Calif. City's Budget Fix: Soda Tax Would raise $7M per year, officials say By Evann Gastaldo, Newser Staff Posted Jul 24, 2012 1:02 PM CDT 16 comments Comments Bottles of Coca-Cola are displayed for sale at a grocery store in Palo Alto, Calif., Monday, April 25, 2011. (AP Photo/Paul Sakuma) (Newser) – El Monte, Calif., is staring down a fiscal emergency, but it's about to pop the top on a solution that could raise $7 million per year: Tax sugary drinks. The California city will ask voters to decide on the plan, which calls for sugar-sweetened beverages sold within the city to be taxed at a rate of one cent per ounce. If it passes, the new tax will fill the funding gap that will occur when a half-cent sales tax expires in 2014, the Los Angeles Times reports. The city's finance director says El Monte is not on the verge of bankruptcy, but it doesn't want to follow other California cities like Stockton and San Bernardino down that path. "People are looking for who's the next one [to declare bankruptcy]," he says. "El Monte is not the next one … not today, not now. What we're doing is financial planning. We're trying to take the right steps." Based on the fact that 48% of Americans have at least one soda every single day, it's probably a solid plan.