California Gov. Newsom proposes inflation relief checks

Inflation has hit people's budgets in many ways, from getting groceries at the store to filling up the tank at the gas station.

"I used to be able to fill this truck with $80. Now it's $150," said Jose Torres of Alameda. 

"It's expensive, and it's crazy," said Ibrahim Hadwan of Alameda, "To even fill up gas, it's 8 gallons, $52."

Gov. Gavin Newsom wants to use some of the state's projected record $68 billion budget surplus for an $18.1 billion inflation relief package.

The proposal includes:

  • $11.5 billion to send $400 checks to car owners$2.7 billion toward emergency rent relief$1.4 billion to help people with past-due utility bills$933 million for relief checks to some hospital and nursing home staff

The governor also is proposing $750 million for free public transit, a pause in the diesel sales tax, and waiving child care fees for low-income families.

"It's a struggle right now so if it does pass it'd be very much appreciated," said Stephanie Smith, a Richmond resident who has three children and a spouse in her household.

Some lawmakers, however, oppose parts of Newsom's plan. 

A group of Democrats and Republicans say the state should temporarily suspend the state's 51-cent-a-gallon gas tax.

Others say the aid should only go to those in the greatest need.

"If we are going to give money back to people it should not be based on who owns a car," said State Senator Scott Wiener of San Francisco says more of the surplus funds should go toward infrastructure projects.

"The Embarcadero could be flooded, the Muni and BART tunnels could be flooded. Up and down the state we have major infrastructure needs," said Wiener.

Some wonder how much and how quickly an inflation relief package would help.

"I think the proposal may help or be a temporary fix, but I think there's a deeper issue that we need to get solved to get back to where things should be," said Aaron Bertia, a Bay Area resident.

"I think the impact will actually be felt relatively quickly. I think it will take more time to get it enacted," said UC Berkeley Economics Professor Jim Wilcox, who added that the relief will help low and middle income people who have been hit the hardest, but it also could have an unintended effect because inflation is caused by more demand than available supplies.

"Providing these extra subsidies, these extra checks will only increase the amount of demand so if anything will tend to make the inflation rate a little higher," he said. 

This story was reported from Oakland, Calif. 

Jana Katsuyama is a reporter for KTVU.  Email Jana at and follow her on Twitter @JanaKTVU or Facebook @NewsJana or