Stimulus Update: California Has Issued Its Last Round of Stimulus Money, but More Checks May Be Coming in 2022

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Hoping that the state stimulus checks will keep rolling in during 2022? If you're a resident of California, you may be in luck. Here's why.

Key points

  • The final round of state stimulus checks was issued to California residents who qualify earlier this week.
  • While this round of checks was the final stimulus payment for the 2021 fiscal year, a state budget surplus makes it possible for more money to be issued in 2022.
  • Recent comments from Governor Gavin Newsom have also made it clear that there could be more stimulus money earmarked in the 2022 budget.

As the COVID-19 pandemic continues to take a toll on the nation, millions of Americans are holding out hope that more federal stimulus money will arrive in mailboxes and bank accounts in 2022. Right now, though, there aren't many signs that a new round of stimulus money, or even extra Child Tax Credit money, is on the table. Well, not when it comes to federal stimulus payments, anyway. There could be more stimulus money on the horizon for residents of some states.

Federal stimulus money was relatively limited in 2021, so over a dozen states stepped in to help their residents weather the economic storm that was caused by the pandemic. One of those states, California, just issued the final round of stimulus checks to residents earlier this week -- to the tune of more than $5.9 billion in total. That money was likely a big boost to residents who qualified for the stimulus money, but there are currently no more payments on the roster for Californians.

That doesn't mean the stimulus boosts will be coming to a complete end for residents of the Golden State, though. While nothing is set in stone, there are three signs that more stimulus money could be on the way for residents of California in 2022. Here's what those signs are.

1. The state of California has plenty of extra money in the budget to earmark for stimulus checks

The direct payments that were issued to California residents in 2021 were possible because of a massive budget surplus that was in excess of the state constitutional limit. This required the state of California to issue the money from the budget surplus back to taxpayers in some form -- and the state chose to do so via stimulus checks that were issued to low- to moderate-income earners in the state.

This type of budget surplus doesn't happen often. In fact, it's only occurred twice in the last four decades, but it's expected to happen again during the 2022 fiscal year, which starts in July. It appears that there's going to be a lot of money left over, too, as California is expected to have a $31 billion surplus in the budget for 2022.

What that means is that the state will likely be required to issue the money from the budget surplus back to California residents in some form or fashion -- and it's likely to do so, at least in part, by issuing another stimulus payment. What exactly that stimulus payment will look like, though, is anyone's guess.

2. The governor has signaled that stimulus money is on the table

Earlier this week, Governor Gavin Newsom introduced a $286 billion budget proposal for the state of California's 2022 budget year. But while the state is expecting the massive budget surplus noted above, the budget proposal did not include another round of stimulus checks.

While that may have been disappointing to California residents, it was not a sign that there will be no more stimulus money for California residents in 2022. Rather, the governor made it clear earlier this week that he expects to include more stimulus money in the budget when it's revised in May.

"We expect in the May revise language when I update the budget that we are likely to have an additional rebate to the taxpayers," he said. "No new taxes in our budget."

3. The 2021 California stimulus program was a huge success -- and it reached more residents than expected

While federal lawmakers were hesitant to provide more stimulus money to Americans in 2021, the California government took the opposite approach. When the program was first initiated last year, it was aimed at helping low-income Californians who were struggling due to the pandemic and the high cost of living in the Golden State.

But that program was expanded in July to include residents who were making $75,000 or less, which meant that it reached more Californians than initially anticipated. According to the governor's office, this expansion meant that two out of every three Californians were eligible for a share of $12 billion in state stimulus funds. This likely had a huge impact on the finances of Californians in a wide range of income brackets.

The success of last year's stimulus program bodes well for another stimulus program to be created in 2022. And, with the budget surplus and Governor Newsom's recent comments, it's likely that there will be some form of stimulus program on the table when the budget is revised in July.

Are other states likely to follow suit?

While it's uncertain as to whether California or any other state will actually issue more stimulus checks to residents in 2022, it's possible. Last year, there were 13 states in total that issued stimulus money in some form or fashion to residents, and with the new strain of COVID wreaking havoc on the nation, we may see similar moves this year, too.

That is, of course, all up in the air at the moment. Whether or not these or other states will offer more stimulus money to residents this year remains to be seen. Each state is still dealing with its own set of pandemic-related issues, and as we saw in 2021, those challenges could have a big impact on how each state addresses the financial boosts and other incentives they offer to residents.

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