Governor Gavin Newsom and legislative leaders have reached an agreement in principle to provide up to $1,050 to millions of California families to help deal with rising gas prices and inflation, according to emails sent this week to Democratic members of the Senate and State Assembly.
The three-tier program would benefit about 17.4 million California taxpayers, including single filers earning up to $250,000 and joint filers earning up to $500,000, according to the pattern obtained by CalMatters, households at low and middle income to gradually receive more money.
The plan is part of a broader $300 billion budget deal that heads of state continue to negotiate ahead of the start of the fiscal year on July 1.
Although the email to Democratic senators and their chiefs of staff called the reimbursement proposal a “deal,” a spokesperson for Senate President Pro Tem Toni Atkins, a Democrat from San Diego, said warned in a statement today that ‘any tentative deal can fall apart’.
Anthony York, a spokesman for Newsom, reiterated the point, denying there was an agreement as details could still change until a final budget compromise is publicly announced.
“We’re not taking any issues off the table until the budget is complete,” he said.
Under the plan, households earning up to $75,000 for individuals or $150,000 for joint filers would receive $350 per taxpayer, plus an additional $350 if they have at least one dependant. Thus, a single parent would receive $700 and two-parent families would receive $1,050.
The amount would increase to $250 per taxpayer for households earning up to $125,000 for individuals or $250,000 for co-filers, and $200 per taxpayer for households earning up to $250,000 for individuals or $500,000 for co-registrants. In these two tiers, parents would receive an additional $250 or $200, respectively, if they have at least one dependent.
Californians with incomes over $250,000 for an individual or $500,000 for joint filers would not receive a refund. The plan would also include a raise for Supplemental Social Security recipients who do not file taxes.
“The plan recognizes that some people suffer more than others and provides them with greater relief,” according to the courier email sent to House Democrats, which estimates the overall cost of the rebates at $10 billion. .
Differences in proposed spending on universities, housing and social safety net programs, as well as details of a major climate package, persisted as the Legislative Assembly adopted a shadow budget earlier this month. But the biggest stumbling block to a deal, which must be printed by Monday in order to pass before lawmakers leave for summer recess at the end of the month, has been the dispute over direct financial aid to taxpayers.
Newsom and legislative leaders had been at odds for months over whether to target relief to the most needy drivers or Californians.
During his State of the State address in March, the governor called for a plan to deal with soaring gasoline prices, which have since averaged over $6 a gallon. He offered to send $400 debit cards to each registered vehicle owner in the state, up to two per person.
Legislative leaders strongly resisted this approach, which did not include an income limit. Progressive critics noted that it would benefit millionaires and billionaires while leaving out Californians too poor to own their own cars.
The tentative agreement is much closer to the program designed by Atkins and Rendonunder which the state would have reduced checks by $200 for each eligible taxpayer and their dependents living in households earning less than $250,000 per year for a couple or $125,000 per year for an individual.
Despite growing demands of Republican lawmakers, plus a growing number of Democrats, the plan does not include a suspension of the state’s gas tax, which is set to rise by three cents on July 1.