The cigar industry made no secret of their feelings of relief in the wake of the expected defeat of Proposition 29 in California, a proposal that would have raised taxes of premium cigars and pipe tobacco by 73%.
In one of the first press releases issued following the announcement that 100% of precincts had reported, Bill Spann, CEO of the International Premium Cigar and Pipe Retailers Association, said in a statement that “the conflicts of interest alongside California’s growing debt have apparently led voters to realize that now was not the time for a new bureaucracy. There wasn’t even anything in the proposition that required the money to be spent in the state or even the country.”
Spann went on to add that “Californians spoke today and said that ‘bigger government and more bureaucracy is not prudent,’ especially with the state’s dire economic position. This small margin of victory shows that grassroots politics works, as the tipping point for victory was likely many of our IPCPR member retailers, manufacturers, and consumers who were energized to go to the polls by a concerted team effort of social and traditional media explaining why Prop. 29 was bad policy from the get-go.”
The Associated Press called the election on Friday afternoon, saying that “the measure failed by 50.3 percent to 49.7 with about 5 million votes cast, The Associated Press determined Friday. The measure was losing by about 27,000 votes with 150,000 ballots remaining to be counted; too few for the `yes’ side to pull ahead.”
As of 9:41 AM PDT on Friday, the vote was 50.3% opposing the measure and 49.7% in favor, with vote totals of 2,518,344 and 2,490,456 respectively.
Retailers were excited about the news as well. Mark Just, owner of Tower Cigars in Sacramento, said that he was “relieved to say the least. I’m smiling big this morning. Trying to get our message out that propositions like this are just a power and money grab. No accountability and can’t be amended for 15 years.” For Just, defeat of Prop. 29 meant business would go on as usual, which takes some of the worry out of his future. “Selling premium cigars is my life. I don’t have other businesses to offset declines in sales and neither does my father. We love premium cigars – it’s our life!”
Joe Barron, co-owner of Grant’s Tobacconists in San Francisco, said that “for sure this is a sign of relief for now,” adding that he remembers the similarly narrow defeat of Proposition 86 in 2006 which makes him feel that “we will see more bills and propositions down the road. The pro-tobacco tax folks retreat when they don’t have a victory and come out of the gates with more disturbing media and higher profile celebrities to con voters that higher tobacco taxes will cure the big hole in States deficits and or create new programs to help solve all the worlds problems – a Utopia – that never seems to ring true.”
The Facebook page of Mission Pipe Shop in Pleasanton exclaimed “Friends, WE DID IT!!! We beat Prop 29!! It’s a day to celebrate your freedom to smoke a cigar and not pay a 55 percent sin tax to the state. Thankfully, the voters of this great state read the fine print and did not have a knee jerk reaction to the words “cancer” and “cigarettes” and vote yes…Lance Armstrong, put THAT in your pipe and smoke it!”
Armstrong and New York City Mayor Michael Bloomberg had both made significant contributions to supporters of the proposition, angering many who saw them as trying to meddle in other state’s affairs and taxes.
Not everyone was ready for celebration mode, however. Glynn Loope, Executive Director of Cigar Rights of America, remained guarded in a post he shared on his Facebook page, saying he “wasn’t passing judgment until certified by the Secretary of State.” He went on to note that the number of absentee ballots remaining to be counted scared him.
Per California law, counties can count other ballots for up to 28 days following the election, meaning that the vote totals could still shift from the numbers posted Friday morning. As noted in the AP story, there were still approximately 150,000 mail-in ballots left to be counted.
County officials have 31 days from the election to complete their tallies and must report their final results to the Secretary of State by July 6, who must certify the election by July 13.
Voters in the more liberal coastal counties showed the strongest support for the proposition, with 73.7% of voters in San Francisco county and 69.2% of voters in neighboring Marin County voting yes. However the proposition didn’t pass in Los Angeles County, with 50.5% of voters saying no. Voters in Orange, Riverside and San Bernandino counties were also strong in their opposition.
Pete Johnson of Havana Cellars and Tatuaje Cigars, which is based in Los Angeles, said simply “Thank you California voters” via his Twitter and Facebook accounts once all precincts had reported.
The bill, had it passed, would have raised taxes on cigars and pipe tobacco by 73% in an attempt to generate more money for the state. Critics had pointed out that the proposition didn’t require the money raised to be spent in the state, and speculated that most of it would leave California and do nothing to address the state’s $16 billion budget deficit while unduly taxing residents and driving business out of state.