Newsom’s $400 gas rebate for California drivers: What to know

Gov. Gavin Newsom on Wednesday outlined an $11-billion proposal designed to offset rising gas prices.

Gas prices in California have spiked in recent months, with the average gallon topping $6 in Los Angeles.

Here is a snapshot of the plan and the politics from The Times’ coverage:

Newsom’s plan

  • $400 to Californians for each vehicle registered in their name.
  • The current plan would allocate the money through a debit card to all vehicle registrants, including motorcycle and electric vehicle owners, regardless of income, as early as this summer.
  • Payments would be capped at $800 for anyone with more than one vehicle registered under their name, though households with multiple vehicles registered to different family members could receive far more than that amount.
  • Californians who don’t own a registered vehicle would not receive a refund, although $750 million in grants would go to transit and rail agencies to offer free or substantially reduced fare.
  • Newsom’s proposal is expected to cost the most of several proposals introduced in the state Legislature. His $11-billion plan includes $9 billion in tax refunds to drivers, $750 million for public transit grants, $600 million to pause the sales tax on diesel for one year and $523 million to pause inflation increases to gas and diesel excise taxes.

What’s next

  • The governor’s plan would be subject to approval by the state Legislature and could set him up for a battle with leaders of the Senate and Assembly, who introduced their own proposal last week to provide financial relief from the increasing costs of all goods with more money for families. The lawmakers’ plan centers on $200 rebates for each taxpayer and dependent, and excludes the top 10% of earners in the state. Their proposal gives money to eligible Californians whether or not they own a vehicle.
  • Questions and concerns are already being raised about Newsom’s plan. Environmentalists have argued that connecting refunds to vehicle ownership conflicts with the state’s effort to reduce reliance on fossil fuels and remove cars from the road. The decision to exclude Californians who don’t own a car — and are also more likely to live in poverty than vehicle owners —stunned some advocates for low-income families. Though some households could still save hundreds of dollars on public transit costs, the proposal could disproportionately benefit those with the financial means to own a car or multiple cars.

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