New $600-Plus CA Stimulus Plan Would Affect Majority of Residents

Monday, May 10, 2021

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Gov. Gavin Newsom on May 10 proposed another round of $600 California stimulus checks, which would go to both middle-class and low-income residents.

The "immediate" relief is part of a proposed $100 billionCalifornia Comeback Plan, which is made possible by a historic $75.7 billion budget surplus, Newsom said. The governor touted the proposal as the biggest recovery package in state history.

"This time last year we announced a $54.3 billion projected shortfall. Today, we are announcing a projected $75.7 billion budget surplus," Newsom said at a May 10 news conference in Alameda County. "It's a remarkable turnaround. ... California is going to come roaring back."

Newsom's $11.9 billion plan would send a Golden State Stimulus payment to two-thirds of Californians and another $500 to families with children. Those who make up to $75,000 a year would qualify for a payment. The plan builds on the expanded child tax credit, which was introduced in the recent federal stimulus package.

Newsom also aims to double rental assistance with a $5.2 billion proposal that would pay back 100 percent of the rent owed by Californians affected by the pandemic.

The new relief package would triple the size of the existing Golden State Stimulus plan if approved by the Legislature. Newsom's previous package, signed into law in February, included one-time $600 payments for an estimated 5.7 million residents.

As with the last round of state stimulus payments, Californians would have to file their 2020 tax returns to receive a payment.

The new plan would become "the biggest state tax rebate in American history," Newsom said. The package aims to tackle the state's "most stubborn challenges," including rent relief and outstanding utility bills.

"We're also mindful rent is just one part of the burden of households," he said.

Another $2 billion would be set aside to help pay for gas, water, and electric bills for Californians, Newsom said.

The governor was expected to flesh out his relief plan and present a revamped version as part of the state budget. As early as next week, lawmakers will begin their own negotiations ahead of the June 15 deadline to pass a new state budget plan.

The $600 stimulus checks may also satisfy the voter-approved state appropriations limit that hasn't been triggered since 1986, Bloomberg reported. Since the state's budget includes excess revenue, that mandate directs the state to return some of that money to taxpayers.

Newsom on Sunday also rolled out another proposal to send relief to families and caregivers. He proposed funding for 100,000 new state-subsidized child care slots, $200 million to support career pathways for home care workers and millions more dollars to invest in child care providers.

"We're going to be making some bold investments, and some big investments, in particular, to support parents," Newsom said in a Mother's Day video posted to Twitter. "We have the backs of mothers and will be making investments to solve real problems and to acknowledge the extraordinary stress that so many moms, particularly working moms, have been under over this last year."

The news comes as the state recorded another record low coronavirus positivity rate on Monday: 1.1 percent.

"Our economic recovery is predicated on ending this pandemic," Newsom said. "And we are mindful that the mutations are as challenging as they've ever been...if we want this economic recovery to continue as robustly as its began, we need to continue our vaccine program."

To date, the state has administered 32 million vaccine shots to Californians.

Newsom's relief proposal also comes as he prepares to battle an upcoming recall election that threatens to unseat him.

Category: Economic News, COVID-19, Economic Aid, California, Governor Newsom