the California Music and Culture Association. He said his organization anticipates “that the alcohol tax will be more costly for bars and nightclubs, while unintentionally benefiting big-box stores like Safeway, which can distribute the financial burden throughout its other products.”
Kamel Karajah, owner of That’s It liquor store at 23rd and Mission for the past 14 years, said he understands the city’s need to protect hospitals, but “the timing is — especially for small businesses like us — just wrong.” Karajah believes that Avalos supports small businesses in general, but said that a majority of his customers won’t recognize the good intentions behind the fee. “It’s making it hard for us. The customers already know the prices, and they’re going to be upset. They will think we are just raising prices.”
As a guest on KQED’s Forum radio show on Tuesday morning, Avalos argued that the fee is justified to offset costs to the city related to “the impact of over-excessive drinking in San Francisco.”
He cited an independent study commissioned by the city’s controller’s office that concluded the city pays $17.7 million per year in costs related to excessive alcohol consumption.
Joseph Hanrahan, a 28-year-old bartender at the Elbo Room, called the fee a “vice tax,” but doubted it would slow drinking.
“You can tax alcohol whatever you want, and people will pay for it — I’m not saying this is a good thing. We don’t want to see San Francisco turn into an airport bar.”
So far, 6 of the 11 supervisors support the proposed fee, but Mayor Gavin Newsom is opposed, arguing that it’s too soon to impose additional costs on small businesses still recovering from the recession. If the board fails to reach an accord on Tuesday, the proposal could head to the November ballot.