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Newsom proposes $18.1 billion inflation relief package

SACRAMENTO – As people throughout the country face increasing costs due to global inflation, Governor Gavin Newsom proposed an $18.1 billion inflation relief package to get money into the pockets of Californians, a spokesman for the governor said.

“We enacted the most comprehensive economic stimulus program in the nation last year, getting billions in immediate relief to millions of Californians. But many folks are still struggling, especially with high costs due to inflation, so we’re leveraging this historic surplus to get money back into the pockets of Californians,” Newsom said.

“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,” he projected.

The inflation relief package includes:

• $11.5 billion tax refund to help address inflation. As the entire country faces increasing costs due to inflation, Newsom proposed getting $400 checks to every eligible, registered vehicle owner, capped at two checks per individual.

• $2.7 billion for emergency rental assistance. Newsom is proposing state funds for qualified low-income tenants, who requested rental assistance before March 31.

• $1.4 billion to help Californians pay past-due utility bills. As Californians continue to face difficulties in paying for utility bills, this investment expands upon last year’s utility relief program to continue this support – $1.2 billion for electricity bills and $200 million for water bills.

• $933 million for hospital and nursing home staff. Providing up to $1,500 to hospital and skilled nursing facility workers, who have been delivering care to patients during the COVID-19 pandemic.

• $750 million for free public transit. Newsom is proposing incentive grants to provide three months of free public transportation for communities throughout the state.

• $304 million to make health coverage more affordable for middle-class families. This extends health insurance premium assistance under Covered California for families of four earning up to $166,500 annually, upwards of 700,000 Californians.

• $439 million to pause the diesel sales tax. Bringing relief to the commercial sector and drivers. Newsom is proposing a 12-month pause in the sales tax rate for diesel fuel, which would provide upwards of $439 million in relief.

• $157 million to waive child care fees for low-income families. Making state-subsidized preschool and child care more affordable, benefitting 40,000 low-income California families with savings of up to $595 per month.

Additionally, California’s minimum wage is projected to increase to $15.50 per hour for all workers on Jan. 1, 2023. The accelerated increase is required by a provision in the state’s existing minimum wage law when inflation exceeds seven-percent.

The wage increase will benefit millions of California households, which are struggling to keep pace with the highest rate of inflation in decades, the spokesman said.


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