San Francisco Chronicle

EDITORIAL

Don't swallow the spin
Tuesday, September 6, 2005

A FLAVORED malt beverage may sound innocuous, even healthy. But these sweetened drinks, which have become a favorite among underage drinkers, are hardly innocuous or healthy.

They're alcoholic beverages with an alcohol content of between 4 percent and 6 percent. They have names like Smirnoff Ice, Bacardi Silver and Skyy Blue. Their manufacturers say the flavorings, which make the drinks taste like distilled spirits, constitute only a negligible percentage of the drink.

But a 2003 study by the Alcohol and Tobacco Tax Trade Bureau in the U.S. Treasury Department found that it's the malt part of the drink that makes up a small percentage of its volume. In nearly all the products tested, the bureau found that the distilled "flavorings" made up most of the alcohol in the drinks.

Yet these products have routinely been sold as beer in California and other states.

Attorney General Bill Lockyer has made a compelling case that these drinks should be classified as distilled spirits under California law. The state's definition of beer contains no reference to distilled spirits, while its definition of distilled spirits encompasses "all dilutions and mixtures thereof."

It is not simply a technical distinction. Because distilled spirits are subject to a far higher tax than beer, classifying malt beverages as distilled spirits would make them more expensive. Studies have shown that the most effective way to discourage underage drinking of such beverages is to raise their price.

In addition, the drinks could only be sold in outlets with hard-liquor licenses, which would drastically limit their availability. Classifying them as distilled spirits would also make it more difficult for manufacturers to advertise them on television and other outlets viewed by young people.

But Lockyer's efforts to get malt beverages reclassified has triggered a backlash from the industry, which is desperate to make sure that the highly profitable drinks continue to be sold as beers.

Last week, Assemblyman Greg Aghazarian, R-Stockton, took a bill that he had authored earlier this year that had nothing to do with flavored malt beverages and changed it to declare that malt beverages would remain classified as a beer. "If it walks like a beer and talks like a beer, it is a beer," he said. He says reclassifying malt beverages would have a devastating impact on family restaurants and other outlets that sell malt beverages and don't have the means to apply for hard-liquor licenses.

Aghazarian told us indignantly that he was not using Sacramento's familiar "gut and amend" tactics to ram through legislation near the end of the legislative session. "We want to have all the committees with the proper jurisdictions look at it," he told us. But with the Legislature under pressure to vote on all its bills by the end of this week, it is hard to see how that would be possible.

Incredibly, AB417 is now on a fast track to be approved in the Legislature. Lawmakers in both houses should move quickly to kill it. Before taking action, there should be proper hearings on the content and impact of "malt beverages," which are contributing to the dangerous practice of underage drinking.

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