Golden State Stimulus: How to claim the extra $500 under the California Comeback Plan

Facing a recall election, Governor Gavin Newsom is eager to increase his public favorability. On Monday, 10 May, Gov. Newsom announced that the state would see a historic budget surplus of over 75 billion dollars for the next fiscal year. This week Newsom is unveiling key pieces of stimulus legislation that will be presented to the state legislature on Friday. Dubbed the California Comeback Plan, the $100 billion proposal includes funding to send $600 direct payments to 80% of California residents. The checks will be more significant for those with children as they qualify for an additional payment of $500.

Returning money to taxpayers during a budget surplus forms part of California law. In 1970, voters in the state approved a measure mandating that if a state surplus reaches a specific limit, the government must return money to taxpayers. A state finance officer, H.D. Palmer, believes the surplus is about $16 billion over the limit. While the state law does not obligate the government to act immediately, Newsom has.

Who would qualify for these payments?

Unlike the first round of Golden State stimulus checks, which recipients must make under $30,000 to receive, the new payments have a higher income limit of $75,000. The governor has said that two in three California residents would be eligible to receive a check by increasing the income threshold.

The payments in California are not based solely based on social security numbers. Instead, the legislature opted to use the taxpayer identification number, to ensure immigrants can also receive payments. Using the ITIN allows payments to be sent to undocumented residents who make up about ten percent of the workforce and who have been categorically left out of all federal support.


Details on the additional $500 check for those with children

During the governor’s announcement, he announced that families with children would see larger checks worth $1100. Newsom touched on the specific toll the pandemic has had on working parents, specifically single moms, who have been forced into impossible situations. To support these individuals and others, the California Comeback Plan includes an additional $500 check for those with children. Additionally, the bill includes billions for rent and utility relief to help families reset their finances.

What is next for this legislation?

Many states have taken different approaches to stimulate their economies. Direct payments are one tool at the government’s disposal to increase spending within the economy. When responding to questions on why the governor favors this approach over targeted spending for various programs, Newsom said “We believe people are better suited than we are to make determinations for themselves on how best to use these dollars."

The full bill will be presented to state lawmakers on Friday, 14 May, and the group will have one month to negotiate and get it passed. If the legislature moves forward and approves the measure, California residents could begin seeing payments as soon as this summer.