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Beverage-tax foes outraise proponents
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BY MATTHEW STONE
Staff Writer
Kennebec Journal & Morning Sentinel Thursday, July 24, 2008

AUGUSTA -- The proponents of an effort to repeal a new tax on beer, wine and soda grew their cash advantage over an opposing group in June and July as they closed in on meeting a voter signature threshold to land a question on November's ballot.

A beverage industry group with backing from the Maine State Chamber of Commerce collected nearly $375,000 in campaign contributions as last week's signature submission deadline approached.

The group, called Fed Up With Taxes, raised nearly 15 times the amount collected by its main opponent, a political action committee called Health Coverage for Maine, during the seven-week period May 28 to July 15.

The numbers, which became public this week in finance reports filed with the Maine Ethics Commission, showed the group opposing the beverage tax repeal raised slightly more than $25,000 during the reporting period.

At issue is a state law passed in April that instituted beer, wine and soda taxes as one way to fund Dirigo Health, the state health insurance program that covers 18,000 people. Under the law, the Dirigo program would derive its funding from those taxes and a fee collected on insurance claims.

The Fed Up With Taxes Coalition last week said it submitted more than 90,000 signatures to the secretary of state. Local clerks certified 74,533 of those signatures and the secretary of state's count is ongoing.

The group needs 55,087 signatures certified by the state to land the repeal measure on November's ballot.

Spokesmen for both groups Wednesday accused the opponent of spreading misinformation about the issue. Both expressed confidence their side will prevail in November.

"We're looking at $75 million of new taxes that were implemented without any public comment in the waning hours of the legislative session," said Newell Augur, a beverage industry lobbyist and head of the Fed Up With Taxes group. "The upside is that there are more than 90,000 Maine people who, in the last 60 days, said they would like to have a voice on these new taxes."

But Amy Thompson, development director of the Maine People's Alliance and a spokeswoman for Health Coverage for Maine, said the beverage tax issue is one of health care, not taxes.

"Mainers understand the importance of providing health care and health insurance," she said. "When they understand the vote is to put health coverage at risk for so many Mainers, I think it's going to be a no-brainer."

While Fed Up With Taxes outraised its opponent before May 28, the margin widened in June and July.

Before May 28, Fed Up With Taxes recorded $182,000 in campaign donations while Health Coverage for Maine took in $110,000.

Nearly all of the $110,000 came from S. Donald Sussman, a Greenwich, Conn., man who lives part-time in Deer Isle and is the chairman of the investment management firm Paloma Partners. After May 28, the bulk of Health Coverage for Maine contributions came from the Washington, D.C.-based Service Employees International Union.

Fed Up With Taxes received its largest donations after May 28 from beverage industry lobbying groups.

The five largest contributions for the reporting period were from the Washington, D.C.-based American Beverage Association, Augusta-based Maine Beer and Wine Wholesalers, Pepsi Bottling Group of Somers, N.Y., the Hallowell-based Maine Beverage Association and the Bedford, N.H.-based Coca-Cola Bottling Company of Northern New England. Repeal proponents also recorded contributions from a number of McDonald's franchises in Maine.

"We have support throughout the business community, from restaurants, from innkeepers, from car dealers, from associations that represent thousands of Maine workers," Augur said. "They are all in agreement that these taxes are absolutely the wrong thing that the state government should be forcing on Maine people during these very difficult economic times."

But the repeal's opponents criticized their foes for relying on large, out-of-state contributions to run their campaign.

"These are big corporations who are concerned about their bottom line, concerned about making as much money as they can," Thompson said. They are "not concerned about health insurance for Mainers, not concerned about the implications for a lack of health insurance on Mainers and on Maine's economy."

Thompson said her group had to rely on a few, large out-of-state contributions because "we very quickly needed to mobilize resources on a defensive level to get resources going."

As the beverage tax opponents conducted their signature collection drive, they paid $380,000 to a Michigan firm to collect voter signatures during the seven-week reporting period.

Health Coverage for Maine recorded more than $50,000 in expenditures from May 28 to July 15, most of them to firms that coordinated phone banks, volunteers and made automated phone calls to voters.

The Fed Up With Taxes finance reports showed more than $76,000 remaining in the group's coffers as the tax opponents look ahead to November voting. Health Coverage for Maine reported almost $49,000 in cash on hand.

Both groups said they will speak with as many voters as possible as the November vote approaches through paid media, phone calls and by knocking on doors. Both sides will also need to raise funds, they said, to marshal the resources for a campaign that will become more expensive.

"There's many better things we can do with this money," Thompson said. "But because it's at stake, it's a battle we have to fight. Literally, people's lives hang in the balance when we speak of health insurance."

"Our campaign will be just as efficient and just as effective as our signature-gathering effort," Augur said. "In less than 40 days...we were able to collect more than 90,000 signatures from Maine people. That ought to tell you something about how they feel about these taxes."

Matthew Stone -- 623-3811, Ext. 435

mstone@centralmaine.com

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