Last month, the California Legislature and Governor Newsom reached a budget agreement that will provide meaningful support to low-income and working Californians. With the passage of a $17 billion inflation relief package, state leaders built on the economic stimulus efforts of the past two years by getting cash into the hands of Californians and investing in programs to help people make ends meet.
The budget includes $1.95 billion in additional emergency rental assistance funds. At least one in seven Californians have reported being behind on rent, with low-income renters and people impacted by COVID-19 being the most likely to be behind on rent. To cover back rent, hundreds of thousands of Californians have applied for funds from the California COVID-19 Rent Relief Program. But the program’s slow rollout and a lack of funds had threatened the program’s efficacy — just as eviction moratoriums have come to an end. The legislature’s investment in the program means thousands of households will be able to avoid eviction and stay in their homes.
State leaders also shored up the state’s utility relief fund by adding $1.4 billion to help Californians pay past-due utility bills. Last year, it was estimated that there was nearly $3 billion in unpaid water and power bill debt in California, much of it held by low-income households who had been financially harmed by the pandemic. The state passed a budget with billions in assistance, but the amount has not been enough to pay down all utility debts. This new investment will help low-income households continue to keep the lights on and taps flowing.
The largest investment — $9.5 billion — comes in the form of one-time cash transfers, so called “inflation relief rebates.” The direct cash transfers will be sent to every Californian who filed a tax return for 2020, with payments of up to $1,050 going to the lowest income households. Households will be eligible for:
- $350 for people with incomes below $75,000, or $150,000 for people who file jointly
- $250 for people with incomes between $75,000 and $125,000, or $150,000 – $250,000 for people who file jointly
- $200 for people with incomes between $125,000 and $250,000 or $250,000 – $500,000 for people who file jointly
- $300 for households with a dependent
These cash transfers, targeted by income to maximize impact, build on state leaders’ prior efforts to get money into the hands of the people who need it most. Last year’s Golden State Grants helped California’s lowest income residents dealing with the economic fallout from the pandemic, and these rebate checks will help households grappling with inflation.
These efforts mark a significant investment in programs that will help Californians struggling to make ends meet. By continuing to invest in helping people who have been most destabilized by the pandemic, and who suffer the most under inflation, California can take meaningful steps toward building economic security for all people.