Newsom floats budget proposal with expanded state stimulus payments

California residents who made up to $75,000 last year would be eligible for a $600 stimulus check under a budget proposal Gov. Gavin Newsom outlined Monday in Oakland.

In a briefing at the Spanish Speaking Unity Council, Newsom said the state would spend some $12 billion on the payments, made possible by a projected general fund surplus of $75.7 billion.

Roughly $38 billion in total from that surplus would be used for pandemic relief programs like the stimulus checks, $5.2 billion to assist low-income renters pay off their back rent and $2 billion to help residents pay off unpaid utility bills.

Newsom said:

“We think this is a significant, direct not only stimulus, but direct relief to millions and millions of Californians in need.”

The state sent out initial $600 stimulus payments earlier this year as part of Newsom’s initial budget proposal in January.

Those payments, which the legislature approved in February, were targeted at residents who made less than $30,000 in 2020, received the California earned-income tax credit or filed their taxes with an Individual Tax Identification Number.

Just as with those initial payments, the $600 checks Newsom announced Monday would be dispersed to state residents regardless of their immigration status, as people living in the U.S. without legal permission were not eligible for the three federal stimulus payments issued over the last 15 months.

If approved by the legislature, the $600 payments announced Monday would go to income-eligible taxpayers who did not receive the first stimulus payment as well as additional $500 payments to families with dependents and families living in the state without legal permission.

At the briefing, Oakland Mayor Libby Schaaf said:

“I love saying Oakland, California, is the most unapologetic sanctuary city in America,. … I also commend Gov. Gavin Newsom for recognizing that our immigrant workers will be taken care of by the state of California.”

The funding to assist with unpaid rent and utilities, Newsom said, is part of an effort to pay off all back rent owed in the state as a result of the pandemic.

The governor noted that the results of studies on the amount of back rent owed in the state have varied between $2.5 billion and north of $5 billion, but the proposal sets aside $5.2 billion for back rent out of “an abundance of caution.”

Newsom is expected to tease out other portions of his May budget proposal revision this week before unveiling the full proposal on Friday.

Newsom and the state legislature will then have until June 15 to approve the budget before the new fiscal year begins on July 1.