Getting your
Trinity Audioplayer ready...SANTA CRUZ — The Sacramento County Superior Court denied a petition challenging Santa Cruz’s sugar-sweetened beverage tax, the city announced Tuesday.
The tax was approved by Santa Cruz voters as Measure Z in November 2024 and requires distributors of sugar-sweetened beverages to pay the city a tax of two cents per fluid ounce, which supports the city’s General Fund.
In May 2025, the tax was challenged by the American Beverage Association and a group of other grocers and retailers, including the California Chamber of Commerce and the California Grocers Association. The petitioners sought to halt the implementation of the tax, arguing that it violated the state constitution. They asked for the tax measure to be rendered unenforceable and that the city refund any tax collected.
Now that the petition has been denied, the city anticipates that the petitioners may file an appeal. Once the final judgement is entered in the next one to two weeks, the petitioners will have 60 days to do so.
Until the appellate process ends, the city said in a statement, Santa Cruz will continue collecting the tax in preparation for implementing projects supported by tax revenue. The city has also established a sugar-sweetened beverage tax oversight committee.
Steven Maviglio, a spokesperson for the American Beverage Association, said that the Keep Groceries Affordable Act has a straightforward goal to prevent new local taxes on grocery items.
“The court appears to have ignored the law and the legislature’s intent and instead decided to create its own interpretation of the tax,” Maviglio said in a statement. “We will not relent in our defense of a law that continues to receive overwhelming support from Californians because it has helped hold down costs on groceries at a time of record high prices.”
The city said it will continue to defend the tax’s legality. As a charter city, Santa Cruz has the authority to implement a local measure approved by voters, said City Attorney Cassie Bronson in a statement.
“The court’s ruling sends a clear message: local democracy can withstand even the deepest-pocketed opposition,” said Santa Cruz Vice Mayor Shebreh Kalantari-Johnson. “I’m proud of our city for standing its ground and leading the way for charter cities across California.”