Newsom: California has a record budget surplus of $97.5 billion

California is entering the next budget year with a record surplus of nearly $100 billion, Gov. Gavin Newsom said Friday.

Newsom unveiled a revised budget plan of just over $300 billion for the next fiscal year, the highest in state history and fueled by rising tax revenue. The state has collected $55 billion more in taxes than officials expected in January, leaving it with an estimated surplus of $97.5 billion.

That means Newsom, a Democrat, has tens of billions more dollars to spend on new and existing initiatives as he seeks re-election in the fall. He plans additional spending to deal with the ongoing drought, to help more women get abortions in California and to offset rising costs for food, gasoline and other goods due to inflation.

He will have to come to terms with the Democratic-led legislature on all of his proposals. They have until the end of June to finalize the budget, which goes into effect July 1.

Newsom said one of his top budget priorities is providing relief to Californians from inflation.

“People feel deep stress, deep anxiety,” he said.

He has proposed giving $400 checks to state-registered car owners, with up to two checks per person. That would cost the state about $11.5 billion, she said. Although the money would only go to car owners, Newsom said it should be considered a “rebate and inflation relief.”

“For you, it could be reimbursement to address the groceries problem, it could be reimbursement to address the other cost burdens that are put on you,” he said.

Democratic lawmakers, however, have a different idea about how to provide aid. They want to give $200 checks only to those below a certain income level.

Meanwhile, Republicans say instead of a paycheck, Newsom should suspend the nation’s highest state gas tax for a year. He has also been asked to increase a tax credit for renters and offer new tax credits to students.

“Republican senators believe there is a better way to invest in the state,” said Sen. Rosilicie Ochoa Bogh of Yucaipa.

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