Newsom: Gas Rebate Would Be Delayed Until October Under Legislature Plan

Governor touts DMV as quickest alternative to getting money back

After a flurry of proposals from Sacramento in March to send money back to Californians, a rebate check could still be nearly five months away under plans promoted by legislative leaders, Gov. Gavin Newsom warned, as he argued that his contentious plan linking financial relief to car ownership is the quickest alternative to landing money back in wallets.

In a recent interview with the Bay Area News Group editorial board, Newsom criticized California’s Democratic leadership for outlining a plan that would funnel $8 billion through the Franchise Tax Board, which he said could add months to the refund timeline. Under that proposal, taxpayers making up to $125,000 would see $200 checks with an additional $200 for each child or other dependent.

“FTB can’t get the money out quickly, because they’re in the middle of tax refund season,” Newsom said, adding that refunds would start in late September and could span all the way into next spring. “My sense was, people may get a little cranky about that. They may want a little quicker relief.”

The wrangling between Democrats — who hold a supermajority in the legislature — over how to give Californians relief at the gas pump has dragged on for weeks as gas prices have remained well over $5 a gallon for the past two months. Democratic leadership and the governor remain at loggerheads over whether the money should be going to all residents at all income levels, as Newsom has proposed, or be targeted toward people in greater need.

Newsom has proposed $400 for each vehicle Californians own, capped at $800 for two vehicles, totaling $11 billion in rebates. Under Newsom’s plan, the Department of Motor Vehicles — not the Franchise Tax Board — would be responsible for distributing debit cards that could start hitting mailboxes “earlier in the summer,” the governor said.

Newsom said the two-vehicle rebate cap would prevent “people with 23 Teslas” from exploiting the state’s generosity. But Newsom said that this rebate should include higher-income earners who were left out of the previous stimulus check that was limited to people earning $75,000 or less.

“We want to acknowledge that the middle class felt a little left out of the last one,” said Newsom.

The governor has also called for public transit grants as part of his proposal to allow transit agencies to provide free rides for three months.

Negotiations between key legislators and the governor are taking place ahead of a highly-anticipated May budget revision out next week. The revision will provide an updated picture of how much money the state has and how Newsom wants to spend it before all parties need to finalize a budget in June.

According to the latest figures, the Golden State is now estimated to have a booming $68 billion surplus. A 1979 spending cap requires Sacramento to send some of this money back to taxpayers or spend it on select categories, including education and infrastructure.

A Valero gas station in Sacramento on March 10, 2022. (Miguel Gutierrez Jr., CalMatters)
A Valero gas station in Sacramento on March 10, 2022. (Miguel Gutierrez Jr., CalMatters) 

In a short statement to the Bay Area News Group, Senate President Pro Tem Toni Atkins and Assembly Speaker Anthony Rendon said they are working to provide taxpayers with speedy financial relief, although they did not directly address Newsom’s criticism.

“We have been clear from the first conversations on this issue that the Legislature wants to help as many people as we can, as quickly as possible,” the Democratic leaders said.

Scott Graves, research director at the California Budget & Policy Center, an organization advocating for low-income residents, said Newsom should not look to the DMV’s cumbersome bureaucracy when the state already relied on the Franchise Tax Board to target billions of dollars in relief payments to families.

“Let’s not reinvent the wheel,” said Graves. “Let’s use a proven pathway that we already used last year to efficiently get money out the door to Californians who really need it.”

The average price for a gallon of regular in California topped $5.76 on Thursday and was even higher in the Bay Area. Regardless of gas relief checks, drivers should expect to pay around 3 cents more per gallon come July 1 due to an inflationary increase to the gas tax that is currently pegged at 51 cents a gallon. Newsom had sought to pause the increase, but the legislature failed to meet a deadline last week to do so.

Click here to read the full article at the Mercury News

US Inflation Jumped 8.5% In Past Year, Highest Since 1981

WASHINGTON (AP) — Inflation soared over the past year at its fastest pace in more than 40 years, with costs for food, gasoline, housing and other necessities squeezing American consumers and wiping out the pay raises that many people have received.

The Labor Department said Tuesday that its consumer price index jumped 8.5% in March from 12 months earlier, the sharpest year-over-year increase since 1981. Prices have been driven up by bottlenecked supply chains, robust consumer demand and disruptions to global food and energy markets worsened by Russia’s war against Ukraine. From February to March, inflation rose 1.2%, the biggest month-to-month jump since 2005. Gasoline prices drove more than half that increase.

Across the economy, the year-over-year price spikes were widespread. Gasoline prices rocketed 48% in the past 12 months. Used car prices have soared 35%, though they actually fell in February and March. Bedroom furniture is up 14.7%, men’s suits and coats 14.5%. Grocery prices have jumped 10%, including 18% increases for both bacon and oranges.

Investors focused on a bright spot in the report and sent stock prices up: So-called core inflation, which excludes volatile food and energy prices, rose just 0.3% from February to March, the smallest monthly rise since September. Over the past year, though, core prices are up 6.5%, the most since 1982.

“The inflation fire is still out of control,” said Christopher Rupkey, chief economist at the research firm FWDBONDS LLC.

The March inflation numbers were the first to fully capture the surge in gasoline prices that followed Russia’s invasion of Ukraine on Feb. 24. Moscow’s attacks have triggered far-reaching Western sanctions against the Russian economy and disrupted food and energy markets. According to AAA, the average price of a gallon of gasoline — $4.10 — is up 43% from a year ago, though it’s dipped in the past couple of weeks.

The acceleration of inflation has occurred against the backdrop of a booming job market and a solid overall economy. In March, employers adding a robust 431,000 jobs — the 11th straight month in which they’ve added at least 400,000. For 2021, they added 6.7 million jobs, the most in any year on record. In addition, job openings are near record highs, layoffs are at their lowest point since 1968 and the unemployment rate is just above a half-century low.

The escalation of energy prices, a potential threat to the economy’s long-term durability, has led to higher transportation costs for the shipment of goods across the economy, which, in turn, has contributed to higher prices for consumers. The squeeze is being felt particularly hard at the gas pump.

“That’s an extra dollar per gallon that I’m paying to get into the city to work,” Jason Emerson of Oakland, California, said as he loaded groceries into his car. “And then, you know, we have the tolls that just went up this past year a dollar. My eggs are a dollar more as well. So everything’s going up at least a dollar, which, you know, adds up.’

The latest inflation numbers solidify expectations that the Federal Reserve will raise interest rates aggressively in the coming months to try to slow borrowing and spending and tame inflation.

Kathy Bostjancic, an economist at Oxford Economics, said she expects year-over-year inflation to hit 9% in May and then begin “a slow descent.” Some other economists, too, suggest that inflation is at or near its peak. With federal stimulus aid having expired, consumer demand could flag as wages fall behind inflation, households drain more of their savings and the Fed sharply raises rates, all of which could combine to slow inflation.

But that could take time. Robust spending, steady pay raises and chronic supply shortages are still fueling inflation. In addition, housing costs, which make up about a third of the consumer price index, have escalated, a trend that seems unlikely to reverse anytime soon.

Economists note that as the economy has emerged from the depths of the pandemic, consumers have been gradually broadening their spending beyond goods to include more services. A result is that high inflation, which at first had reflected mainly a shortage of goods — from cars and furniture to electronics and sports equipment — has been emerging in services, too, like travel, health care and entertainment. Airline fares, for instance, have soared an average of nearly 24% in the past 12 months. The average cost of a hotel room is up 29%

The expected fast pace of the Fed’s rate increases will make loans sharply more expensive for consumers and businesses. Mortgage rates, in particular, though not directly influenced by the Fed, have rocketed higher in recent weeks, making home buying costlier. Many economists say they worry that the Fed has waited too long to begin raising rates and might end up acting so aggressively as to trigger a recession.

The American public’s expectation for inflation over the next 12 months has reached its highest point — 6.6% — in a survey the Federal Reserve Bank of New York has conducted since 2013. Once public expectations for inflation rise, they can be self-fulfilling: Workers typically demand higher pay to offset their expectations for price increases. Businesses, in turn, raise prices to cover their higher labor costs. This can set off a wage-price spiral, something the nation last endured in the late 1960s and 1970s.

Click here to read the full article at the Mercury News

The Long Beach Area Republicans Stand Tall for Energy Independence 

As you’re driving down the street, it’s hard to overlook the signs at the gas station featuring prices that are lighting up like a Las Vegas slot machine on a good night. It’s no secret that California is home to some of the highest gas prices in the nation with a state average around $5.72, hovering well above the national average. 

While some may argue that gas prices in California have always been relatively high, the reality is we didn’t wind up in this situation by mistake. Over the past two years, federal officials in Washington have taken deliberate and calculated moves to cripple our once-thriving American energy industry.

From the political slow playing of new oil and gas leasing on federal land to revoking the key permits for major energy projects like the Keystone XL Pipeline, a project that was going to be powered by renewable energy and have net-zero emissions across its operations, decisions like these have led us to where we are today. 

Couple these types of choices with the ongoing war in Ukraine, it can spell real trouble for not only the American energy market, but the international market and particularly that of our European allies as well. 

For decades, our international energy trade was dominated by the likes of unfriendly regimes in Russia, Venezuela, and Saudi Arabia, causing the US and our allies to rely on foreign foes to provide us with the necessary resources to keep our world and economy moving. But we have the opportunity to change that by investing further in American energy development. 

The impacts of high energy prices won’t only be pain at the pump. Soon it has the potential to increase the cost of almost all consumer goods. We can rewrite this narrative and it starts by working alongside our American energy industry to restart the responsible, sustainable, and safe operations needed to access the vast reserves of oil and natural gas that lie right below our feet.

A crucial first step in this is opening the sale of oil and gas leases on federal land. 

While Biden Administration officials like to stand at the podium and argue that there are 9,000 outstanding leases available – a misguided figure they repeatedly state – they’re neglecting the fact that these leases only represent a small fraction of the 37,496 leases that are actively being used. Furthermore, they continue to act as a roadblock in the issuing of new federal leases: 4,621 applications are currently being held up by bureaucratic red tape with another 2,200 of them being litigated in court.

You may ask yourself, why is this important? The reason is that not all leases yield oil or natural gas and they do expire. Having a stockpile of new leases allows for the continuous production of oil and gas – something that is more critical today than ever before. 

When the American energy industry is thriving, not only is our world a safer place, but it is cleaner as well. The United States energy industry operates under some of the most environmentally responsible standards anywhere in the world. Couple these high standards with cutting edge advancements in technologies and the industry has been able to drive down the emissions related to natural gas and oil production by 60%.

Demand for oil and natural gas isn’t going anywhere anytime soon. If we want to help alleviate the financial strain caused by high energy prices and make America energy independent, we need to provide our energy companies with access to the resources needed to do so.  

The Long Beach Area Republicans 

A $400 Tax Rebate To Offset California’s High Gas Prices? Here’s How It Would Work

A proposed $400 tax rebate to help Californians deal with high gas prices draws support, but don’t expect to see any checks in the mail next week.

SACRAMENTO — A group of Democratic state lawmakers on Thursday proposed sending every California taxpayer a $400 tax rebate check to reduce the financial pain they’re suffering because of gas prices and the rising costs of everyday goods.

But it’s by no means a done deal, so don’t expect to see any checks in the mail next week.

Here’s what is known so far:

Who would receive tax rebates and when would they be sent out?

All Californians who pay state income taxes would receive a $400 rebate, regardless of their income. So, in theory, billionaire Facebook co-founder Mark Zuckerberg and the manager of your local In-N-Out would both receive a rebate of $400. Because the payments would be sent to each individual taxpayer, married couples would receive $800.

Assemblymember Cottie Petrie-Norris (D-Irvine) said the rebates should be sent out as soon as possible and that the state should not wait until the Legislature and Gov. Gavin Newsom agree on the entire state budget, which is traditionally completed in late June.

“Our goal is to be able to do this in the spring, and all the folks here are going to be pushing really, really hard to make that happen,” Petrie-Norris said at a news conference Thursday outside the state Capitol.

Petrie-Norris said the intent of the group of Democratic lawmakers — which included moderate legislators — was to provide as much relief as possible to as many Californians as possible. But she acknowledged that decisions about who would receive a rebate and how much they would get will be hashed out in negotiations with the legislative leadership and the governor.

Assembly Republican Leader James Gallagher of Yuba City said he supports the proposed tax rebates, especially since the Newsom administration expects a $45-billion budget surplus. Gallagher wants to suspend the state gas tax as well.

“There’s an urgent need right now with the high costs across the board, not just gas, but all of our daily living costs have increased. People need relief now,” Gallagher said.

Why $400?

Petrie-Norris said the $400 tax rebate figure was used because it equals the amount a typical Californian pays in state excise taxes on gasoline per year. She said California drivers on average fill up their gas tanks 52 times a year. California’s highest-in-the-nation gas tax is 51 cents per gallon.

“That’s a yearlong gas tax holiday,” she said.

Why not just cut the state gas tax?

Republican lawmakers are pushing for a six-month suspension of the state gas tax, arguing that it would be the most effective way to provide direct financial relief to Californians reeling from high gas prices.

“The thing about a gas tax suspension is that it is naturally targeted at folks who are feeling the pain,” said Assemblymember Kevin Kiley (R-Rocklin). “People who are driving the most because let’s say they live in a rural area, or maybe they have to commute a long distance to work, or maybe they have several kids they have to drive to school, the benefit will be commensurate with the pain that they’re feeling right now.”

Kiley’s bill to suspend the gas tax failed in the Democratic-controlled state Assembly on Monday, though the lawmaker said he plans to force another vote on the proposal next week.

Assembly Speaker Anthony Rendon (D-Lakewood) and Senate Pro Tem Toni Atkins (D-San Diego) have said cutting the gas tax would endanger critical repair work being done on California’s crumbling roads, bridges and other essential transportation projects. They also said it would not provide substantial financial assistance to Californians.

Both the governor and Democratic lawmakers also said there’s no guarantee that oil companies would lower gas prices if the tax is suspended, warning that the companies might pocket the savings instead of passing them along to drivers at the pump.

Kiley dismissed that as political gamesmanship. He noted that Democratic Gov. Ned Lamont of Connecticut called on lawmakers in his state to suspend one of two taxes on gasoline by 25 cents per gallon until the end of June. Kiley also noted that the nonpartisan Legislative Analyst’s Office said in a February report that cutting California’s gas tax would save drivers money when filling up.

“Available evidence suggests that lower excise taxes likely would result in lower retail prices. The exact effect on retail prices is uncertain, but most of the change in the tax rate likely would be passed through to prices at the pump,” the report stated.

What are the odds that a $400 tax rebate will pass?

It’s clear that the governor and both Democratic and Republican leaders in the Legislature want to provide tax relief to Californians hit hard by high gas prices as well as increasing costs for food, housing and other daily needs. Because of the give-and-take of most spending negotiations in Sacramento, however, the odds of the $400 tax rebate proposal passing as is are not high.

Newsom and the Legislature’s Democratic leadership continue to negotiate over the best ways to help alleviate the financial pain at the gas pump, and some of the ideas that have been discussed include sending tax rebates to Californians with registered cars and sending out stimulus checks. In his January budget proposal, Newsom called for canceling an increase in California’s gas tax scheduled for July, indicating that he’s not completely opposed to tinkering with the state’s fuel taxes.

Click here to read the full article at the San Diego Union Tribune

Working Californians Hit Hard By Gasoline Prices

A recent column in this space was headlined “Inflation, the cruelest tax.” Well, if inflation is the cruelest tax, then inflation’s impact on gasoline, combined with the nation’s highest tax, can only be characterized as “cruel and unusual punishment.”

In addition to inflation and taxes, other government policies related to petroleum are counterproductive. These include regulatory burdens and open hostility to the entire petroleum industry currently on display in both Washington and Sacramento. All this adds up to a lot of unnecessary pain being inflicted on the middle class and working poor.

But now, progressive politicians are looking at poll numbers with alarm as they discover that most Americans believe the nation is on the wrong track, due in large part to feckless and incompetent leadership. Rather than fix the problems, however, the reaction of both the Biden and Newsom administrations has been to deflect blame.

A couple of months ago, the Biden administration blamed rising fuel costs on supply chain issues. Then, returning to an old excuse resurrected when the need arises, the blame shifts to the “greedy oil companies.”

But even the most artful political spin is unlikely to change the public’s understanding of who is at fault. Republicans are replaying the video clip on a constant loop where Biden stated unequivocally, “No more drilling on federal lands. No more drilling, including offshore. No ability for the oil industry to continue to drill, period.” Moreover, the attempt to blame the war in Ukraine is especially easy to expose as unfounded. Gas prices were already at record levels before the hostilities began.

In California, Gov. Newsom is attempting to blunt the political backlash by promising some sort of rebate to taxpayers out of the state’s massive surplus. But any notion that he would do so out of the goodness of his heart would be in error. Taxpayer advocates in 1979 sponsored the Gann Spending Limit which voters overwhelming approved. It is the Gann Limit, not Newsom’s benevolence, that might afford some relief for California drivers filling up their tanks.

If skepticism among voters when it comes to energy policy is high nationally, it is even more so in California due to the long history of misspending and gas tax proceeds. For example, in 1990, voters were told that California’s roads, freeways and bridges were crumbling and that spending on transportation was so seriously inadequate that a gas tax increase was desperately needed to save California from ruin. Fast forward to 2017 with the infamous passage of Senate Bill 1, a massive tax increase of another 12 cents per gallon on gasoline, an additional 20 cents per gallon on diesel fuel and a sharp increase in the cost of vehicle registration.

Voter anger at high gas prices might be less intense if they believed they were getting good value in the form of well-maintained roads and highways. But California consistently ranks in the bottom ten of all states in highway maintenance despite having the highest gas tax.

Our political leaders claim that the pain we’re feeling is because addressing climate change is our highest priority. But many of the restrictions they impose are counterproductive to environmental well-being. For example, rather than encourage drilling in North America, we are increasingly reliant on oil shipped from overseas, including from despotic regimes. But oil tankers run on massive diesel engines and foul our ports. How does that help address climate change?

Click here to read the full article at the OC Register

California Gas Prices Soar to Record High

The average price of a gallon of regular gasoline in California reached a record high on Monday.

The statewide average increased to $4.68 a gallon Monday, according to figures from the AAA, Fox 11 reported.

“This new average surpasses the previous record of $4.67 set in Oct, 2012,” the outlet continued:

The average price of regular gasoline in California is $1.27 higher than the current national average of $3.41, according to AAA. The average price of a gallon of self-serve regular gasoline in Los Angeles County rose seven-tenths of a cent Monday to $4.672, moving within 3.3 cents of the all-time high.

The average price rose 1.4 cents Friday, according to figures from the AAA and Oil Price Information Service. It is 7.9 cents more than it was one week ago, 20.8 cents more than one month ago and $1.523 higher than one year ago.

In a social media post on Thursday, oil and refined products analyst Patrick De Haan said average gasoline prices in California were at all-time record highs, “beating out both 2012 and 2008 records. $4.68/gal today statewide average”:

The High Cost Of Driving In California Is No Accident

How about some gas facts?

In late October, the highest price for gasoline in the country was a “mind-numbing $7.59 a gallon” for regular, $8.50 for premium in Gorda, on California’s central coast.

The average prices for regular, mid-grade, and premium are highest in California, $4.60, $4.78, and $4.90 a gallon, respectively, according to AAA. Prices are rising nationwide, but those numbers are still far in excess of the U.S. average of $3.40 a gallon.

The average gasoline price in Los Angeles had risen for 18 straight days through Oct. 29.

Late October was also when gasoline prices in San Francisco reached an all-time high, passing “the previous record of $4.743 per gallon, set over 3,300 days ago in 2012,” says Gas Buddy.

California shows up as an outlier far out of sync with the rest of the nation in the Gas Buddy price heat map.

Two days before Halloween, “parts of California,” most of them in the northern half, “recorded their highest average gas prices ever,” KTLA reported.

None of this is due to bad luck or unhappy coincidences. Nor can “profiteers” or speculators be blamed for the surge. The high prices are by design. The factors driving prices them are the products of deliberate policymaking:

  • California has the highest motor fuel taxes in the country – 67 cents a gallon, says the Tax Foundation, using American Petroleum Institute data. Second highest are in Illinois, 60 cents a gallon. The national median is about 30 cents a gallon.
  • Due to “big-government energy policies,” California drivers pay a 37% premium for gasoline compared to the national average. Backing off these mandates would have saved drivers $9.6 billion in 2020 over 2019.
  • Carbon cap-and-trade policy adds more than 14 cents a gallon to the cost of gasoline in California.
  • The state’s low carbon fuel standard increases prices 22 to 24 cents per gallon.
  • As requirements of cap-and-trade and the low carbon fuel standard become more demanding, their costs will continue to add up, reaching a range from 89 cents to $2.10 a gallon.

Let’s end with a quiz. Who said: “Somehow, we have to figure out how to boost the price of gasoline to the levels in Europe”?

No, it wasn’t a California official. It was Steven Chu, a Berkeley-trained, Nobel-winning physicist who taught at Stanford, and was serving as the Obama White House’s secretary of energy when he made the statement. The words just happen to sound a lot like those a Sacramento lawmaker would string together.

Kerry Jackson is a fellow with the Center for California Reform at the Pacific Research Institute.

This article was originally published by the Pacific Research Institute.

California gas prices surge to five-year high; what’s causing the spike?

California residents are paying much higher prices at the pumpcompared with the average U.S. resident.

As of Thursday, the average gasoline price in the state was about $4.02, according to AAA, compared with the national average of $2.83.

Those are the highest prices California has seen since 2014. Prices have risen around 68 cents per gallon over the course of a month.

What’s driving prices to multiyear highs? According to Dan McTeague, a senior petroleum analyst at GasBuddy, it’s a supply crunch resulting from refinery upsets in Los Angeles and San Francisco. …

Click here to read the full article from Fox Business.

California Gas Prices Climb 50 Cents in 1 Month Ahead of Gas Tax Increase Slated for Summer

Los Angeles County gas prices spiked again over the weekend, with the average price climbing about 10 cents a gallon to $3.88 as of Monday, the latest AAA figures show.

That’s higher than California’s statewide average of $3.80 for a gallon of regular unleaded, which also happens to be the most expensive of any state at the moment.

In one month, prices at the pump have soared in the Golden State, climbing from an average of $3.30 to $3.80, according to AAA.

L.A. County, meanwhile, has seen an even sharper spike, with the cost increasing by about 55 cents since March 8. …

Click here to read the full article from KTLA5

Progressives Now Complaining About Gas Prices


Gas TaxOnly in California. Progressive policies in California have forced drivers to pay some of the highest gas prices in the nation. Now, a group of liberal legislators want the California attorney general to investigate why this is true.

Let’s recap what the progressives have inflicted on working Californians who are simply trying to get to work and get their kids to school and soccer practice. According to the California Center for Jobs and the Economy, gas prices dropped slightly in December but declined faster in other states. In the United States other than California, the average gas price was $2.26 per gallon. In California, it was $3.40, a premium above the national average of $1.144, a 50.6 percent difference.

California had the second-highest gasoline price among the states behind only Hawaii. Californians paid $1.48 per gallon more than consumers in Missouri, the state with the lowest price. That’s 77 percent more for the same tank of gasoline.

The Center also noted that “California’s fuel regulations and the isolated market created by those regulations continue to push the state’s cost premium up higher — a cost-of-living factor that in particular falls on lower-wage workers as they are forced to commute longer distances in order to find housing they can afford.” Those regulations include California’s unique cap-and-trade law and low-carbon fuel standards, rendering the production of gasoline an expensive and risky enterprise.

To read the entire column, please click here.