As states struggle with historic budget deficits, many lawmakers have proposed hiking taxes on alcohol as a way to fund specific state programs or increase general revenues.

Yet even as policymakers struggle -- sometimes desperately -- to balance state budgets, relatively few states have accepted higher alcohol taxes as part of the solution.

According to the Center for Science in the Public Interest (CSPI), bills have been introduced in at least 28 states proposing to raise alcohol taxes during the current legislative session. But only a handful have succeeded.

Last year, Alaska raised its alcohol tax, as did Tennessee and Puerto Rico, according to George Hacker, director of CSPI's Alcohol Policies Project. This April, lawmakers in Utah -- where the majority Mormon population eschews alcohol use altogether -- agreed to raise the state's beer tax from $11 a barrel to $12.80 a barrel.

In California, a proposal to use a five-cent-per-drink tax to pay for treating the health consequences of alcohol use is still being debated, as is a measure allowing counties to impose their own alcohol taxes.

Connecticut lawmakers are still mulling Gov. John Rowland's plan to double alcohol excise taxes to raise $38 million towards closing the state's budget deficit, and Gov. Ed Rendell's plan to raise Pennsylvania's malt-beverage tax is still alive, as well.

In Vermont, the state House of Representatives approved a plan to raise the state sales tax and extend it to beer.

But similar proposals in Arizona, Massachusetts, New Mexico, Ohio, West Virginia, and Wyoming were voted down, while bills in Idaho, Maine, Maryland, Montana, Nebraska, South Dakota, were either tabled or died in committee. Also derailed was an innovative California proposal to charge alcohol producers a fee based on their share of the youth alcohol market, which was withdrawn by its sponsor so it could be reintroduced during the state's next legislative session.

Big Alcohol, Big Impediment

Advocates of increased alcohol taxes -- which experts say would reduce underage drinking and could provide needed funding for treatment and prevention programs -- say intense lobbying by the alcohol industry is the biggest reason that alcohol taxes have gotten so little traction with lawmakers.

"The industry has been incredibly active at the state level," said Hacker, who says industry lobbyists have been "much more aggressive in crowing about their contributions to state revenues."

Gerrit Den Hartog, a Missouri policy analyst and lobbyist for addiction-field organizations, counters by telling state lawmakers that current alcohol taxes (known euphemistically in Missouri as "fees") generate just $27 million annually, while alcohol use costs the state $3.7 billion each year.

Yet that argument has fallen largely on deaf ears in Missouri, which is home to industry powerhouse Anheuser-Busch. Every year for the past 23 years, activists have proposed raising alcohol taxes in the state. And every year, the measure has been quietly killed in the legislature, without even being brought to a vote.

"The industry wants to do everything it can to prevent legislators from going on the record as being for or against alcohol taxes," said Den Hartog. "If you ever wanted to see total dominance by an industry in a state capital, Anheuser-Busch has no parallel in any state in the U.S."

Anheuser-Busch is not shy about flexing its political muscle in Missouri, but even subtle methods can be used to derail alcohol-tax legislation. In New Mexico, Glenn Wieringa smelled a setup when a legislative audit of state DUI programs concluded that they suffered from a lack of accountability. Lawmakers then used the report to argue against a nickel-a-drink tax hike that would have been dedicated to addiction-related prevention and healthcare services, despite the fact that the tax bill had nothing to do with the DUI programs.

"We could not get out from under the shadow of that negative program audit," said Wieringa, a health educator with the state Department of Health.

In States, Some Signs of Hope

Still, Wieringa said that support for increasing alcohol taxes has been growing in New Mexico, and supporters plan to reintroduce the measure next year. And the news on alcohol taxes has not been all bad.

For example, Alaska Gov. Tony Knowles last fall signed into law a bill that increased the state's alcohol tax to 10 cents a drink on a 12-ounce beer, a 5-ounce glass of wine, or a 1-ounce shot of hard liquor. The previous tax rate averaged 3 to 4 cents per drink.

Knowles said that the added revenue, estimated at $20 million annually, would be used to offset the costs of alcohol addiction to the state.

"This reasonable, responsible, and realistic increase in Alaska's alcohol taxes is long overdue," Knowles said. "It is time Alaskans stepped up the fight against alcohol abuse. It is time we help people who want to stop drinking and protect the public from those who refuse to stop drinking. It is time to ask consumers to help contribute more of the share of the costs of dealing with problem drinkers."

In Alaska, Republican lawmakers championed the increase, noting that even with the tax hike the state's alcohol tax remains one of the nation's lowest. Moreover, a grassroots coalition emerged to lobby for using alcohol-tax funds for social-service programs related to alcohol use and abuse.

Stephanie Manning, director of federal relations for Mothers Against Drunk Driving (MADD), said an increasing number of MADD chapters nationally are starting to view increased alcohol taxes as a facet of their advocacy mission. "In Alaska, our MADD folks in Juneau worked hand-in-hand as part of a coalition to increase alcohol taxes," said Manning. "It varies from state to state, but increasingly this issue comes up due to state budget deficits."

Industry Seeks Tax Rollback

MADD supports higher alcohol taxes at both the state and federal level, arguing that higher costs discourage young people from buying alcohol, thus supporting MADD's mission of preventing underage drinking. Moreover, said Manning, alcohol taxes are seen as a potential revenue source for prevention. "Alcohol use and abuse costs society so much, we do think some of that money should go to prevention programs," she said.

On the federal level, as with the states, Manning admits to facing an uphill battle to convince lawmakers to raise alcohol taxes. In fact, she said, MADD has recently been "playing defense" against legislation that calls for reducing the federal excise tax on beer from $18 a barrel to $9 a barrel.

"The beer tax is a nonsensical, anti-consumer, prohibitionist throwback," said Rep. Phil English (R-Pa.), one of three primary cosponsors of the rollback legislation, H.R. 1305. Sen. Rick Santorum is expected to sponsor similar legislation in the House.

Jeff Becker, the president of the Beer Institute, said the tax has "damaged the beer industry economically and disproportionately impacts low and middle-income American consumers."

The House bill has attracted 133 cosponsors to date. Yet opponents of the measure are quietly optimistic that the measure will stall in Congress. The English bill has been referred to the House Finance Committee, chaired by Sen. Charles Grassley (R-Iowa), a solid MADD supporter in the past.

Plus, looming federal budget deficits may make legislators think twice about further tax cuts beyond the massive reductions proposed by President Bush. "Our best information on the House said says this bill is not going anywhere," said CSPI's Hacker.

A Long-Term Battle

Hacker admits that 99.9 percent of state lawmakers' motivation in proposing alcohol excise taxes is driven by deficits, not public-health concerns. Yet he remains optimistic that, unlike the feds, more states will give serious consideration to raising alcohol taxes in the next few years.

"This is the beginning of what may be a long-term battle at the state level, given that states could be experiencing budget problems for years to come," Hacker said. "Their primary motivation is that they have huge deficits that have to be addressed. Several state legislatures have been going after tobacco for many years, and it not a tremendous leap to go after alcohol from there."

Thanks to information and advocacy campaigns by CSPI and the American Medical Association about the relationship between low alcohol prices and underage drinking, Hacker also sees a growing awareness of the issue on the part of legislators.

Even in Missouri, there are signs of progress. In a state where the Republican party controls the legislature for the first time in half a century, alcohol-tax backers succeeded in getting a GOP sponsor for the bill this year.

More impressively, Missouri last year passed legislation lowering the state's BAC standard from .10 to .08 percent after the alcohol industry dropped its opposition to the measure. This year, the industry is even cosponsoring a keg-registration bill, noted Den Hartog.

"The only thing the alcohol industry has to lose is that people consider them to be a good neighbor and a good corporate citizen," Den Hartog said. Anheuser-Busch has shown a pragmatic streak in "redrawing the line in the sand" when sufficient public pressure threatens this all-important image, he noted.

Whether the industry will become more accommodating on the tax issue remains to be seen, but the precedent, at least, is there.