Millions of poor and middle-class Californians would get tax rebates of up to $1,100 under a proposal unveiled Monday by Democratic Gov. Gavin Newsom, as part of a broader pandemic recovery plan made possible by an eye-popping $75 billion budget surplus.
He is calling it the "California Comeback Plan". The state estimates it will be $16 billion over that threshold. If approved, the state would give $600 checks to workers who earn up to $75,000 annually, with $500 bonuses for tax filers with dependents and undocumented families.
California Governor Gavin Newsom on Monday issued an expanded "drought emergency proclamation" for 41 of the state's 58 counties, citing above-average temperatures and dry conditions for April and May.
"Today we are announcing a projected $75.7 billion budget surplus", added Newsom, governor of a state that is the world's fifth-largest economy.
The proposal, one in a series the governor plans to make this week in his annual budget revision, takes advantage of a remarkable turnaround in the state's financial picture that comes not only as California emerges from the coronavirus pandemic, but also as Mr. Newsom works to defuse an expected recall election. Earlier this year, people making less than $30,000 got a $600 payment.
State law requires that taxpayers get a rebate when a budget surplus hits a certain size, which has only happened once in California in more than 40 years.
Raphael Sonenshein, the executive director of the Pat Brown Institute for Public Affairs at California State University, Los Angeles, said it was unlikely that an extra $600 would soften hard-line opposition to Mr. Newsom among the state's minority of Republican voters.
A year after slashing spending to fill a record-breaking deficit spurred by the pandemic, California Gov. Gavin Newsom is eyeing a massive surplus and hopes to send out a second, larger round of stimulus checks to residents.
Mr. Newsom's proposal was immediate grist for conservative recall candidates.
"Californians need permanent, real tax relief, not just one-time stimulus checks", Faulconer, the former San Diego mayor, said in a statement. A spokesperson for the California Department of Finance said the numbers for this year's state budget won't be finalized until 2023. The state's budget relies heavily on personal income tax from high earners.