New Bill Would Create an Incentive to Go Car-Free in California

In the search to offer relief for high prices (and sidestep the Gann Limit), Governor Newsom has floated the idea of offering checks to car owners, and the legislature has come up with a different way of providing some payments directly to taxpayers, but not based on car ownership.

Now Senator Anthony Portantino (D – La Cañada/Flintridge) has hit on another way to provide relief to people who really need it – and that would help the state meet its climate goals. His bill, S.B. 457, would offer a tax credit to taxpayers who do not own a car. It’s a stimulus aimed at people who need it most – those who cannot afford a car – as well as in incentive for everyone to reduce dependence on cars.

“As the impacts of climate change are felt across our state, it’s time we more aggressively commit to implementing modes of sustainable transportation,” stated Senator Portantino in a press release about the bill. “S.B. 457 is an important step towards that goal. We can invest in the future by providing financial incentives for Californians to transition from vehicles to more sustainable options.”

The largest contributor to greenhouse gases in California is transportation, with a large portion of that coming from single occupancy vehicles. California is investing a lot of money into helping drivers transition to electric vehicles, via direct incentives to car buyers, building infrastructure, and tax breaks for electric car owners. But the Air Resources Board, which manages those programs, acknowledges that all that investment won’t be enough – that Californians will need to drive less, full stop.

It can be tough to go car-free in California. Better transit and safer bike and pedestrian infrastructure will be absolutely be necessary. But millions of Californians do get by without owning cars, either because they can’t afford one or don’t want to add a further burden to the environment. This bill would reward people for living car-free or “car-light,” and encourage more people to do so.

S.B. 457 would create a tax credit of $2,500 for each household member sixteen years or older above the number of registered vehicles in that household, beginning in January 2023. The bill would limit the total amount of the credit per household to $7,500.

The bill’s sponsor, Streets for All, says that it’s fair to provide tax relief beyond those given to car owners. The group’s legislative advocate writes that “S.B. 457 invests in the future by encouraging Californians to use public transit, cycling, scootering, walking, and other sustainable modes to get around. It is beyond time to support families who choose the safest, most sustainable option: not owning a vehicle at all.”

S.B. 457 can be introduced this late in the legislative session through what’s known as a “gut-and-amend” process: by rewriting an existing bill on a different topic. In its previous version, the bill had already passed through several Senate committees and a Senate floor vote, and landed in the Assembly.

The rewritten S.B. 457 has been assigned to the Assembly Committee on Revenue and Taxation. It must pass that committee and an Assembly floor vote before it returns to go back through the Senate committee process once again.