In February, Dr. Sejal Hathi, the new director of the Oregon Health Authority (OHA), appeared before lawmakers and admitted that her agency had erred in withholding a report. This report, which suggested that increasing taxes on beer and wine would have minimal effect on reducing excessive drinking, had been shelved. The Oregonian’s revelation about this suppression led to accusations that the OHA was trying to obscure findings that contradicted its push for higher taxes as a solution to excessive drinking.
Dr. Hathi publicly acknowledged on February 23 that the report should have been released and pledged her commitment to transparency. However, she was unaware of the full context behind the report’s suppression. It turns out that the report was not only politically inconvenient but also fundamentally flawed because it relied heavily on research funded by the alcohol industry.
Records obtained by Willamette Week (WW) reveal that a U.S. Centers for Disease Control and Prevention (CDC) researcher had flagged concerns about the report as early as January 2022. The CDC’s reservations about the report’s quality and methodology were one of the primary reasons it was not published initially, as indicated by internal OHA emails. Dr. Hathi, according to a spokesperson, only learned of these concerns in the past few weeks, too late to prevent the report’s release. Consequently, the OHA published the report without modifications, despite its known issues.
The report’s controversial history reflects a broader debate over the best methods for addressing the problems of excessive drinking. On one side, the alcohol industry and some economists argue for increased regulation rather than tax hikes. On the other side, the CDC advocates for higher taxes as a means to reduce excessive drinking, a stance supported by many public health experts.
Dr. Jeffrey Drope from the Johns Hopkins Bloomberg School of Public Health criticized the decision to release the report, saying, “The initial decision not to publish it was the correct one. The decision to publish—as is—was the wrong one.” The CDC’s comments on the report, obtained by WW through a public records request, highlighted concerns about the quality of the underlying research, much of which was funded by the alcohol industry.
Oregon has some of the lowest beer and wine taxes in the nation, partly due to its lack of a sales tax and outdated tax rates. The state’s tax on beer has remained unchanged since 1977, and the wine tax was last updated in 1983. These taxes generate approximately $20 million annually, a stark contrast to the nearly $300 million Oregon earns from state-run liquor stores.
Public health experts generally support increasing alcohol taxes as a way to reduce alcohol-related harm. A 2007 CDC panel recommended higher taxes to combat excessive drinking, a recommendation that remains influential. In contrast, Oregon’s attempt to replicate a New Mexico study on tax impacts led to disappointing results. The study by ECOnorthwest, commissioned to gauge the effects of a tax increase, found that such measures might have minimal impact on risky drinking behaviors.
The CDC criticized the ECOnorthwest report for relying on industry-funded research, including studies by Dr. Jon Nelson, whose work on alcohol tax impacts has been disputed by other experts. Despite these criticisms, ECOnorthwest defended its report, asserting that its conclusions would stand even without the controversial studies.
As public scrutiny grew, OHA officials chose to release the report to demonstrate transparency, despite its flaws. This decision has left the public with a potentially misleading impression of the report’s validity. A senior economist from the Legislative Revenue Office recently cited the report in a presentation, underscoring its influence despite the acknowledged concerns.
Dr. Hathi has since acknowledged the mishandling of the report and expressed a commitment to improve transparency moving forward.