Saturday 24 September 2022

California Prepares To Send Out ‘Inflation Relief’ Checks

 Some residents of California are slated to receive inflation relief checks of more than $1,000 in the coming weeks.

Married individuals earning under $150,000 and taking care of a dependent are eligible to receive a check of $1,050, according to a website from the California Franchise Tax Board, with benefits falling by income bracket before reaching $400 for couples who earn between $250,000 and $500,000. Singles earning more than $250,000 or couples earning more than $500,000 are not eligible for relief.

“We enacted the most comprehensive economic stimulus program in the nation last year, getting billions in immediate relief to millions of Californians. But many folks are still struggling, especially with high costs due to inflation, so we’re leveraging this historic surplus to get money back into the pockets of Californians,” Governor Gavin Newsom (D-CA) said in a statement earlier this year. “This inflation relief package will help offset the higher costs that Californians are facing right now and provide support to those still recovering from the pandemic.”

Inflationary pressures have weighed upon the broader American economy for the past two years. Price levels between August 2021 and August 2022 rose 8.3%, according to data from the Bureau of Labor Statistics, marking a slight moderation from an 8.5% year-over-year increase in July and a 9.1% year-over-year increase in June.

Earlier this year, California provided residents with stimulus checks of $400 per registered car for up to two vehicles, as well as free public transit for three months, in order to mitigate soaring gasoline prices. After surpassing a nationwide average of $5.00 per gallon in early June, gas prices have somewhat subsided to $3.70 per gallon as of Friday, according to data from AAA, while prices in California still remain at an average of $5.58 per gallon.

The Golden State’s budget reached a sum of $308 billion this year, according to a press release from Newsom’s office, which includes a surplus of $97 billion. However, the state’s top marginal income tax rate is 13.3% and the state’s sales tax rate is 7.25%, both of which are the highest in the nation, according to an analysis from the Heritage Foundation.

Meanwhile, California has witnessed a mass exodus in response to government lockdowns and rising prices. Between March 2020 and December 2020, roughly 267,000 people moved out of California while 128,000 entered the state. The trend is particularly salient in San Francisco, where real estate prices and crime rates are especially high. Between 2019 and 2020, more than six times as many residents left the city than entered.

An analysis from Filterbuy revealed that soaring rental costs are impacting the millennial cohort — defined as those between 24 and 39 years old — such that most can no longer afford to rent one-bedroom apartments in California’s largest cities. Median wages in Los Angeles, Anaheim, and Long Beach are $36,649, while the annual wage necessary to afford a one-bedroom apartment is $72,560.

“The combination of rising rents and stagnant wages has been a challenge for Americans of all stripes, but certain groups have been more disadvantaged by this state of affairs than others,” Filterbuy explained. “Even well-off households are feeling pressure, as rising real estate costs price would-be buyers out and keep them competing for space in the rental market — and as they spend more on rent, they have a harder time saving for homeownership.”

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