Wisconsin lawmakers roll out beer tax increase

(AP) - Wisconsin's beer tax, which has been flat for 40 years, would be five times higher under a proposal backed by police, health workers and others.

But the idea unveiled Wednesday got a predictably tepid response from the beer industry and the state's bars and restaurants, which have successfully fought it for decades. Gov. Jim Doyle also remains opposed.

Even the bill's sponsor was realistic about her idea's chances.

"I'm not going to expect miracles," said state Rep. Terese Berceau, D-Madison.

The beer industry is ingrained in Wisconsin's economy, which explains why the tax hasn't gone up in 40 years, said Tavern League lobbyist Scott Stenger.

Raising it now would not only hurt bars, which are already seeing a decrease in customers due to the recession, but it would also harm smaller craft breweries, Stenger said.

"The worst possible time to look at doing something like this is in this economy," Stenger said.

The Tavern League, along with Miller Brewing Co., Anheuser-Busch and the Wisconsin Restaurant Association, all fought the bill in the past.

Wisconsin has a long tradition as a beer-friendly state, once home to more than 400 breweries. But last year Miller announced it was moving its headquarters to Chicago under its merger with Coors. Milwaukee, often called the "Brew City," also was once home to Blatz, Schlitz and Pabst breweries, but they closed years ago.

While the larger breweries are gone, Wisconsin is home to 66 smaller craft breweries, according to the national Brewers Association. That is 10th highest per capita.

Even as breweries have come and gone, the tax on beer has only been increased three times since Prohibition ended. The state's tax is two or three times less than what neighboring states charge and third lowest nationwide, behind only Missouri and Wyoming.

There were dire predictions the last time the tax was raised in 1969 that it would lead to the downfall of the state's beer industry, said state Sen. Fred Risser, D-Madison, the only current lawmaker who was in office then.

"We need the increase," said Risser, the bill's co-sponsor. "I'm not a hypocrite in this area. I like beer. I drink beer."

Last year only two other lawmakers, out of 132, joined with Risser and Berceau to co-sponsor the bill.

Doyle remains opposed and told Berceau that a month ago. Senate Majority Leader Sen. Russ Decker, D-Weston, also would prefer not to raise the beer tax, said his spokeswoman Carrie Lynch.

But tax increase backers said they believe support is growing given the high cost of treating alcohol abusers and drunken driving cases. A coalition of more than 50 law enforcement agencies, hospitals and health care workers, politicians and others formed in November to push for the higher tax and tougher drunken driving laws.

In December, the Wisconsin District Attorneys Association proposed raising the beer tax to pay for more prosecutors to handle alcohol-related cases.

"Wisconsin has a drinking problem of national renown," Berceau said. "Let's quit enabling the problem in Wisconsin by not directing resources to the problem."

Under the bill, the tax on beer would be five times higher, up from 0.6 cents to 3 cents per bottle. The $58 million raised would be used to provide grants to local governments to reduce alcohol-related crimes by hiring more police, fund drug and alcohol abuse treatment services, and substance abuse and prevent programs.

Under the increase, a person who drinks a six-pack of beer a day for a week would pay an additional $1 in taxes over that time.

That's a small price to pay to help defray the millions of dollars in costs related to dealing with alcohol abuse, which in 2007 was put at $935 million, Berceau said.

"We're at a tipping point here," said Lisa Maroney, legislative liaison for UW Health, which organized the coalition to back the tax increase. "I think public sentiment is changing about drunk driving and binge drinking in the state."

A number of proposals are working their way through the Legislature to crack down on drunken driving, including making the first offense a crime rather than just traffic citation and legalizing roadblocks to catch offenders.