Gov. Gavin Newsom’s coronavirus recovery proposal is too focused on promoting electric cars and not enough on supporting small businesses, some lawmakers said Monday.
Some moderate Democrats were among the lawmakers who raised concerns about the plan during the Legislature’s first hearing on Newsom’s budget proposal, indicating it faces hurdles from his own party.
Assemblyman Jim Wood, D-Healdsburg, pointed out that Newsom wants to spend more on his electric car plans than on grants for struggling small businesses.
“We have $1.5 billion in the budget for electric car infrastructure and incentives. We have $575 million going to small businesses. I wonder: Is that the right number?” Wood said, as his Republican colleague James Gallagher, R-Yuba City, nodded his head vigorously behind him.
Newsom’s economic recovery plan includes $575 million in grants for small businesses to help them through the pandemic. Last year, he and lawmakers approved $500 million for the same program, which provides up to $25,000 to struggling businesses.
He’s also asking lawmakers to quickly approve $70 million in fee waivers for businesses hit hardest by the pandemic, including salons and restaurants.
The plan includes $1.5 billion to help low-income Californians buy zero-emission vehicles and to build infrastructure to support them, including electric charging stations and hydrogen fueling stations.
That spending would help Newsom reach an ambitious goal he set through a September executive order that aims to phase out sales of new gas-powered cars by 2035 to reduce carbon emissions that are warming the planet.
Newsom argues the funding will help create jobs for people to manufacture zero-emission cars and build charging stations for them.
But Assemblyman Jim Cooper, D-Elk Grove, called the proposed electric vehicle spending “disconcerting.”
“Climate change is real… but if you ask the average person, what are their issues right now… no one’s thinking about electric vehicles,” Cooper said. “That’s a part (of the governor’s budget plan) that really concerns me and in some ways it is tone deaf to the citizens of California.”
Several Republicans also blasted the plan, including Gallagher, who said he supports the governor’s direct aid to small businesses through grants and fee waivers, but thinks the money Newsom has slated for electric cars should be spent elsewhere.
Budget bills generally only need a majority of support in the Legislature, meaning Newsom likely won’t need all Democrats to support it. Several Democrats also spoke in support of his climate and transportation plans, including Assemblywoman Eloise Gómez Reyes.
“The proposed investments in clean air, clean transportation infrastructure and meeting our climate goals not only reflects the priority of a majority of Californians, but it also provides another avenue for economic recovery,” the Grand Terrace Democrat said.
Assemblyman Richard Bloom, D-Santa Monica, said the Legislature needs to continue fighting climate change, even during the pandemic.
“Automobile exhaust remains the single largest contributor to carbon emissions,” he said. “We need to transition out of this carbon economy, and one of the ways we do it is by incentivizing electric vehicles.”
Lawmakers will debate Newsom’s budget proposal over the next few months. They’ll need to approve a full budget plan by June ahead of the start of the 2021-22 fiscal year on July 1.