Gas stimulus check: What is the $400 rebate proposed by Governor Gavin Newsom in California?

Shattering previous records, the average price of a gallon of gasoline hit $5.80 in California last week. The price is up more than two dollars from the $3.76 figure consumers saw this time last year.

In response to these increases, Governor Gavin Newsom has proposed a legislative package that would provide direct relief to families across the Golden State.

In related news: Inflation-aiding checks

What does the bill include?

“This package is also focused on protecting people from volatile gas prices, and advancing clean transportation – providing three months of free public transportation, fast-tracking electric vehicle incentives and charging stations, and new funding for local biking and walking projects,” said Governor Newsom when describing the package.

$400 gas rebate

The majority of the $11 billion relief package, around $9 billion, has been allocated for the sending of a $400 direct payment for each vehicle a household owns.

There is a two-vehicle limit and residents should be aware that the bill caps the number of times this benefit can be claimed at two. Each year drivers in California spend around $300 in state excise taxes for gas and diesel and the direct payment aims to offset this cost.

The bill also allocates funding “to pause the inflationary adjustment to gas and diesel excise tax rates.” These rates are tied to the price. If the rate sits at five percent and prices increase, the cost for consumers is larger and this is what the state is trying to avoid.

Should the legislator pass the bill, the rebates could be sent as soon as July.

Who is eligible to receive the gas rebate?

To avoid the exclusion of “seniors who receive Social Security Disability income and low-income non-tax filers,” Newsom’s proposal would send the rebate to all who have a vehicle registered with the California Department of Motor Vehicles.

“The Governor’s proposal does not have an income cap in order to include all Californians who are facing higher prices due to the cost of oil,” reads a press release put out by the governor’s office.

Reducing the cost of public transit

To encourage ridership of public transit systems, the bill also includes “$750 million in incentive grants to transit and rail agencies to provide free transit for Californians for 3 months.”

Each day in the state millions use public transit systems and by making these systems free Gov. Newsom hopes that this will encourage riders to continue using the bus, train, or light rail.

Bolstering electric vehicle infrastructure

The proposal is also forward looking in that it includes funding to build a greater number of electric vehicle charging stations. This part of the bill aims to encourage Californians to consider the purchasing of an electric vehicle the next time they are in the market for a new car.

Currently, around eighty-seven percent of cars in the state run on gasoline. However, in 2020 the number of electric vehicles on the road surpassed 635,000 with the most popular model being the Tesla Model 3.