California Gov. Gavin Newsom’s revised budget will feature $18 billion for an array of inflation relief measures — including tax refunds for vehicle owners and bonuses for healthcare workers.
The governor’s office released details about the package on Thursday, ahead of Newsom’s revised budget presentation Friday. It’s intended to help Californians struggling financially in an inflationary economy that continues to have some of the highest gas prices in the country.
“This inflation relief package will help offset the higher costs that Californians are facing right now and provide support to those still recovering from the pandemic,” Newsom said in a statement.
The biggest chunk of money — $11.5 billion — will fund tax rebates for vehicle owners, who would get $400 each for up to two registered cars. Newsom first proposed this plan in March, and it hasn’t changed much since he first put it on the table.
The package will also include $750 million in grants to help municipalities make public transit free to all riders for three months.
Department of Finance staffers said on a press call that the value of residents’ cars may factor into their eligibility for the governor’s rebates. Californians likely won’t see the rebates until September, when they will receive the money in the form of debit cards or direct deposits.
Legislative leaders don’t back Newsom’s rebate plan. Instead, they’ve put forward their own proposal that would give all taxpayers $200, including $200 for each dependent. Their plan is also income-limited, and only taxpayers earning $125,000 or less — $250,000 for joint filers — would qualify for the rebate.
Senate President Pro Tem Toni Atkins, D-San Diego, reiterated her disapproval of the plan on Thursday.
“We know prices are too high and supplies are too low,” Atkins said in a statement. “The Senate is working to make sure Californians get rebates — not just passing along a one-size-fits-all windfall that benefits millionaires.
“Senate Democrats don’t believe a rebate tied to car ownership does the job,” she added. “That plan leaves out non-car owners — including low income and elderly Californians, who are also impacted by the current high costs of consumer goods and are also deserving of relief.”
Bonuses for nurses and more relief plans
Newsom’s package also includes $933 million in bonuses for an estimated 600,000 nurses and other healthcare workers to boost retention efforts amid the severe burnout caused by the pandemic. The state would give healthcare workers $1,000 and would match employer contributions of up to $500, according to the Department of Finance.
Healthcare union leaders praised the move on Thursday, with SEIU United Healthcare Workers West calling it an “investment in keeping skilled healthcare workers on the job.”
“For years, SEIU-UHW members have raised concerns about California’s healthcare staffing shortage,” President Dave Regan said in a statement. “The staffing crisis has only worsened as workers have left the industry in droves during the pandemic because of increased health risks, emotional and mental stress, and overwork.”
“The proposed inflation relief package, which includes pay for healthcare workers, marks an important step that would recognize their sacrifices on the frontlines of the pandemic and help retain skilled and experienced caregivers,” Regan added.
Other spending priorities in the inflation relief package:
- $2.7 billion to fund all qualifying COVID-19 rental assistance applications submitted prior to March 31
- $1.2 billion to help Californians pay past-due electricity bills, along with $200 million for water bills
- $300 million to extend Covered California premium assistance for families of four earning up to $166,500
- $439 million to pause the diesel fuel sales tax
- $157 million to cover fees for families enrolled in state-funded child care and preschool
Atkins and Sen. Nancy Skinner, D-Berkeley, said their house “has been working for months to ensure the 2022-23 budget will be one of the best budgets ever for the people of California.”
“We know that’s a goal we share with the Assembly and the governor,” Atkins and Skinner said. “We look forward to reviewing the new suggestions coming out of the governor’s office this week as we continue our work to pass a responsible, effective, and equitable budget by our June 15 constitutional deadline.”
This story was originally published May 12, 2022 4:11 PM.