Political Watch: February 8, 2024

• U.S. Rep. Salud Carbajal (D-Santa Barbara) joined an “overwhelming majority” of the U.S. House of Representatives to advance a bipartisan tax package that includes an expanded Child Tax Credit and housing affordability tax credits and would provide additional support for small businesses and families affected by recent natural disasters, according to a Jan. 31 statement from Carbajal’s office. The tax package also expands the Low-Income Housing Tax Credit to allow states to support the creation of more affordable housing projects. Under the tax agreement, the refundable child tax credit available to low-income families would rise from $1,600 this year to a projected $2,100 by 2025, and the income cap on the credit will expand to account for the number of children in a family. “With partisan gridlock at an all-time high, I’m pleased to see that Congress can still come together to reach a compromise on critical measures that will help Central Coast families by lowering their cost of living, promoting affordable housing, supporting small businesses, and helping those impacted by recent natural disasters. It is also worth noting that these investments are paid for through offsets to avoid adding to our national debt,” Carbajal said in the statement. “While this deal isn’t everything my Democratic colleagues and I would have hoped for, it is a down payment on the kinds of investments we want to make in American communities, and I am confident it will make a difference in the lives of Central Coast families.”

• U.S. Sens. Alex Padilla (D-California), Bill Cassidy (R-Louisiana), Jon Tester (D-Montana), and Cynthia Lummis (R-Wyoming) introduced the Protect Innocent Victims of Taxation After Fire Act to provide tax relief for wildfire survivors who have received compensation for losses and damages suffered during a wildfire, according to a Feb. 1 statement from Padilla’s office. The bill aims to ensure that payments made from funds like the Pacific Gas and Electric Company (PG&E) Fire Victim Trust will not be taxed. The trust, established in 2020, is a multi-billion-dollar wildfire settlement for the nearly 70,000 victims of the three major fires in 2015, 2017, and 2018 found to be caused by PG&E equipment. Currently, the taxability of funds received from the trust varies based on what type of loss is being claimed, making it difficult for recipients to determine what amount of their claims can be used to rebuild their lives or replace their losses. With utility-caused fires on the rise, more and more states have qualifying settlements or active litigation, according to Padilla’s office. This bill would provide future wildfire survivors with the certainty that their settlement money will not be taxed. “Wildfire victims should not be taxed on payments that don’t cover their full losses and damages to begin with, but over 70,000 Californians impacted by the Butte, North Bay, and Camp wildfires currently face uncertainty over whether this assistance is taxable,” Padilla said in the statement. “These payments are not income, and our bipartisan bill will ensure families that have suffered devastating loss receive full and proper compensation to help rebuild their lives.”

• Gov. Gavin Newsom highlighted historic climate investments that the Biden administration recently announced for California. The funding through the Bipartisan Infrastructure Law and the Inflation Reduction Act is the largest investment in clean energy and climate action, according to a statement from Newsom’s office. The amount is anticipated to increase as the Biden administration announces additional awards in the coming years. “The $15.5-plus billion from the Biden-Harris administration is helping California build our clean energy future, transform our transportation, clean our air, save our communities from wildfire and floods, and protect our state’s natural beauty,” Newsom said in the statement. In the last month, California has received more than $425 million to build offshore wind infrastructure and create manufacturing jobs at the Port of Humboldt Bay, $88 million to help eight California school districts purchase clean school buses, $168 million to add more than 2,600 electric vehicle charging stations in rural and disadvantaged areas across the state, and $63 million to upgrade existing electric vehicle charging stations.

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