Newsom proposes $400 debit cards, free transit
Gov. Gavin Newsom unveiled a proposal on Wednesday to funnel $11 billion in relief to California motorists in the form of $400 debit cards along with a freeze on gas tax increases and three months of free public transportation.
The refund is the latest idea from Sacramento as lawmakers scramble to lessen the pain of surging gas prices amid a booming state budget surplus.
Under Newsom’s proposal, registered vehicle owners would be eligible for $400 for each vehicle they own, capped at $800 for two vehicles. There is no income limit to the direct cash back program, which includes electric vehicle owners but excludes people without cars — a sore spot for many lower-income residents.
The direct payments would total $9 billion in relief, Newsom’s office said.
“That direct relief will address the issue that we are all struggling to address — and that’s the issue of gas prices,” Newsom said in a video statement.
If approved by the legislature, Californians could see debit cards in the mail as soon as July, the governor’s office said.
The package would also provide $750 million in grants to allow transit agencies to provide free transit for three months and over a billion dollars in funding to pause tax increases on diesel fuel and gasoline.
Alicia Trost, a BART spokesperson, said the agency is “delighted” that there could be a new source of transit funding but the details remain unclear.
“Based on his announcement it’s a grant program. It would be an application, so is not guaranteed,” she said. “We just don’t know yet if it will be an impact to BART and BART riders.”
This latest package comes ahead of budget negotiations between the governor and lawmakers as they look to return some of the budget surplus back to Californians. The legislature is also eyeing a constitutional amendment, known as the “Gann Limit,” which would force them to return some money back to taxpayers if they don’t come up with their own proposals to address excess revenues.
Democratic leaders all agree they need to address the skyrocketing fuel prices and rising costs of living. But divisions have emerged in Sacramento over whether direct payments should be channeling money back into the pockets of billionaires alongside their lowerincome neighbors.
Some like Adina Levin were not impressed.
“So riders get 3 months of free transit and then the agencies run out of money to run the service, and the bus comes once an hour?” tweeted Levin, a co-founder of the group Friends of Caltrain.
In recent weeks there has been a flurry of proposals aiming to put cash back in Californians’ wallets as gas prices break records on a near-daily basis, hitting an average $5.87 a gallon and approaching $6 in the Bay Area.
Last week a group of mostly Democratic lawmakers outlined their proposal to give every taxpayer $400, a plan which was not linked to vehicles or income. Meanwhile, Assembly Speaker Anthony Rendon is working on an alternative proposal to provide a minimum of $200 rebates — but only for taxpayers making $250,000 or less.
Meanwhile, Republicans, who are a small minority in the legislature, have called for immediate relief by suspending the state’s 51-cent gas tax. Democrats rejected this proposal saying it would upend funding for roadway improvements and benefit oil companies.