What’s Gov. Gavin Newsom’s plan to take on California’s highest-in-the-nation gas prices?
The California governor’s $11 billion proposal would send vehicle owners a $400 debit card and make public transit free for three months
Gas is more expensive in California than any other state, and to combat rising costs, Democratic Gov. Gavin Newsom proposed an $11 billion package that includes payments to vehicle owners, a pause on some fuel taxes and three months of free public transit.
Newsom said in a statement his proposal is meant to “get money directly into the pockets of Californians who are facing higher gas prices as a direct result of (Russian President Vladimir) Putin’s invasion of Ukraine.” The average price of a gallon of gas in California reached $5.90 on Friday, according to AAA.
If passed, California would send $400 debit cards to households for up to two vehicles per household and twice per vehicle, totaling $9 billion. The debit cards would be available for vehicle owners as soon as July, according to Newsom’s office.
The legislation would also pause the sales tax rate for diesel fuel for one year, and pause inflationary increases to taxes on gas and diesel. Newsom’s office said the average California driver spend about $300 a month on gas excise taxes.
In addition, $750 million is set aside for transit and rail agencies to provide three months of free transit, and $500 million for projects to promote biking and walking.
Newsom can pay for his pricey proposal thanks to California’s historic budget surplus, which his office forecast to be $45.7 billion in January.
California Republicans have criticized the plan, including House Minority Leader James Gallagher, who represents a district in Northern California and said Newsom’s proposal is too slow.
“July? Seriously? Californians are struggling and Capitol Democrats are dragging their feet,” Gallagher said in a statement. “How could it possibly take that long? Capitol Democrats are all talk and no action.”
A Republican proposal to suspend California’s 51 cents per gallon tax for six months failed in the state’s Assembly.
Democratic governors from Colorado, Michigan, Minnesota, New Mexico, Pennsylvania and Wisconsin called for the federal gas tax to be suspended for the rest of 2022 in a letter to congressional leaders earlier this month. And at the state level, governors and lawmakers from both parties are working to temporarily suspend their state gas taxes in states including Florida, Georgia, Maryland, Michigan and Pennsylvania.
A Morning Consult-Politico poll taken between March 18 and 21 found about 7 in 10 Americans support temporarily suspending federal and state gas taxes.