I got confirmation last night on how exactly the proposed San Francisco alcohol fees will be applied. The actual language in the ordinance is incredibly vague and open to interpretation (and misinterpretation). My source has either spoken to several city supervisors or talked to others who have, a combination of the two, I believe. And here’s what we’ve learned. There’s good news and bad news, so to speak.

Despite the change in language — apparently an “ethanol ounce” is common European parlance — the proposed ordinance will still be applying the tax “per fluid ounce of alcohol,” forcing a lot of math and administrative headaches, to say the least. So every single bottle containing alcohol, even changing vintages, will require a formula be applied to it. For example, take a 12 oz. bottle of beer that’s 6% a.b.v. Here’s how it will work.

• 12 oz. x 0.06 (the % of alcohol) = 0.72 ounces of alcohol
• 0.72 x $0.076 dollars = 0.5472 cents “fee”
• Rounded, presumably, to 5 cents or possibly 5.5 cents

To say the least, it will be an administrative nightmare — primarily for wholesalers, brewpubs and self-distributing breweries who will be filing the reports and paying the fee.

Here’s a few more examples of what the fee would be for various alcoholic beverages.

• 22 oz. bottle of 10% barley wine = 16.7 cents
• 750 ml bottle of 14% wine = 27 cents
• 750 ml bottle of 40% single malt whisky = 77 cents
• 15.5 gallon keg of 8% Pliny the Elder = $12.06

And let’s not forget that the fee will be imposed at the wholesale level, meaning that it will be marked up and the fee passed along to consumers at a much higher rate, and then marked up again by the retailer or bar, whoever sells it to you and me.