LOS ANGELES – Low-income families across California could be getting a little more financial help from the state.
AB 2589 would use the state’s $97 billion budget surplus to expand the Young Child Tax Credit, providing a one-time $2,000 tax credit per child to families earning $30,000 or less per year.
The bill would also raise the minimum amount for California Earned Income Tax Credit from $1 to $255 to keep more low-income workers and families from falling deeper into poverty.
“California has a chance to lead the way in fighting poverty,” Santiago said in a statement. “Our $97 billion surplus provides a critical opportunity to support our lowest income families.”
The bill will be heard by the Assembly appropriations committee on Thursday.
According to Santiago, 1.7 million kids in California are at risk of falling back or further into poverty.
The federal aid started last July but ended after President Joe Biden’s Build Back Better bill stalled in the sharply divided Congress. Payments of up to $300 per child were delivered directly to bank accounts on the 15th of each month.
The new numbers represent a serious setback from the original goals of the child tax credit program, which ambitiously sought to cut nationwide child poverty in half. As part of Biden’s $1.9 trillion COVID-19 rescue package last year, the existing child tax credit program was massively reshaped, boosting the amount of the payments, greatly expanding the pool of eligible families and delivering the money in monthly installments designed to be incorporated into day-to-day household budgets.
The program extended payments of $250-per-month for children ages 6 through 17 and $300-per-month for those under 6 to most families in the country, at an annual cost of about $120 billion. The goal was to put discretionary cash in the hands of parents along with the freedom to spend it as they saw fit month-to-month.
The Associated Press contributed to this report.
