California ‘Windfall Gas Tax Profits:’ Gas Now $2.55 Above the National Average

‘Governor Newsom and Capitol Democrats are as dumb as they want to be’

Californians are paying the highest gas prices in the entire nation thanks to the state’s “windfall gas tax profits.” The average price for a gallon of gas in the U.S. is $3.891 according to AAA. California’s average price for a gallon of gas is $6.392. This means Californians are paying a $2.55 premium on gas in many locations.

Gas in Mono county California is $7.82 per gallon.

The lowest gas is in Mississippi at $3.205 per gallon. Texas comes in at $3.232, Florida is $3.289, and Georgia is $3.207.

Notably, “It has now officially been 211 days since the Democrats promised action on soaring gas prices,” Assembly Republican Leader James Gallagher (R-Yuba City) said Thursday.

“Governor Newsom and Capitol Democrats are as dumb as they want to be. People have friends in other states who are paying around $3.50 a gallon. It’s laughable and Californians aren’t buying it,” Gallagher said.  “Another dismal record the state set earlier this week shows that California has the worst maintained roads in the nation, even though most of the gas tax is intended for road maintenance.”

A new report found “44% of California’s roads analyzed were in poor condition. That’s the highest of any state, MoneyGeek said. Only 22% of the state’s roads were in good condition.”

Assemblyman Kevin Kiley (R-Granite Bay) also weighed in, and he addresses Gov. Newsom’s threat to call a special legislative session for the sole purpose of raising taxes. Again.

“Gavin Newsom is considering a Special Session of the Legislature for a single purpose: raising taxes. That is the last thing California needs,” Kiley said. “Newsom’s proposal, a new tax on suppliers, will inevitably make gas prices even higher. For those keeping score, prices in California are now $2.56 above the national average and our state budget has grown $100 billion since Newsom took office.”

“If Newsom does re-convene the Legislature, he’ll be sending the Supermajority into a trap. I’ll use the opportunity to force a new vote on suspending the gas tax, and we’ll see if they’re willing to oppose it again as ballots land in mailboxes.”

As for Gov. Newsom’s special session of the Legislature in response to rising gas prices, “We’re hoping to do more with this windfall profits tax to go after big oil,” he said Thursday at the climate change compact signing in San Francisco.

Newsom’s solution is to accuse oil companies of hoarding “windfall profits,” and to impose additional taxes. This isn’t a climate plan, but a tax plan.

Assemblyman Kevin Kiley had a solution to California’s highest-in-the-nation gas prices, but in March, Democrats on the Assembly Transportation Committee hijacked Kiley’s bill by passing amendments to gut the bill so they could not be accused of voting for the gas tax increase. Kiley proposed to suspend California’s .51 cent gas tax (CA gas tax is now .54 cents). At the hearing, Kiley noted that Maryland and Georgia had just reduced their gas taxes, and the people of those states saw immediate results. He said rebates are a good idea, especially with a substantial state surplus, and should be much larger, returning to overtaxed tax payers more of their own money.

Democrats diddled for 100 days to provide relief at the pump for the state’s drivers from the record high gas prices,” the Globe reported in June. California Democrats abandoned the opportunity for a gas tax holiday, and then announced they were forming a new committee to investigate gas price gouging to make it appear they were doing something.

Read more about Gov. Newsom’s new “windfall profits tax” on oil companies.

Here are some of the policies implemented in California that drive up the cost of gasoline:

  • 51.1 cents – State gas tax (add an additional 3 cents starting July 1.)
  • 25 cents – Cap and Trade (estimate)
  • 22 cents – Low Carbon Fuel Standard (estimate)
  • 2 cents – Underground Storage Fee
  • 10-15 cents – California’s switch to summer-blend costs more to produce than other types of gasoline. Source.
  • 14.4 cents – State sales tax (estimate based on 6/20 average price)

Click here to read the full article at the California Globe

California Gas prices Hit Record Highs, With OPEC+ Move Sparking Worsening Economic Threat

As gas prices hit record highs in Los Angeles on Wednesday, a pledge by OPEC+ to reduce its oil production by 2 million barrels a day brought concerns about more economic pain to come.

California is facing surging oil prices in the wake of shutdowns at several oil refineries that produce a specific grade of fuel for the state. Prices began to creep up in September after months of declines. And unlike the nationwide rise in gas prices over the summer, this most recent spike is mostly confined to California and the West Coast. 

There was also debate among experts about the effect of the move by OPEC+, which amounted to the biggest reduction since 2020 and was designed to boost sagging oil prices.

It remains unclear how the reduction would affect pump prices, but experts said it poses another threat to the shaky global economy amid growing concerns about an impending recession.

The OPEC+ move comes a month before crucial midterm elections in the U.S. President Biden and other Democrats hoped the decline in gas prices in recent months would help them with an electorate angry at rising inflation and concerned over an economic downturn.

In March, Biden announced the U.S. would release of 1 million barrels of oil per day from strategic reserves for six months in hopes of easing gas prices.

“When President Biden released oil from the Strategic Petroleum Reserve, it hurt OPEC in terms of revenues. Most of that oil went to refiners,” said Phil Verleger, a Denver-based oil expert who formerly served as a senior staff economist on the Council of Economic Advisors. “Now, OPEC wants some of that money back. But Biden has already said he will release more from the reserve to counteract this.” 

Verleger added that California’s record fuel price spike “is because of refining issues, not because of crude prices.”

Tom Kloza, an expert in energy prices who serves as global head of energy analysis for the Oil Price Information Service, also said OPEC+‘s decision should not hit California motorists too hard. 

“I don’t think the crude agreement from OPEC will have much impact,” Kloza said. “A lot of the California refineries that have been out of service because of planned maintenance and unanticipated problems are coming back online and resuming production. You might see another increase over the next couple of days, but that should be it.”

The average price for a gallon of regular gasoline in Los Angeles ticked up to $6.494 on Wednesday, increasing five-tenths of a cent overnight, according to data from the American Automobile Assn.

Gas prices for regular fuel have jumped by more than 38 cents in Los Angeles since a week ago. This time last year, the average price was about $5.28 a gallon.

The Wednesday announcement by OPEC+, a coalition of oil-producing countries, to cut oil production by 2 million barrels a day also raised fears that the move could hurt the global economy.

Before the announcement, Moody‘s Investors Service said that any plan to raise oil prices now would likely fail and maybe even backfire. 

“In our view, elevated oil prices cannot be sustained for long because of economies’ limited ability to absorb higher oil costs and continue growing,” said a note by Moody’s senior vice presidents Elena Nadtotchi and Madhavi Bokil. “A persistently high cost of oil would impede economic growth and hasten substitution to alternative sources of energy, leading oil prices to eventually fall to the reinvestment price range.” 

Severin Borenstein, faculty director of the Energy Institute at UC Berkeley’s Haas School of Business, said the OPEC+ decision “might add 10 to 15 cents to the price of a gallon of gasoline.” 

“That will be swamped by the number of refineries returning to service and by California’s switch to cheaper winter-blend gasoline,” he added. 

Biden said he was “disappointed by the shortsighted decision,” while White House national security advisor Jake Sullivan and National Economic Council Director Brian Deese confirmed that the U.S. would release an additional 10 million barrels of oil from the Strategic Petroleum Reserve next month in response. 

The Golden State has experienced the steepest hike in gas prices in the U.S., climbing to an average of $6.42 per gallon for regular fuel Wednesday and causing Gov. Gavin Newsom to shift to the state’s cheaper, winter-blend gasoline

Other Western states, such as Oregon and Washington, have also seen increases. 

“With gas prices continuing to surge on the West Coast and Great Lakes, the national average saw its second straight weekly rise,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a blog post. “But at the same time, areas of the Northeast and Gulf Coast have continued to see declines as the nation experiences sharp differences in trends between regions.” 

De Haan said that West Coast states have seen gas prices rise between 35 and 55 cents per gallon in the last week but that Californians should expect some relief at the pump soon, despite the OPEC+ news.

De Haan called it “very nuanced right now because of refinery kinks” but predicted gas prices will fall in the West Coast, Great Lakes and other areas experiencing price surges, while increasing in the East Coast, Southeast, South, Gulf and Northeast because of the OPEC+ decision. 

“The worst appears to be over for California. … Price differentials are plunging, with gasoline values down some 45c/gal,” he tweeted Wednesday morning. “This will take a few days for stations to start getting the cheaper fuel, but lower gas prices are coming!”

Click here to read the full article at the LA Times

California Gas is ‘Out of Whack’ – Nearly $2 More than National Average. Who’s to Blame?

California has long been known as the country’s priciest place to fill up your tank, but these days the Golden State is “completely out of whack.”

As gas prices plummeted around the nation in recent weeks, California’s price at the pump has rebounded with a vengeance to an average of $5.58 a gallon.

That’s $1.89 more than the national average — the highest price gap in at least 22 years, according to a Bay Area News Group analysis of AAA data.

While Russia’s invasion of Ukraine drove prices higher around the world, California’s perplexing price swing is largely due to the local oil industry, experts say, which is putting the state on another planet when it comes to gas.

“The commodity price of gasoline in California has gotten completely out of whack,” said Severin Borenstein an energy economist at UC Berkeley. “If this holds, we’re just starting to see the increase. It’s going to go up even more.”

Although fuel costs are still down from their peak in June, drivers are contending with nearly seven months of average prices topping $5 a gallon.

“It’s unfair,” said Sonya Khvann, a single mother of three, who was pumping gas in Alameda on Friday. She spends about $800 a month on fuel shuttling around her children. “It’s not like you can change your career overnight,” said Khvann, a part-time real estate agent. “Not everyone can be in tech.”

Much of California’s high gasoline costs are explainable. The state’s 54-cent gasoline excise tax is among the highest in the country — only Pennsylvania’s is higher. There are also stricter environmental regulations and special fuel blends that prevent rampant smog from accumulating in cities, altogether these factors tack on roughly $1.20 to California’s gas prices.

But the widening gap between what everyone from San Jose to Los Angeles is paying compared to the rest of the country is due to the concentrated nature of California’s oil refineries, experts say. Due to the state’s special gas blend, California is often termed a “fuel island” because nearly all gas sold in the state is refined locally by a handful of companies, including Chevron, Marathon Petroleum and PBF Energy. That means mechanical hiccups at refineries can cause major price spikes not seen elsewhere in the country.

Tom Kloza, of the Oil Price Information Service, said the reduced flow of gas is likely due to refiners bringing equipment offline for maintenance. He said much of the oil industry deferred regularly scheduled maintenance in spring so they could continue reaping record profits during the energy price spike following the Russian invasion.

But it’s hard to get to the bottom of exactly why California’s oil refiners have reduced output now just as prices drop elsewhere. There has been no major refinery outage or catastrophe reported in recent months. Instead, experts glean information from oil production reports. “Because of antitrust regulations, we don’t know how individual refineries are operating,” said Kevin Slagle, vice president of the Western States Petroleum Association.

In a statement, the California Energy Commission said state refineries are seeing “temporary” production issues that, coupled with maintenance activity and “lower-than-normal gasoline inventories,” is driving the current price spike over the past four weeks.

The mysterious price surge comes as California Gov. Gavin Newsom has turned up the rhetoric against the oil industry as the Golden State moves to phase out most gas-powered vehicles by 2035 and expand restrictions on drilling. In a statement on Friday, Newsom’s office accused fossil fuel companies of “holding families hostage” while touting Sacramento’s plan to send up to $1,050 to California families to alleviate the financial pain.

“We’re phasing out the fear of gas prices and ushering in our oil-free future,” Newsom’s office added.

Borenstein has spent years studying the gap between California’s gas prices and the national average. He said the unaccounted-for difference, which he termed a “mystery surcharge,” took off in 2015 when gas prices spiked in the aftermath of a Torrance oil refinery explosion. Before the blast, the unexplainable price gap was about 2 cents, but afterward it ballooned to over 40 cents and has remained high ever since.

Kloza, Borenstein and David Hackett, an energy expert at Stillwater Associates, said there is no evidence of racketeering among the state’s oil refineries. There is an ongoing probe into gas pricing and oil industry practices in the State Assembly, however. Sacramento has a long history of accusing the industry of price-gouging and announcing investigations that yield few results.

Click here to read the full article at the OC Register

Californians can’t catch a break as gas prices spike again

The ongoing heat wave is raising the risk of blackouts on top of perennial drought and fires. And now, after enduring record pump prices in June that were much higher than the national average, Californians face surging gasoline costs again at the end of the summer travel season when they typically fall.

Pump prices jumped 10 cents a gallon in a week in Los Angeles County and the Inland Empire and 13 cents in Orange County, according to auto club AAA. Record wholesale premiums signal they could rise even further. At the state level, retail prices average $5.34 a gallon on Friday, 4 cents more than the previous day.

The confluence of bad news highlights how vulnerable California’s energy systems are to supply disruptions. The state is an energy island, cut off from crude and fuel hubs in the Gulf Coast and Midwest by the Rocky Mountains. Regulators require a boutique grade of cleaner-burning fuel that few refineries are geared to produce outside of the state. As a result, fuel shortages take time to resolve and price spikes are far more common than elsewhere in the country.

Gasoline stockpiles on the US West Coast have fallen by 11% since the beginning of August amid a lack of imports to their lowest level in about seven years, data from the Energy Information Administration show. The California grade of gasoline known as Carbob also saw inventories drop to 8% below the five-year average for this time of year, according to the California Energy Commission.

Refiners in the state are running harder, but hot weather and a stressed power grid may be causing some problems. Excess heat challenges the water cooling system in refineries, and one way to handle it is to cut operation rates, said John Auers, managing director at RBN Energy.

“Heat, along with the way the power grid is being managed, can be contributing to the refinery issues,” Auers said in a phone interview. A string of incidents recently surfaced in Southern California and may have spooked traders in the spot market, which sets the basis for retail prices.

Click here to read the full article at the OC Register

Midterm forecast: Gas prices get GOP control of U.S. House

If control of the House of Representatives flips to the Republicans this fall, economist Jim Doti thinks he found the issue driving political change: the gas pump.

Chapman University’s veteran economic forecaster was trying to see which historic economic, demographic or voting patterns factors might provide numerical hints for November’s midterm elections in which control of the House is at stake.

Doti’s formula suggests Republicans will gain control of the House by flipping 53 of the legislative body’s 435 seats to the GOP side of the political aisle in November. The flip isn’t terribly stunning considering the party controlling the White House has lost an average 27 seats in midterms since World War II. And over the July 4th weekend, forecasters at fivethirtyeight.com gave the GOP an 87% chance of winning the House in the first fall projection for 2022.

Political track records are not fool-proof prognostications of future election results. But Doti was startled to discover the pivotal vote-changer that’s bad news for President Joe Biden and his Democrats: record-high gasoline prices.

“First of all, let me say that this was a big surprise to me,” Doti says.

Price points

Pain at the pump was not on Doti’s mind when he started the research with fellow Chapman professor Fadel Lawandy. He was betting big vote swings followed inflation, which in 2022 is running at 40-year highs.

But when the professors looked at voting patterns vs. traditional measures of the cost of living, such as the Consumer Price index, Doti said “I found nothing, even when you look at some of our high inflationary periods.”

So gasoline prices were input into his formula, and to the professors’ astonishment, fuel inflation was a significant political driver. The out-of-power party gained more House midterm seats when gasoline was pricier.

Equally noteworthy were the only two times the party in the White House grew its political base in the House at the midterms — Bill Clinton’s second term (1998) and George W. Bush’s first term (2002).

Gas prices were falling in both of those outlier periods.

So why is gasoline — a relatively modest expense for many Americans — such a political flash point? It’s the simplicity of the economic measurement.

“People every week fill the tank. They see these big prices,” Doti says. “It’s not like reading the CPI. Or reading the Wall Street Journal. It’s affecting their pocketbook, and they get it. They’re agitated.”

Bad start

Doti’s research shows the Democrats start the midterm political season in a weak position.

The model revealed Democrats’ modest House advantage — it’s currently only a 10-seat edge — translates to 10 seats lost come November.

Biden’s unpopularity doesn’t help. The president scored a low approval rate of 41% in May, according to Gallup. That compares with an average of 51% at the same moment for presidents since WWII. The Chapman formula says that adds up to nine more lost Democratic seats.

Yes, there’s decent economic growth — Biden’s 2.8% gross domestic product expansion is better than the 2.5% post-WWII average. But that earns Democrats only one seat by this math.

And a Republican winning Virginia’s governorship — an election that’s proven to be a leading indicator of political fortunes — translates to a six-seat House pickup for the Republicans, says the formula.

Then ponder gas prices — up 61% in a year vs. average hikes of 2.5% annually. That pump pain is worth 29 seats for the Republicans — literally giving them the House if this Chapman forecast is correct.

You don’t need an economics doctorate to understand that if folks vote with their wallets, gas prices are an obvious winner for Republicans. And a psychology degree isn’t required to comprehend the emotional response gas prices can create — and voters often act with their hearts.

To me, though, what will be intriguing to watch is what voters think this fall about topics hard to quantify. The Supreme Court’s actions on reproductive rights or gun control. Or the hearings into the January 6 insurgency.

I’ll note that 1974’s midterms — when the Republicans controlled the White House and lost 48 House seats — were the party’s second-worst outcome since World War II. By the way, the 50 seats lost in Dwight Eisenhower’s second term in 1958 was the GOP’s biggest drop.

What was up in 1974?

Gas prices jumped 33% to 53 cents per gallon. Inflation ran at 11%. But Richard Nixon also resigned from the presidency. Oh, and it was the first midterm election after the Supreme Court made abortion a right in every state in Roe vs. Wade.

Sketchy tale

Doti tells the tale of a recent visit to a Chapman University graphic design class.

Students were assigned to draw a political cartoon. Doti was there to provide some economic background highlighting the nation’s inflation challenges.

And what was the theme of the graphic professor’s favorite cartoon from the assignment? A humorous sketch of a gas station where the price was artfully displayed at $18.89 a gallon.

“That brings home the fact people see it, it’s transparent,” Doti says of the fuel pump’s political power. “The analysis clearly shows gas prices affect how people vote in midterm elections — but not the overall trend in consumer prices.”

Click here to read the full article in the OC Register

California Governor, Lawmakers Near Deal on Gas Tax Rebate

Most California taxpayers would get hundreds of dollars in cash to help offset the high price of fuel and other goods under a tentative budget compromise being discussed by legislative leaders and Gov. Gavin Newsom.

The plan would return a portion of California’s record-setting $97 billion budget surplus to taxpayers — but the money would only go to people who made below a certain income level.

Newsom and legislative leaders were still negotiating the state budget on Friday, with talks scheduled to extend into the weekend. While both sides had agreed to a framework for rebates, the overall numbers could change as other parts of the budget are finalized. But in general, the less money people make in a year, the more money they would get from the state.

The current proposal would return about $9.5 billion to taxpayers. Single people who make less than $75,000 per year and couples who make less than $150,000 per year would get $350 per taxpayer, plus an extra $350 for each dependent. That means a married couple earning $100,000 per year with one child would get $1,050.

Single people who make less than $125,000 per year and couples who make less than $250,000 per year would get $250 each plus their dependents. Single people making less than $250,000 per year and couples making less than $500,000 per year would get $200 each plus their dependents.

The proposal was confirmed by Assemblymember Miguel Santiago, a Democrat from Los Angeles. Santiago announced the plan in a news release late Friday afternoon, calling it an agreement between Newsom and the Legislature. But a representative for Santiago’s office later clarified the deal has not yet been finalized.

“As prices increase on everything from gas to baby formula, this rebate will help the vast majority of California taxpayers, including undocumented Californians, with hundreds of dollars in direct cash assistance, providing critical relief during tough times,” Santiago said.

The statewide average price for a gallon of regular unleaded gasoline in California hit an all-time high of $6.44 last week. The average price was $6.35 cents per gallon on Friday compared to the national average of $4.93.

Republicans, who don’t control enough seats in the state Legislature to pass anything, have called for Newsom and Democrats to temporarily suspend the state’s gas tax — which at 51.1 cents per gallon is the second highest in the nation. The tax is scheduled to increase to 53.9 cents per gallon next week, an automatic adjustment that is part of a state law intended to keep up with inflation.

Newsom and Democratic leaders have refused to suspend the gas tax, arguing it would not guarantee a big enough price drop to benefit drivers. They also said it would cost construction jobs as the tax pays for highway maintenance throughout the state.

Click here to read the full article in AP News

CA Republicans Demand Gas Tax Suspension While Dems Investigate High Gas Prices

‘It is a sad commentary on the impact of a one-party rule’

Friday marked 100 days of diddling by California’s supermajority party to provide relief at the pump for the state’s drivers from the record high gas prices. Rather than actually authorizing a gas tax holiday at the pump, Legislative Democrats want it to appear they care and are doing something. So they are going to “investigate” the state’s highest-in-the-nation gas prices.

As of Sunday June 19, 2022, AAA reports the Average Gas Price in California is $6.401, while the national average is $4.983. The highest gas price in California is in Mono County at $7.212.

With California’s excessive petroleum industry regulations, highest-in-the-nation gas taxes, and special “summer blend,” expect to see that average of $6.401 per gallon of gas get much higher this summer – some predict over $10.00 per gallon. These are just averages – some counties in California already have over $10.00 a gallon gas.

Friday, Senate Republicans issued a press statement acknowledging that they have been calling for gas tax relief for months, and said keeping the pressure on is paying off.

“Running for cover, Assembly Democrats are now calling for an investigation as to why gas prices are so high. Been there, done that. Governor Newsom made the same move in 2019, and nothing has changed, except for the price of gas.”

“In a political move, Democrats are joining Republicans in calling for a pause in the scheduled July 1 gas tax increase. These are the same Democrats who failed earlier this year to suspend this increase when presented with the opportunity. Senate Republicans proposed this idea last year, again in January, May, and this week. Welcome aboard.”

“Democrats are feeling the heat. Californians are rightfully mad that the Democrat supermajority has done nothing but talk about alleviating the pain at the pump for 100 days. Republicans began calling for a pause in the gas tax increase almost a year ago and have not let up,” Senate Republican Leader Scott Wilk (R-Santa Clarita) said. “While I am glad to see some of my colleagues come around, it is a sad commentary on the impact of a one-party rule. This could have done at any point this year; they just chose not to.”

Notably, Senate Republicans last July 2021 called for a ‘Gas Tax Holiday’ to include a full suspension on state gas tax collection for the 2021-2022, to be backfilled by the State’s general fund… to no avail.

Democrats issued a press release Sunday announcing a press conference Monday at noon, to launch their investigation into rising gas prices in California:

“Assembly Speaker Anthony Rendon (D-Lakewood), along with Assemblymember Jacqui Irwin (D-Thousand Oaks) and Assemblymember Cottie Petrie-Norris (D-Laguna Beach), will hold a press conference announcing legislative action to investigate rising gas prices in California.”

 The Globe has a suggestion for these Democrats: Watch the news. Pay close attention to the White House Executive Orders and directives. It’s been 18-months since President Joe Biden killed the Keystone Pipeline along with 70,000 oil and gas jobs under the guise of “climate change.”

“New drilling leases on federal lands were brought to a halt by Biden’s illegal executive order, and Biden unilaterally revoked the cross-border permit for the Keystone XL Pipeline to transport oil from the Canadian Tar Sands to Gulf Refineries,”  the Federalist reported.

As for California’s highest-in-the-nation gas, nearly one year ago, the Globe reported on the escalating gas prices, when the national average was $3.131 per gallon, and California’s average was $4.31 for regular grade gas – even higher than Hawaii’s gas prices. California’s medium unleaded gas was selling for $4.50 per gallon on average. Gas in Mono County was $5.13 per gallon.

And we found an expert to explain why California’s gas is so costly:

“David Blackmon, a Senior Contributor to Forbes explains that California is a state that is rich in underground oil resources, but over the past two decades, the state government of California has pursued a policy agenda designed to inhibit drilling and production within its borders as part of an overall program to try to ratchet down emissions via command-and-control regulations. In more recent years, the state government has implemented emissions regulations that far exceed current federal regulation and implemented mandates requiring a rapid phasing-out of gas-powered cars and replacing them with electric vehicles (EVs).”

Here is a breakdown of the California taxes and fees on California gas:

Taxes:
Federal Excise Tax: 18 cents per gallon
State Excise Tax: 51 cents per gallon (this will be increased to 53.9 July 1)
Sales Tax (estimated): 10 cents per gallon

Fees:
Low Carbon Gas Programs: 22 cents per gallon
Greenhouse Gas Programs: 15 cents per gallon
Underground Tank Storage: 2 cents per gallon

Click here to read the full article in the California Globe

Lawmakers Pass a Budget, But No Deal Yet on Gas Relief

On Monday, Senate and Assembly Democrats passed their version of the 2022-23 state budget.

While patting themselves on the back for adopting “a budget that puts California’s wealth to work for individuals, families, and businesses throughout our state,” there was one thing missing from their announcement – the support of Gov. Newsom.

Newsom and legislative Democrats are still at odds over how to give Californians some relief in the state budget from record-high gas prices and inflation.

Keep in mind that Monday’s vote was about lawmakers meeting voter-approved requirements that they pass a budget – ANY budget bill – by June 15 to keep receiving their paychecks.

Publicly for now, everyone is making nice.  Senate President pro Tem Toni Atkins and Assembly Speaker Anthony Rendon released a statement on Monday saying “we look forward to working with the Governor in the coming days to ensure we have a responsible budget in place for the start of the fiscal year that delivers prosperity and strengthens the future.”

Senate Budget Committee chair Nancy Skinner, D-Berkeley, told Calmatters “the Legislature is more than 95% in agreement with Newsom.”  Newsom, Atkins, and Rendon literally smiled for the cameras in a photo of their budget discussions tweeted out on Tuesday.

Behind closed doors, Newsom continues to press for his $11.5 billion May Revise plan to give rebates to car owners – $400 per car, for a maximum of $800.  Legislative Democrats want to give out $8 billion in rebates, $200 per taxpayer, limited to those earning under $125,000 a year for individuals and $250,000 for couples filing jointly.

One of the disputes is over how fast Californians would get relief under the competing plans.

As the Sacramento Bee reports, Department of Finance official Erica Li told lawmakers that “while the legislature’s budget includes a very important relief proposal to address these rising costs, as it’s currently structured, it will take longer to implement the smaller $8 billion and will not reach as many Californians when compared to the governor’s $11.5 billion proposal.”

Newsom’s senior advisor for communications Anthony York told Calmatters that Newsom also “remains opposed to massive ongoing spending” in the Legislative Democrat plan, which is ironic given the administration’s proposal for a record $300 billion state budget.

So far, no one is blinking.

Lawmakers and the Governor are likely testing one another’s resolve to see who will give in first.  If history is a judge, the Legislature will ultimately cave.

In 2011, then-Gov. Jerry Brown vetoed a budget that the Legislature’s Democrat majority sent him on a majority vote calling it “unbalanced.”  As the Los Angeles Times reported at the time, “Democratic lawmakers had knowingly flirted with the possibility of a veto by stuffing their plan with the very things that Brown promised he would never sign.”

Brown exercised gubernatorial supremacy and largely dominated every future budget.  Newsom, too, has dominated his first three state budgets.

In an election year, legislative Democrats are now testing the limits of how far they can push Newsom in other areas to get what he wants – delivering immediate relief to struggling Californians.  While he will likely not veto the budget – or even issue a veto threat – his continued resistance to the plans put forward by Atkins and Rendon is further proof that the governor ultimately carries the upper hand in budget negotiations.

While Newsom wants a gas tax relief deal soon, expect the discussions over this and other thorny budget issues to drag into the summer.  Newsom and Legislative Democrats can reach a deal on a companion budget bill with changes to the main budget bill in order to win his signature by June 30, while punting the thorny issues for further discussion.

Click here to read the full article in the Pacific Research Institute

California Tops Nation’s Highest Gas Prices at $6.43 Per Gallon

California is once again at the top of the charts, leading the nation in… wait for it… gas and diesel prices.

AAA reports today’s national average of $5.014 per gallon — California comes in at a cool $6.436 per gallon for Regular, and nearly $7.00 per gallon for Diesel.

California’s prices greatly top the national averages: The average for a gallon of regular gas in California is $6.436 per gallon, and a gallon of diesel is $6.991.

The Globe just took the photo above Monday June 13, 2022 at a Chevron gas station in Sacramento, CA.

With Regular at $6.79 and Diesel at $7.39, California’s gas prices are much higher than the state average and even higher than Hawaii and Alaska.

The Wall Street Journal reported Monday:

“California, Oregon and Washington have traditionally had higher fuel costs than the national average due to a lack of refineries and pipelines that can pump in domestic oil, said Patrick De Haan, head of petroleum analysis at price tracker GasBuddy. These states have to pay higher prices to ship in oil, much of it from abroad, which then gets passed down to the consumer, he said.”

AAA reports that Georgia drivers are paying on average $4.484 per gallon of gas – the lowest in the country.

Florida drivers are paying $4.891 per gallon of gas.

Indiana drivers are paying $5.221 per gallon of gas.

Tennessee drivers are paying $4.642 per gallon of gas.

Mississippi drivers are paying $4.524 per gallon of gas.

Texas drivers are paying $4.664 per gallon of gas.

California drivers are paying $6.436 per gallon of gas.

The Wall Street Journal noted that “states along the Gulf Coast, including Texas and Louisiana, are among the states with the cheapest gas because of the abundance of fuel refineries, pipelines and domestic sources of oil in the region.”

Click here to read the full article in the California Globe

Californians Deserve Relief From High Gas Prices: Michelle Steel

With the official start of summer just weeks away, families are getting ready to pack up the car and hit the road, visiting places like our beautiful Orange County beaches and our world class theme parks.

It’s estimated that the average family spends 23 hours on summer road trips. But this year during their travels, families are being hit with some of the highest gas prices they’ve ever seen. In fact, Californians are paying the highest gas prices in the country. The average price for a gallon of gas in our state – about $6.40 – has gone up more than 30% in the last year.

In some places across Southern California, gas is more than $7 a gallon. After months of higher prices at the pump, you don’t need to read national news headlines to know that people are fed up.

Included in the $6.40 gallon of gas is nearly $1.20 in taxes and fees, 51 cents of which is the state’s gas tax. This year the state of California has a budget surplus of almost $100 billion, thanks to state Democrats having collected an extra $55 billion in taxes. Those dollars belong in your pocket, not Gov. Gavin Newsom’s.

Despite bipartisan calls in Congress for Newsom to suspend the tax, and state lawmakers’ opportunity to provide relief for California families, nothing has been done to alleviate these skyrocketing costs. Instead, in just a few weeks on July 1, the gas tax is going to increase to 54 cents a gallon. This is on top of record-high inflation, which is costing the average American household an extra $5,200 this year. It’s time to repeal the state gas tax entirely and begin providing relief to hard-working Californians.

Inflation is just another tax on every American, and in California we already pay some of the highest taxes in the entire country. Repealing this tax could save families up to $10 every time they visit a gas station. But this tax repeal, though helpful, would ultimately be a band aid on a much bigger issue.

The reality is that the United States and California could be strong leaders in the energy independence movement, but liberal policies are holding us back and American families are the ones paying the price. The U.S. is the largest oil producing country in the world, responsible for almost 20% of worldwide crude oil production.

We have the resources and the tools to produce our own supply. Instead, we’re reliant on markets run by dictators like Vladimir Putin and Nicolás Maduro. The United States cannot be a leader on the world stage while beholden to foreign dictators’ oil.

Major U.S. refineries are shutting down while the Biden Administration moves further away from oil and gas production, completely halting new oil and gas leasing on federal lands.

40 years ago, California produced 61% of the oil that the state consumed. By 2019 that number had fallen by half, and now the state imports 37% of its oil from Saudi Arabia. We also receive major imports from Iraq. Shockingly, we produce less than 1% of the oil used within our state.

We have the resources right here at home to bring down costs and produce energy to supply our needs. President Biden and national Democrats have been leading the charge to close U.S. refineries by creating stricter regulations that are fueling the crisis we see today. California and the U.S. should use their state-of-the-art technology to be leaders in oil refining.

Unfortunately, the U.S. only has 18% of the world’s refineries, this hurts our economy in many ways, these are high skilled, high paying jobs that could be in California.

Click here to read the full article in the OC Register

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