By MADISON HIRNEISEN
THE CENTER SQUARE
(The Center Square) – California lawmakers could soon offer tax credits to households with fewer cars than people of driving age under a new proposal.
Senate Bill 457, introduced by Sen. Anthony Portantino, D-La Cañada Flintridge, would allow for a tax credit of $2,500 for each household member of at least 16 years of age that exceeds the number of registered vehicles, capped at $7,500. The bill would take effect on Jan. 1, 2023, if signed into law.
California lawmakers aim to address the impacts of climate change in the Golden State with such bills. Lawmakers have pointed to transportation’s impact on the climate, which accounted for 41% of California’s greenhouse gas emissions in 2019, according to data from the California Air Resources Board.
California already offers incentives for residents to switch from gas cars to electric vehicles, but Portantino’s bill would incentivize moving away from vehicle dependence altogether. Instead, the bill would incentivize people to choose more sustainable transportation options – like mass transit – to slash greenhouse gas emissions.
“What we’re really trying to do here is incentivize car-free life,” Sen. Portantino told The Center Square. “This is tied to incentivizing the use of mass transit and creating a way for people to have a monetary reason to give up their car, just like they have a monetary reason to go from gas to electric.”
The bill specifies that a qualified vehicle includes a “device by which a person or property may be propelled, moved or drawn upon a highway,” excluding devices “moved exclusively by human power” or on stationary tracks. The bill also notes that an electric bicycle does not qualify as a vehicle.
A fiscal analysis from the Franchise Tax Board estimates the bill would result in General Fund losses of $0.7 billion in fiscal year 2022, followed by losses of $1.2 billion in the coming fiscal years.
A committee analysis of the bill pointed out that it “could favor high-income earners who have the ability to telework, live in walkable neighborhoods and live in desirable communities with public transportation options and bicycle lanes.” The analysis further explains that the bill would not benefit households who live far from work due to affordability issues and must commute by car, households in rural areas without public transportation or people with disabilities that require a motor vehicle.
The committee also voiced concerns about whether or not the tax credit is the best way to achieve the bill’s goal of cutting back on greenhouse gas emissions.
“While this bill is well-intentioned, Committee staff questions whether using tax credits to reward those with fewer registered vehicles is the most effective way of accomplishing the desired goal,” the analysis states. “The Legislature may also accomplish the desired goal by subsidizing the cost of public transportation, increasing funding to make streets safer to walk or ride on, and making public transportation more accessible and convenient.”
No organizations have registered in support or opposition to the bill yet, though the bill is sponsored by Streets for All, a Los Angeles-based advocacy group seeking a “transportation revolution.”
Bubba Fish, a legislative advocate for Streets for All, said in a statement that the bill “invests in the future” of California by encouraging residents to use sustainable transportation, like public transportation, scooters and bikes.
“It is beyond time to support families who choose the safest, most sustainable option, not owning a vehicle at all,” Mr. Fish said.
The bill will be heard for testimony only in the Assembly Committee on Revenue and Taxation Monday.